July 19: Sales, LO, AE jobs; credit, broker, accounting products; events & training; cap. mkts. dollar roll primer

Some people pray for ice cream, and their prayers will be answered as this Sunday is National Ice Cream Day. An MLO prayer? “Dear Lord, just give me one more refi boom. I promise to save my money this time.” At the lender level there is plenty of maneuvering going on. Lenders are busy re-hiring ops staff laid off in the past, setting up contract underwriting with private mortgage insurance companies to handle the overflow, or interviewing competitor’s ops staff. Some are hiring with the caveat of not hiring anyone requiring desk space in the office. Vets know that full pipelines in July don’t necessarily mean full pipelines in October.

Employment

“How confident are you that 100% your customers are coming back to you when they are purchasing a new home? Loan Originators at First Community Mortgage are staying ahead of the competition by leveraging technology which alerts them if they have customers with a probability of listing their home in the near future. And increasing your database retention rate increases your income. Join a company that invests in YOU and YOUR success. Human Mortgage by First Community Mortgage is the perfect place for loan originators to thrive. Our experienced support staff and advanced technology helps to streamline the mortgage process giving you the ability to close more with less effort. Apply through the First Community Mortgage careers page. We have branches throughout the southeastern United States but are always looking to grow with the right ‘humans,’ no matter your location. If you have experience and are interested in discussing opening a new branch or joining our winning team, reach out to Brandon Sandefur, EVP.”

For a job in the financial services sector, due to continued growth, Inheritance Funding Company, Inc., is looking to hire an additional Funding Officer for its San Francisco Financial District home office. Inheritance Funding Company, Inc. has provided heirs waiting for their inheritance distribution with capital advances for nearly 25 years. “With nearly $200M advanced to heirs in all 50 states, IFC is the oldest and largest purveyor of inheritance advances in the country. With continued growth in this lucrative sector, IFC is looking to hire the right talent to catch up with increased demand. Inheritance or probate experience is neither expected nor required. The right candidate will have a blend of sales expertise, analytical reasoning, and strong client communication skills. Competitive base salary and uncapped incentive pay for strong performers.” Contact Eric Holdsworth, VP of Marketing.

Lender products and services

Have you converted your leases to the new accounting standard? The requirement kicks in effective January 1, 2020 so there’s not much time left to make the switch. To help you understand what is required and how to tackle this project, Henry Chavez, Principal at Spiegel Accountancy Corp., is presenting a free webinar on July 30 at 10AM PT. Avoid surprises and learn what you need to do to be compliant by year end.

The mortgage industry is in flux. Fluctuating interest rates. Shrinking inventories. Changing borrower needs. Wouldn’t it be nice to have some consistency– especially from your automated underwriting system? Freddie Mac Loan Product Advisor® delivers reliable eligibility findings that foster responsible lending and give you confidence that you’re originating quality loans. Its innovative capabilities were developed in collaboration with lenders, providing automation and insights that help reduce costs and increase efficiency. What does it all mean for you? Greater opportunity for business growth and an edge on the competition– The Freddie EdgeSM. Learn more about ACE and AIM, available exclusively through Loan Product Advisor®.

First Guaranty Mortgage Corporation (FGMC) is excited to announce the appointment of Michael Massella, SVP of Wholesale Production. “Michael brings over 30 years of wholesale lending experience and is looking for motivated individuals to join the FGMC Wholesale Team as our nationwide expansion continues. With competitive pricing, industry leading turn times, a dedicated structure desk and more, the FGMC Wholesale Team has it all. Do you need a partner who offers Conventional, GNMA, FHA, VA, USDA, 203K and our newly released Second Lien products? We’ve got it. What about Non-QM solutions? Through Maverick Solutions, our proprietary suite of Non-QM products, we offer alternative options for jumbo loans, investment properties, and more! Sign up HERE or contact us here to get started today.

“Strong history. Bold future. Stearns Wholesale Lending is celebrating its 30th year supporting the mortgage broker. At Stearns, relationships always come first. You are never just a number. Stearns is committed to utilizing a distributed sales model supplemented by a hybrid internal sales group offering a best in class operational experience for their clients. Hear more from Account Executive Austin Willis in this video. If you’re looking to join a company that with a BOLD Future reach out to our Wholesale Recruiter Melissa Richardson at Melissa.richardson@stearns.com.”

“Can you believe it’s less than 6 months until 2020? If you’re worried about hitting your 2019 revenue goals, it’s time to rethink your strategy before it’s too late. Fortunately, Informative Research’s VP of Client Success Blair Biehle will be at the 2019 Convention of the Independent Community Bankers of Minnesota in August. Make sure to meet up with him and learn about Informative Research‘s arsenal of solutions that give you a proven plan on how to cut your credit cost by up to 50%. It’s possible to save money, retain your customers, and get all of the solutions and services you need to finish out the year strong! Just reach out and we’ll show you how.”

Events & training

The Mortgage Bankers Association of Greater Philadelphia is hosting a free webinar on July 25 at 2pm EDT sponsored by Lenders One. The topic is Top Marketing Strategies to Reach Millennial Home Buyers by Kristin Messerli of Cultural Outreach. Millennials are quickly becoming the largest home-buying generation, but lenders still struggle to reach them. Understanding the millennial mindset, their values and communication styles are key in reaching this group of first-time home buyers. Registration is free here

The 2019 Convention of the Independent Community Bankers of Minnesota is being held 8/1-8/3.

The Lenders One Summit in Seattle (8/4-8/7) provides a forum to learn from peers and experts in the field. “In this challenging market, we’re focused on continuing to bring new solutions to support your business. Our member and provider networks are the keys to driving our co-op ahead in this industry, and we’re excited to gather at Summit to provide a forum for you to grow and learn from thought leaders and peers.”

CECL is up for public comment, but FASB and its requirement for an estimate of expected credit losses over the life of the portfolio to be effectively recorded upon origination is still a concern. The new accounting standard applies to all banks, savings associations, credit unions, and financial institution holding companies. Join OMBA’s Webinar, on Tuesday, August 6th beginning at 10:00. Mike Cavellaro & Rob Folland, Barnes & Thornburg LLP will provide an in-depth look at what is required of your financial institution. There is no charge to OMBA Members & Non-Members.

AmeriHome’s Correspondent underwriting management team is inviting Sellers to participate in a webinar on August 12th to cover recent Fannie Mae and Freddie Mac updates and the effect on AmeriHome guidelines and requirements.

Mortgage Innovators Conference is the ONLY mortgage industry conference that highlights all innovators! Taking place August 11-13 in San Diego, it will feature engaging, expert speakers on a variety of topics from Day 1 Certainty to blockchain and everything in between.

Join the Michigan Mortgage Lenders Association at the state’s largest mortgage industry event of the year! I will be attending the MMLA Annual Lending Conference is from August 14-16 at Crystal Mountain Resort & Spa in Thompsville. This event is for anyone in the mortgage industry and has something for independent mortgage bankers, brokers, community banks, commercial banks, credit unions, and all companies that provides a service to the industry!

The Mortgage Collaborative will be at the new J.W. Marriott in Nashville, TN Aug 18-20 for their 2019 Summer Conference. TMC’s bi-annual conferences are extremely interactive events with the agendas constructed by and sessions led their lender members. The entire events are heavily focused on exchange of best practices, experiences with third party providers, and operating more efficiently and profitably. The complete agenda and full details on the event can be found here, and for more information contact TMC’s COO Rich Swerbinsky.

The New England Mortgage Bankers annual conference will be held 9/11-9/13 in Newport, Rhode Island.

The MBA of Southwest Pennsylvania Fall Kickoff in Pittsburgh (LeMont Restaurant) will be held Wednesday, September 18th.

Capital markets

Let’s “open the kimono” a little on some of the capital markets nitty gritty. Capital markets folks are talking about how the drop from one month to the next in MBS prices is negligible, translating to rate sheet pricing differences for a 30-day lock versus a 60-day lock price isn’t large. (LOs know, however, that a longer lock period can result in a potential borrower shopping around for a lender, or an increased chance of renegotiation if rates drop. Grab ‘em while you can!)

Recently the New York Fed announced it would engage in four small value agency MBS dollar roll open market transactions, as they do from time to time, for the purpose of testing operational readiness to implement existing and potential policy directives from the Federal Open Market Committee (FOMC). The New York Fed’s Open Market Trading Desk conducts these exercises to test its operational readiness in the Authorization for Domestic Open Market Operations and Authorization for Foreign Currency Operations.

But what is a dollar roll and why should originators care? It’s a type of repurchase transaction in the mortgage pass-through securities market in which the buy side counterparty of a “to be announced” (TBA) trade agrees to a sell off the same TBA trade in the current month and to a buy back the same trade in a future month. Like you are selling your brother a car, but agreeing to buy it back in a month for a set price.

The term “roll” refers to rolling the securities forward a month, or three, the most common and most liquid contract dates for rolls. Because there is no increase or decrease in the outright position, dollar rolls carry no, or very little, duration risk. It is simply an extension of a contract, not a new contract. Rolls can be purchased by a new transaction where the originator wishes to push their hedge out to a further date.

Rolling allows the buy side trade counterparty to invest the funds that otherwise would have been required to settle the buy trade in the current month until the agreed upon future buy-back. The sell side trade counter-party benefits by not having to deliver the pass-through securities (which they might otherwise have shorted or committed to another trade) in the current month. Prices vary month to month based on the supply of large collateralized mortgage obligation deals that increase the demand for mortgage pass-through securities, or unexpected fallout of mortgage closings in a mortgage originator’s pipeline. In either case, financial institutions might have more sell trades in the current month than they are able to deliver securities into, forcing them to “roll” those trades into a future month.

Every basis point can help a lender, and in turn help its borrowers, right? The ability to “trade rolls” gives additional flexibility to MBS market participants, allowing them to better manage the risks and exposures of their production cycles and take advantage of attractive funding opportunities. Trading in rolls takes place to accomplish a variety of purposes such as obtaining pools as collateral for newly issued transactions, pushing hedges further into the future if loans are funded at a slower than expected pace, taking advantage of favorable financing opportunities available through the roll market, and efficiently delivering newly created pools against their TBA transactions.

Thursday was a snoozer of a day in the bond market until the very end. That changed with a late rally that saw the curve steepen and the 10-year close -2 bps to 2.04 percent, after New York Fed President and permanent FOMC voter Williams said that rates should stay lower for longer and that the central bank should not keep its powder dry when neutral rates are low. Specifically, he stated “it’s better to take preventative measures than to wait for disaster to unfold. When you only have so much stimulus at your disposal, it pays to act quickly to lower rates at the first sign of economic distress.” Those remarks, in which he also lamented the lack of a larger increase in the cost of living despite the fact that inflation was lower and the central bank was making large daily asset purchases when the fed funds rate was near zero, grabbed the market’s attention.

That was one of many central bank developments throughout the day. There were also reports that the European Central Bank is considering a change to its inflation target, which bid EGBs as markets assumed lower for longer; the Bank of Korea unexpectedly lowered its repurchase rate, Bank Indonesia cut its repurchase rate, and the South African Reserve Bank lowered its repurchase rate. Lots of lowering out there!

Preliminary June Michigan sentiment is the only domestic release slated today, but there is a little Fed speak with both St. Louis Fed President Bullard and Boston Fed President Rosengren delivering remarks. We begin the day with Agency MBS prices worse .125 and the 10-year yielding 2.05%.

Thank you to Richmond, VA’s M.S. for passing along something that should be printed out ahead of every conference call.

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 18: LO, AE jobs; bulk bid, construction, broker products; lender flood news; State Farm/Rocket Mortgage

There’s a lot going on out there! Rocket Mortgage is creating new technology that will allow the State Farm agents to offer a Rocket Mortgage loan as a licensed loan originator. Some accounting staff believe their prayers have been answered regarding CECL. The Financial Accounting Standards Board voted Wednesday to propose to delay some of its major accounting standards (including credit losses, leases, hedging and long-duration insurance contracts) for private companies, nonprofits, and small reporting companies. And in the courts, a ruling dealt a blow to efforts by HUD to restrict nonprofit housing funds from operating on a national scale. Chenoa is especially interested in Judge David Neffer (U.S. District Court, Utah) granting an injunction from the bench further delaying implementation of the letter, according to people following the case, as it seems Brian Montgomery’s letter ran afoul of the Administrative Procedure Act.

Jobs

Wrapping up another record-breaking quarter, non-QM lender Angel Oak Mortgage Solutions added to its impressive roster of Account Executives in June. Paul McDermed came on-board in Chicago, with David Salim, Anthony Prieto, John Sciascia and Zuly Munoz joining Inside Sales. These AEs have gone through the first round of training and have been teaching brokers and correspondents how easy it is to work with Angel Oak. Angel Oak is not done yet as it is continuing to add Account Executives in many additional markets across the country and Inside AEs in Miami. To learn more, view the latest job openings on the Careers Page or email Regional Sales Manager, John Wise.

Sierra Pacific Mortgage, Inc. is pleased to announce the addition of mortgage executive Amy Mahar as Executive Vice President, Third Party Originations. Amy brings an impressive 25 years of experience to Sierra Pacific, including implementing origination platforms, building successful teams and exponentially growing market share in third party originations. ‘Sierra Pacific has been committed to the broker community for over 30 years and this channel is significant to our organization. Because of that commitment, we are thrilled to take the next step in our growth strategy by hiring Amy,’ said Jay Promisco, Chief Production Officer. ‘Amy is widely known as a visionary industry leader. Her work ethic, combined with her commitment to the TPO channel and our associates, complements our culture we describe as Promises Made. Promises Kept. With Amy’s leadership, Sierra Pacific will continue to grow its market share by providing the TPO community the service and support they deserve.’”

National mortgage, NewRez, is looking for Loan Officers to join its new Joint Venture partnership in the Orange County and San Diego County areas in California. “We have several great opportunities available for candidates looking to obtain a competitive edge of being a Preferred Lender inside a very successful and prominent real estate company,” says Vince Daino, VP of Recruiting and Business Development. “The right person should be growth minded and able to capitalize on an amazing opportunity with our new real estate partner.” Contact Vince Daino, VP of Recruiting and Business Development to learn more about this role and other open positions available within NewRez.

Congrats to Chris Fleming whom Waterstone Mortgage promoted to SVP, National Sales. Very cool since he stared off as a branch manager in 2009 with Waterstone. He will be responsible for day-to-day interactions with Waterstone Mortgage’s branches, and will oversee branch financials and business development.

Lender services and products

We all understand the impact a top producer can have on a lending team’s bottom line and loan volume. Top producers drive disproportionate volume and can stimulate meaningful business growth, which is why so many managers spend a bulk of their time attracting and retaining high-performing LOs. But how can you find a sustainable model to groom and motivate the top performers on of your team today? Maxwell interviewed some of the country’s top-producing originators to understand how they’ve reached (and maintained) such a high level of success in a fluctuating market. Their eBook, “14 Habits of High-Producing Loan Officers,” highlights the tips and tricks that make them stand out from the competition. No form or email required; this eBook is a must-read for ambitious managers looking to elevate their team’s performance. Download your complimentary copy here.

