Dec. 1: DACA – lenders & investors decide residency; URLA/1003 questions for every MLO to ask

My cat Myrtle never pays attention to rumors. Pine-scented cat litter next door? She shrugs. Line-caught salmon for dinner every night up the street? Couldn’t care less. Not so, however, in mortgage banking as rumors and bad-mouthing by some continue. How would you like to receive this email from a respected owner of a mid-sized non-depository lender in the Midwest? “This industry is turning on itself. We hear so many rumors and have people attacking us and calling our agents with things that are not true. I have never seen so much in-fighting ever. Why is everyone trying to take down everyone else with these lies? Why are the recruiters allowed to say anything they want? How can we get our industry to raise its standards and stop acting like the old subprime reps? It’s so disheartening!” [Apologies to any old subprime reps.]

URLA: Shades of TRID rollout?

The GSEs (Freddie and Fannie) have redesigned the Uniform Residential Loan Application (aka Form 1003), developed a corresponding Uniform Loan Application Dataset, and created a new Desktop Underwriter Specification (DU Spec) for submitting the redesigned Form 1003 data to DU. Rumor has it that the Agencies originally were going to implement it last January but the additional data fields required weren’t (originally) collected in a typical loan file, leading to complexity issues, so they kicked the can.

Want to see what the borrower will see? Here you go. Freddie Mac has a nice graphic showing the timeline. Unfortunately for every single lender, and every loan officer who takes a loan app, there’s a big difference between “Start planning now” and actually having everything in order. Do I have to remind you about how smoothly TRID was implemented having a year or two lead time?

Why are the Agencies doing this now? “Changes in the mortgage industry and the regulatory environment have led to the need for the GSEs to reassess the information obtained at the time of loan origination. The URLA/ULAD initiative has the following objectives. First, to update the URLA form to collect loan application information that is relevant and useful to the industry in making a loan underwriting decision, as well as update the physical format and layout to enhance the collection of information and usability of the form. Second, to develop and publish an industry data standard in support of the URLA. The ULAD Mapping Document provides a cross reference for every field on the redesigned URLA to the equivalent data point(s) in the MISMO Version 3.4 Reference Model. And third, publish GSE-specific automated underwriting system (AUS) specifications for Desktop Underwriter® (DU®) and Loan Product Advisor® updated to MISMO v3.4 and including the new URLA data fields.

I am fielding notes of dismay about the length and complexity. Nearly a month ago I published this: “In a world where things are becoming faster, easier, and more accurate, we have this for lenders?” There are some questions that every lender should be asking, and every vendor, and the Agencies, should have answers for. Third-party integration? Implementation support? business process design, LOS modifications, LO sales training?

How long is the form? The length of the redesigned URLA will vary depending on the number of borrowers, the type of loan and the type of transaction. All the examples I have seen are 9 pages, more if overflow is needed. The URLA Rendering Document provides additional formatting guidance for technology solution providers and lenders to tailor production of the form according to system requirements.

Wholesale lenders accepting brokered loans, or correspondent investors buying loans, will you accept two apps from the same lender for several months? (Lenders may begin submitting loan application production files starting July 1, 2019. Lenders will be able to submit their existing datasets until February 1, 2020.) F&F currently tell us that new applications dated February 1, 2020, or later must use the new AUS datasets based on MISMO v3.4. Applications dated before February 1, 2020, but that have not closed (e.g. construction loans) will be accepted in the existing data formats until February 1, 2021, when only the datasets based on MISMO v3.4 will be accepted.

Can or should the redesigned URLA be viewed in a web browser? It appears that no, the GSEs recommend that lenders and technology solution providers download the forms to their computers and then open the forms using a PDF document reader such as Adobe Acrobat Reader or Adobe Acrobat Pro. Ask F&F, but if the forms are opened within a web browser, the fillable PDF versions of the form may lose some functionality and as a result, not perform as designed.

By using the new URLA, are Fannie & Freddie telling the loan officer how to ask the questions and in what order? Ask your Agency rep, but it appears that they are proposing the consumer interview sequence of questions and interview flow as an interactive PDF that can take the role of input form. Experienced LOs are good at knowing how to glean information from their borrowers, and how to ask questions. Will that be eliminated?

What if the LO can’t have all the questions answered in one sitting? Good Question: that is likely to be bigger than just a technology change and will require modified processes and training.

Has there been real testing of the proposed interview flow and data sequence to see how well all of the new 1003 data elements will handle overflow cases (e.g., when you have 5 other sources of income and the form for 3, more assets and liabilities than there is room on the form to handle)? Ask Fannie & Freddie!

If your company just spent several months, tens of thousands of dollars, and countless hours of LO training rolling out a new LOS, what now? I don’t know – ask your vendor!

John Haring, Director of Product Management at Ellie Mae, shot over, “While the new URLA and ULAD are fifteen months away, that’s not a lot of time to get prepared for the impact of the changes. At Ellie Mae, we are planning to deliver functionality in the July 2019 timeframe to coincide with the early release date of the URLA and allow customers and partners ample time to test and transition. Ellie Mae’s goal is to always minimize any regulation or industry change so that it becomes a ‘non-event’ for customers and partners.

“Nearly every mortgage application is collected on Form 1003 or Form 65 and the format has not changed significantly in the last 20 years. Fannie Mae and Freddie Mac, under direction of the Federal Housing Finance Agency (FHFA), have significantly redesigned the form. With this, lenders may choose to use the new URLA starting July 1, 2019, although the GSEs will not require it until on or after February 1, 2020 for new loan applications.

“The redesigned URLA takes a design thinking approach, with dynamic field collecting and a presentation of data tailored to the individual borrower and loan scenario. The goal is to provide greater efficiency, transparency and certainty for future homebuyers applying for mortgage loans and greater consistency for lenders who sell to both Fannie Mae and Freddie Mac.

“While the new URLA and ULAD are fifteen months away, that’s not a lot of time to get prepared for the impact of the changes. At Ellie Mae, we are planning to deliver functionality in the July 2019 timeframe to coincide with the early release date of the URLA and allow customers and partners ample time to test and transition. “Ellie Mae continues to educate and keep customers and partners updated on the latest with URLA/ULAD with a series of webinars, FAQs and resources for training. Your readers can find them all on Ellie Mae’s Compliance Central.

Will the proverbial can be kicked down the proverbial road, and implementation delayed? Perhaps, but for now, despite lenders being caught up in the glamor of the nebulous “digital mortgage,” every entity that takes a loan app, and every investor that buys loans based on the information contained in that app, had better focus on having an implementation plan and holding vendor partners accountable. Pronto.

DACA loans

“Rob, I am seeing some lenders, and hearing about others, offering DACA loans. And some with conventional loans. Any feedback or anything you are hearing that make these possible?”

First, yes, apparently some lenders are offering these loans to individuals who fall under the Deferred Action for Childhood Arrivals (DACA) – a kind of administrative relief from deportation. Service to their community? Competitive reasons? Generally, lenders will make the loans and investors will buy them if some minimum level of residency is met. Some investors, such as loanDepot’s wholesale channel, spell things out in terms of eligibility.

Personally, I would be hesitant about basing my entire business plan on originating these loans, but that’s just me. Like MSAs and joint ventures, lenders should know all aspects. One can start by seeing what the U.S. Government, in its infinite wisdom and with its ability to state things in language we can all understand, has to say: “On June 15, 2012, the Secretary of Homeland Security announced that certain people who came to the United States as children and meet several guidelines may request consideration of deferred action for a period of two years, subject to renewal. They are also eligible for work authorization. Deferred action is a use of prosecutorial discretion to defer removal action against an individual for a certain period of time. Deferred action does not provide lawful status.”

Here is what Fannie’s Guide has to say about this. “Borrower Residency Status: The Selling Guide is clear that lenders, not Fannie Mae, determine whether an individual is legally present, and decide upon the documentation used to make that determination (my bolding). On the specific subject of DACA, lenders may wish to review applicable judicial decisions to evaluate whether current DACA beneficiaries’ status is consistent with being ‘legally present’ in the United States. We have also been advised to let Lenders know it is their responsibility, as always, to look at the specific circumstances of the individual’s employment to determine whether our continuity of income representation and warranty is met.”

Freddie Mac is also very clear in its guide (bottom of page 26) that the “Sellers represent and warrant that the non-U.S. citizen borrower is lawfully resident in the United States. Freddie Mac does not specify the documentation required to establish lawful U.S. residency…”

From what I understand, verbally FNMA and FHLMC are classifying DACA Borrowers as “Non-U.S. Citizen, not lawfully in the U.S.,” therefore, not eligible for financing. In writing they refer the actual question back to the lender.

FHA? Same kind of thing. The Atlanta HOC has verbally confirmed with lenders that there are still no changes to its policy. Namely, these individuals are considered temporary residents which fall under non-U.S. citizens without lawful residency in the U.S. and are not eligible for FHA insuring at this time. Borrowers with deferred action status are not eligible for FHA financing because they are not on a pathway to residency and do not meet the guidelines printed in the manual. Additionally, these loans are clearly not eligible for USDA financing as GUS requires you to enter information that identifies their status in the US. When you do so, GUS will tell you that the borrower is ineligible.

This commentary discussed DACA borrowers in the autumn of 2016 and it probably still aligns with HUD’s current position on DACA borrowers. There are millions of these people here in the U.S. and many of them are trying to apply for loans. Many of these loans are closing even though most lenders agree they should not.

Perhaps most DACA borrowers have probably closed undetected under FHA financing because HUD has nothing published regarding the ‘Category’ a Borrower’s EAD card is issued under (few were monitoring the “Category” of the Borrower’s EAD card on FHA loans and only recently became aware of Category C-33 being an identification of a DACA Borrower). Most lenders know that potential borrowers with EAD cards issued under Category C-33 need to be underwritten under paragraph (c) of Section (9) for Residency Requirement.

Since HUD published Handbook 4000.1, lenders have been told to “follow what is published in the 4000.1”. Some believe that a DACA borrower holding a valid EAD card should be eligible for FHA financing until HUD publishes that EAD cards issued under Category C-33 are not eligible for FHA financing. Because without that detail most DACA Borrowers will meet all of HUD’s published requirements under HUD Handbook 4000.1 Section II.A.1.b.ii. (A).(9).(b) for a ‘Non-Permanent Resident Aliens’.

Some in the industry believe that politics are to blame for the confusion (imagine that!) but that the Agencies will wait for one of the loans to go delinquent and push them back for repurchase stating the lender shouldn’t have made the loan because the borrower did not have a lawful status. Let’s hope that’s not the case. Agencies are not charged with setting the Administration’s policy.

(Thanks to Tony H. for this one.)

A delightful angelic little boy was waiting for his mother outside the ladies room of the gas station.

