This report does not constitute a rating action. Since its inception over a decade ago, the non-qualified mortgage (non-QM) origination and securitization market has in many ways become commoditized. (The non-QM market also includes business purpose loans, which are referred to as debt service coverage ratio, or DSCR, loans because they are underwritten to the expected cashflows of the property.) Since 2019, origination of non-QM loans has grown to an expected $200 billion in 2026 from roughly $45 billion. In terms of residential mortgage-backed securities (RMBS) backed by these loans, issuance has grown to an expected $100 billion from about $25 billion in 2019, with almost negligible volume in 2016. Its popularity has earned non-QM a place among three other