In celebration of National Mortgage Brokers Day, AFR Wholesale reaffirms its commitment to the success and support of mortgage brokers, guiding them through opportunities for new business with unique programs for Manufactured Housing, as well as Renovation and their comprehensive One-Time Close suite of products. AFR Wholesale’s One-Time Close offerings include FHA, VA, USDA and Conventional OTC programs. Designed to simplify the financing process for homebuyers, eliminating the need to obtain a construction loan and permanent mortgage, fast turnaround, low construction administration fees, and the ability to apply various down payment assistance programs are just a few of the ways AFR has applied its expertise to One-Time Close lending. To further help brokers, correspondents, builders and MH dealers, AFR Wholesale provides personalized concierge service to guide originators and their builder/dealer partners throughout the One-Time Close process. For more information, email sales@afrwholesale.com or call 1-800-375-6071.

Financial brands are racing to keep up with rising consumer expectations and ultimately modernize their customer journey. With that comes implementing the right technology solutions to fuel digital transformation. But before you can enhance the customer experience to grow lasting connections, you must lay the groundwork for modern marketing success across four crucial steps. Read the Total Expert blog for step two of digital transformation: gathering input from key stakeholders.

Walking through a pitch-black dark room is scary.  It’s also scary not knowing what is going on with your loan. QLMS is turning on the lights! Unlike most lenders, QLMS obtains vendor items, like homeowners insurance and VOE’s, for their partners. And starting today, QLMS partners can see, on their PC or smart phones, the status of every loan’s vendor items. Introducing “Vendor Visibility” – another major innovation from the most innovative lender in the country. With 24/7/365 visibility into their loans, QLMS’s partners have real-time certainty as to where each loan stands. If you’re tired of stubbing your toe in a dark room, click here to let QLMS shine the light of visibility on your precious loans.

Freddie Mac Single-Family is ALL FOR reducing barriers and raising hope. Freddie Mac is expanding the thinking around affordable lending and inspiring others to do the same. With All For HomeSM, we’re leading the way through providing insights, education, mortgage products and business solutions that address the needs of today’s borrower and of The Borrower of the FutureSM. Rising home prices and interest rates, coupled with a lack of entry-level inventory, are increasing affordability challenges. Demographic and cultural shifts, migrations from rural to urban, first-time homebuyers with thin-credit files and complex processes pose additional barriers to achieving the American dream. It takes collaboration and partnership to innovate solutions that make a positive impact. Learn more about All For Home, discover key insights to inform your business and take advantage of solutions and tools that will enable your borrowers to make Home Possible®. All in.  All of us.  All For Home.

GSF Mortgage Corporation is now able to offer customers a Float Down option for Single Close Construction loans. The interest rate and monthly payment will automatically be lower if interest rates are lower when their home is complete. A Single Close Construction to Permanent loan provides customers with the peace of mind of knowing what their interest rate and monthly payment will be before construction begins and when construction is complete. “GSF Mortgage Corporation offers more choices to our customers than most other lenders, to buy or build their dream home. If you are an Originator with construction experience, please contact our VP of Retail, Frank Papaleo for information on our growing Single Close Construction program.”

Where’s Noah?

Lenders know that FEMA is the ultimate authority for disaster updates, and have procedures and policies based on disaster declarations. Who’s doing what from a lending perspective?

FEMA announced, via Amendment No.11, an extension to the incident period end date for Iowa counties to June 15, 2019.

Fannie Mae issued a reminder to those impacted by Tropical Storm Barry of available mortgage assistance and disaster relief options. Under Fannie Mae’s guidelines for single-family mortgages: Homeowners affected by disaster are often eligible to stop their mortgage payments for up to 12 months. Mortgage servicers are authorized to suspend or reduce a homeowner’s mortgage payments immediately for up to 90 days, even without establishing contact, if the servicer believes the homeowner was affected. During this temporary payment break, homeowners will not incur late fees, credit bureau reporting is suspended, foreclosure and other legal proceedings are suspended. When payments resume, a loan modification may help maintain the pre-disaster payment amount. Homeowners may request mortgage assistance by contacting their mortgage servicer following a disaster.

Fannie Mae also offers help navigating the broader financial effects of disaster to homeowners with a Fannie Mae-owned mortgage through its Disaster Response Network*, including: A needs assessment and personalized recovery plan. Help requesting financial relief from FEMA, insurance, servicers, and other sources. Web resources and ongoing guidance from experienced disaster relief advisors. Homeowners can call 877-833-1746 to access Fannie Mae’s Disaster Response Network™* or other available resources.

Freddie Mac issued a reminder to Single-Family mortgage servicers of its disaster relief policies for borrowers affected by Tropical Storm Barry. Freddie Mac’s disaster relief options are available to borrowers whose homes or places of employment are located in federally declared Major Disaster Areas where federal individual assistance programs are made available to affected individuals and households. In areas where the FEMA has not yet made individual assistance available, mortgage servicers may immediately leverage Freddie Mac’s short-term forbearance programs to provide mortgage relief to their borrowers affected by the storm.

Freddie Mac Single-Family disaster relief policies authorize mortgage servicers to help affected borrowers in eligible disaster areas: those federally declared Major Disaster Areas where federal individual assistance programs have been extended. A list of these areas can be found on FEMA’s website.

Freddie Mac Single-Family mortgage relief options for affected borrowers in eligible disaster areas include: Suspending foreclosures by providing forbearance for up to 12 months;

Waiving assessments of penalties or late fees against borrowers with disaster-damaged homes; and Not reporting forbearance or delinquencies caused by the disaster to the nation’s credit bureaus. Freddie Mac is reminding servicers to consider borrowers who are impacted by the storm, but who live and work outside of an eligible disaster area, for Freddie Mac’s standard relief policies, which include forbearance and mortgage modifications. Affected borrowers should immediately contact their mortgage servicer—the company to which they send their monthly mortgage payment.

Tropical Storm Barry set in motion Wells Fargo’s Funding Seller Guide and to disaster declarations listed on the FEMA website.

U.S. Bank Correspondent/HFA SEL-2019-028 is available for viewing. Topics include independent appraisal review, delinquent credit/material and disaster declarations.

FEMA granted federal disaster aid with individual assistance to Turner County in South Dakota affected by flooding during the period of 3/13/2019 – 4/26/2019. AmeriHome Mortgage issued a reminder to Sellers that they are responsible for determining potential impact to a property located in an area where a disaster is occurring or has occurred. Irrespective of whether a property was included in the area covered by the declaration. If a Seller has reason to believe that a property might have been damaged in a disaster the Seller must take appropriate action to ensure that the property is free from damage and meets AmeriHome requirements at the time of purchase by AmeriHome. Employment re-verification requirements for declared disaster areas are not necessary at this time.

Mortgage Financial Solutions posted a revised announcement regarding the Oklahoma Storms.

First Community Mortgage Wholesale Announcement on July 2nd covers various updates to private flood insurance requirements, VA transactions, HomeReady and Home Possible guideline updates. And 2019-21 noted its Disaster Counties Announcement.

Mortgage Solutions Financial issued Announcement 13-19W a revision regarding the Arkansas flooding disaster alert.

The FAMC Correspondent National Bulletin 2019-16 includes information on private flood insurance. FAMC will require a copy of the full private flood insurance policy to be delivered in the closed loan package.

SunWest Mortgage Company posted an informational update on the disaster reported by FEMA in the state of Ohio.

PennyMac Correspondent Group has posted an announcement regarding flooding in the Midwest.

Capital markets

Compass Analytics today announced enhancements to its whole loan trading platform, CompassBid™! With more than $350 Billion bid through the platform last quarter, CompassBid™ remains the industry’s leading whole loan trading platform, offering the most advanced bid automation, agency optimization and loan valuation capabilities for aggregators and lenders of all sizes. The latest CompassBid™ release prioritized tools that save lenders time and money by efficiently selling their own loans, including several workflow enhancements to further simplify the loan sale process. Users now can review user-defined fields within CompassBid™ at the time of best execution analysis, choose from multiple trade allocation strategies when making hybrid AOT decisions, and more easily calibrate investor bids to current market pricing, among other enhancements. Contact Compass to learn more!

Turning to the Treasury market, durations across the curve rallied, including the 10-year closing -6 bps to 2.06 percent after the release of a weaker-than-expected report on July housing starts and building permits. Looks like single family residences will remain a limiting issue for the overall housing market. The Federal Reserve’s Beige Book for July was released, describing the expansion of overall economic activity as “modest.” Most Districts reported a slight increase in sales of retail goods; vehicle sales were little changed; tourism was described as “broadly solid;” transportation sector reports were mixed; home sales increased slightly; construction was little changed; and finally, loan demand increased in all but two Districts. As far as Fed speak went, Kansas City Fed President and FOMC voter George said that she is willing to adjust her view on rates due to growing trade-related uncertainties and weaker growth abroad,

Today’s action began with initial jobless claims for the week ending July 13 (up slightly, but as expected) and Philly Fed (21.8, a nice improvement). Later this morning brings remarks from Atlanta Fed President Bostic and New York Fed President Williams; and June leading indicators. We begin the day with Agency MBS prices roughly unchanged and the 10-year yielding 2.06%.

(Thank you to Ruth at MegaStar Financial for this one aimed at folks with a good vocabulary.)

What do you call two crows on a wire?

An attempted murder.

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 17: MBA, national account jobs; comp, broker, compliance exam products; F&F changes; the Fed & rates

I encounter plenty of people in the mortgage biz, from part-time receptionists to owners, who are focused on helping consumers. It’s a good thing! And they ask me about consumer education. (“Have you ever heard of a class for anyone on home buying or the home loan process?”) One solution, and this is not a paid ad, is to invite them to set up a personalized (branded in your name, look/feel) financial locker through FinLocker, which currently houses over 140 consumer-facing videos and includes goal setting, budget planning and more. Shoot President Brian Vieaux an email to learn more. If it helps just one potential borrower or kid in school, or saves you from creating 140 videos, why not?

Employment

MBA is hiring an Assistant Director of Member Engagement to add to MBA’s dynamic engagement team. The incumbent develops, strengthens and manages personal relationships with executives at the Association’s member companies in order to maximize the value of their MBA membership and engagement. S/he coordinates and facilitates integration in delivering enhanced member value and provides comprehensive account management and support, connecting members to the MBA resources that meets their needs, from engaging on policy issues to leveraging MBA’s conferences, committees, networking groups, education, research and more. Contact Tricia Migliazzo if you have questions, otherwise you can apply here.

NEXA Mortgage is one of the nation’s fastest growing mortgage broker, leading the way out of retail with growth across the country. If you are a LO, BM, or TL, contact NEXA now to experience why brokering is better. Many of our LOs have doubled their production within the first 3 months due to NEXA’s solid support, compensation, underwriting (you don’t really believe brokers lose control), rates, products, leadership, marketing, technology, and processing (you will love our processing). Mark your calendars now to join our weekly WHY NEXA Zoom meeting, Thursday at 11am PST. Login on to NEXA Support and our support staff will place you in the meeting. If you can’t wait to learn more, login now and ask for Michael Neill (480-643-9161) or email Michael. Currently in 9 states, submitted in 14 more and will add any requested. NEXA Mortgage, the leader in WHY Brokering is Better!”

A leading mortgage technology company is seeking a National Account Manager with a proven track record of success in working with consumer direct lenders. The ideal candidate will have a minimum of 3+ years in selling B2B services and technology. You may work remote, so organization and accountability are a must. Frequent travel across the US to meet and present to potential clients as well as participate in trade show opportunities will be required.  Create and deliver effective presentations. Effectively manage pipeline, sales activity, and provide accurate forecasting. You must have a proven track record of success in a high-volume fast paced role. Previous experience in technology sales selling to financial institutions and C-Level executives. Pre-existing contacts in the mortgage and banking industry are a big plus. Send notes of interest to Anjelica Nixt.

Lender products & services

“The Customer Experience is critical. Today, everyone has been focused on the Digital revolution taking place within the mortgage life cycle. While speeding up cycle times and lowering costs are important, we must not lose sight of the key element that drives our business. The consumer, how do you lower costs while improving customer experience? That key focus is, ‘Why?’ Lenders and Servicers are partnering with Sutherland. Our Design and Innovation Labs in San Francisco are a customer’s centric think tank that allows us to uncover opportunities to increase our client’s business. Whether you’re trying to reduce withdrawal rates, increase portfolio retention or reduce call center volumes with Conversational AI, our focus is to pinpoint areas of improvement that keep your most precious asset, ‘the borrower.’ If interested in learning more, or obtaining a Whitepaper on how we recently helped a top 5 Lender, please contact Neil Armstrong (919-270-5324).”

Things are continuing to grow out on the farm! RuraLiving is expanding its Hobby Farm and Rural Resident programs in support of rural America. If you are looking to expand your business and markets, you should explore how RuraLiving programs might help your borrowers finance large acreage properties that do not qualify for conventional or USDA programs. Check out their lender update with their new additions to these unique programs.

Caliber Home Loans, Inc. continues to make Non-Agency loans more efficient and effortless for our business partners through innovations and technology. Caliber Smart Start is a game-changing tool that validates loan parameters against Caliber’s portfolio program guidelines with just a few clicks of a mouse. Smart Start also takes the guesswork out of processing and documenting the loan file. This free tool reduces uncertainty and allows you to expand your product offerings and turn your pipelines faster. Fire up your Non-Agency production today by visiting www.CaliberSmartStart.com.

Lenders Compliance Group posted an article on its Mortgage FAQs website titled

Compliance Management System – Exam Readiness. One of its subscribers was cited for a deficient compliance management program and asked for some urgent guidance. Jonathan Foxx, LCG’s Chairman, wrote a response that you should read. He lays out the dangers in not being prepared, provides a whole set of important questions for self-assessment, and, as a solution, offers the CMS Tune-up!™ – one of many “mini-audits” that the compliance firm has pioneered – which LCG says is cost-effective, done relatively quickly, and offers “actionable findings.” The article has links for presentations and appointments as well as for scheduling calls and audits. You can read the post HERE.

National mortgage lender, NewRez, recently announced the launch of Preferred Lending Services, LLC (“Preferred Lending Services”), a new Joint Venture mortgage company operating in the Greater Tampa, Florida region. Led by industry veteran Bob Klorer, Preferred Lending Services is the 13th Joint Venture to be established in the NewRez partnership network. “We are thrilled to formally expand our lending footprint throughout the state of Florida with the launch of Preferred Lending Services,” says Randy VandenHouten, SVP, Joint Venture & Retail Lending, NewRez. “Under Bob’s leadership, and backed by the strength and expertise of NewRez and Shelter Mortgage, Preferred Lending Services will prove to be a great asset to the Greater Tampa community.” For more information on the Shelter Mortgage Joint Venture platform, please contact Randy VandenHouten. To learn more about Preferred Lending Services, visit flpls.com.