As he stood there, he was approached by a man who asked, “Sonny, can you tell me where the Post Office is?”

The little boy replied, “Sure! Just go straight down this street two blocks and turn to your right. It’s on the left.”

The man thanked the boy kindly, complimented him on how bright he was and said, “I’m the new pastor in town. If you and your mommy come to church on Sunday, I’ll show you how to get to Heaven.”

The little boy replied with a chuckle; “You’re kidding me, right? … “You can’t even find the Post Office.”

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 30: LO jobs; paper on fraud, construction product; FDIC & non-bank lending; the Fed to start watching OBFR instead of Fed Funds?

As one Native American said, “Only a white man would cut two inches from the top of a blanket, sew it to the bottom, and think he has now has a longer blanket.” (Feel free to use that one wherever you like.) Winter is coming, with its increased blanket needs. According to the Census Bureau, while the majority of U.S. households are heated by electricity (39%) or utility gas (48%), 2% rely on wood for heat. Weighing in for the top two counties reliant on wood (with populations of 65,000 or greater) is Apache county Arizona accounting for 61% and McKinley county New Mexico at 39%. On the low end, Nevada county California and St. Lawrence county New York utilize 17% wood heat.

Employment & retail products

Caliber Home Loans, Inc., with a 25% growth rate in government volume between the Q3 2017 and Q3 2018, continues to report strong numbers – per IMF – throughout a challenging year for the industry. In 2018, Caliber has hired to-date 517 producers to join its national sales force, who will conservatively add $4.5 billion in annual purchase volume. Looking ahead, Caliber is excited to carry the positive momentum into 2019 and beyond. “Caliber is committed to establishing a local presence in markets across the nation,” said Caliber CEO Sanjiv Das. “Our loan officers are strong forces in their communities, and their stellar work has helped Caliber grow tremendously in the past few years. I can’t wait to grow our team further.” If you’re a motivated loan officer, looking to join a premiere purchase lender, visit JoinCaliberNow.com or reach out to Jeremy DeRosa.

Parkside Lending, LLC continues to expand its product offering!  Now offering USDA loans, Interest Only loans down to $100,000 and Jumbo using DU findings.  They’ve also launched Jumbo II allowing Restricted Stock Unit income, loan amounts to $4,000,000 and Non-Warrantable Condos.  With Parkside’s simplified process, automated Loan Estimates, state and federal disclosures delivered electronically, access to underwriters, and a plethora of products, it is easy to see why brokers love working with Parkside. Parkside continues to grow and is excited to welcome Alan Michaels and Debbie Baider covering the Mid-Atlantic states. They bring incredible depth and experience in the Mid-Atlantic region. Parkside isn’t done with new product roll outs; HELOCs and more Interest Only & Non-QM programs are coming soon, plus a Bank Statement program. To find out more about these programs contact your Account Executive or Sales@ParksideLending.com. If you are an Account Executive looking to join a great team or are a mortgage broker who is not currently working with Parkside Lending, please contact us at Sales@Parksidelending.com.

Gateway Mortgage Group, has introduced an innovative program designed to protect a homebuyer’s down payment. The new Down Payment Protection program is offered through ValueInsured and has been integrated into most of Gateway’s mortgage loan products. This unique program offers homebuyers an optional insurance feature minimizing market risk on the value of their home and safeguard some, or all, of their down payment. If the market price drops and the home sells at a loss, up to the full amount of the down payment could be reimbursed in a turnkey, home inspection-free process that can take 30 days or less. “Gateway is always growing and innovating,” said Alan Ferree, president of Gateway. “This program allows us to differentiate Gateway from other mortgage lenders while providing our customers a unique option that offers peace of mind and simply makes sense for certain markets or borrowers.” For more information, visit Down Payment Protection at Gateway or contact your local Gateway Mortgage Group branch.

PRMG continues to expand its national footprint by opening 5 new Retail Locations during the month of November!  Along with the drive and ambition to bring the American Dream of Homeownership to all cities across the country, PRMG has now opened its doors in Colorado Springs, CO; West Palm Beach, FL; Chicago, IL; Farmers Branch, TX and Federal Way, WA.  PRMG is Built by Originators for OriginatorsTM and is devoted to continuously growing their retail platform.  If you are a Motivated Loan Originator who wants to be Progressively Better, contact Chris Sorensen (909.262.0452).

Lender products and services

CALCAP Lending, LLC a leading wholesale lender in the high demand private money lending market is “Front and Center” at the upcoming NAMB 2018 conference in Las Vegas. We invite attendees to visit with us at Booth #400 to find out more about our competitive rental, fix-and-flip, foreign national, and construction lending business purpose lending programs, including CALCAP’s recently released Zero Point upfront option. On pace to double production from last year, CALCAP Lending has established a “Value Partners Program” dedicated exclusively to mortgage originators who are seeking to expand their production and income opportunities. To become a CALCAP Value Partner or to learn more about CALCAP Lending and the career opportunities we offer which include sales training, please click here or give us a call at 855-372-0960.

Professional Development has been proven time and time again as a vital step for achieving business growth. There are infinite possibilities, however, to realizing deep and everlasting success & happiness when we invest in ourselves personally as well as professionally. XINNIX, The Mortgage Academy, is committed to helping you thrive in every aspect of your life. As you focus on developing plans for your business in 2019, XINNIX is offering a great year-end opportunity to enrich your personal development as well with free registration to its December 12th webinar, Infinite Possibilities presented by XINNIX CEO Casey Cunningham. In this empowering session, you will learn how to plan and prioritize your personal and professional goals, implement a formula for success, and write and effective life mission statement that guides your decisions and priorities. CLICK HERE to register today for Infinite Possibilities on Wednesday, December 12 at 10 AM ET!

“Here’s a hi-tech breakthrough in lending to self-employed borrowers. Amidst rising interest rates and declining origination volume, lenders must cast a wider net for customers, a growing number of which are self-employed. To capitalize on this trend, lenders need a simpler, faster way to underwrite mortgages for Americans who are their own bosses. To this end, Freddie Mac has integrated fintech vendor LoanBeam’s technology with Loan Product Advisor®, our automated underwriting system, to introduce the first and only integrated self-employment income solution for the market. LoanBeam’s software uses optical character recognition technology to extract and digest a borrower’s tax returns and other financials, and then calculate a total income figure that aligns with Freddie Mac’s guidelines. This integration offers lenders several advantages, including an automated review of the accuracy of qualifying income, eliminating the need to chase down unnecessary documents that support residual/excess income and certainty that the income calculation is eligible for representation and warranty relief.” Learn more.

FundingShield reported an estimated $75 million per day in wire and closing fraud

exposure. This will result in exposure of $20+ Billion in 2018 despite reduced volume the sector remains a hotbed for cyber criminals and fraud. Wire fraud and cyber threats such as phishing, injection and business email compromise events spike during the holiday season when fraudsters take advantage of staff being on vacation, increased consumer transactions, increased remote access by staff and more back up teams supporting production and operations. Couple this with the expansion of digital lending processes, widespread use of wireless networks that may not be encrypted and properly secured, email server threats to known and new third-party relationships of lenders, closing and settlement companies and law firms and the risk is more prevalent. Jerry Halbrook, former President of Black Knight Inc. Origination Technology and Business Intelligence Divisions and Fundingshield Advisory Board member shared Unknown parties to the transaction as well as known and trusted vendors are being exposed to these risks hence a proactive transaction level monitoring system is needed” Contact info@fundingshield.com to create a user centric risk and control strategy to get ahead of wire and cyber fraud attempts that go beyond a vendor vetting with active defenses at the loan level that save your firm on operational and risk cost.

M&A keeps on keepin’ on, and what about non-bank lending?

Capital One ($408B, VA) will acquire online shopping comparison engine Wikibuy. Wikibuy provides price comparison in real time, get coupon codes at checkout and receive price drop alerts on products and services to its more than 1mm members.

From Alabama comes news that Hometown Lenders, Inc., has acquired TotalChoice Mortgage Division, led by Michael Farrell, Divisional Manager. “In the upcoming months, TotalChoice Mortgage Division plans on adding production offices in North Carolina, Pennsylvania and Florida. These additions alone will increase the 2018 annual projected loan origination volume by $240 million. TotalChoice Mortgage is a division of Hometown Lenders, Inc., a privately held mortgage lender with locations in Columbus, Ohio, as well as other states. Hometown Lenders, Inc. maintains 37 active state licenses to originate residential refinance and home purchase loans. The company size is approximately 400 employees.”

Speaking of non-bank lenders, which regulators view as thinly capitalized versus banks in case something goes wrong, they now account for 44% of lending by the top 25 originators, up from 9% in 2009… Five of the largest ten are non-banks, as is the largest retail mortgage originator, Quicken Loans. Their market share for servicing mortgages, or collecting monthly payments, has risen from 5% in 2009 to 41% this year. The FDIC is certainly aware of, and concerned with, the trend.

Capital markets

The Fed is considering big change in how it sets US interest rates, possibly targeting the OBFR instead of the fed funds rate. But what is the OBFR? The Fed tells us that, “The overnight bank funding rate is calculated using federal funds transactions and certain Eurodollar transactions. The federal funds market consists of domestic unsecured borrowings in U.S. dollars by depository institutions from other depository institutions and certain other entities, primarily government-sponsored enterprises, while the Eurodollar market consists of unsecured U.S. dollar deposits held at banks or bank branches outside of the United States. U.S.-based banks can also take Eurodollar deposits domestically through international banking facilities. The overnight bank funding rate (OBFR) is calculated as a volume-weighted median of overnight federal funds transactions and Eurodollar transactions reported in the FR 2420 Report of Selected Money Market Rates. The New York Fed publishes the OBFR for the prior business day on the New York Fed website at approximately 9AM ET.”

To a large degree interest rates move based on supply and demand. How’s the supply going on the housing side of things? The phrase “housing market slowdown” isn’t exactly surrounded in positive connotation, but as the $220 trillion global housing market starts to cool off in some places against a backdrop of monetary policy normalization, there may be some reasons for calm. Price declines are impacting the most expensive cities, where they might not drag down consumption the way standard theory predicts. In theory, a housing price decline should leave households feeling less confident about their finances and less willing to spend. But the pace of home price increases has exceeded the rise in disposable incomes by so much in some markets that a little cool-off might instead make consumers less budget-constrained. Despite global property prices potentially peaking for the cycle in places now on the decline like London, New York, Stockholm, Hong Kong and many other cities, it may not lead to a significant weakening in consumption, as long as it remains modest and gentle. It may actually promote consumption in some areas.

