COVID-19’s Impact of S&D Mortgage Loans 3.0

Intro:

COVID-19’s Impact of S&D Mortgage Loans:  COVID-19 continues to be the biggest topic surrounding the country, economy and the Scratch and Dent industry.  Our last two blogs have focused on the effects the pandemic is having on whole loan trading and this blog will do the same.

COVID-19’s Impact of S&D Mortgage Loans:

At the outset of the pandemic in the United States, S&D pricing was at an all-time high around mid-March.  However within 30 days COVID-19’s Impact of S&D Mortgage Loans and the whole loan trading space had been turned upside down.  Some buyers exited the space due to liquidity issues.  Some buyers put a hold on purchasing new scratch and dent loans.  Other buyers placed multiple overlays and price adjustments on their whole loan trading platform.  All three changes dramatically affected pricing in a negative way.

As July comes to an end, the Scratch and Dent niche is beginning to rebound.   Some buyers have re-entered the market space and other buyers have removed some of the initial overlays.  Pricing is still not where it was prior to the pandemic.  But it has gotten much better in the last 30 days compared to Mid-April.  However, there is still a lot of uncertainty within the Scratch and Dent industry.  Especially, with the surging of positive cases, unemployment numbers and forbearance requests in mind.  Pricing has improved but will it remain, get better or get worse?  No matter what outcome is in store for the 3^rd quarter of 2020, Right House is here to support your needs.

Summary:

At the same time, mortgage originations have been booming.  There are a lot of loans currently sitting on warehouse lines.  If a mortgage provider needs to liquidate a scratch and dent loan, investor fallout loan, non-QM loan, jumbo loan, re-performing loan, sub-performing loan, non-performing loan or any other unsaleable loan, Right House Capital is here to assist in getting the best price available under the current market conditions.

For more information or if you have any problem loans in your pipeline, contact Andrew Zale at 502-365-5632.