“July 18th is National Mortgage Brokers Day, brought to you by Association of Independent Mortgage Experts (AIME). Why are we celebrating this day JUST for brokers – and why now? The age of millennial shifts the market towards a more economical versus emotional drive to purchase a home. After a 10-year industry lull, independent mortgage brokers began to rise back to the surface. In doing so, millennial home buyers realized the benefits of researching all of their options and started using brokers for their mortgage needs. This increased the independent mortgage broker share of the housing market from 8% to 15% in just a year and a half, according to data from Inside Mortgage Finance. This year, we’re bringing you a number of ways to get involved and help spread the word that #BrokersAreBetter. See how you can show your support this #NMBD on AIME’s National Mortgage Brokers Day event page.”

Growing your team is a great accomplishment that also multiplies the number and complexity of LO comp plans. After acquiring several banks and absorbing MB Financial Bank’s mortgage division in July 2018, Level One’s own mortgage team doubled in size, spurring the decision to move from manual, spreadsheet-based commission calculation to LBA Ware’s full-featured compensation management platform CompenSafe. Said Level One Bank Executive Vice President, Consumer Banking Officer, Timothy R. Mackay: “CompenSafe created significant efficiencies for our payroll department, saving countless hours of manual labor and eliminating the risk of human error. Additionally, it has improved compensation transparency with our loan originators who now have the ability to login and view their pipeline and payroll information at any time.” Get the full scoop on how Level One leveraged CompenSafe to scale up here.

Conventional conforming changes just don’t stop

Fannie Mae Announcement SEL 2019-06 outlines changes related to HomeReady® income limits, clarifies requirements for compliance with Office of Foreign Assets Control Regulations, simplifies requirements for signed IRS Form 4506-T, updates its definition of relocation loans and disaster policies reminders.

Wells Fargo Funding announced it will not purchase Freddie Mac CHOICERenovation Mortgages.

A recent Fannie Mae Servicing Guide update outlines its escrow waiver policy and clarifies requirements for compliance with Office of Foreign Assets Control (OFAC) regulations.

Freddie Mac’s Guide Bulletin 2019-7, explains its revised requirements for Home Possible® mortgages to state that, effective July 3, occupying borrower(s) must not have an ownership interest in more than two financed residential properties, including the subject property, as of the note date (or as of the effective date of permanent financing for construction conversion and renovation mortgages).

Plaza offers a One Time Close (OTC) Construction-to-Permanent Conventional Loan Program through its Wholesale Lending Division. Instead of securing separate construction financing AND permanent financing, borrowers can combine them into one single transaction.

Capital markets

The Fed has publicly stated the concern with ongoing trade tensions weighing on business investment and slowing GDP growth, and easing would be consistent with the Fed making efforts to meet the price stability side of its mandate. But more accommodative policy would help support growth and hiring, putting pressure on remaining resource capacity in the economy and leading firms to raise prices. At issue for the FOMC is that slack is the part of the inflation equation that the committee can influence in the short term, but the undershoot in inflation remains centered in goods and services largely unaffected by slack. Prices in “acyclical” inflation categories have been running lower than cyclical areas in recent years, and are materially weaker compared to historic trends. Fed easing in the coming months should support higher inflation by driving the cyclically sensitive areas of inflation higher. With core inflation running below the FOMC’s target for almost all of the current cycle and inflation expectations drifting lower, the price stability side of the FOMC’s mandate needs all the help it can get. Yet, with acyclical inflation categories responsible for the bulk of the underperformance, rate cuts are unlikely to solve inflation’s persistent shortfall on their own. Look for core inflation to continue to run below 2 percent through the second half of the year, even as the Fed likely provides some additional policy support.

Fed Chairman Powell’s testimony before the House Committee on Financial Services left the markets expecting a rate cut on July 31st. Now the question becomes by how much? There has been discussion that the Fed may choose to go beyond the expected 25bps movement and cut by 50bps, however that may be too aggressive at this point. Most experts seem to believe the Fed will move 25bps this month and cut another 25bps later in the year depending on the prevailing economic conditions. Inflation data in June continued to be below the Fed’s target as the Producer Price Index over the previous twelve months was up 1.7 percent and the consumer price index was up 1.6 percent over the same period. The Fed does not want to see the economy enter a deflationary cycle given that consumer spending accounts for 70 percent of the economy. Combined with the other downside risks surrounding trade and slowing global growth the fed may feel the time is right to give the economy a little boost.

The treasury market took another hit yesterday, including the 10-year closing +3 bps to 2.12 percent following a stronger than expected economic release in the form of June Retail Sales, a recent trend that has seemingly diminished the prospect of a 50-bps rate cut at the July 30-31 FOMC meeting. Despite the largest YoY decline in June import prices in three years, President Trump saying we have a “long way to go” with China on trade (claiming he still has the option to impose tariffs on $325 billion worth of Chinese goods), and dovish-minded remarks from Fed Chair Powell and Chicago Fed President Evans in which both said the Fed will act as appropriate to sustain expansion (read: two potential rate cuts regardless of a China deal), Treasuries seemed to be propelled in slinky-like fashion as they rebounded from recent overselling.

Today began with Mortgage applications decreasing -1.1 percent for last week, according to data from the MBA Weekly Mortgage Applications Survey (adjusted for the Fourth of July holiday). Next up is housing starts and building permits for June (-.9% due to multifamily numbers, and -6.1% respectively), before the afternoon brings remarks from Kansas City Fed President George and the latest Beige Book. And looking at current conditions, Agency MBS prices are up a few ticks versus last night’s close and the 10-year is yielding 2.09%.

Overheard here in San Francisco. “I just watched a documentary on marijuana. I think all documentaries should be watched this way.”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 16: AMCs wanted; rehab, U/W, training, non-QM, marketing products; Ginnie’s growth

Although lots of small lenders don’t seem interested in being acquired any longer (“Hey, our pipeline is full and we’re making money again!), M&A is alive and well. The latest example comes from Southern California where William Lyon Homes (NYSE: WLH) has bought South Pacific Financial Corp., a retail mortgage banking company based in Irvine. South Pacific has been rebranded as ClosingMark Homes Loans Inc., and is part of a new financial services division being launched by the homebuilder. The unit, ClosingMark Financial Group, will include title insurance, settlement and mortgage services.

Jobs & franchises

AMCs and Title Companies: Due to continued growth, Accurate Group is looking to acquire appraisal management and title/closing businesses throughout the U.S., with particular emphasis in the Western U.S. By becoming part of Accurate Group, your teams will gain access to the latest digital and mobile technologies and be on the leading-edge of revolutionizing real estate lending processes. Please contact Paul Doman to learn about Accurate Group’s approach to acquisitive growth.

Are you tired of managing a corporate P&L? Then maybe it’s time to start managing your own instead. Introducing Motto Franchising, LLC, the very first national franchised mortgage brokerage network in the U.S. When you join the Motto Mortgage network, you have the freedom and flexibility to run your own business while taking advantage of an out-of-the-box mortgage company solution. We even streamline the process of starting a new business by providing a strong wholesale lender mix, franchisee setup support, LOS training, licensing assistance, marketing tools and more. It’s time to manage your future, on your terms. To learn more on how this innovative model is breaking the mold, contact our team (866.668.8649).

Lender products and services

As a lending manager, the winding down of home-buying season is the perfect time to re-evaluate your process and determine how technology can help unlock the potential of your business. Taking a step back to look at what you’ve accomplished this home-buying season and how you can improve next time around is crucial for meaningful year-over-year growth. Whether it’s improving your borrower experience, lifting referrals, or increasing back-office efficiencies, digital mortgage providers like Maxwell are an impactful way to push your business forward. Today, Maxwell has 150+ retail-focused lenders on the platform that enjoy increased efficiency — closing loans 45% faster than the national average — and elevated borrower experience, seeing customer satisfaction increase as high as 25%. To experience Maxwell, click here and set up time for your customized demo. It’s not too early to start planning for 2020!

MortgageFlex Systems a leading industry LOS provider announced its successful integration of MortgageHippo, a borrower-centric digital lending platform with CU Home Mortgage Solutions (CUHMS). MortgageFlex realized MortgageHippo was an efficient solution because of its ability to improve automation, adapt to the lenders look and feel, and support lender strategies. By utilizing open API’s, the integration was seamless. MortgageFlex and MortgageHippo align on the same values and mission to exceed customers’ expectations. Both organizations strive to deliver a smooth digital experience across multiple channels of lending. Now, MortgageFlex and MortgageHippo are expanding their relationship to offer a bundled cost solution. “The focus of many lenders is to establish a POS presence that will improve the quality of originations and level of customer service,” COO of MortgageFlex, Craig Bechtle said. “By creating an industry-leading integration between MortgageFlexONE and MortgageHippo, we were able to provide CUHMS, a seamless transition between POS and LOS.”

Verus Mortgage Capital, the industry’s premier non-QM investor, helps lenders reach responsible borrowers like the self-employed, foreign nationals and real estate investors who don’t fit traditional credit profiles. Grow your customer base, your margins, and your loan offerings. Learn more about Verus’ correspondent lending opportunities at CMBA’s 47th annual Western Secondary Market Conference July 15-17. Email Jeff Schaefer to schedule an on-site meeting.

Calling all Marketing Managers: How difficult is it to produce compliant marketing that is targeted, localized, and customizable… while meeting your Loan Officer’s deadlines? Usherpa’s custom marketing portal – Launch Pad – was designed for corporate marketing teams so you can design and send materials that align with your unique company vision and brand strategies all in one place. Effortlessly build a library of collateral that is directly linked to all your LO’s databases and integrated with your Loan Origination System. Why switch between multiple systems to build content on demand when you can seamlessly design marketing campaigns within Usherpa CRM? Launch Pad is your one-stop-shop to getting the right messages out at the right time. Don’t hesitate! Learn how Usherpa’s HTML email wizard leverages your efforts while saving an impressive amount of time.

“Just like summer, XINNIX has a deal that won’t last forever! We are providing exceptional Summer Savings to help your referral business grow with two outstanding one-hour classes for one great low price. “Exceeding Realtor Expectations” and “Powerful Presentations” are the perfect combination that will help your business thrive this summer and beyond. Through July, both classes (valued at $498) are being offered together for the low price of $299. Don’t delay! This offer ends on August 1. Register today for our August classes and watch your production grow all season long. For more information about The XINNIX System of performance training, accountability, and coaching, visit our website or click to schedule a call with one of our Account Executives.”

The key to success is to start looking into opportunities to expand your business. As a leading investor in the industry, TMS offers a suite of rehabilitation loan products to maximize your loan offerings. It is currently running a pricing special on FNMA Homestyle, FHA 203k and USDA Combo CTP Pilot loans. Reach out to your TMS CAREspondent VP or sign up to partner with TMS today to learn more.

Simplify your underwriting process with Loan Product Advisorasset and income modeler (AIM). Through the expertise of third-party service providers, AIM automates the manual processes of assessing borrower assets and income. AIM reduces the burden of traditional documentation, speeds up the loan origination process and helps you close loans faster. Freddie Mac is working hard to bring you solutions that create efficiencies for your business and improve the borrower experience – giving you a competitive edge. These capabilities are available now. Gain greater efficiency in your underwriting processes with AIM– get The Freddie EdgeSM.

Capital markets

Here at the Western Secondary in San Francisco some of the folks were talking about how Ginnie Mae securities (primarily GNIIs, composed of government loans) traded poorly in the selloff amid heightened concerns about more supply following last week’s passage in the House of two bills impacting FHA and VA loans. Investors in mortgages, and mortgage-backed securities, are keenly interested in watching prepayment speeds. Who in their right mind would want to pay 105 (a premium of five points, like paying $105,000 to own the cash flow from a $100,000 mortgage) if it is going to pay off in six months and return $100,000? The exposure of Ginnie, Freddie, and Fannie pools of mortgages are driven by rates and broker exposure. Experts think prepayments, aka “speeds,” will increase this month due to lower rates. But there are other things lenders should know about what is pushing rates and prices around these days.

Ginnie Mae announced that issuance of its mortgage-backed securities (MBS) totaled $44.217 billion in June, the highest since December 2016. A breakdown of June issuance includes $42.785 billion of Ginnie Mae II MBS and $1.432 billion of Ginnie Mae I MBS, which includes $1.014 billion of loans for multifamily housing. Ginnie Mae’s total outstanding principal balance of $2.076 trillion is an increase from $1.971 trillion in June 2018. For more information on monthly MBS issuance, UPB balance, REMIC monthly issuance and global market analysis, visit Ginnie Mae Disclosure.

Credit is the lifeblood of the economy, and it continues to flow, as corporate bond issuance has picked up, and growth in bank credit remains solid. Financial markets encountered a significant amount of volatility at the end of 2018. Not only were there signs of slower global growth, but markets witnessed the Fed tightening monetary policy further, escalating trade tensions with China, a U.S. stock market swoon, and yield spreads on corporate bonds, especially on high-yield corporate bonds, widening noticeably. Tighter financial conditions, if maintained, can lead to slower economic growth, if not to outright economic contraction. Furthermore, new issuance in the corporate bond market slowed to a trickle at the end of last year as there was only $12 billion of new investment grade bonds brought to market in December. There was no new issuance in the high yield market that month, which normally slows toward the end of the year, but December’s outturn was the lowest monthly total in at least 18 years. Corporate bonds are vitally important to the financing of the non-financial corporate sector as they account for two-thirds of its outstanding debt. Activity in the corporate sector could come to a screeching halt if the corporate bond markets remain essentially closed for an extended period of time.

But financial conditions have eased markedly thus far in 2019. Not only has the stock market rebounded, but corporate bond spreads have receded in recent weeks. In addition, new issuance in the corporate bond market has picked up noticeably in the new year. In January, there was $117 billion of investment grade bonds and $17 billion of high yield bonds that were brought to market. The $134 billion of total corporate bond issuance in January was above the average monthly run rate of 2018. Bond issuance may be important for large and some medium-sized businesses, but smaller enterprises rely on bank financing. In that regard, growth in bank credit has strengthened in recent months. Total bank credit was up 5.0% YoY in the week ending January 23, more than a full percentage point higher than just a few months previously. Commercial and industrial loans were up 11.0% relative to the same period in 2018. If there is a weakness in bank credit, it is in real estate loans, which are up only 2.9% on a year-ago basis. In summary, financial markets have bounced back this year, with volatility subsiding and credit continuing to flow to the non-financial sector. Solid growth in credit at present reinforces the conviction that U.S. economic growth will remain resilient in 2019, albeit a bit slower than last year.