The U.S. 10-year closed Thursday -1bp to 3.04% as Treasuries across the curve closed on a mostly flat note after backing off their opening highs after the market received another reminder of a weakening housing market in the form of a disappointing Pending Home Sales report for October. The FOMC Minutes from the November meeting acknowledged that almost all policymakers believe that another rate hike will be warranted “fairly soon.” Policymakers also noted that fiscal stimulus and a strong consumer could produce upside risks to inflation. Personal income and personal spending both beat expectations, while Real PCE, which is the component that factors into Q4 GDP forecasts, was up a solid 0.4%. The tamer the inflation readings support the Federal Reserve taking a more deliberate approach to raising the fed funds rate.

Today will see much of the markets’ attention in Buenos Aires as the G20 summit gets under way and continues into the weekend. With regards to the economic calendar, today is relatively light consisting of just Chicago PMI for November and an appearance by NY Fed President Williams. Additionally, the U.S., Mexico, and Canada are set to sign a new NAFTA deal. We begin today with the 10-year yielding 3.01% and Agency MBS prices better a smidge.

The wedding ceremony came to the point where the minister asked if anyone had anything to say concerning the union of the bride and groom.

The moment of utter silence was broken when a beautiful young woman carrying a child stood up. She starts walking slowly towards the minister.

The congregation was aghast – you could almost hear a pin drop. The groom’s jaw dropped as he stared in disbelief at the approaching young woman and child.

Chaos ensued. The bride threw the bouquet into the air and burst out crying. Then the groom’s mother fainted. The groomsmen started giving each other looks and wondering how to save the situation.

The minister asked the woman, “Can you tell us, why you came forward? What do you have to say?” There was absolute silence in the church.

The woman replied, “We can’t hear you in the back.”

And that illustrates what happens when people are considered guilty until proven innocent.

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 29: LO, AE jobs; broker, fraud, subservicing products; training & events in the next 2 weeks; Fed speech moves rates

Yes, MLO commissions are dropping. But the traditional 6% real estate agent commission continues to be under attack as well, the latest salvo fired from Clever, a real estate startup that connects homeowners to top rated agents in their area that list their home for less commission. (“Our main goal is to connect potential sellers and buyers to top performing agents based on the homeowner’s specific needs, but we also write guides, share tools, and teach our readers pretty much everything they need to know about the mortgage process via our blog.” Questions? Contact Chris Milko.) Realtors are also watching Ribbon Home, Zillow Offers, and Open door.

Jobs

A nationwide wholesale lender has immediate opening for a team in key US markets. This heavily capitalized lender leverages a centrally located and seasoned fulfillment team. Broad product portfolio and competitive rates offered along with an experienced leadership team dedicated to expansion. Send me a confidential note if you and your team are ready to start a new in 2019.

PRMG continues to expand its national footprint by opening 5 new Retail Locations during the month of October! Along with the drive and ambition to bring the American Dream of Homeownership to all cities across the country, PRMG has now opened its doors in

Indianapolis, IN; Homestead, FL; Melbourne, FL; Columbus, OH and Mentor, OH. PRMG is Built by Originators for OriginatorsTM and is devoted to continuously growing its retail platform. If you are a Motivated Loan Originator who wants to be progressively better, contact Chris Sorensen (909.262.0452).

And remember that any displaced employees (the latest rumors focus on Cendera and United Bank, Hartford, CT, unfortunately) can place their resumes on www.LenderNews.com for free.

Lender products and services

Borrower satisfaction has always been the main focus to lenders large and small. Many state the benefits of repeat business, increased referrals, and stronger relationships with realtors as their motivators, but very few in our industry know how to track the ROI and level of investment they should be putting towards their borrower focused initiatives. A new eBook, “Borrower Satisfaction & Profitability” brings together focus areas and industry data, enabling lenders to track and monitor the impact of their borrower satisfaction efforts. An exclusive to Rob Chrisman subscribers today and a must read for all mortgage lenders, Download Your Free Copy Here.   

We now live in the age of digital mortgage processes. Lenders who use outdated technology, or none at all, to interface with their customers are experiencing a sharp rise in loan production costs, as well as a decrease in overall borrower satisfaction. Tech-focused non-banks like Quicken Loans continue to absorb more and more market share every year, and now dominate the list of top lenders by volume. At the same time, less agile institutions have seen their origination volumes and lending departments shrinking by the day because this new generation of borrowers expects to transact digitally with mobile options. They also expect to be continuously informed. And when they work with lenders who employ Floify’s point-of-sale technology, they get to check all those boxes. In just 30-minutes, see for yourself how the innovative platform can immediately put your team on the leading edge of mortgage tech, and keep it there!

Protect your earnings and be prepared. Digital lending and virtual consumer experiences are all the hype in today’s market. And while there are a lot of benefits, it doesn’t come without its risks. Real, tangible risks. Wire transfer fraud, which saw a 480% increase just a few years ago, can cause a major upset to a company’s bottom line and become a huge resource waster. Learn more with Informative Research’s new article about the “4 Answers on Wire Transfer Fraud that Criminals Don’t Want You to Know.” With so many areas open to exploitation, companies can never do too much to understand wire transfer fraud and prevent losing thousands of dollars at a time. For more detailed information, contact one of our team members at info@informativeresearch.com.

“Lenders, cut 80% off your essential LOS/PPE tech spend. The ReadyPrice retail and wholesale enterprise-strength LOS with an embedded multi-investor PPE and proprietary ‘error trapping’ tech is the answer for any sized lender (or brokers wanting to become bankers). The ReadyPrice all-in-one retail and wholesale platforms are fully configured out of the box, are up to 80% less expensive than heavy, ‘mature’ competitors, come complete with D1C, deep Fannie DU, EarlyCheck, etc. integrations and can be stood-up in a couple of weeks. Or, you can easily and inexpensively customize/configure it to easily fund thousands of loans per month from thousands of MLO’s or brokers, for example. The ReadyPrice LOS/PPE has funded over 300k units for $70 billion and is leading the way forward for today’s mortgage bankers as we utilize essential mortgage tech.” Call them at (408) 357–0931 or email hello@readyprice.com to receive a free demo today.

Did you know that, according to HubSpot, 39 percent of marketers say proving the ROI of their marketing is their top marketing challenge? When developing your plan for 2019, build it with confidence. Consult with the mortgage and fintech industry communications specialists at Seroka Brand Development. Seroka has been creating and executing successful marketing and PR communications plans for over 30 years. Today’s plans demand a contemporary approach that utilize a blend of digital, social media and traditional tactics along with the right tech stack to generate positive awareness, build engagement with your brand and drive conversions. And, with Seroka, you’ll have access to detailed campaign measurement and analytical tools to confidently evaluate your success, often in real time. Seroka can also help with specific campaigns or special projects. So #TurnUpYourBrand and make Seroka’s experience your advantage. Learn more here or email info@seroka.com to schedule a free consultation.

JMAC LENDING’S Non-QM submissions are through the roof. With streamlined features such as our 3-month bank statements option and Buyer Pre-Approval for bank-statement loans, it’s easy to see why JMAC is leading the Non-QM surge. Many brokers feel Non-QM loans are too complex. Not for the underwriters at JMAC, since we were one of the first to offer non-QM products. We’re here to help our clients navigate these products and assist with scenarios. In fact, non-QM scenarios are answered quickly by our experienced Account Executives. To speak with an AE, and to submit a scenario, contact sales@JMACLending.com or call 844.888.5622. You can also fill out our scenario form to find assistance right now! Experience the JMAC Difference today.

Are you a hunter or a farmer? And what does this have to do with the business of lending or subservicing anyway? This new white paper from TMS gives a fresh take on subservicing and how the cost of acquiring a new customer (“Hunting”) is often lost.  Instead, lenders hand over their new, precious customers to a subservicer who doesn’t help them retain (“Farming”) that customer for future value. Partner with a subservicer who will deliver the same level of customer service your customers have come to expect from you. Make sure you’re a farmer. If not, you risk a lasting negative effect on business.

NAMB national is just a few weeks away. While many are concerned with what the future holds, REMN Wholesale sees massive opportunities for brokers who need to offer more than the basic vanilla products. If a borrower doesn’t fit nicely into a QM loan these days, and to be honest, many don’t, REMN now offers the Simple Access program. Supported by one of the top customer service teams in the industry, REMN’s Simple Access non-QM program provides a unique opportunity to work with quality borrowers who don’t qualify for QM loan products. REMN believes that products and technology are nothing without the necessary people to support them, which is why it continues to grow by recruiting some of the best account executives in the industry. Recent additions to the REMN team include Jim Collins in Connecticut and Christine Garcia, who will be handling all of Los Angeles County.

“Here’s a hi-tech breakthrough in lending to self-employed borrowers. Amidst rising interest rates and declining origination volume, lenders must cast a wider net for customers, a growing number of which are self-employed. To capitalize on this trend, lenders need a simpler, faster way to underwrite mortgages for Americans who are their own bosses. To this end, Freddie Mac has integrated fintech vendor LoanBeam’s technology with Loan Product Advisor®, our automated underwriting system, to introduce the first and only integrated self-employment income solution for the market. LoanBeam’s software uses optical character recognition technology to extract and digest a borrower’s tax returns and other financials, and then calculate a total income figure that aligns with Freddie Mac’s guidelines. This integration offers lenders several advantages, including an automated review of the accuracy of qualifying income, eliminating the need to chase down unnecessary documents that support residual/excess income and certainty that the income calculation is eligible for representation and warranty relief.” Learn more.

Events & training in the first half of December

The Federal Financial Institutions Examination Council (FFIEC) will hold a webinar on December 6 to promote awareness and understanding of efforts to develop alternative reference rates to LIBOR, because of the uncertainty as to continued availability of LIBOR after 2021: view the FFIEC November 19th press release.

Register now for the MBA’s December 6th Increasing Sales with Women Homebuyers webinar and learn the best practices and strategies to reach one of the fastest growing buyer segments in the nation.

Lenders One is hosting The Executive Roundtable December 5-6 in Miami, FL, including a session on developing a strategy and growth plan in a down market with executive coach Gary Peck, a best practice roundtable led by our sponsor Fannie Mae, and a market outlook and business forecasting led by Mike Fratantoni from the MBA.

The 2018 NAMB National Conference will be held December 8th-10th in Las Vegas including a session featuring Freedom CEO Stan Middleman and Angelo Mozilo comparing the beginnings of their companies, the evolution of lending, and discussing their thoughts on what the future holds.

The MBA is starting a brand-new study on HELOCs and home equity lending and servicing, which will include benchmarking data on portfolio characteristics, utilization rates, draw activity, repayment options, as well as statistics on new commitments such as processing times and pull-through. The study is for MBA members who originate and/or service these products; the participants will help design both the survey instrument and outputs. The initial planning call is on Tuesday, December 11 at 2PM ET. Register for the call here.  Download the informational flyer or contact Marina Walsh with questions.

