“The average loan officer can’t read tax returns, they’re very convoluted and can include a lot of addendums. Bank statements are actually easier (to understand) – a bank statement loan is a good loan,” he noted.
One of Angel Oak’s non-QM star features is that every loan has a 30-year fixed program, which Hutchens said removes confusion for the borrower.
He said: “They know what their payments are going to be, today, next year, five years, 10 years, and until the life of the loan.”
Non-QM produced $25 billion in origination in 2019, pre-COVID, but as a “safe environment” for investors it has a much bigger potential for growth, Hutchens insisted.
“We believe the market is 10 times bigger than what it is today – the potential of non-QM in volume is that it should be in the $300 billion annual range,” he concluded.