Last week we saw that June’s strong payrolls did nothing to change the outlook of the Federal Reserve regarding its economic outlook and the expectations for a rate cut at the end of July. Global economic trade winds as well as deteriorating fundamentals should be enough to compel the members of the FOMC to cut rates as an insurance measure to aid continued economic expansion. At his recent semiannual testimony before Congress, Fed Chair Powell was candid in his assessment that he does not consider labor market as being hot and that it has room to continue to attract people back into the workforce as well as the potential to boost wages. Although as we’ve seen, wage grown has been anemic throughout the expansion. On the other side of the Fed’s dual mandate, inflation continues to remain below the Fed’s target despite recent price index data showing small upticks. Part of the reasoning behind a rate cut is also to bring inflation up to the Fed’s desired levels.

Turning to yesterday’s bond market, which drive mortgage prices, U.S. Treasuries began the week quietly, closing -1 bp to -2 bps across the curve, including the 10-year -1 bp to 2.09 percent on no notable domestic news, though China’s growth figures for Q2 showed the slowest growth rate in nearly three decades. That slowing was expected, and speaking of expectations, Fitch Ratings expects the FOMC to cut the fed funds rate just one time this year. And from Europe, Germany’s Economy Ministry showed that growth weakened in Q2 while manufacturing remained sluggish in its latest monthly report.

Today is much more interesting as far as markets are concerned, with several first-tier releases. We’ve already had earnings reports from JP Morgan, Wells Fargo, and Goldman Sachs, as well as June retail sales (+.7%) and import / export prices (-.9%, -.7% respectively). Ahead are Redbook same-store sales for the week ending July 13, June industrial production and capacity utilization, May Business inventories, the NAHB Housing Market Index, and May TIC data. There are also several Fed speakers during the session to provide further rate cut clarity, including Governor Bowman, Atlanta’s Bostic, Dallas’ Kaplan, Chicago’s Evans, and Chair Powell. The Fed will also publish the minutes from the recent discount rate meetings. But we begin the day with Agency MBS prices worse .125 and the 10-year yielding 2.11%.

Overheard here in San Francisco at the Western Secondary. “I bought shoes from a drug dealer once. I don’t know what he laced them with but I was tripping all day.”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 15: Non-QM, U/W, broker, marketing, tech products; wholesale news; webinars this week

You don’t think your spouse listens to you? What about Google? You bet: “Google Very Angry After Contractor Leaks Over a Thousand Assistant Recordings.” Interesting that many of the “best and brightest” of people in their 20s and 30s want to work for an advertising company. (Yes, 80-90% of Google/Alphabet’s revenue comes from advertising.) Google handles a lot of data that scammers would love to have. The United States Census Bureau has posted information to help consumers who are part of a survey to avoid fraudulent activity and scams. You may be the victim of a scam if someone claiming to be from the Census Bureau asks you for certain information. The Census Bureau never asks for your full Social Security number, money or donations, anything on behalf of a political party, your full bank or credit card account numbers and your mother’s maiden name.

Products, services, and business opportunities

For those who missed it last week: Eileen O’Grady, Founder and CEO of EMO, LLC, and a mortgage and mortgage fintech industry veteran, is representing a client in the sale of exclusive rights to a digital volume of business requirements for Regulatory and Investor (Fred & Fan) Compliance, Loan Origination (for Fan, Fred, FHA, VA, and USDA Rural Housing loan programs), Loan Servicing and Quality Control/Auditing. It is a rich, current, annotated compendium of content, rules, processes and audit procedures that would save years in requirements gathering and convert to millions of dollars in savings on development project budgets. If interested please reach out to Eileen to request a Solicitation of Interest Document.

Unit Busters is a new sales and marketing focused complimentary webinar series from National Mortgage Professional Magazine. Here’s a new webinar: “What The Top 5 Banks Don’t Want You To Know About Selling Conventional Loans.” Think selling conventional loans are too much work for too little money? The big lenders count on that mindset and make billions in the 80% of the loan market you’re not fishing in. If the bulk of your business is in the govy pond, you can’t afford to miss this webinar by Monster Lead Group. We reveal the statistics and strategy of how to create explosive loan revenue in any market, regardless of rates, how to make this strategy work for your business even if you’re a small lender or don’t have a large marketing budget, the top 3 reasons small companies don’t fish in the same ocean as the big lenders, why just focusing on VA and FHA is the biggest mistake many brokers and lenders make, and how to build a predictable, successful conventional line of business without going broke. It’s tomorrow, Tuesday, July 16th at 2PM ET. Register here – it’s free!

ResX Warehouse Lending is a division of United Bank, a respected commercial lender with an over 150-year track record of delivering for its clients. ResX isn’t new to the warehouse business. In fact, ResX has been making warehouse loans longer than many of the “established” lenders out there. There is not time wasted on inflated promises or the latest fix-and-flip pitch. Instead, they’re real people and experts in the business. ResX Warehouse delivers extensive management experience, more effective and efficient processes, and the drive to be a complete banking resource for clients. In combination with United Bank’s full-service array of products and services, ResX is the ideal platform for the mortgage banker serious about meaningful growth. That means no wasted time, no pipeline clogs and no worrying about whether or not it is in it for the long haul. If that sounds interesting to you, give ResX a look!

Flagstar Bank and Detroit Fintech Bay has announced the launch of the Flagstar Mortgage Tech Accelerator Program, which focuses on early stage startups active in developing innovative technology solutions for the mortgage industry. “We’re excited to partner with the Fintech Consortium to launch the first startup accelerator in the U.S. exclusively focused on the mortgage industry,” said Rocky Stubbs, head of Digital Lending at Flagstar. “We have the depth and breadth of capabilities to support fintech startups operating at every point in the mortgage value chain, and we offer the best of both worlds—the advantages of a federally chartered bank combined with the agility of a typical nonbank.” Interested entrepreneurs and startup founders may apply for the program June 27–July 27 or email Rocky.

ARMCO Q4/CY 2018 Mortgage QC Industry Trends Report: Defects Related to Loan Package Documentation Doubled from 2017 to 2018. “Critical defects in 2018 reflect the market’s rising interest rates and continued escalation of property values,” said Nick Volpe, chief strategy officer for ARMCO. “Fewer highly qualified borrowers transact mortgages when rates increase, which fills the market with more marginal borrowers who tend to require more documentation. It makes sense that defects related to loan package documentation more than doubled from 2017 to 2018.” Report Summary: In Q4 2018, the critical defect rate increased just over 2%; In CY 2018, the critical defect rate increased almost 8% over the previous year; Defects related to Income and Employment are on the rise; In Q4 2018, defects attributed to categories related to Underwriting / Eligibility continued to dominate overall quality issues. Read the full report.

Would you like to do a better job leveraging social media platforms like LinkedIn, Facebook, Twitter and Instagram to build awareness of your company, what you offer and drive qualified leads? Social media is effective for any of these goals and an important component of your overall marketing and public relations strategy. Seroka Brand Development will develop your strategy and content to ensure your social presence plays the role it should in driving real business results. These platforms are constantly changing and adding functionality. Seroka will help you stay on top of them and prioritize the platforms most important to your business. Want to learn more? Reach out to Seroka and get ready to #TurnUpYourBrand! Also, register for the MBA webinar Wholesale Lending: The Client Relationship Post Closing and hear John Seroka talk about the tactics LOs should leverage to build client relationships after closing.

NonQM, a blanket term being used to cover many different product options, when it is simply a different way to look at “ability to repay” than defined by the CFPB. “We at NMSI Wholesale absolutely care about ability to repay when we lend our funds. We just have come up with products that look at it differently. For example, our Portfolio RED Program, stands for reduced income documentation. We allow self-employed borrowers significantly easier ability to qualify for a mortgage by showing us their own prepared P&L, supported by 2 months bank statements or CPA letter. We not only see cash flow but liquid asset reserves on top of 20% investment in down payment. This is not subprime credit either and follows closely with conventional prime guidance. We lend on other unique NonQM programs helping RE investors, Foreign Nationals, Asset Depletion/RSU, Interest Only, VOE Only, ‘Life’ Happens Events, all offering No Prepayment Penalties. Visit us to learn more, or contact James Hooper.”

Optimal Blue launches unrivaled support for Non-QM and Expanded Criteria loans. To help clients differentiate and be more competitive, Optimal Blue made a substantial investment to support these unique loan products. With monthly lock volume exceeding $1 billion, a threshold 2.5 times the volume experienced just 18 months earlier, Optimal Blue is observing significant market growth in this area. Designed to drive pricing accuracy and precision, Optimal Blue now supports close to 20 granular filters for income verification, payment history, debt consolidation, bankruptcy, and more. In addition, specific housing events, financial outcomes, and other user-defined selections are evaluated. Optimal Blue lenders can now take advantage of the Non-QM and Expanded Guidelines products for +60 leading investors. According to Mike Strauss, President of Sprout Mortgage, “Sprout has found Optimal Blue’s Non-QM filters to fully support its product line with complete accuracy. This is a tremendous step forward for the Non-QM marketplace.”

Unlock opportunity in a growing market with Loan Product Advisor® asset and income modeler (AIM) for self-employed borrowers. AIM for self-employed is Freddie Mac’s solution to automate the manual lender process of assessing borrower income using tax return data. It’s also the industry’s only AUS-integrated self-employed borrower income calculation solution. AIM for self-employed makes it easier to do more business, close loans faster and get immediate income rep and warranty relief related to certain borrower employment income. Freddie Mac has teamed up with third-party service provider, LoanBeam®, in leveraging its expertise and powerful optical character recognition (OCR) technology to supply qualifying income for any applicant. Freddie Mac’s broad release of AIM for self-employed on March 6 is the next step in their journey to provide innovative technologies that can help lenders turn more borrowers into homeowners. AIM for self-employed borrowers … and get YOUR edge.

Wholesale news

What is going on with wholesalers around the nation? Let’s take a random look.

Stearns Holdings reached an agreement with its largest bondholder, PIMCO, to ensure support for the restructuring plan. “Having PIMCO’s support going forward will help to expedite the court-supervised process further. With 1.5 billion in warehouse capacity Stearns’ 2,700 Wholesale, Retail, Joint Venture, Preferred Partner and Corporate employees continue to originate, lock, underwrite and fund loans with the same best-in-class service they have always provided. CEO David Schneider added, ‘As we move forward, we remain firmly committed to our mission of helping homebuyers find the best loans for their current and future needs.’”

UWM has lowered its Elite BPMI rates again, offering specially discounted mortgage insurance rates to 640+ FICO borrowers that aren’t available at every other lender. “In addition to saving your borrowers money, you’ll also save three to seven days on every loan by eliminating the second underwrite with Instant MI. Plus, no additional MI overlays, not even for DTI or co-borrowers. These BPMI rates can make a huge difference in your borrower’s monthly payment and they won’t show up in pricing engines, so the only way to see them is to join the UWM network and price them out today!”

Plaza Home Mortgage’s AUS Non-Conforming adjustments are changing from rate adjustments to price adjustments. These changes will be effective for loans locked on or after Monday, July 8, 2019. refer to the AUS Non-Conforming rate sheet for all changes.

Log into the FAMC website to view the top errors on loans delivered for or purchased by FAMC based on its Loan Purchase reviews, Pre-Purchase Underwriting reviews and monthly QA review findings. Errors in data entry, missing documentation required for issues not included in the AUS analysis and non‐compliance with the AUS requirements place the loan at risk for losing Reps and Warrants. This information is for the purpose of giving you knowledge so the appropriate changes may be made, as necessary, to avoid potential consequences in the future.

Webinars/events over the next week

Register now for a Supreme Lending Ransomware Industry Call Webinar on July 16th.

Looking for the Insiders Perspective on How Wholesalers Set Prices, the Role of MSR Values and Maintaining Your Customer Relationships post the loan closing? Join two complimentary webinar opportunities from the MBA presented by leading industry experts in these fields. Register for the webinar How Wholesalers Set Their “Street Price” on July 17th from 2-3:30 EST. and The Client Relationship Post Closing on July 22nd from 2-3:30 EST.

NMMLA is bringing New Mexico State Legislature to your doorstep with its July 18th Luncheon to include guest speaker Lt. Governor Howie Morales.

Join Fannie Mae for a live HomeReady webinar on July 18 at 2 p.m. ET and learn why a HomeReady mortgage may be a better solution for your low-income borrowers. This webinar is geared toward loan officers but open to all lenders and housing professionals, and will cover HomeReady features, benefits, and underwriting guidelines, as well as address the upcoming changes and allow plenty of time to answer your questions.

Capital markets

Summer doldrums for rate volatility? U.S. Treasuries responded to higher-than-expected prints for PPI and core PPI Friday and record-setting gains for the stock market, by fluctuating back and forth before closing to display little movement ending the week, including the 10-year ending the session -1 bp to 2.10 percent. Headlines involved the Treasury acknowledging the debt ceiling limit could be reached by early September, Labor Secretary Alex Acosta announcing his resignation, and President Trump tweeting his disapproval of cryptocurrencies. The Producer Price Index for June, much like the Consumer Price Index for June, provided little support for the case of a 50 bps points cut in July, let alone a 25-bps cut in July.

This week’s economic calendar includes an uneventful domestic calendar today, with only the NY Fed manufacturing for July, NY Fed President Williams speaking, and the Treasury conducting its usual T-bill business with a $36 billion auction of 3- and 6-month bills. Tomorrow, things pick back up with Retail Sales for June; Import and Export Prices for June, Industrial Production for June, Business Inventories for May, and the NAHB Housing Market Index for July. Wednesday see the usual MBA Mortgage Applications Index for week ending July 13 but also Housing Starts and Building Permits for June, and the Fed’s Beige Book, before Thursday brings jobless claims, the Philadelphia Fed Index for July, and Leading indicators for June. The week closes with the preliminary University of Michigan Consumer Sentiment. We begin today with Agency MBS prices better by a smidge and the 10-year yielding 2.10%.

Thank you to Haskell M. for…

Q: “What birds of a feather stick together?”

A: “Vel Crow!”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 13: Letters on VA loans, marijuana, and tech spending; Agencies moving away from LIBOR

Although VA loans are a relatively small part of the origination pie, they are very much a source of pride for those companies that offer them, and MLOs that specialize in them. And there are plenty of sources of news for veterans. Want a chart of VA funding fees? Here you go. VA loans by county? Sure thing. And due to recent coverage in this commentary about the VA program, some folks wrote in with reminders and possible improvements.

From New Mexico Bill Elliott writes, “You forgot a major reason that many veterans do not take advantage of the VA loan and that is the VA Funding Fee. When I obtained my first VA loan, there was no funding fee. If I wanted to buy another home and use my VA eligibility, the VA Funding Fee would be 3.3% or an additional $6,600.00 on a $200,000 VA loan with no money down. I could reduce that amount to 1.5% or 1.25% by putting 5% or 10% down, respectively, but that is still a pretty good chunk of change. Of course, if the veteran is ‘lucky’ and has a service-connected disability, the Funding Fee is waived. I served active duty from 1965 until 1969 and have no such ‘luck.’”

And John Easterbrook observed, “About the lack of VA participation, most real estate agents have a stigma about VA because of legacy issues (Panel D, etc.) and the fact that VA requires a clear termite report (Sec. 1 & Sec. 2 that relates to moisture). I have had to do a lot of education with agents and still there is resistance because many buyer’s agents feel that if they are in a competitive situation, they will have a hard road trying to get their VA offer accepted.