On December 11th, industry leaders, Patrick Stone and Ken Markison will discuss the economic and compliance environment in 2019. Register for this Economic and Regulatory webinar here.

October Research, LLC’s annual Economic and Regulatory Outlook webinar is 12/11 at 2PM ET.

Don’t miss registering for the December 15thNMMLA annual Teddy Bear and Blanket Drive luncheon with guest speaker, Mayor Tim Keller.

National MI issued its training for December. A Look Ahead to Social Media Trends 2019: PDT, Dec 13, Oh, Shift! Session #3 – Flow: PST, Dec 12, A Look Ahead to Social Media Trends 2019: PDT, Dec 13. Click here: National MI to register for these classes.

Capital markets

Once again stocks grabbed the headlines, but secondary marketing groups saw some volatility yesterday. The U.S. 10-year closed Wednesday’s session at 3.04% as early action was reversed by Fed Chairman Jay Powell’s dovish remarks saying that interest rates are “just below” neutral. In his estimation, rates “remain just below the broad range of estimates of the level that would be neutral for the economy,” however, these words were digested as “dovish” by capital markets. Accordingly, the Federal Reserve’s Financial Stability Report acknowledged that asset prices “appear high relative to their historical ranges, ” and escalating trade tensions, geopolitical uncertainty, or other adverse shocks could produce a sharp decline in asset prices. The report also acknowledged that business sector debt relative to GDP is historically high with signs of deteriorating credit standards.

Powell’s comments nudged one veteran originator to pen, “The Federal Reserve continually and repeatedly states that it is data-driven. That’s fine in 1980, but with the advent of the computer the world is driven by real time data algorithms, if you will. Even the average person receives news almost instantaneously.

 

“It seems the data the Fed is using, for better or worse, is trailing the real world by 60-180 days. This reminds me of ten years ago. In late Feb 2007 a New Century AE comes into my office and says that their warehouse lines were frozen, 3 weeks later they were gone, by late June the wholesale subprime market was gone, in August the jumbo market was in dire straits, and in early September the FRB Chairman says the subprime market is ‘contained.’

“Yes, that is rehashing the old, what seems like a few weeks ago for some, but it is still relevant. In July and Aug, I was being told by friends they were seeing a huge slowdown in real estate. I was fortunate and didn’t see it until late September. November has been a disaster. The Fed had been worrying about an over-heating economy, and still on target to raise rates. Today was a positive, but only by one person.

“At one point I saw something that said about 20% of homes had second mortgages. I don’t know where that is today, but I still have loans being subordinated because HARP excluded them, the CLTV wouldn’t work, or because the cash out LLPA was too high. Every jump in the discount impacts that chunk of the economy. A 1% increase in a $200k HELOC is $166 per month. As an originator I see a lot of them, and that $166 doesn’t help the economy.”

Looking at today, we’ve seen November’s Personal Income and Spending (strong at +.5% & +.6%, respectively) weekly jobless claims (+10k to 234k, 6 month high), and core PCE only +.1%. Fed Chair Powell, who turned heads yesterday, will be back speaking though he is not expected to make any major market-moving comments. The October Pending Home Sales Index is seen unchanged at 10:00am (versus +0.5% previously). We then turn to some action from the Fed, which will release the minutes from the November 7-8 meeting at 2PM ET, the same time as Fed Presidents Mester, Evans, Harker, Kashkari, Rosengren and Kaplan all participate in an Economic Development forum discussion. We begin today with the 10-year yielding 3.00% and Agency MBS prices better by .250.

(Thanks to Brian L. for this oldie but goodie.)

The Will

His nurse, his wife, his daughter and two sons, are with him.

He asks for two witnesses to be present and a video recording made to document his last wishes. When all is ready, he begins to speak.

“My son, Gabe, I want you to take the Ocean Reef houses.”

“My daughter Sarah, you take the apartments between mile markers 100 and Tavernier.”

“My son, Larry, I want you to take the offices over in the Marathon Government Center.”

“Barbra, my dear wife, please take all the residential buildings on the bay side on Blackwater Sound.”

The nurse and witnesses are stunned as they did not realize his extensive holdings, and as Bernie slips away, the nurse says, “Mrs. Pender, your husband must have been such a hard-working man to have accumulated all this property!”

The wife replied, “He has a paper route!”

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 28: LO & mgt. jobs; non-QM product, construction webinar; lender and bank M&A going bonkers

Sorry for the length of the commentary today, but there’s a lot going on. In most of the U.S., the 2019 maximum conforming loan limit for one-unit properties will be $484,350, an increase from $453,100 in 2018. There is more detail below. Although modestly good news for lenders, as noted yesterday, jumbo mortgage rates are very attractive relative to conforming rates in many areas, so some argue the conforming mortgage limit is currently somewhat less meaningful. What is more meaningful, besides the new URLA/1003 coming at us, or the creator of SpongeBob SquarePants passing away, is Amazon. Amazon customers control about 75% of total US household wealth, according to a Bain and Co survey. That’s a lot of leverage and data on buying habits, should it decide to go into the residential biz.

Jobs, promotions, & personnel moves

Verity Search a well-known search firm in the industry, helps lenders procure top notch Managers, Support and Production talent. President Jim Boghos believes times are changing and like lenders, the search firms must also now evolve. “As margin compression has affected the lenders, recruiting firms must also now adapt. Those who don’t will experience a shrinking business. For years lenders have struggled with the risk of paying 3rd party recruitment fees. Announcing POP, (Partner Origination Platform) by Verity Search. We are proud to offer this cutting-edge concept in mortgage production building.” Recruiter and Lender goals and objectives are aligned. Verity is filling a major gap in the business without charging exorbitant up-front placement fees. This shared risk model has already seen tremendous early success. “POP removes limitations by ensuring the lender investment associated with opening new branches. The failure rate is now all but eliminated. We are rewriting the rules of recruiting engagement. Verity becomes your trusted partner and guarantees your growth”.

 

NBT Bank is searching for a Director of Residential Lending. This is an exciting opportunity to join a growing organization and build out the Residential Lending department. The ideal candidate will be a team player with 10-15 years management experience in mortgage banking and will have successfully led the growth of company. Recently named the Regional Winner for New England in MONEY Magazine’s Best, NBT Bank is a full service community bank approaching $10 billion in assets and operates through a network of more than 150 branches across 6 states in the Northeast. For further confidential questions, please contact AVP Ali Brained.

 

With loan originations forecasted to be lower in 2019 and more pressure on margins, are you looking for a well-respected visionary SVP/C-level banking/mortgage executive with a proven track record to improve overall business results and maximize operational and technology efficiencies? This well-respected business leader has proven expertise across areas of mortgage operations and servicing, technology, risk and vendor management, business strategy, financial analysis and mergers and acquisitions. Please contact me.

What if changing jobs was less stressful? What if you could switch companies and not lose any momentum?  What if you had a team by your side to make every phase of your transition simple and fast. What if moving your business to a Top 10 National Purchase Lender was all it took to achieve your career goals? PrimeLending takes the “what if” out of the equation with first-rate recruiters who make your needs their priority, offering support through every step of the process. You can feel confident making a move with PrimeLending recruiters Peter Briggs and Bobbi Jo Wiggins guiding the way. Peter, who works with Uly Kim in the Southern California and Kelly Lee in Northern California, and Bobbi Jo, who covers South Texas with Joe Thompson and North Texas with Dawn Robinson, are mortgage industry veterans with the expertise, the dedication and the knowledge to make your move to PrimeLending easier than you could ever imagine. If you’re always wondering “what if” about your career, it’s time to connect with Peter or Bobbi Jo today.

Considering a change? At MortgageRight, we set ourselves apart by offering lower rates, better pricing and higher compensation! We’re making a name for ourselves across the nation by operating with thinner margins than other industry players. We saw the rising interest rate environment coming ahead of time and decided in advance to put several key strategic factors into place that would help our producers win in a market like this one! Very simply, we can offer lower rates and/or a higher comp, and we can back our claims up 100%! But don’t take our word for it. Check out this recent example: We recently on-boarded a branch manager who was able to increase his comp by 50BPS AND offer 1/8 better RATE to his customers! Give us the opportunity to show you how our model can help you win more deals in any environment. We’ll be happy to put any candidate in touch with recent hires and existing LOs to discuss our strengths, see what we have to offer, and hear our vision for the future. For a pricing engine walk through, contact Mike Russo (866-425-5456) or visit our website.

Movement Mortgage landed two more top producers this month. Movement announced VA specialist Grant Schneider has joined the company as a Market Leader in Colorado Springs, Colorado. Schneider specializes in serving clients relocating in the Armed Forces, as well as homebuyers of all types in Colorado. In addition, Movement announced Ryan Cotter has joined its growing team in the Midwest as a Market Leader in Chicago. He is a 20-year veteran of the mortgage and real estate industries and most recently managed a captive mortgage referral relationship with a leading Chicago real estate firm where he was also a President’s Club mortgage originator. Click here to learn more about a career at Movement Mortgage.

On Q Financial announced the promotion of Shane Miller, to the role of Senior Vice President – Eastern Divisional Manager. In his new role, Miller will lead the company’s Eastern states through growth and service, as well as expanding On Q into untapped markets.

Valuation Partners announced that Jason Kitch will join its sales team in the Northeast Region as VP, responsible for business development and client services in NY, NJ, PA, DC, MD, DE, CT, RI, MA, VT, NH, MN, and WV. “He has served as an originator, a mortgage insurance account executive and manager, and also spent 10 years as a correspondent representative in the Northeast.”

Congrats to Carolyn Covington has joined Infrrd as the Director of Mortgage Business. Infrrd is the world’s leading provider of Intelligent Data Capture for the Enterprise. “Its proprietary blend AI Enabled Computer Vision, NLP and Predictive Algorithms automate the extraction of structured, unstructured data and image content providing deep insights to guide business decisions and save time for banks, credit unions, as well as any type of mortgage company.”

Lender products and services

Imagine increasing your borrower NPS by 25% in less than two months. That’s exactly what happened for a regional credit union that implemented Maxwell’s digital mortgage point-of-sale solution. Maxwell continues to be the leading digital mortgage solution for small- to mid-size lending teams looking to improve their borrower experience and increase profitability. I’ve seen firsthand the results and impact Maxwell can have across many different organizations, from independent lenders to banks and credit unions. Their platform enables teams to easily launch an all l-encompassing digital experience to their borrowers, while providing industry leading tools and integrations to help improve loan officer efficiency across the organization. To learn more about Maxwell visit www.himaxwell.com or request a demo here.

