PART 1

ATR Changes Will Boost NonQM Lending Volume — And Expose Its Biggest Bottleneck

There’s a shift happening in mortgage lending that most people are framing as a win.

Regulators are signaling a move toward loosening Ability-to-Repay (ATR) expectations and revisiting how Qualified Mortgage (QM) frameworks are applied. The stated goal is straightforward: expand access to credit, reduce unnecessary friction, and allow more borrowers—especially self-employed borrowers—to qualify.

And that will happen.

NonQM lending volume is about to increase.

More borrowers will enter the pipeline through bank statement mortgage programs, P&L-based income qualifications, and other alternative documentation channels. Lenders that were previously constrained by rigid documentation requirements will begin to re-engage. Production teams will see more opportunities, more submissions, and more approvals.

On the surface, this is exactly what the market has been asking for.

But there’s a problem.

Increased volume does not eliminate friction. It exposes it.

The Deal Ender That Doesn’t Go Away

Those additional NonQM files, no matter how strong the income, no matter how qualified the borrower, will most likely (in 95% of the cases) eventually run into the same conditions:

Provide a CPA letter for mortgage approval including:

Self-Employment Verification / Business Ownership Percentages / Business P&L Cash-Flow / Etc.

That condition has been quietly killing deals for years. It’s not new. What’s changing is the scale.

As production increases, so does reliance on third-party verification. And that’s where things start to break.

CPAs hesitate to issue letters because of liability. Some refuse outright. Others delay until the file is no longer salvageable. Borrowers who self-file don’t have a CPA at all. Large tax firms often prohibit employees from issuing verification letters under any circumstances.

The result is predictable: delays, conditions that won’t clear, and files that fail and fall out late in the approval process.

This is what the industry refers to as CPA letter friction.

And it is still the number one pull-through killer in NonQM lending.

When Volume Increases, So Does the Problem

The mistake most production teams make is assuming that more volume simply means more closings.

It doesn’t.

More volume means more exposure to whatever is already broken in the process.

If your current pipeline struggles with CPA letter delays, scaling production will not fix that issue. It will multiply it.

More files will require verification. More borrowers will be unable to produce it. More time will be spent chasing documentation that never arrives.

What was once an occasional issue becomes a systemic one.

The Question Most Lenders Aren’t Asking

The industry is focused on capturing opportunity.

Fewer are asking whether their processes are built to handle it.

As NonQM lending expands, the real question becomes:

Are you scaling production…

Or are you scaling up your biggest deal killing issue?

That's Part 1:

In Part 2, we’ll break down what this increase in NonQM volume really means for risk, repurchase exposure, and long-term file defensibility.

But if you already know CPA letter friction is slowing your pipeline -

FIRST take a minute to review our 5STAR reviews from a mix of lenders, AE's, processors, brokers, underwriters, loan officers, and borrowers. All with a common theme of how NonQMVerifi (powered by US Tax Certs) stepped up to save deals after other tax firms refused to cooperate. Here is the Review Link.

👉 Then email Support@USTaxCerts.com with the subject line “John Wick” and we’ll send you an example of a Business Background Evidence File and Verification Letter so you can see how we replace "CPA letter friction" with closings.