“What I stress with my buyer’s agents is that it is essential to get me involved with the education of the listing agent when a VA offer is being presented. What I emphasize is that the buyer can pay for the termite report and repairs (if they have the ability to pay), the appraisal process now is almost identical to the appraisal management processes in place for every other loan, and the appraisal standards are nearly identical to every other loan with regard to value. It’s our duty as LO’s to look out for our borrower’s best interest. If the agent isn’t on board with a VA loan and we lose a loan as a result, so be it.”

Too Much Tech?

Nate Johnson, head of the U.S. mortgage business at SLK Global Solutions, a business process transformation enterprise that serves four of the top 25 banks, wrote, “Home lenders need to balance technology with human interaction. As more and more lenders adopt new technology to digitize all points of customer contact, they shouldn’t neglect the human side of customer engagement. While technology certainly does improve the customer experience, human interaction remains irreplaceable. Lenders should never lose sight of the fact that, for most customers, financing a home purchase is the single biggest financial decision of their lifetime, and a certain amount of hand-holding will be required.”

JT Gaietto, CISSP, Executive Director, Cybersecurity Services, Richey May Technology Solutions sent on a note on his thoughts on why lender spending on cybersecurity and compliance isn’t letting up. “Lenders working in states like California are now being required to develop comprehensive data privacy and governance programs. This means adding new controls, such as data loss prevention and encryption, which will push IT budgets higher. These extra costs are being compounded by the fact that cybersecurity and data privacy experts are in high demand and not easy to find or afford.

“Ransomware and endpoint security, that is, protecting networks that are connected to client systems, are growing challenges as well. Many lenders do not have a disaster recovery or incident response plan in place. When something does go wrong, it typically leads to prolonged system availability outages, which ultimately will impact production. There are plenty of things lenders can do to manage costs as long as they get the right help.” (JT says his company is helping lenders make the right security investments, in tandem with other technology investments on the rise such as dashboarding and data analytics.)

Weed

Anyone interested in lending to borrowers in that industry should read, “Fannie’s HomeReady Program Allows for Cannabis Industry Financing.” Lenders are well aware, however, that marijuana is still illegal in the eyes of the Federal Government, and therefore institutions regulated by the Government (like Wells Fargo or Chase) still will not lend to borrowers whose income is based on that business.

That said, the Senate in California has passed legislation that will create state chartered cannabis banks, as it seeks to help this industry get around the legal issues faced by the banking industry. The legislation allows private banks or credit unions to apply for a limited-purpose state charter to provide depository services to licensed cannabis businesses.

The Agriculture Improvement Act of 2018 (2018 Farm Bill) that became law at the end of last year officially allows banks to provide services to industrial hemp customers. Under the law, banks can legally service hemp businesses that include farmers, transportation, warehousing, processing, manufacturing, distribution, financing, and sales activities. The Bill directs the US Dept. of Agriculture (USDA) to issue regulations and guidance and to implement a program for the commercial production of industrial hemp in the US. Banks should note that the USDA has begun gathering information for rulemaking, but that remains in motion so rules are in flux. The USDA says it plans to issue regulations in the fall of 2019 to accommodate the 2020 planting season. Interested banks should do plenty of pre-work to ensure not to run afoul of any laws or banking regulations.

Yesterday’s commentary noted how the number of dispensaries in Denver stacked up to the number of well-known chains such as Starbucks or McDonalds. Besides eliciting Claus to send, “One may ask whether people in Colorado now all stoned will continue to live in wood houses?” the note prompted this email from Aaron Ninness. “I have to comment on the Denver Weed Scene portion at the beginning. Before every one on your mail list gets the idea that us Denverites are waking up every day to get Stoney Baloney on our way to our job of basket weaving and drum circles, this article is based on the City and County of Denver. The Denver Metro area is really more like 35 – 40 cities & towns that are collectively called Denver. Denver county has the least restrictions on getting a marijuana dispensary license which is why most are congregated there. If you go to other towns like Parker, Co (still part of the Denver Metro Area) you won’t find one but WILL find plenty of Starbucks and a couple Micky D’s. That is because Parker is located in Douglas County which does not allow dispensaries and is also usually in the top 5 of wealthiest counties in the USA. It accounts for 335,000 of our Denver Metro Area.

“Bottomline is the number is severely skewed when you look at the City & County of Denver (population 619,968) vs. the Denver Metro Area (11 counties and population of 2.93M). Yes, we have a lot of dispensaries but it isn’t as bad as it sounds. Also, as a fun note Colorado had $1.6 billion in tax revenue on our budget last year. Looking at this State Fiscal Rating website, it is clear more states might want to consider getting into the marijuana game.”

Capital markets

The U.S. Agencies are addressing the move away from LIBOR. Recently Freddie Mac, Fannie Mae, and Ginnie Mae have all published information on the topic that lenders should be aware of. For example, “Freddie Mac supports the Alternative Reference Rate Committee’s (ARRC) recommendation to replace the LIBOR index with a new index based on the Secured Overnight Financing Rate (SOFR). The transition will impact new purchases of hybrid ARMs once a SOFR-based product is implemented.”

Fannie issued a similar statement. The FHFA, which oversees Freddie and Fannie, sent out a note of support. And not wanting to be left out of current events, CFPB Director Kathleen Kraninger said, “CFPB is committed to working with the other ex-officio members of the ARRC to help the market successfully transition away from LIBOR. The release of the white paper relating to adjustable rate mortgages by the ARRC is an important step in helping all market participants, including consumers, to move away from LIBOR in a transparent, orderly, and fair manner.”

Ginnie Mae, which doesn’t purchase loans, had information on its first REMIC transaction with a tranche indexed to the Secured Overnight Funding Rate (SOFR). Apparently, it was well received by investors when it went to market in April. Since then, many questions about the transaction have been posed to which Ginnie Mae provided an explanation of the SOFR transaction.

All is not unicorns and rainbows. The transition away from Libor could disrupt lenders’ hedge accounting arrangements, some market participants say. They fear the switch to an alternative rate could nullify contracts and create balance-sheet volatility.

Freddie & Fannie continue to move forward with initiatives that aren’t directly reliant on political decisions, like billions of dollars of transferring credit risk. Dan Fichtler, Director of Housing Finance Policy, for the Mortgage Bankers Association observes, “We continue to be encouraged by the progress the GSEs are making with respect to their CRT programs. For the STACR and CAS offerings in particular, it’s clear that they’ve turned the corner to become better-understood, more-liquid securities, which is increasing investor demand and contributing to tighter spreads. Another very positive development is the decision by both GSEs to issue their STACR and CAS securities as REMICs, which should allow greater investment by REITs.”

Loan originators should know that transferring credit risk away from taxpayers to willing buyers help rates for their borrowersLet’s see what Freddie’s been up to in the capital markets.

Freddie Mac announced its second Seasoned Loans Structured Transaction (SLST) offering of 2019—a securitization backed by a pool of approximately $1.3 billion seasoned re-performing loans. The SLST program is a part of Freddie Mac’s seasoned loan offerings which reduce less-liquid assets in its mortgage-related investments portfolio and helps to shed credit and market risk. The loan pool is comprised of loans that were modified to assist borrowers who were at risk of foreclosure to help them keep their homes, and will be serviced in accordance with requirements that prioritize borrower retention options in the event of default and promote neighborhood stability. The two-step process involves an auction of the right to purchase the subordinate, non-guaranteed certificates backed by the RPLs, and the SLST Trust issuing both senior and subordinate certificates. Freddie Mac will guarantee certain senior certificates, and may initially retain some of such certificates. The winner of the auction will purchase the subordinate certificates at issuance. To date, Freddie Mac has sold $8 billion of non-performing loans and securitized more than $53 billion of RPLs. Additional information about the company’s seasoned loan offerings can be found at: http://www.freddiemac.com/seasonedloanofferings/.

Freddie Mac priced a new $240 million offering of Structured Pass-Through K-Certificates (K-J24 Certificates) that are backed by underlying collateral consisting of supplemental multifamily mortgages and settled on June 28, 2019. The K-J24 Certificates are backed by corresponding classes issued by the FREMF 2019-KJ24 Mortgage Trust and guaranteed by Freddie Mac. The KJ24 Trust will also issue certificates consisting of class B and class R certificates, which will not be guaranteed by Freddie Mac and will not back any class of K-J24 Certificates. Class A-1 has principal of $91.141 million, a weighted average life of 4.74 years, a coupon of 2.283 percent, a yield of 2.25996 percent, and a dollar price of $99.9981. Class A-2 has principal of $149.575 million, a weighted average life of 7.55 years, a coupon of 2.821 percent, a yield of 2.51573 percent, and a dollar price of $101.9997. Class X, which is not offered, has principal of $300.896 million and a weighted average life of 6.50 years.

On May 24, Freddie Mac announced it sold via auction 118 non-performing residential first lien loans as part of Freddie Mac’s Extended Timeline Pool Offering, expected to settle in July 2019. Freddie Mac’s seasoned loan offerings are focused on reducing less-liquid assets in the company’s mortgage-related investments portfolio in an economically sensible way, including through sales of NPLs, securitizations of re-performing loans (RPLs) and structured RPL transactions. To date, Freddie Mac has sold $8 billion of NPLs and securitized more than $52 billion of RPLs consisting of $29 billion via fully guaranteed PCs, $20 billion via Seasoned Credit Risk Transfer senior/sub securitizations, and $3 billion via Seasoned Loan Structured Transaction offerings. Given the delinquency status of the loans in this particular transaction, the borrowers have likely been evaluated previously for or are already in various stages of loss mitigation, including modification or other alternatives to foreclosure, or are in foreclosure.  Mortgages that were previously modified and subsequently became delinquent comprise approximately 54 percent of the pool balance. Additionally, purchasers are required to solicit distressed borrowers for additional assistance except in limited cases and ensure all pending loss mitigation actions are completed. The $22 million UPB principal pool of New York loans (excluding NYC) was won by Matawin Ventures XXVII, with the cover price in the mid-$80s area. Additional information about the company’s seasoned loan offerings can be found at:

http://www.freddiemac.com/seasonedloanofferings/.

A gorilla walks into a bar in San Francisco at the Western Secondary and, to the amazement of the bartender, orders a martini. When the bartender gives the gorilla the martini, he is further surprised to see that the ape is holding a $20 bill.

The bartender takes the $20 bill, then he decides to see just how smart the gorilla is, so he hands the gorilla $1 change. The gorilla quietly sips the martini until the bartender breaks the silence.

“We don’t get too many apes in here at the Westin,” he says.

The gorilla replies, “At $19 a drink, I’m not surprised.”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 12: VP, Controller, AE, LO jobs; doc, U/W products; LO training; Fannie, ARMs, and SOFR; yield curve news

Glenn Freezman sent, “I have a step ladder. I never knew my real ladder.” Toddlers, drunk people, and yoga pants don’t lie. What about statistics? Denver’s medical marijuana dispensaries outnumber Starbucks locations 3 to 1. In fact, this source says they outnumber Starbucks and McDonald’s combined. Colorado or elsewhere, who says the economy isn’t changing? What about the real estate market? If someone doesn’t believe scientists about climate change (natural or man-made), why should we believe Redfin about bidding wars? Buyers are now about four times less likely to face a bidding war than they were just a year ago.

Employment

A motivated and experienced investor is seeking to acquire a FULL EAGLE/HUD Designated. Licensed in CA would be preferred but is not required. The ideal situation is for current shareholders to liquidate all or a large portion of their equity through the transaction. Principals would be willing to negotiate/keep the existing team. Interested parties should contact Anjelica Nixt; please specify opportunity.

Universal Lending is a FNMA, FHLMC, and GNMA approved lender headquartered in Denver, Colorado with offices in other states. No other independent mortgage banker has been owned and operated in Colorado longer than our 38 years. We are proud to have earned best in class from the STRATMOR Group in overall customer satisfaction. Universal Lending ranks well ahead of the national benchmark in all major driver categories, most notably in Loan Officer and Processor satisfaction. LO’s and Processors have strong teams to support them all the way from prospecting to post-closing. We are hiring a Controller. This individual will be part of our management team and will oversee accounting and human resources and will also be responsible for our sub-servicer oversight. If you are an experienced mortgage professional with a strong accounting background, earned your CPA designation and are interested in joining a fun, friendly, and successful company, please send your resume to HCollins@ulc.com.”

A “best in class” VA and FHA lender who has experienced unprecedented growth is looking for 2 VPs who can bring an experienced, loyal team of multi-state licensed consumer direct mortgage bankers capable of handling a high inbound call volume. Ideal candidates must have expert knowledge of VA or FHA loan programs and managing large sales teams. Leaders will be responsible for managing the sales force and call conversions of an abundance of customer calls looking to refinance at or above our company standards. Lead conversion, pricing and loan structure skills must be exceptional. It is required for the team to generate complete mortgage applications, ensuring appropriate company procedures and policies are followed, while meeting sales goals and objectives. Please send Anjelica Nixt your resume and specifically mention these roles, if interested.

CrossCountry Mortgage is pleased to announce the acquisition of PERL Mortgage and bemortgage. Together, these three lenders have formed one all-encompassing company under the CrossCountry Mortgage name and are bringing the power of a national lender to every branch. “With this union, CrossCountry Mortgage is gaining new energy and more experienced individuals,” says Beth Keckley, Chief Marketing Officer for CrossCountry Mortgage. “This will inevitably strengthen our position as a heavy-hitting mortgage company across the country.” To find out why CrossCountry Mortgage is experiencing so much success and to learn more about career opportunities at one of Inc. magazine’s Fastest Growing Private Companies in America, email Jeana Ziroli‑Kobielsky or call 949-233-5635.

“If career opportunity were an algebraic formula, the formula would be ‘G + C + I = O.’ That’s ‘Growth + Culture + Innovation = Opportunity.’ Quicken Loans® Mortgage Services is growing faster than any other lender in its space.1 Our ability to innovate new products, processes and services is what sets us apart. We’re looking to add passionate, smart and creative people to the following roles: Account Executive (Detroit) and Credit Underwriter (Detroit). As America’s largest mortgage lender2 serving the needs of brokers, regional banks and credit unions, we want to attract the best and the brightest. Is that you? Are you ready to jump-start your career? Check out our job openings.” (1Quicken Loans is the fastest-growing top 10 wholesale mortgage lender based on wholesale mortgage volume reported by Inside Mortgage Finance, Q4 2018. 2Based on Quicken Loans data in comparison to public data records.)