Here’s a webinar on “Construction Lending in the Age of TRID: A Community Banker’s Guide.” TRID has been a complicated and sometimes confusing force in lending since it was brought into effect in 2015. Understandably, the assumptions and concerns regarding workload increases and new requirements under TRID have led some community bankers to forgo construction lending altogether. On November 29 at 10AM PST, join Land Gorilla to understand the history, myths, and realities regarding TRID, find the impact it’s had on community banks regarding construction lending, and learn how to leverage technology to overcome any possible hurdles in this new age of lending. Register today!

ARMCO Boosts QC Process Efficiency and Security with Latest ACES Upgrade – Single sign-on supports company’s strategy to best support enterprise-level customers – ACES Risk Management (ARMCO), the leading provider of enterprise financial risk management solutions, has announced new product enhancements that increase QC process efficiency and security for lenders and servicers using its auditing platform ACES Audit Technology™. The top features of this upgrade include the addition of single sign-on capability, and integration with DataVerify. Access the full press release.

Deephaven Mortgage, a leading Non-QM lender, shines the light on Non-QM through its loan programs & technology, aimed at making loans responsibly for millions of Americans locked out of the market. The primary mortgage origination market continues to experience challenges in the form of margin compression, low inventory, and declining volumes. Originators are actively evaluating the introduction of Non-QM products to help offset some of the current market dynamics. Deephaven continually evaluates its products knowing the target market is significant. Studies show 16+M self-employed Americans (Bank Statement Loans), 83M Millennials (Non-Warrantable Condos), 75M Baby Boomers (Asset Depletion), and 57M Americans earned more in 17′ than 16′ (1 Year Alt Doc), and these are just a few underserved segments that represent a significant opportunity for originators. To find out more about how Non-QM can grow your business, contact Deephaven Wholesale or Deephaven Correspondent. (Sources: Bureau of Labor Statistics, CNN.)

“Here’s a hi-tech breakthrough in lending to self-employed borrowers. Amidst rising interest rates and declining origination volume, lenders must cast a wider net for customers, a growing number of which are self-employed. To capitalize on this trend, lenders need a simpler, faster way to underwrite mortgages for Americans who are their own bosses. To this end, Freddie Mac has integrated fintech vendor LoanBeam’s technology with Loan Product Advisor®, our automated underwriting system, to introduce the first and only integrated self-employment income solution for the market. LoanBeam’s software uses optical character recognition technology to extract and digest a borrower’s tax returns and other financials, and then calculate a total income figure that aligns with Freddie Mac’s guidelines. This integration offers lenders several advantages, including an automated review of the accuracy of qualifying income, eliminating the need to chase down unnecessary documents that support residual/excess income and certainty that the income calculation is eligible for representation and warranty relief.” Learn more.

Non-depository and depository M&A news

Just to clarify on yesterday’s announcement of the sale of Leader Mortgage to Firstar Bank – this is not the same Leader Mortgage that is a division of Leader Bank, which is a roughly $2 billion mortgage lender in the greater Boston area.

Guaranteed Rate announced that it will acquire certain assets of Honolulu HomeLoans (HHL) and Hawaii Lending Alliance (HLA). G-Rate will license new branch locations in downtown Honolulu and several other locations and maintain its existing branch locations in Honolulu and Aiea. “I am thrilled that Honolulu HomeLoans and Hawaii Lending Alliance are becoming part of Guaranteed Rate,” said former HHL President and CEO Anders Hostelley, who joins Guaranteed Rate as a Regional Manager, continuing to lead that business unit. “Many of the former HHL/HLA loan officers joining Guaranteed Rate are fluent in international languages including, Vietnamese, Ilocano and Tagalog.”

Depository banks are out of control! The M&A in the last four weeks has continued unabated. During this time it was announced that…

Florida’s CenterState Bank Corp. (Nasdaq-GS: CSFL) will acquire Birmingham, Ala.’s, National Commerce Corp. (Nasdaq: NCOM) in a $850 million combination, creating a Southeastern regional bank with branches in Florida, Georgia and Alabama and combined deposits of $12.8 billion.

Simmons Bank ($16B, AR) will acquire Reliance Bank ($1.5B, MO) for $62.7mm in cash (37%) and 4mm shares of stock (63%) or about 1.59x tangible book. Silicon Valley Bank ($55B, CA) will acquire investment bank Leerink Partners (MA) for $280mm in up-front cash and $60mm to be paid over 5 years. BancorpSouth Bank ($17B, MS) will acquire both Grand Bank of Texas ($345mm, TX) for about $51.75mm in cash (21%) and stock (79%) and Merchants Bank ($221mm, AL) for about $37.5mm in cash (21%) and stock (79%). This is an aggregate price to tangible book of about 1.65x. Advia credit union ($1.7B, MI) will acquire Golden Eagle Community Bank ($150mm, IL). BankFirst Financial Services ($974mm, MS) will acquire FNB Of Central Alabama ($271mm, AL). In Tennessee FirstBank ($5B) will acquire 11 TN and 3 GA branches from Atlantic Capital Bank ($2.7B) for a 6.25% deposit premium and a 0.68% discount on purchased loans. The branches hold $602mm in deposits and $381mm in loans. In Kansas Guaranty State Bank and Trust Co ($273mm) will acquire The Jamestown State Bank ($17mm).

In Texas Amarillo National Bank ($4.1B) will acquire Lubbock National Bank ($1.1B), and American Momentum Bank ($1.1B) will acquire Commercial State Bank ($676mm). In Illinois Heartland Bank and Trust Co ($2.9B) will acquire State Bank of Lincoln ($345mm), and Byline Bank ($4.8B) will acquire Community Bank of Oak Park River Forest ($326mm) for $42mm in cash (16.5%) and stock (83.5%) or 1.65x tangible book. First Midwest Bank ($14.8B, IL) will acquire wealth management investment advisor Northern Oak Wealth Management Inc. (WI). The First ($2.5B, MS) will acquire Florida Parishes Bank ($382mm, LA) for $86.1mm in stock (100%) or about 1.90x tangible book. In Massachusetts North Easton Savings Bank ($553mm) will merge with Mutual Bank ($518mm). Peoples Bank ($4.0B, OH) will acquire The First Commonwealth Bank of Prestonsburg, Inc. ($311mm, KY) for $45.4mm in cash and stock or about 1.98x tangible book. Evansville Teachers FCU ($1.5B, IN) will acquire American Founders Bank, Inc. ($88mm, KY). Citizens Bank ($124B, RI) will acquire wealth management firm Clarfeld Financial Advisors LLC. In Iowa Fidelity Bank & Trust ($816mm) will acquire State Bank ($378mm). Enterprise Bank & Trust ($5.5B, MO) will acquire Los Alamos National Bank ($1.3B, NM) for $213mm in cash (18%) and stock (82%) or 2.02x tangible book. In Nebraska Heartland Bank ($442mm) will acquire both Jefferson County Bank ($42mm) and The First National Bank of Fairbury ($144mm. In Indiana Horizon Bank ($4.1B) will acquire Salin Bank and Trust Co ($918mm) for $135.3mm in cash (18%) and stock (82%) or about 1.62x tangible book. Peoples Bank ($4.0B, OH) will acquire The First Commonwealth Bank of Prestonsburg, Inc. ($311mm, KY) for $45.4mm in cash (25%) and stock (75%) or 1.98x tangible book.

Orrstown Bank ($1.6B, PA) will acquire Hamilton Bank ($525mm, MD) for $58.5mm in cash and stock or 1.31x tangible book. Software company Kony will acquire the innovation unit of Umpqua Bank ($26B, OR) known as Pivotus. (Pivotus is a software-as-a-service company that connects customers with their financial institution through a personal banker where they can communicate via voice, video and text chat.) In New Jersey OceanFirst Bank ($7.8B) will acquire Capital Bank of New Jersey ($483mm) for $80mm in stock (100%) or about 1.73x tangible book. Blackhawk Bank ($772mm, WI) will acquire The First National Bank of McHenry ($175mm, IL) for $23mm in cash (100%). In South Dakota First Savings Bank ($740mm) will acquire The Roberts County National Bank of Sisseton ($54mm).

Conventional conforming loan limits

FHFA, which overseas, uh, oversees Freddie and Fannie, announced an increase to the maximum conforming loan limits for single-family mortgages eligible to be acquired by Fannie Mae and Freddie Mac in 2019 to $484,350 from $453,100. This reflects the average increase in FHFA’s House Price Index (HPI) of 6.9% since 3Q17. The maximum for high-cost areas increased by the same percentage, to $726,525. (High cost areas are defined as those where 115% of the local median home value exceeds the baseline loan limit. The cap is set at 150% of the baseline loan limit.) After holding flat starting in 2006, conforming loan limits have now increased three years in a row. Officially the new cap becomes effective in 2019, but some lenders are jumping the gun.

Does this help private MI companies? Not so much, since the industry average home price is closer to $250,000.

Capital markets

The U.S. 10-year closed Tuesday at 3.06%, where it began the week, on another day that lacked any market-moving news. And Donald Trump talking trash about the Federal Reserve doesn’t count. The only news of note was a report President Trump is expected to meet with China’s President Xi Jinping over dinner on December 1. (Trump has said he expects to raise more tariffs on China – that should help the digestion.) As far as economic releases went, the Conference Board’s Consumer Confidence Index dipped slightly in November, though the previous mark from October was the highest reading since 2000. In housing, the Case-Shiller 20-City Index rose 5.1% in September on top of last month’s 5.5% increase while the FHFA Housing Price Index for September increased 0.2% on top of last month’s increase of 0.4%.

 

This morning we learned that MBA mortgage applications for Thanksgiving week were +5.5%, refis less than 38%. Next up was the 2nd update on Q3 GDP (expected to downtick to 3.3% from 3.5%, it was unrevised at 3.5% with final sales also falling 0.2% to 1.2%). The advance trade deficit widened $1 billion, and wholesale inventories rose. Ahead are October new home sales and the Richmond Fed’s manufacturing and services indices. We also have some Fed speak, with Fed Chair Powell speaking on “The Federal Reserve’s Framework for Monitoring Financial Stability” at noon. Today begins with the 10-year yielding 3.06% and Agency MBS prices nearly unchanged.

“I saw a documentary on how ships are kept together. Riveting.”

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 27: AE & LO jobs; sales, branding, non-QM products; “don’t fight the Fed” when it comes to rates

Will today or tomorrow bring the 2019 Freddie and Fannie loan limit change announcement? Stay tuned, as it usually released soon after Thanksgiving. Is it arguably less impactful since many jumbo programs have lower rates than conventional conforming products since they don’t have guarantee fees, fit nicely into some portfolios, and have lower compliance costs to originate. One thing is clear: lender M&A continues. For example, yesterday we learned that Firstar Bank has reached an agreement to acquire the assets of Leader Mortgage. And unlike GM’s plans to “idle” five factories in North America and cut some 14,000 jobs, lenders are hiring:

Mortgage Employment

The Correspondent Lending team at Caliber Home Loans, Inc. has partnered with BlitzDocs to provide a seamless integration for mutual customers. This solution removes the manual loan package delivery process and delivering it directly from Blitzdocs to Caliber. Earlier this year, Caliber’s correspondent sales channel was ranked 2nd by Scotsman Guide among all correspondent lenders nationwide. In addition to new technology that streamlines the loan process for its clients, Caliber Correspondent also has a proprietary suite of non-Agency products called Portfolio Loans which allow its lenders to provide home financing solutions to more eligible borrowers. The newest of these products is Elite Access, which offers up to $3 million, 90% loan-to-value, and no mortgage insurance.