Lender products and services

Attending the upcoming Western Secondary Market Conference? We know that you work hard getting loans in the door. You’ve built strong relationships with your investors to sell those loans to. Chasing trailing docs slows your team down and causes them to lose focus. You don’t have to let this inherent inefficiency cause a bump in your road. At DocProbe, your tailing docs is our business. It’s all we do. We retrieve, audit, manage corrections, and ship complete and correct trailing documents to your investors on time, every time.  Guaranteed. No missed deadlines.  No errors. No penalties. DocProbe’s per loan fee structure and simple on-boarding process makes it easy to start today. And our proprietary LOS-integrated software keeps you in the know all the way through. Nick Erlanger will be attending. To set up a meeting and learn how you can get back to focusing on your core business, email nerlanger@docprobe.net or call 866-486-0554.

The mortgage industry is in flux. Fluctuating interest rates. Shrinking inventories. Changing borrower needs. Wouldn’t it be nice to have some consistency– especially from your automated underwriting system? Freddie Mac Loan Product Advisor® delivers reliable eligibility findings that foster responsible lending and give you confidence that you’re originating quality loans. Its innovative capabilities were developed in collaboration with lenders, providing automation and insights that help reduce costs and increase efficiency. What does it all mean for you? Greater opportunity for business growth and an edge on the competition– The Freddie EdgeSM. Learn more about ACE and AIM, available exclusively through Loan Product Advisor®.

LO Training

Here’s a new webinar: “What The Top 5 Banks Don’t Want You To Know About Selling Conventional Loans.” Think selling conventional loans are too much work for too little money? The big lenders count on that mindset and make billions in the 80% of the loan market you’re not fishing in. If the bulk of your business is in the govy pond, you can’t afford to miss this webinar by Monster Lead Group where we reveal the statistics and strategy of how to create explosive loan revenue in any market, regardless of rates. You’ll learn exactly how to make this strategy work for your business even if you’re a small lender or don’t have a large marketing budget. In this webinar, you will learn: 1) The top 3 reasons small companies don’t fish in the same ocean as the big lenders; 2) Why just focusing on VA and FHA is the biggest mistake many brokers and lenders make; 3) How to build a predictable, successful conventional line of business without going broke. TUES., JULY 16TH, 2PM ET. Register for FREE.

Looking to grow your business? Ryan Mecum is hosting a training workshop in Oakbrook, Illinois on July 18th, titled “5 Concrete actions to grow your mortgage business.”  The training is on specific strategies, scripts and daily actions to ignite your client database, as well as implementing product strategies to serve the additional volume that is generated.  Ryan has appeared in Scotsman Guide as a top producer for many years (#78 in volume in 2018), and is better known as who many top 1% loan officers call for guideline, sales, and operations guidance.  Learn more or sign up here.

Capital markets

The Alternative Reference Rates Committee (ARRC) published a whitepaper titled “Options for Using SOFR in Adjustable-Rate Mortgages,” outlining a framework for the use of the Secured Overnight Financing Rate (SOFR) for newly originated consumer residential ARM products in advance of the possible cessation of LIBOR at the end of 2021. “Fannie Mae is pleased with the progress the industry is making to ensure it is prepared for a market where the LIBOR index may not exist. The whitepaper and framework demonstrate the potential solutions that exist as a replacement for LIBOR, and reflect input from ARRC members, including Fannie Mae and Freddie Mac, lenders, investors, servicers, and consumer advocates. The framework outlined in the whitepaper is comparable to today’s existing ARM structure and seeks to offer a product that is attractive to both investors and consumers while providing appropriate consumer protections.

“Though the transition to SOFR is voluntary, Fannie Mae will use the framework to develop a SOFR-indexed ARM product for new originations in advance of the possible termination of LIBOR, leading the way for industry, consumers, and financial markets. Fannie Mae expects to make an ARM product based on overnight SOFR available once systems and processes have been put in place to accommodate the new index. We will provide reasonable notice in advance of the offering to our lenders and will communicate complete details about any new product(s).”

In the last few days long-term rates have gone up, but prior to that, plenty to “experts” were fretting about the yield curve. The recent inversion of the yield curve had many market participants speaking of an imminent recession, at the same time causing analysts to question the yield curve as a reliable recession indicator. Let’s keep in mind the depth and duration of the inversion is important to predict an imminent recession, as before the last two recessions the spread of the 10-year note over the 3-month bill fell to as little as -60 bps and -100 bps in early 2007 and in late 2000, respectively. Additionally, the yield curve remained in negative territory for several consecutive months prior to the last three recessions. While the curve stayed above the zero line in April, in late March the spread slipped into the negative zone for the first time in the post-Great Recession era, and fell to -12 bps on May 29.

Compared to historical standards, the recent inversion is very shallow, and the depth and duration do not indicate a recession in the near-term, as per many experts the yield curve would need to invert significantly and for a longer duration to be a reliable recession signal. Furthermore, the Federal Reserve’s quantitative easing program may have affected the yield curve, depressing longer-term yields and making the curve more inverted than it may otherwise be.

Wells Fargo’s Probit model that uses the yield curve as a predictor estimates a 23.8 percent probability of a recession during the next six months. Although this figure is the highest in the post-Great Recession era, the probability of a recession remains below previous thresholds associated with a recession. That same model predicted a 55 percent probability in Q1-2007 and a 61 percent probability in Q1-2001. Remember, the index of Leading Indicators is healthily in positive territory, the stock market remains generally supported, and employment growth is positive. But a further sustained inversion of the curve, along with a generalized restriction in financial market conditions and deterioration in the economic fundamentals could spell the end of sustainability for this current economic expansion.

As the US is in its longest economic expansion in history, of course people are going to voice their opinions about when it is going to end. But data has been mostly positive. The main headline was the jobs report which showed 224,000 jobs added in June and unemployment at 3.7 percent, although income gains “only” rose 0.2 percent for the month despite difficulties many businesses have finding qualified workers. New claims for unemployment remain at low levels though they have inched up slightly since April. Manufacturing data continues to be closely watched as the ISM manufacturing index declined to 51.7 in June, continuing a downward trend. It is still above 50.0 however; the divider between expansion and contraction. The trade gap widened in May to -$55.5 billion as imports increased $8.5 billion possibly influenced by a strong dollar as well as generally weaker foreign demand for goods.

Despite the fact that the US economy is still expanding, albeit at a slower pace, the markets fully expect the Fed to lower the fed funds rate at the end of July by 25 basis points. In a speech on June 25th Fed chair Powell said, “Many FOMC participants judge that the case for somewhat more accommodative policy has strengthened. But we are also mindful that monetary policy should not overreact to any individual data point or short-term swing in sentiment.”

U.S. Treasuries again closed a day of Fed Chair Congressional testimony with losses across the curve, taking yields to their highest level in a month after a poor bond auction, including the 10-year closing +6 bps to 2.12 percent during a session that saw more steepening in the 2s10s spread and the 2s30s spread as markets continued to digest Wednesday’s headlines rather than react to much new Thursday. New York Fed President Williams did say he has lowered his 2019 growth outlook for the U.S. to around 2.25 percent. In inflation news, consumer pricewise, the report yesterday showed that the yr./yr. uptick in core CPI should seemingly diminish the prospect of a 50-basis points rate cut at the July meeting.

After yesterday’s strong core CPI reading for June, today’s calendar is underway with June producer prices (+.1%, weak, core +.3%, strong). All that is left to really impact the mortgage market will be remarks from Chicago Fed President Evans. We begin the day with Agency MBS prices roughly unchanged and the 10-year yielding 2.13%.

(Thanks to Stephen S. for this one.)

An 8-year-old girl went to the office with her father on “Take Your Kid to Work Day.”

As they walked round the office she started crying and getting cranky.

Her father asked what was wrong.

As the staff gathered round, she sobbed loudly, “Daddy, where are all the clowns you said you worked with?”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 11: LO jobs; sales training, digital, broker, cap. mkts. products; FHA & DPA news; FOMC & rates

In honor of World Population Day today, the Census Bureau tells us that the world’s population will hit 7.58 billion this month. But why believe that? Or anything “experts,” like actuaries or scientists, tell you? There is a lot of real news out there, and a lot of rumors, and the Stearns Chapter 11 has wholesale tongues wagging. Quicken tested the MSR market with a $10 billion servicing sale this year? Ask your rep, could be just a rumor. United Wholesale selling servicing to NewRez on a regular basis? Ask your AE for the scoop – could be another rumor. (Both amounts would be small compared to the $11 trillion of outstanding residential servicing.) And PenFed Credit Union notifying 100+ mortgage employees in the Alexandria Virginia office that they need to move to San Antonio, Texas, in the next four months or receive a severance package? Darned if I know – ask them yourself.

Employment, business opportunities, & transitions

“True innovation means making talent your #1 investment,” according to Citizens Bank CEO Bruce Van Saun. It may sound cliché but the long-term success or failure of any company almost always ultimately comes down to talent. Attracting the right talent is among the biggest challenge facing most lenders as they transform to meet shifting customer needs, keeping up with technology demands and reinventing oneself as new disruptions come along.  Learn about the steps we are taking to develop and retain talent across our company. If you’re looking to build your future with a company that is winning in the mortgage marketplace, apply at Citizens Bank today!

Planet Home Lending is pleased to announce that Brian Kedzior (NMLS #1002187) has joined the company as an Area Sales Manager in Chicago. Kedzior has amassed a significant sphere of influence during his more than two decades in the industry. At Planet, he’ll focus on raising brand awareness and adding producing loan originators and branches in the Great Lakes region. “Chicago is a target market for Planet, and we foresee multiple branches there because of the demand for renovation, first time homebuyer and mixed-use mortgages,” said Planet SVP, Eastern Division Manager Fobby Naghmi. To find out why more mortgage professionals are joining Planet Home Lending, contact Brian Kedzior.

AMCs and Title Companies: Due to continued growth, Accurate Group is looking to acquire appraisal management and title/closing businesses throughout the U.S., with particular emphasis in the Western U.S. By becoming part of Accurate Group, your teams will gain access to the latest digital and mobile technologies and be on the leading-edge of revolutionizing real estate lending processes. Please contact Paul Doman to learn about Accurate Group’s approach to acquisitive growth.

Congrats to Brenda Hedeen whom On Q Financial has brought on as a new Chief Financial Officer. Ms. Hedeen has over ten years of experience in finance and six years of experience in the mortgage industry, and she plans on “protecting net margins and streamlining processes to ensure On Q Financial maintains a culture that’s efficient and solution focused.”

Lender products & services

Sometimes, things you need appear before you know you need them. That doesn’t happen very often with tech development, but sometimes it does. In this case, Eileen O’Grady, Founder and CEO of EMO, LLC, a mortgage and mortgage fintech industry veteran, has a unique offering. Eileen is representing a client who is marketing exclusive rights to a digital volume of business requirements for Regulatory Compliance, Investor (Freddie & Fannie) Compliance, Loan Origination (for Fannie, Freddie, FHA, VA, and USDA Rural Housing loan programs), and Loan Servicing or Quality Control/Auditing spaces. It is a rich, up-to-date, annotated compendium of content, rules and processes and audit procedures that would speed time-to-market for mortgage fintech companies, and would save product managers, business analysts, tech analysts and developers FTE years in requirements gathering and application development. This could convert to millions of dollars in savings on IT project budgets. If interested in learning more about this windfall, or to see examples, please reach out to Eileen to request a Solicitation of Interest Memo.

In a changing and challenging market, your secondary marketing holds the keys to profitability. In a recent case study, First Bank realized a net profitability increase of 52 basis points after implementing pipeline hedging and best execution loan sales with MCT. They also experienced an 8-basis point lift from new bid tape AOT delivery channels and 12 basis points through investor set optimization. According to Andrew Stringer, Director of Secondary, “MCT’s BAM platform allows me to accomplish my tasks with a small team. If I had to prepare, send, receive, and manage bid tapes by hand I would probably need to hire another person.”

Beyond the bottom-line results, MCT offers clients transparency and boutique-style service that’s hard to find between the FinTech’s and Wall Street these days. Learn more about the profitability and efficiency gains that come through leveraging secondary marketing software and an expert team from MCT.

Tired of your subservicer not providing the level of service your customers deserve? Well if you’re planning to attend the CMBA Western Secondary in San Francisco, July 15-17, be sure to set up a meeting with the TMS Team to find out how they’re taking the sub-par out of subservicing. Reach out to them at subservicing@themoneysource.com to set up a time!

Every superhero needs a sidekick and every broker needs a partner who has their back. Brokers who have Quicken Loans Mortgage Services (QLMS) as their sidekick now have two new tools they can utilize. Through QLMS’ partnership with Waymark, brokers can create custom, professional videos designed to be shared online and on every social platform. This means it’s possible to reach wide audiences and extend your reach in a few clicks. QLMS also has a partnership with Exclusive Marketing Agency, who helps brokers with web site creation, social media management, lead generation and more. Additionally, all QLMS partners have access to Marketing Hub, the lenders’ collection of tried and tested marketing materials ranging from social media posts to direct mail pieces. If you’re not a partner already, you can click here to connect with QLMS, your new sidekick.

Floify continues to integrate their mortgage point-of-sale platform with the critical technology solutions that lenders use every day. Floify’s recent integration with Microsoft® OneDrive® joins their existing connections with Dropbox™, Google Drive, and Box to further help lenders automate the uploading and organization of loan documents in their cloud storage solution of choice. Coupled with Floify’s intuitive borrower interface and intelligent prompts and reminders, the platform is helping originators completely streamline and simplify their loan document management processes – generating tremendous ROI and freeing more hours in the workday to create new business opportunities and strengthen relationships. To see for yourself how Floify can help you take your business to the next level, book a live demo. 

Todd Duncan is giving away a FREE VIP TICKET ($1900 Value) to his Sales Mastery Event in San Diego, California on October 14-17. Click here for a chance to win the 4-day VIP TICKET and join Todd Duncan and over 2,000 professionals and gain access to life-changing keynotes, thought-provoking panels, and vendor networking to get your business and life FIT! FAST! FORWARD! VIP Benefits include: 4-Day Access to the Sales Mastery Event, Priority Seating, Digital Access to 2019 Sessions, Free E-Course by Todd Duncan, $250 Gift Card for Training Tools and Resources, an Exclusive Cocktail Party with Todd and Deb Duncan, and a lot more! Contest ends on Thursday, July 18th. Enter to win now!

FHA & down payment assistance news

Loan officers continue to report that plenty of potential home buyers (and thus potential borrowers) can afford the monthly mortgage payments but lack the savings for a down payment. But investors in mortgages in the secondary markets love “skin in the game” with high down payments. Thus the rise of government-funded down payment assistance programs. The FHA tells us that more than 13% of borrowers who used the FHA program so far in 2019 received government help with the down payment. There are more than 2,500 programs around the country, and somewhere north of 10% of current borrowers are using a program per a Freddie Mac survey. Let’s hope property values don’t start to head south. Some programs forgive the money, usually viewed as a second loan, others require repayment.

Is there any land to build houses on, even if renters had the down payment resources? Repeatedly Zelman’s Land Development Surveys show strong demand for entry-level product. Land price appreciation has moved higher, its overall acquisition demand index is strong, and often the largest improvements were for entry-level finished lots, entry-level raw land, ‘C’ location finished lots and ‘C’ location raw land. (Zelman’s studies also look at the level of development activity, lot supply, the level of development activity outside of ‘A’ locations, finished lot prices, development costs, and keep an eye on municipal fees which are a wildcard and could push higher.)