CFBank, Ohio (lending in all 50 States) is now building its retail footprint nationwide. After selling his company, Smarter Mortgages in 2015, John Fearon is now heading up CFBank’s residential mortgage division. “My seasoned team, including five nationally ranked originators, has built the infrastructure and put the support team in place to begin our nationwide expansion. We have implemented our Close Fast Technology to enable top loan officers to focus on growing their business versus chasing down paperwork.” If you are a seasoned loan officer, team leader, or company owner looking for new opportunity, contact John Fearon directly to customize your next chapter in mortgage lending.

How do you say “bucket-list experience” in Spanish? Academy Mortgage’s President’s Club can check Barcelona, Spain, off their lists after their recent return from the company’s Sales Conference in the magical Mediterranean city. From mountain tops to tapas, Academy’s highest producers in 2017 were rewarded with all that Barcelona had to offer through walking tours to learn about the city’s unique architecture and history, taking in the spectacular view from the top of the Hotel Arts, and dining in the finest restaurants. Watch these adventures! The Sales Conference attendees also had the chance to relax, recharge, and reconnect with fellow team members, as is typical of an Academy Sales Conference. More than 100 originators and managers—a record high—qualified for Academy’s President’s Club in 2017Candidates interested in seeing the world with Academy should contact Chad Melin, VP of National Business Development.

Fidelity Bank Mortgage is headquartered in Atlanta, Georgia with Retail Mortgage production offices throughout the Mid-Atlantic and Southeast. Since 2008, the Mortgage division has grown to over 36 offices and over 500 employees. Fidelity Bank Mortgage is a Fannie Mae, Freddie Mac and Ginnie Mae seller/servicer offering specialty products such as Portfolio Doctor Loans for eligible doctors, Construction-to-Permanent Loans, Escrow Holdback, and more. The majority of our operational support is in the local markets, providing for the best possible customer service. Fidelity Bank Mortgage has one of the highest production averages per Loan Officer according to MBA/STRATMOR Peer Group Surveys and boasts well above average Performance and Loan Officer Loyalty. We are expanding into new markets and interested in Top Sales and Leadership Talent. Click here to contact David Rapson, Senior Vice President, Mortgage Production Manager, and view our eBook to learn more about our team.

 

“Do you produce over $1 million a month in volume? You might be leaving over $200k on the table every year. Why not take that home? Here’s how… There are too many people between you and your commissions, aka middle management. How much money do you lose on every deal because you’re paying for the salaries for multiple layers of middle management? If you want more money, cut the fat and increase your take home! Here’s a solution for you – Canopy Mortgage – a flat organization that isn’t burdened with ‘legacy-costs’ that means fewer people between you and your commissions. Canopy is now hiring a National base of seasoned LOs. Reach out to Josh Neumarker, Director of Business Development at Canopy Mortgage (888-696-9076).

 

Primed to continue to break origination records in Q4, the leader in non-QM Angel Oak Mortgage Solutions announced its largest class of new account executives, adding 11 in November to teach brokers and correspondents about growing their business with non-QM. Adding additional coverage across the country, Michael Hooven came on-board in Philadelphia, William Reed in Milwaukee, Dudley Delbridge in the Richmond/Virginia Beach area, Jim McMillan in Northern New Jersey, Jodi Favish in Pittsburgh, Anna Prince in Orlando, Randy Rees in Cleveland, Suzanne Perez in Los Angeles and Tony Zodrow in Minneapolis with Damien Pippens and Andres Bernal in Inside Sales. And AOMS is just getting started, looking for new Account Executives in markets across the country. Why work with anyone but the best? To learn more, view the latest job openings on the Careers Page or email Regional Sales Manager, John Wise.

 

Lender products and services

Ethos Lending is being called “the best mortgage company that no one has heard about!” With its top 3 price, 18-day fundings, and state of the art proprietary technology, Ethos Lending customers are raving about how valuable it is in helping borrowers “stick” with them. For that reason, Ethos’ growth is unprecedented in these current market conditions. While the majority of wholesale companies have been laying off and restructuring, Ethos Lending has continually increased its sales force month-over-month. In addition, Ethos has added a full suite of Non-QM products with features like, Bank Statements, Non-Warrantable Condos, Asset Depletion, Interest Only, Cash in hand up to $1MM on Investment, 90% purchase and refinances up to $3MM, and many others. “Ethos Lending’s world-class sales team is backed by a world-class Ops team with tenured industry veterans who are happy to talk to their customers.” If you feel like you need an edge to compete, contact Bryson Bede to find the sales representative in your area.

This holiday season, TMS is putting the CARE in CAREspondent Lending. For every new lender that partners with TMS before the end of the year, they will donate $250 to Family Reach —a national non-profit dedicated to alleviating the financial burden of cancer. You can sign up here.

“How to Build a Non-QM Focused Origination Business” which takes place on Thursday, November 29 at 2:00 PM EST and is sponsored and presented by Deephaven Mortgage. Attendees will walk away from this webinar with a clear business case on why they should be originating Non-QM loans and of even more importance, how to build a business with Non-QM as a focal point. In this 60-minute webinar we will cover the state of the non-QM market, show you how to source AND CLOSE non-QM loans and more. Reserve your seat on this free webinar here.

Today’s tech-savvy home buyers are online and mobile, and if your digital mortgage platform doesn’t provide the comprehensive home buying experience they demand, you’re at risk. For years, HomeScout® has helped lenders by providing a consumer facing experience where buyers can shop for a home and a loan in a single location, while the lender is exclusively branded on every screen. Considering that 100% of all purchase transactions require a house, lenders need a real estate search option for leads and preapproved customers, or risk losing them to online portals that advertise the competition. HomeScout offers an online experience that gives lenders control over more transactions by providing real-time loan pricing for every MLS listing to help prevent borrower rate shopping and give them the confidence to make a purchase decision. Find out more by contacting them HERE and scheduling a demo or give them a call at 952-831-0623.

Are you ELITE? Todd Duncan’s 2019 ELITE Membership Group is now open for enrollment. This one-year program is the most progressive, unique, mentoring, masterminding, and learning program available in the mortgage business today! Membership includes monthly mentoring sessions with Todd Duncan, your own personal, high-performance ELITE Coach, your own private Board of Advisors, best-practices Webinars, Two Mastermind Retreats, and access to every fellow member to brainstorm ideas, seek guidance around important decisions and implement key strategies for your business and life. If selected, you will join the most exclusive coaching experience in the mortgage industry! Are you prepared to make 2019 your best year ever? Apply to Todd Duncan’s ELITE today! Membership is limited to 24 qualified and vetted applicants.

Digital transformation is changing the elements that give your organization a competitive edge in an age of unprecedented change: your people, your processes, your technology and your brand. By driving transformation efforts through process-centric digital technologies, companies can transform their operations to be nimbler and more competitive. Level up your technology and ensure your tech stack works together. Understand how your customers feel when they interact with your brand at every touchpoint. What set you apart five years ago is no longer enough. Surviving – thriving – depends on your ability to serve your customers in a way that is unique, authentic and memorable. Read the Total Expert blog: Four Things That Will Set You Apart from Your Competitors.

“Here’s a hi-tech breakthrough in lending to self-employed borrowers. Amidst rising interest rates and declining origination volume, lenders must cast a wider net for customers, a growing number of which are self-employed. To capitalize on this trend, lenders need a simpler, faster way to underwrite mortgages for Americans who are their own bosses. To this end, Freddie Mac has integrated fintech vendor LoanBeam’s technology with Loan Product Advisor®, our automated underwriting system, to introduce the first and only integrated self-employment income solution for the market. LoanBeam’s software uses optical character recognition technology to extract and digest a borrower’s tax returns and other financials, and then calculate a total income figure that aligns with Freddie Mac’s guidelines. This integration offers lenders several advantages, including an automated review of the accuracy of qualifying income, eliminating the need to chase down unnecessary documents that support residual/excess income and certainty that the income calculation is eligible for representation and warranty relief. Learn more.

Capital markets

There’s no reason to pay anyone to predict interest rates for you – all we have to do is listen to the Federal Reserve! Goldman Sachs economists say the Federal Reserve’s anticipated rate increase of 1% or less over the next year would have a relatively small effect on the US economy, while an unexpected hike of 1.5% would likely send Treasury yields up and cause equity-market losses. Their analysis sets the risk of recession in the next two years at 26%.

But let’s take a brief step back to late September. The FOMC increased the Fed Funds target by 25bps as widely expected. In the statement announcing its decision it removed language asserting the policies were accommodative, a signal that the current policy has moved into neutral territory. The updated “dot plot” forecasts re-affirmed another rate increase is expected in December as the Fed views the economy and labor markets are strong and inflationary pressures are on target.

(Recall at that time data that was released supported the Fed’s optimistic view of the economy. The consumer confidence index neared an all-time high at 138.4 in September and personal income and wages also both increased as the tight labor market appears to be driving income growth. New home sales rose in August 3.5 percent after declining for a few months but affordability remains a concern in the wake of rising prices and mortgage rates. These two factors remain headwinds to future home sales growth in the coming months.)

Moving to November’s meeting, to no one’s surprise the FOMC voted unanimously to leave the fed funds target at 2.00% – 2.25%. The policy statement following the meeting offered little changes from the September meeting as the committee’s evaluation of the economy remained positive. With continued strong job growth and inflation at the Fed’s target, the committee expressed their expectations for further gradual increases in the target range for the federal funds rate. The markets expect the next rate increase following the December FOMC meeting and are mixed as to the number of increases expected in 2019. (The news was overshadowed as the election was the main focus but results were largely in line with expectations of a divided government. While sweeping changes are less likely following the election, the possibility remains for some bipartisan cooperation surrounding long discussed infrastructure spending rather than simply gridlock leading up to the 2020 elections.)

In fact, looking ahead to next month’s Federal Open Market Committee meeting, 100% of economists surveyed by the Wall Street Journal expect the Fed to raise interest rates by 25bp. The median of this group projects 3 more rate hikes in 2019.