Remember on April 25 in low down payment news, HUD, dba the FHA, agreed to a 90-day stay in implementation of Mortgagee Letter 19-06 (regarding down payment assistance) to have a 90 day comment period. The flurry reminded the industry that there are lots of options out there for low down payment loans. By my simple-minded calculations, and by Mortgagee Letter 2019-07, July 23rd is “the date.”

Recall that earlier this year the FHA announced it was tightening standards for certain programs, targeting the Chenoa Fund, run through a mortgage corporation () owned by the Paiute Tribe of Utah. Chenoa sued HUD, which in turn delayed possible implementation of the new rules for 90 days until July.

Per ditech Correspondent’s Announcement CF2019-040, its Conforming, VA and FHA underwriting guidelines are being updated.

Find out how much your borrower could receive using the Land Home Financial Services GSFA Platinum Down Payment Assistance Program. Land Home also offers a 21-day purchase guarantee. Contact mark.sheridan@LHFS.com for details (925-246-2396).

Some argue that if the borrower can’t save enough for a down payment in the first place, then you probably shouldn’t be buying the house. “I have qualms with anybody getting a loan who can’t put some down payment down themselves. Those types of borrowers typically are one water heater away from missing their payments, going into default, maybe losing the house to foreclosure,” said Rick Sharga a while back, EVP at Ten-X, an online real estate sales and auction company. Sharga said that if a borrower can’t fund the down payment alone then he or she is likely not financially ready for the investment.

He was not, however, entirely against the crowdfunding platform. “If crowdfunding is a way to augment a down payment or to make a bigger down payment than you could make yourself, because then it will keep your monthly payments down or it will help you qualify for a loan that you might not have gotten without the crowdfunding, I could see the benefits of that,” he added.

Capital markets

Markets waited tepidly all week for Fed Chair Powell’s first day of prepared remarks and testimony before Congress (yesterday was the House Committee on Financial Services, and today is before the Senate Banking Committee). U.S. equity prices increased, including the S&P 500 topping 3,000 and the 10-year closing +1 bp to 2.06 percent after his dovish statement noted many factors that could justify a fed funds rate cut soon, a move U.S. President Donald Trump has repeatedly demanded. Chairman Powell said bad news from around the world outweighed good news at home. The minutes of the Federal Open Market Committee meeting of June 18/19 were released as well, which showed support within the FOMC for a more accommodative policy (read: a fed funds rate cut in July). It should be noted, the reaction to the Minutes was muted, since Chairman Powell provided a more current view during his testimony.

The FOMC judged that uncertainties and downside risk factors had increased significantly in the weeks before the mid-June meeting, weighing on economic outlook. Several participants/possible voters noted that a near term cut in the fed funds rate could help cushion the effects of future shocks to the economy and was therefore appropriate from a risk management point of view. Powell noted a number of concerns specific to the U.S. economy, including inflation consistently running below the FOMC’s symmetric 2 percent target, the drop of forward-looking inflation expectations, the fact that some demographic groups and some parts of the country still face economic challenges, a slowing in business investment; a slowing in housing investment, a slowing in manufacturing output, unresolved trade tensions, low labor force participation in the U.S. versus other comparable economies, and an increasing level of uncertainty coupled with a decline in business confidence. He also noted that international economic conditions have deteriorated and there is cause for further concern about Brexit. The implied probability of a 50-basis point rate hike on July 31 rose to nearly 29 percent from around 3 percent yesterday.

Today’s busy calendar already began with CPI in June (+.1%, core +.3%) and initial jobless claims for the week ending July 6 (209k). Fed Chair Powell returns to the Hill for a second day when he testifies before the Senate Banking Committee on the semiannual monetary policy report. This afternoon, we have the June Treasury Budget; and a $16 billion 30-year Treasury bond reopening. Additionally, there are several Fed Speakers scheduled outside of Fed Chairman Jay Powell, including New York Fed President Williams; Atlanta Fed President Bostic; Richmond Fed President Barkin; Minneapolis Fed President Kashkari; and Governor Quarles. We begin today with Agency MBS prices worse .125 and the 10-year yielding 2.09%.

Why do supermarkets make the sick walk all the way to the back of the store to get their prescriptions while healthy people can buy cigarettes at the front?

Why do people (like me) order double cheeseburgers, large fries, and a diet coke?

Why do banks leave vault doors open and then chain the pens to the counters?

Why do we leave cars worth thousands of dollars in our driveways and put our useless junk in the garage?

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 10: Sales mgt., LO jobs; construction, broker, reno products; close look at Stearns’ deal; Ginnie & SOFR

There are still, surprisingly, people who deny that climate change is occurring. There are plenty of low-lying areas of this country that are threatened now or will be in the coming years. And just think of all those jumbo loans along the coast, like in California. Owners can spend millions to add more sand to a beach (which will wash away in a few years), build a seawall (roughly 30% of Southern California’s shore is already behind an expensive seawall, and they destroy public beaches), or retreat. The South has plenty of coastline, and what cities there have experienced a surge in population growth between 2017 and 2018? Well, they are all in Texas or Florida, with Austin (12,504), Jacksonville (12,153), Frisco, TX (10,884), McKinney, TX (9,888), and Miami (8,884) topping the list, per the U.S. Census Bureau.

Jobs

Mountain West Financial, (est. 1990) is “seeking a highly motivated leader to join our executive team as the SVP of Retail Lending. This person will oversee all aspects of the Retail Production Channel. Responsibilities include developing, motivating, and providing value to our existing team as well as growing our footprint in the western U.S. You will be joining a dedicated group with a strong work ethic and a commitment of doing the right thing. We owe our 30-year longevity to strong relationships, commitment to our staff and the communities we serve. All applicants must have a proven track record of developing, managing and growing a retail team. For a confidential interview, contact Gary Martell (909 557-2246).

NEXA Mortgage is one of the nation’s fastest growing mortgage broker, leading the way out of retail with growth across the country. If you are a LO, BM, or TL, contact NEXA now to experience why brokering is better. Many of our LOs have doubled their production within the first 3 months due to NEXA’s solid support, compensation, underwriting (you don’t really believe brokers lose control), rates, products, leadership, marketing, technology, and processing (you will love our processing). Mark your calendars now to join our weekly WHY NEXA Zoom meeting, Thursday at 11am PST. Login on to NEXA Support and our support staff will place you in the meeting. If you can’t wait to learn more, login now and ask for Michael Neill (480.643.9161). Currently in 9 states, submitted in 14 more and will add any requested. NEXA Mortgage, the leader in WHY Brokering is Better!”

Cloudvirga appointed Maria Moskver as Chief Legal and Compliance Officer. With over 20 years of experience in compliance and regulatory matters for financial services technology companies, Moskver has a strong track record of establishing a culture of compliance. Congrats!

Lender products & services

Galton Funding continues to be the premier one stop investor for all of your Non-Agency lending needs with the recent addition of a new Jumbo product as well as enhancements to existing programs. Galton’s new Jumbo program for Full Documentation loans from $100k-$2mm, LTVs to 95%, Investor and Interest Only options, creates one of the broadest product offerings in the Non-Agency space. Enhancements to our current Prime and Near Prime programs allow for more flexibility on mortgage history and lower reserves on other financed properties… all designed to increase borrower reach. Whether you are looking for loan amounts up to $3MM, higher LTVs with no MI, unlimited cash out, or even bank statement programs, Galton is your go-to investor, with new higher premiums to improve profitability. Eliminate investor fatigue by partnering with Galton Funding for the most diverse, dynamic and competitively priced programs in non-agency correspondent.”

Technology may be the fuel for every successful loan originator, but inefficiency is the flat tire. Salesforce-based mortgage CRM platform, Jungo, announced an Ellie Mae Encompass Digital Lending Platform integration this week. This partnership strengthens Jungo’s focus on automating and improving the loan origination process by creating a dual-direction sync of data between the two platforms. In addition to preventing the need for double data entry on the part of the LO, the integration allows automatic email updates sent to all the interested parties in the loan process. Less time juggling multiple logins and thinking about data entry, means more time focusing on the client and closing loans. To see this integration in action, check out its product demo.

“Strong history. Bold Future. Stearns Holdings announced in partnership with Blackstone terms of a comprehensive financial restructuring plan that is expected to significantly improve the financial structure of the firm setting the Company up for future growth opportunities, enhanced profitability, and long-term success. Blackstone pledged nearly $100 million as part of the balance-sheet restructuring, which also includes commitments of $1.5 billion from warehouse lenders. CEO David Schneider notes, “Stearns will come out of this process stronger than before and we are committed to moving as quickly as possible through this process. Stearns will continue to originate, lock, underwrite and fund loans with the same best-in-class service we have always provided. Our 2,700 Wholesale, Retail, Joint Venture, Preferred Partner and Corporate employees are focused on supporting business partners and helping homebuyers find the best loans for their current and future needs as they always have.” Stearns’ joint venture and preferred partner entities are not subject to the court-supervised restructuring process and continue to operate in the ordinary course of business. Stearns enters its 30th year providing residential home financing and this event will position our firm for the next 30 years.”

Build your business with loanDepot Wholesale’s Renovation Lending Suite, that includes programs designed to accommodate both large and small home improvement and repair projects. Therefore, giving you more options for your real estate partners and clients to meet their homeownership needs. Flexible solutions that include FHA 203k Limited and Standard as well as FNMA HomeStyle®. loanDepot Wholesale – proud sponsor of improving homes across America. Contact us today to learn more! Rates, terms, and availability of programs are subject to change without notice.

Simplify your underwriting process with Loan Product Advisor® asset and income modeler (AIM). Through the expertise of third-party service providers, AIM automates the manual processes of assessing borrower assets and income. AIM reduces the burden of traditional documentation, speeds up the loan origination process and helps you close loans faster. Freddie Mac is working hard to bring you solutions that create efficiencies for your business and improve the borrower experience – giving you a competitive edge. These capabilities are available now. Gain greater efficiency in your underwriting processes with AIM– get The Freddie EdgeSM.

There are many construction lending risks that initially fly under the radar during the life of a project. Problems are often realized when it is too late. To help lenders navigate this field and prepare for any potential problems, Land Gorilla has compiled these key risks that must be mitigated for a successful construction loan program. Download this ebook, 11 Construction Loan Risks and How to Protect Your Investment, to discover the common mistakes that put construction loans in jeopardy; they may surprise you.

Wholesalers continue to make news

As noted above, Stearns Holdings, LLC, the parent company of Stearns Lending, LLC (wholesale, retail and strategic alliances) reached an agreement with its majority equity holder, “funds affiliated with Blackstone,” on the terms of a comprehensive financial restructuring plan. The voluntary filing of Chapter 11 involves its majority equity holder, Blackstone, Glenn Stearns, and the 2,700 employees.

It has been four years since Blackstone took down a majority share in Stearns. There are many in the industry that will tell you that traditional, day in and day out, mortgage banking is not for high-flying venture capital, hedge funds, or money managers. One industry vet wrote to me asking, “Do large funds ever wildly succeed in investing in mortgage companies?”

Stearns said it will consider bids from other investors who might want to replace Blackstone. For now Blackstone will provide a $35 million bankruptcy loan to keep the company running and pledged to invest $60 million of new money. Stearns said it also lined up $1.5 billion of warehouse financing to keep its mortgage business operating.

Pimco owns about 67% of the company’s 2020 notes and was approached about a restructuring. Stearns proposed a partial paydown of the debt, a maturity extension and relief from a requirement to use $42 million in proceeds from the sale of mortgage servicing rights to tender for the notes. Pimco rejected that offer and others, insisting it would consider a $50 million capital infusion into Stearns from Blackstone, or taking control of the business.

Pimco would later refuse an offer to take ownership of Stearns and demanded to have its notes cashed out, or else it would insist on a liquidation.

Although other wholesalers (Freedom, Quicken, loanDepot, or United Wholesale jump to mind) have grabbed the spotlight, Stearns has its fans. From a broker in San Jose I received, “I hope they can save it. Stearns is a great niche lender, and has really good employees & excellent customer service every time I’ve closed a loan there.” Other comments I received included, “Ditech didn’t miss a beat. Hopefully Stearns is the same.” “I wonder how that joint venture with SoFi from three years ago will fare.” “We’ve heard plenty of rumors about liquidity issues and declining earnings. Blackstone probably wasn’t seeing the returns or control it required. Is Blackstone interested in contributing more equity capital without some major debt relief? Maybe Blackstone only agreed to contribute more capital because the business looks pretty good right now?” [Editor’s note: as if every other lender is prospering?]

A highly-placed insider told me that, “Stearns discussed other options, but this ’90-day’ plan seemed the best. Employee moral is very good, namely because Blackstone has a considerable amount of capital. The ‘sponsored plan’ that will be rolled out ensures that the existing reps and warrants will be honored for investors and the Agencies, and that any licensing will remain intact. The primary target of the move is to reduce the senior debt.”

Glenn Stearns still owns 30% of Stearns Lending, is still on the board, is active in management, but his future involvement is reportedly unknown. “Through this restructuring, Blackstone has agreed to serve as plan sponsor and contribute substantial new capital to Stearns in return for acquiring substantially all of the ownership of the Company.” Mr. Stearns, well known for his admiration of Gilligan’s Island, has embarked on a new TV project titled “Undercover Billionaire” premiering August 6. A good acquaintance of Glenn’s noted that, “He was looking to sell a large stake in the company. He was smart to cash out and lock in his gains. Today he is enjoying his fortune.”

Capital markets

Ginnie Mae’s first REMIC transaction with a tranche indexed to the Secured Overnight Funding Rate (SOFR) was well received by investors when it went to market in April. Since then, many questions about the transaction have been posed to which Ginnie Mae provided an explanation of the SOFR transaction. Ginnie has also added disclosure bulletin “Loan Liquidations File Republishing for June 2019.”

Economically things are good – here. The start of July marked the 121st consecutive month of economic expansion in the U.S., making this the longest period of continuous economic expansion in American history. So naturally there is plenty of speculation about when we will see a downturn. Economic data thus far this year, however, has pointed more towards moderating (but still growing) economic conditions rather than a contracting economy. Nonfarm payrolls for June showed 224,000 jobs added for the month, well above market expectations. And while the average job gains through the first six months of the year are lower than the last six months of 2018, the economy continues to add jobs at a good pace.

Tariffs continue to pressure manufacturing activity as the ISM manufacturing index was barely in expansion territory at 51.7 and the new orders component was at 50.0, a three-year low. Businesses will exercise caution until there is more certainty around the future structure of trade between the US and China. Many importers have likely re-routed their foreign supply chains as evidenced by the fact that since the trade war with China began, imports have increased and the trade deficit has widened.

Looking at rates yesterday, U.S. Treasuries again experienced limited movement yesterday, including the 10-year hitting a high of 2.07 percent before closing +2 bps at 2.05 percent, as markets waited in anticipation ahead of Fed Chairman Jay Powell’s semiannual monetary policy testimony today. Mr. Powell will appear before the House Financial Services Committee and the Senate Banking Committee today and tomorrow, with markets waiting to hear if the Fed Chairman changes his tone in a way that could reduce expectations for a rate cut at the July 30/31 FOMC meeting. The Fed Funds futures market remains certain that the fed funds target range will be reduced by 25 basis points while the implied likelihood of a 50-bps rate cut now sits below 3 percent.

Today began with MBA mortgage applications for the holiday-adjusted week ending July 5 (-2.4%). As I am sending this out, Fed Chair Powell’s prepared comments before the House Financial Services Committee have just been released ahead of his appearance later this morning. Later today, markets will digest Wholesale inventories and sales for May; the minutes from the June 18/19 meeting; and Fed speakers including Kansas City’s George and St. Louis’ Bullard. We begin the day with Agency MBS prices improved by .125 and the 10-year yielding 2.06%.

(Thank you to Debbie G. for this one.)

A rabbi, a priest, and a minister were all asked the same question. “What would you like people to say about you after you die?”

The priest said, “I hope that people say that I helped them to understand the absolute love that God the Father, the Son, and the Holy Spirit offers to them through the Church.”

The minister said, “When I die, I hope that people will say that I saved many souls by bringing them to Christ.”

Finally, the rabbi was asked, “Rabbi, what do you hope people will say about you after you have died?”

Without pausing, the rabbi answered, “Look, he’s breathing!”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 9: Ops, LO jobs; u/w, digital, appraisal, cap. mkts, non-QM products; upcoming training, don’t ignore CECL

I find it amusing when someone tells me, “The stock market is too risky for me. I have my money with some investment gal/guy.” What do you think they do with it? Deutsche Bank, prominent in the residential & commercial lending sectors, will cut 18,000 jobs during the next three years as part of a revamp that shrinks investment-banking and fixed-income operations and that eliminates the global equities business. A touch of artificial intelligence cutting into things? In a recent Alert, Morrison and Foerster examine concerns related to AI in credit underwriting and the potential for disparate impact risk.

Employment & promotions

Come and join our winning team! Demand for Mr. Cooper’s non-delegated offering continues to grow at a rapid pace! To keep up with the demand and to further invest in this space, we are expanding our Non-Delegated Underwriting and Operations Support teams. We are looking for qualified professionals with non-delegated operations experience and underwriters with FHA DE and/or VA LAPP SAR designations. If either describes your experience and you want to join a dynamic culture, let’s talk about our opportunities in Dallas or remote! Speaking of hiring, did you know we allow for Future Income/Future employment? Ask your Regional Sales team for details, and while you are at it, ask about the benefits of Day 1 Certainty. We allow for component-driven rep& warrant relief. Mr. Cooper is a top 10 Correspondent investor, a premier Co-Issue investor and the largest non-bank servicer with a servicing portfolio $600B+. For information, visit www.mrcooper.com/correspondent.”

As we are now in the middle of the summer construction season, who’s looking for a boost in their builder business? Academy Mortgage has an exclusive license agreement with NoviHome, an innovative tool that helps home builders capture, engage, convert, and retain leads to close homes faster and more efficiently. Through its various apps, NoviHome provides builders with the ability to: house all their marketing materials in one easy-to-navigate app (floor plans, videos, virtual tours, etc.); engage homebuyers in choosing customizations; and stay connected to buyers from contract to contract. In turn, NoviHome presents Loan Officers with a tremendous opportunity to open doors and establish partnerships with new builders. Builder business can take your production to a whole new level and help you achieve your Potential. Contact Chad Melin, VP of National Business Development, to put NoviHome and Academy’s other innovative tools and technology to work for you.

Congrats to Dan Fichtler: The Mortgage Bankers Association (MBA) promoted him to Associate Vice President of Housing Finance Policy within the association’s Residential Policy and Member Engagement team. Mr. Fichtler (he requests that everyone call him that now) will help lead MBA’s housing finance policy development, which includes serving on, and coordinating work from, a variety of committees, work groups, and task forces.

Lender products & services; vendor personnel moves

When it comes to reliable, high-value industry content, Maxwell continues to knock it out of the park, putting out great mortgage resources for lending managers and their teams. If you haven’t kept up with Maxwell’s content lately, here are a few stand-outs from Maxwell’s blog: Real Estate Agent Networking Do’s and Don’ts, 7 Tips for Successful Mortgage Software Implementation and Adoption, 5 KPIs that Profitable Lending Teams Measure, and Digital Marketing Tips to Master Your Mortgage Leads.

FinLocker, a financial data and analytics company, proudly announces the addition of Brian Vieaux to its executive leadership team. Vieaux joins FinLocker as President to help expand the business development and sales effort for the innovative FinLocker platform. Bringing over two decades of extensive experience with bank-owned lending institutions, Vieaux will add a deep understanding of product innovation and capacity in leveraging financial data across depository, lending and consumer bases. His experience and breadth of industry presence will assist in evolving strategy and continued adoption of the sophisticated FinLocker solution. The FinLocker platform is a lead generation, cross-selling, and customer for life data platform for banks and other financial institutions. FinLocker is a personal financial assistant tool that captures consumer financial data to help analyze and streamline financial transactions. By partnering with financial institutions, FinLocker provides consumers with a re-usable financial locker to help manage and achieve financial goals.

On Thursday, July 11th at 2 pm ET, National Mortgage Professional Magazine is hosting a complimentary webinar showing you “How to Originate Non-QM… Your guide to Sourcing and Closing Loans Effectively.” This “soup to nuts” webinar will show you where to source Non-QM clients, how to sell Non-QM effectively to the consumer, how to construct a close-able Non-QM loan with a focus on Bank Statements, Investment Property, and clients with “credit under repair” and more. This webinar is presented by Andrew Berman of NMP and Michael Brenning of Deephaven Mortgage. You can register for the webinar here.

Mortgage Lenders – Are you frustrated by extended appraisal turn times and high appraisal costs? Partner with Accurate Group to quickly transform your mortgage appraisal process. Contact Frank Guarnera to learn how we are helping lenders transform their residential appraisal processes with the latest digital and mobile technologies. Lower costs, faster turn times and happier borrowers are just a step away – contact us today.

Calyx would like to welcome industry veteran Robert Shumake to its team! Robert is an accomplished sales executive with over 20 years of successful sales experience in the banking, mortgage banking and financial technology industries. He’s held leadership positions with eOriginal, ClosingCorp, First Mortgage Corporation, Home Savings of America, Washington Mutual, and California Bank & Trust. Robert is excited to join Calyx as a member of the Calyx Path sales team. He will assume the role of National Sales Consultant in which he will develop effective sales strategies and manage customer relationships for Calyx Path, the company’s latest cloud-based, dynamic, digital loan origination system. To congratulate or reach out to Robert, email him. For information about how Calyx Path can help you transform your loan origination process, visit calyxsoftware.com/products/path.

Unlock opportunity in a growing market with Loan Product Advisor® asset and income modeler (AIM) for self-employed borrowers. AIM for self-employed is Freddie Mac’s solution to automate the manual lender process of assessing borrower income using tax return data. It’s also the industry’s only AUS-integrated self-employed borrower income calculation solution. AIM for self-employed makes it easier to do more business, close loans faster and get immediate income rep and warranty relief related to certain borrower employment income. Freddie Mac has teamed up with third-party service provider, LoanBeam®, in leveraging their expertise and powerful optical character recognition (OCR) technology to supply qualifying income for any applicant. Freddie Mac’s broad release of AIM for self-employed on March 6 is the next step in their journey to provide innovative technologies that can help lenders turn more borrowers into homeowners. AIM for self-employed borrowers … and get YOUR edge.

CECL

Let’s not let this be another TRID slow motion train wreck. Loan officers don’t seem to have caught on that this will impact the pricing to their borrowers. The new accounting standard applies to all banks, savings associations, credit unions, and financial institution holding companies – and who buys your loans? Slowly awareness of this accounting change is growing, and, once again, it is not something where you should shrug and say your vendors will deal with it. Last month I wrote a primer on the changes for the STRATMOR site.

FASB Chair Russ Golden has defended the new accounting standard but also hinted at a possible delay (no guarantee!) in the implementation for smaller financial institutions and community banks. There are additional resources and guidance to assist these institutions with better information and guidance which is meant to alleviate some of the CECL fears. FASB is expected to continue CECL discussions at upcoming meetings. There are other resources to learn more. The new approach requires an estimate of expected credit losses over the life of a loan portfolio to be effectively recorded upon origination.

American Banker and Fiserv are presenting, “Preparing for CECL: What you need to know now” today, July 9, at 2PM ET, 11AM PT. “CECL presents largest change to GAAP accounting in decades and requires a significant modification to the way that credit unions gather and store their data as well as how they calculate and present their loss provisions. The ‘ripple effect’ of these changes will impact every financial institution’s marketing, governance and overall strategy for years to come. Since the accounting guidance is intentionally nonspecific, many credit unions are struggling to establish a solid compliance plan while also minimizing disruption to their organizations.”

Register for the 2-day training course, July 18-19 in New York. Michal Araten will be providing a detailed breakdown of the regulation and what it means in practice, including new standards for things such as PD and EAD. With a practical walkthrough of how to include macro factors into CECL modelling, advice will be given on how to validate and review the models.

Are you aware of the six methods to objectively estimate future credit losses for the life of loans? SEC filers are required to adopt CECL for fiscal years ending after December 15, 2019, with other public business entities in fiscal years beginning after December 15, 2020. In Ohio the mortgage bankers are presenting information on what is required of your financial institution in a webinar by Mike Cavellaro & Rob Folland, Barnes & Thornburg LLP, on Tuesday, August 6.

Trainings and Events

MGIC’s July Webinar Schedule has been posted. Click the link to view numerous training options.

Genworth Mortgage Insurance provides complimentary courses ranging in topics on Understanding Credit Reports and Scores and a two-part series on Fraud, to in-person trainings, Genworth offers over 70 different live and recorded webinars/topics, as well as live on-site training and professional development events.

The Franklin American Mortgage Wholesale July “Monthly Customer Training Calendar” is now available. This months’ options include Mortgage Fraud, Working Virtually, Understanding the Condo Appraisal, Five Habits of Highly Effective Salespeople – Habit 4:  Five Love Languages of Referral Business and Optimizing Linkedin.

Plaza’s July Webinar Offerings include trainings topics like HomeOne VA Reno, High Balance, Appraisal UW, Mortgage Fundamentals, Reverse, Sales and Schedule C.

Join Carrington Wholesale tomorrow, July 10th at 10:00, for part 1 of a 4-part series of webinars where you will hear from some of the industry’s sales experts on sales training techniques.

Also on Wednesday July 10, is a live webinar to share how XINNIX Performance Coaching

can help catapult you to the next level of loan production regardless of where you are in your career.

For capital markets folks, MIAC is offering up a free webinar on MOJO™ to compute the optimal way to pool loans, maximizes the use of specified pool pay-ups, and minimizes the jumbo loan hit or join our free webinar Wednesday July 10th at 2pm ET.

The Temporary Authority licensing rule for mortgage loan originators goes into effect November 24, 2019. Join the MBA on Thursday, July 11th to get first-hand guidance from the Conference of State Bank Supervisors (CSBS) and expert counsel, as we cover what this means from a regulatory standpoint and how the National Mortgage Licensing System (NMLS) will accommodate this new status.

The legalization of marijuana with the passage of Proposal 1 potentially opens the door for greater mortgage eligibility in Michigan. to understand the issues and risk with this topic, register for the MMLA Southeast Chapter’s Marijuana Lending Luncheon on Thursday, July 11th. Melissa Bridges with Bodman PLC will share her expertise and answer your questions.

California MBA is offering a free webinar from the Legal Issues Committee on Friday, July 12th. Register now.

Register for the MBA of Hawaii’s Workshop on July 16th from 10-12 at 1132 Bishop Street, 6th Floor. This workshop is designed as an Overview of the New Purchase Contract focusing on specific changes that could affect your loan.

On Thursday, July 18th at 11am PT, Dale Vermillion, a renewed sales consultant within the mortgage industry will host the webinar series, “Creating a Borrower-First Experienced for Unparalleled Success”. In Part 1 of his thought leadership series with Ellie Mae Dale will cover strategies to help loan officers blend technology and human interaction to form authentic and successful customer connections. Participants can learn how to Capitalize on the most competitive and opportunity-laden mortgage market in recent memory. Stop quoting price and product and start developing individualized conversations that drive more business. Become high tech and high touch to form successful sales, service and communications strategies.

Have you evaluated the other areas of your company the new URLA will impact such as interactive websites, integrated systems and plug-ins with third party vendors, custom reporting, custom forms, investor requirements?  Have you defined how you will manage the URLA delivery options (there are quite a few)?  The MCPAOA is hosting a webinar on the new URLA requirements July 18, at 9AM PT. The guest speaker will be John Haring, Director, Product Management at Ellie Mae.

Capital markets

Got MOJO™? If you are looking to increase your profitability, you need to get some MOJO! Please join our free webinar and learn more about MIAC’s market-leading Maximized Objective Optimizer™ (MOJO™)!  Lenders will now be able to identify the best possible execution and do it in record time! Come learn why MOJO™ is superior to other hedge advisor models as it computes the optimal way to pool loans, maximizes the use of specified pool pay-ups, and minimizes the jumbo loan hitMOJO™ also enables users to easily commit pools, auto-create trades, and allocate loans to trades. Learn how to make more money while saving time with MOJO™For more information contact your MIAC sales executive or join our free webinar Wednesday July 10th at 2pm ET!

After U.S. Treasuries posted large losses to close last week, they began this week in quiet curve-steepening action, including the 10-year closing -1 bp yielding 2.03 percent. Markets should experience limited risk appetite again today ahead of Fed Chair Powell’s testimony on Capitol Hill tomorrow and Thursday. The slight rebound in Treasuries domestically coincided with equity markets across Asia showing weakness, including some disappointing data out of Japan. To me, it seems people are grasping at straws for some data to base expectations on, but allow themselves to sway excessively in the wind day by day based on the most recent data point. Expect this to continue until the dot plot of the July Fed rate decision is released (and then indefinitely from there).

Turning to today, we began with the June NFIB Small Business Optimism Index (down to “103.3”). Later this morning will bring Redbook same-store sales for the week ending July 6; and JOLTS job openings for May. There is also a decent amount of Fed speak before tomorrow’s Fed Chair testimony, including appearances by Chairman Powell, St. Louis Fed President Bullard Atlanta Fed President Bostic, and Governor Quarles. But we begin the day with Agency MBS prices worse almost .125 and the 10-year yielding 2.05%.

The importance of a good night’s sleep is critical. Just ask someone who has gone without it for a night or two. Here’s a clever ad on the subject.

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Residential Lending, Banks, and Market Share.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)