You want transparency? Fed San Francisco President Daly said she favors continuing to gradually raise interest rates given a very favorable economy. A strong labor market, high consumer confidence and healthy business and household balance sheets were all reasons cited. Fed Chair Powell said he is “very happy about the state of the (US) economy” and he expects it to continue. He also indicated that rising signs of a global economic deceleration are “concerning”. Fed Vice Chair Clarida gave his first policy speech and in it said more interest rate hikes are likely coming. He indicated the economy is growing stronger and said the structural unemployment rate is lower than expected.

The U.S. 10-year began the week +2bps to 3.07% on a snoozer of a day as far as markets were concerned. As was the case towards the tail-end of last week, any news of note seems to be coming internationally. Italian officials have reportedly indicated willingness to lower next year’s deficit target, though Italy’s Deputy Prime Minister Matteo Salvini did say over the weekend he would bring down the government if the deficit target is changed. Deputy Prime Minister Luigi Di Maio said that a lower budget deficit would not be a problem if budget measures remain unchanged. And separately, EU leaders approved the Brexit withdrawal bill, but it is uncertain if the bill will make it through the British parliament. British Prime Minister Theresa May warned that there is no better deal available.

 

Today’s economic calendar kicks off with Fed Vice Chair Clarida speaking before the Clearing House 2018 Annual Conference in New York at 8:30AM ET. We then receive Redbook same-store sales for the week ending November 24 half an hour later (previously 0.2% MoM, 6.2% YoY). We will see updates on September home prices from both the FHFA and Case-Shiller. November consumer confidence is next and is expected to decline. The Dallas Fed Texas Services Index for November will be released at 10:30AM. Finally, at 2:30PM we have some Fed speak, with Chicago’s Evans, Atlanta’s Bostic, and Kansas City’s George all participating in a panel at the same conference that Vice Chair Clarida is attending. We begin Tuesday with Agency MBS prices “un-budged” from last night’s close and the 10-year yielding 3.05%.

Want a short visual of the role of an experienced loan originator? Here you go (the guy on the right).

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 26: LO & sales jobs; platform, origination, non-QM, LO products; U.S. economy continues to motor along

I want a free vacation! I want a free fancy car in the garage in my newly-built McMansion! Apparently, due to sagging sales, with some builders I can indeed have those things, and more. Builders in many locales are proving that, regardless of which administration is in power, or who takes credit for some aspect of the economy doing well, business cycles are a fact of life. Lenders know a lot about business cycles, and the number of nonbank mortgage lenders was down by about 3.5% at midyear from the end of 2017, according to the Conference of State Bank Supervisors. (Speaking of “wants,” if you want an “Air Selfie” for Christmas, aka mini-drone, here you go.)

Employment & personnel moves

National MI is excited to share that “we continue with our growth and have added a Sales Representative in Minneapolis. Trevor Enroth joins us in the Minnesota and North Dakota markets and will be partnering with Justin Putz, Regional Team Lead. Trevor has been in the mortgage industry for five years and is an exciting new addition to our team.” Please feel free to reach to Trevor via email or phone at 952-465-7171.

More sales. More revenue. More opportunity. Faster. One of the top mortgage lenders in the nation, Homeside, is launching Rev by Homeside, a net-branching experience built specifically for top-ranking lending teams. Unlike traditional net branching, Rev offers more territory (strategic locations selected, no market overcrowding), more independence

(streamlined corporate involvement, DBAs available), more support (marketing, IT, HR, payroll, licensing, compliance, legal, audits, etc.) and more profit (full control of P&L, pay only for services used). Lending teams interested in joining Rev by Homeside should contact Co-Founder & Managing Partner, Chris Miller.

Building an inclusive and thriving workplace. Evergreen Home Loans™ celebrates women in the workplace and is proud to be named the #3 Best Workplace™ for women in 2018

by Fortune and consulting firm Great Place to Work. 72% of its associates are women, including 50% of the executive team. “Evergreen is committed to continually supporting and encouraging diversity in the workplace, believing that when we treat everyone like family that sense of care and respect radiates to our customers and business partners. ‘It is an honor to be recognized for upholding a strong culture that supports, inspires and empowers women as we strive to be the best place to work in the nation,’ said Don Burton, president, Evergreen Home Loans. Loan officers seeking a great place to work where 96% of employees surveyed are proud to tell others they work here, can find more information on its careers page.

Nations Lending is welcoming a new member to its team, Derek DeGutis, as Division Retail Sales Manager. DeGutis brings more than two decades of experience in mortgage lending and is a proven motivated leader. DeGutis will be laser-focused on making Nations Lending a household name and expanding our market-reach throughout the country. “From the East to West coasts, Nations Lending continues to expand its retail footprint with more opportunities available to high-performing, ready-to-make it happen originators. Ideal candidates for our

Branch Manager will have at least 2 years’ experience as an LO, and ready to roll as a top player in this strategic initiative. Nations Lending, is an Ohio-based, full-service national lender licensed in 47 states. If interested, contact Division Retail Store Sales Manager, Jordan Gerard (337-501-0155) or Division Retail Branch Sales Manager, Derek DeGutis (732-580-5038). For more information and opportunity on how to join our growing organization, please visit the company’s website.

 

“Due to growth, SocialSurvey is looking for Regional VPs of Business Development to open our Southwest, Midwest, and Southeast regions. Candidates must have proven success selling tech or services into the mortgage vertical. SocialSurvey, known for its mortgage reviews platform, now offers social media compliance monitoring as a part of our integrated platform. We create over 600,000 verified mortgage company reviews annually and share those reviews more than 4,000,000 times on social sites, Zillow, and Google to help boost online reputation. Social Survey also acts as a powerful enterprise feedback tool that drives employee engagement and behavior. This is a great opportunity for somebody with the right experience and contacts. Are you ready for something different?” Send confidential resume and contact info to me for forwarding.

Ocwen announced that Timothy Yanoti has joined as EVP and Chief Growth Officer, responsible for leading Ocwen’s lending business and operations, including forward and reverse mortgage lending, MSR purchases and servicing business development efforts. Ocwen also appointed Albert Celini SVP, Chief Risk and Compliance Officer of Ocwen.

Lender products and services

“Lendsnap is the favorite Digital Mortgage app for non-QM Lenders. Our partners close more loans faster because they can pull up to 24 months of original bank and investment statement PDFs. While other lenders and brokers make the customer work too hard, you will have the decisive advantage. When your customers don’t have to manually download and update statements, you will get clear to close in days instead of weeks. Get started right away with our simple yet powerful system that can make every member of your loan manufacturing team more productive. All this functionality is built in to our SOC2-audited platform with no hidden fees or setup charges. Lendsnap replaces many services you pay for separately today and drops in to your workflow easily. Request a free consultation today and go Digital with Lendsnap.”

Interested in offering your customers new products? You may have heard of the “bank statement program” and while that is true, Sierra Pacific Mortgage’s Sierra Access and Sierra Core has much more to offer, including 1-year express tax returns and a full doc option. Join Sierra Pacific’s free webinar on December 4, at 10AM PDT and you will learn how these programs can increase your business, why your borrower needs them, which product is the better choice for your scenario, and how to calculate the income.

Trelix is offering simplified mortgage originations. Trelix offers an industry-leading suite of fulfillment, quality control and due diligence products and services that can help you manage risk and lower costs in a complex industry. If your goal is to grow quickly, dramatically lower costs, and attract top producing loan officers, the Trelix end-to-end solution is perfect for your business. Lenders who utilize our end-to-end services experience up to 40% reductions in manufacturing costs while helping to significantly improve the borrower experience.” To learn more, connect with Justin Vedder.

“Here’s a hi-tech breakthrough in lending to self-employed borrowers. Amidst rising interest rates and declining origination volume, lenders must cast a wider net for customers, a growing number of which are self-employed. To capitalize on this trend, lenders need a simpler, faster way to underwrite mortgages for Americans who are their own bosses. To this end, Freddie Mac has integrated fintech vendor LoanBeam’s technology with Loan Product Advisor®, our automated underwriting system, to introduce the first and only integrated self-employment income solution for the market. LoanBeam’s software uses optical character recognition technology to extract and digest a borrower’s tax returns and other financials, and then calculate a total income figure that aligns with Freddie Mac’s guidelines. This integration offers lenders several advantages, including an automated review of the accuracy of qualifying income, eliminating the need to chase down unnecessary documents that support residual/excess income and certainty that the income calculation is eligible for representation and warranty relief. Learn more.

Want to start a wholesale channel? Do it on the fly for a fraction of the cost of fancy, heavy, “legacy” platforms with ReadyPrice. The ReadyPrice RETAIL AND WHOLESALE enterprise-strength LOS with an embedded multi-investor PPE and proprietary error trapping tech is the answer in all market conditions. The ReadyPrice all-in-one RETAIL AND WHOLESALE

platforms come fully configured, are up to 75% less expensive than heavy, “mature” systems, have D1C & deep Fannie DU integrations and can be stood-up in a couple of weeks. Or, you can easily customize / configure her. The ReadyPrice LOS/PPE has funded over 300k units for $70 BILLION and is leading the way forward to “utilitize” mortgage tech for today’s mortgage bankers. Call them at (408) 357–0931 or email hello@readyprice.com to get a free demo today.

Today’s tech-savvy home buyers are online and mobile, and if your digital mortgage platform doesn’t provide the comprehensive home buying experience they demand, you’re at risk. For years, HomeScout® has helped lenders by providing a consumer facing experience where buyers can shop for a home and a loan in a single location, while the lender is exclusively branded on every screen. Considering that 100% of all purchase transactions require a house, lenders need a real estate search option for leads and preapproved customers, or risk losing them to online portals that advertise the competition. HomeScout offers an online experience that gives lenders control over more transactions by providing real-time loan pricing for every MLS listing to help prevent borrower rate shopping and give them the confidence to make a purchase decision. Find out more by contacting them HERE  and scheduling a demo or give them a call at 952-831-0623.

Cyber Security Survey – Enter to win $50 Amazon Gift Card. Vendorly is constantly looking to provide meaningful solutions to address existing and emerging risks in third-party risk management. Over the last several years, the risk has shifted to cyber security. Please consider completing this 1-minute survey to provide your perspective on what is needed in the marketplace to mitigate the information security risk inherent in working with third-party vendors. Enter to win a $50 Amazon gift card!

Capital markets

Loan officers often wonder what pushes rates in the United States. Gross Domestic Product helps do that. Recall that real GDP beat market expectations of +3.3 percent and increased at a 3.5 percent annualize rate in the advanced estimate for the third quarter. Once again, the driver is consumer spending, which increased 4.0 percent and outpaced the second quarter’s 3.8 percent showing. Government spending jumped 3.3 percent in the quarter, the strongest rate of growth in more than two years. Business investment has slowed significantly from earlier in the year suggesting that stimulative effects of this year’s corporate tax cuts may be wearing off. Another negative component of the report was trade as net exports increased by $99.0 billion in the third quarter and was pulled the top line GDP number down by 1.8 percentage points. Elsewhere, housing data continued to show weakness as new home sales declined 5.5 percent and have now fallen five of the last six months. New home inventories rose to 7.1 months’ supply, the highest since 2011.

Jobs also move rates. Remember that unemployment was unchanged in October at 3.7 percent as the economy added 250,000 jobs and labor force participation increased to 62.9 percent. Wages inched up 0.2 percent in September and real disposable income was up 0.1 percent, the lowest gain since April. Despite the low increase in income, consumer spending increased by 0.3 percent and the personal saving rate declined to 6.2 percent. A strong US dollar will keep pressure on the US trade gap which widened in September to -$54 billion. One of the soft spots in last week’s data was the ISM Manufacturing Index which eased roughly 2 points to a still strong 57.7 in October. 13 of 18 reporting industries expanded during the month. Construction spending was unchanged from August to September but remains up 7.2 percent over the last twelve months. Unemployment claims remain low and were 214,000 for the previous week. Despite softness in a couple of the reports, data from last week still paints a healthy picture of the US economy albeit one that may not be accelerating as quickly as earlier in the year.

The U.S. 10-year closed the Thanksgiving week at 3.06% as markets were forced to turn overseas for any movement of interest. The European Commission announced that an excessive deficit procedure will be opened against Italy, potentially leading to a fine. And British Prime Minister Theresa May met with European Commission President Jean-Claude Juncker in Brussels, but they could not agree on a final version of a Brexit deal.

Today we have a light day with only Chicago Fed activity and Dallas Fed Manufacturing activity – neither big market movers. Things pick up tomorrow with the September FHFA Home Price Index and the Q3 House Price Purchase Index at the same time as CoreLogic data, 9:00 am ET. We then have Conference Board Consumer Confidence figures for November before Wednesday sees the usual MBA Mortgage Application data, Retail and Wholesale Inventories, Q3 GDP data, and the Richmond Fed Manufacturing Index before a busy Thursday and Friday. Monday begins with rates little changed versus Friday: the 10-year is yielding 3.06% and Agency MBS prices aren’t doing much of anything.

(Thanks to Stephen S. for this one.)

A boy was assigned a paper on childbirth and asked his parents, “How was I born?”
“Well, Honey…” said the boy’s mom, “the stork brought you to us.”
“Oh,” said the boy. “Well, how did you and daddy get born?” he asked.
“Oh, the stork brought us too,” chimed in the dad.
“Well how were grandpa and grandma born?” he persisted.
“Well darling, the stork brought them too!” said the mom, by now starting to squirm a little in the Lazy Boy recliner.
Several days later, the boy handed in his paper to the teacher who read with confusion the opening sentence: “This report has been very difficult to write because there hasn’t been a natural childbirth in my family for three generations.”

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 17: The housing market with 5% rates; blockchain update; Grandma’s Thanksgiving letter

The economy is like the weather, with everyone talking about it but there is nothing we can do about it. Some believe that growth will continue and rates will continue higher. Other aren’t so sure. (Thanks to California’s Steve A. who sent this note about Home Depot’s warning of a slow down ahead.) Sure, people in their 20s and 30s have heard about 3.5% mortgage rates for quite some time, but we’re in a different environment, and plenty of folks in our biz started their careers when rates were in the teens. Although not always easy when an LO is dealing with a hesitant borrower, it helps to keep rates’ impact on the housing market in perspective.

With that in mind, Mark Fleming, Chief Economist with First American Financial Corporation, wrote a piece that I received in my email titled, “Why the Housing Market Can Thrive at 5 Percent Mortgage Rates.” “(Recently) the 30-year, fixed mortgage rate hit a seven-and-a-half-year high of 4.86 percent. Most experts believe mortgage rates will continue to rise, reaching 5 percent in 2019. Despite all the talk about rising mortgage rates, it’s important to evaluate this in context. While today’s rates appear higher than the 3 to 3.5 percent rates of 2016, they remain well below the historic average of 8 percent. Yet, the increase in borrowing costs for home buyers, given increasing home prices, has prompted discussion about how the housing market will respond to higher rates.

“Title agents and real estate professionals surveyed by First American believe that the housing market is fairly resilient to rising rates. For example, earlier this year, we asked title agents and real estate professionals what mortgage rates would need to hit before discouraging potential first-time buyers from the market. Their estimate: 5.6 percent. When we asked the same question in the first quarter of 2017, the response was 5.4 percent.

“Historically, mortgage rates have exceeded these thresholds and people have still purchased homes, so what can we expect as rates continue to rise in the near term?

“The history of mortgage rates may provide some insight. We examined mortgage rates and economic history over the last four decades, and identified four distinct mortgage rate eras that may offer helpful context for today’s home buyers.

The 1980s: The Federal Reserve’s War on Inflation. It’s almost unimaginable for today’s buyers, but home buyers in 1981 were faced with 30-year, fixed-rate mortgages at over 18 percent.  Rates declined from the 1981 high point, leveling to around 10 percent at the end of the decade. At the time, the Federal Reserve, under Chairman Paul Volcker, was waging a war on inflation. In an effort to tame double-digit inflation, the Federal Reserve drove interest rates higher. The Fed raises rates in a strong economy to encourage sustainable economic growth, and cuts rates when the economy needs support. Today, the economy is strong – unemployment is low, inflation is on target, consumer confidence is high, and wages are rising. To promote further sustainable economic growth, the Federal Reserve today is increasing interest rates.

1990s and Early 2000s: The Information Boom. In the 1990s, inflation calmed down. Mortgage rates tend to follow the same path as long-term bond yields. Rising inflation will push up long-term bond yields to compensate investors for the higher level of inflation, and mortgage rates typically follow suit. The 30-year, fixed mortgage rate averaged 8.4 percent through most of the 1990s, before dipping below 7 percent in 1998.

“A major reason for the decline in inflation was strong economic growth due to the arrival of the internet and information technologies, which prompted corporate capital investment, enhanced productivity and spawned investment in new internet-based ‘Dot Com’ businesses. In the early 2000’s, after the ‘Dot Com’ stock market bubble burst and sparked a mild recession, the Fed lowered interest rates further. The 30-year, fixed-mortgage rate reached what was then a historic low point – below 6 percent in 2003.

2006-2008: Housing Bubble and Bust. House prices always went up, nationally, until they didn’t. The collapse of the housing bubble exposed the financial system’s excessive leverage, contributing to the financial crisis and the Great Recession. To combat the crisis, the Federal Reserve cut interest rates as much as possible and implemented an unprecedented monetary stimulus policy known as quantitative easing (increasing the money supply by buying government and mortgage bonds). With that, a new era of cheap credit was upon us. As a result, mortgage rates fell below 5 percent in 2009, a level the housing market had not experienced in more than 50 years.

2010-Present: Recovery. Riding the wave of quantitative easing and the Fed’s continued monetary stimulus, mortgage rates entered this decade at 4.7 percent. By 2012, they had fallen to about 3.5 percent. In 2013, rates increased to nearly 4 percent in response to the Fed’s announcement that it would taper quantitative easing. The ‘taper tantrum’ aside, mortgage rates remained near or below 4 percent until 2016. Since then, the 10-year Treasury yield has risen as the Fed slowly tightened monetary policy, and the economy expanded. The 30-year, fixed-rate mortgage followed suit and increased to the current level of 4.86 percent.

“Today’s Rates May Not be as Great, But They are Still Below Eight. [Catchy Mark!] What is the lesson from this trip through the “mortgage-rate” past? The recent period of mortgage rates between 3 and 3.5 percent is a historic anomaly, as challenging as it might be to believe so after experiencing it for 10 years. Historically, the housing market has performed well when mortgage rates were considerably higher than today. Rates averaged 6 percent between 2001 and 2009. In 2000, they averaged 8.05 percent. In the decade between 1980 and 1990, they averaged a whopping 12.5 percent.

“The key take-away, however, is that people were still buying homes across all of these mortgage rate eras. Mortgage rates have adjusted in the past in response to high inflation, a technological revolution, a housing crisis and a financial collapse. However, today’s higher mortgage rates are due to a near record-long economic expansion, and a strong labor market. If you think 5 percent is high, take a walk down mortgage memory lane.”

Blockchain & IT security

What’s the Saturday commentary without a little blockchain chatter? As a refresher, a blockchain, originally block chain, is a growing list of records, called blocks, which are linked using cryptography. Each block contains a cryptographic hash of the previous block, a time stamp, and transaction data. By design, a blockchain is resistant to modification of the data. Should title companies and MERS be nervous it will replace them? Ask them.

Yesterday the commentary mentioned Equator which has launched a mortgage servicing blockchain solution. Through an agreement with Factom, Inc., the Factom® Harmony blockchain-as-a-service (BaaS) platform is integrated into the Equator® PRO software-as-a-service (SaaS) solution. The addition of Factom’s Harmony provides Equator customers the opportunity to incorporate the recordation of data, documents and key audit events onto Factom’s blockchain solution. Factom’s Harmony provides options for individual loans to be tracked as individual chains of data on the blockchain. This design allows Equator PRO customers the option to embed blockchain preservation into their various workflows, allowing for an immutable and encrypted blockchain audit record to be built for each loan and each workflow step.

In other fields it is making inroads. Stock exchanges are finding innovative ways to harness blockchain to accelerate and improve back-office functions. Swiss exchange owner SIX Group will launch a digital asset-trading platform next year, while Australia’s ASX will introduce a clearing and settlement platform based on blockchain in 2021.

The Financial Times reports that, “The banking sector has seen years of overhype and experimentation surrounding distributed ledger technology, but one project led by JPMorgan Chase, the Interbank Information Network (IIN), is quietly producing results at scale. The IIN is essentially a more efficient way for participating banks to transfer US dollars across borders and institutions. Its elevator pitch is that problematic payments, which are currently being held up for as much as two days for compliance issues or to resolve errors, could go through almost instantly under the new system.”

Did you know that most ATMs can be hacked in under 20 minutes, and even less, in certain types of attacks? Yup. Here’s the actual report.

Grandma’s Invitation

Dear Family,

I’m not dead yet. Thanksgiving is still important to me. If being in my Last Will and Testament is important to you, then you might consider being with me for my favorite holiday.

Dinner is at 2:00

Not 2:15

Not 2:05

Two. 2:00

Arrive late and you get what’s left over. 

Last year, that moron, Ron, fried a turkey in one of those contraptions and practically burned the deck off the house. This year, the only peanut oil used to make the meal will be from the secret scoop of peanut butter I add to the carrot soup.

Daryl, your last new wife is an idiot. You don’t arrive at someone’s house on Thanksgiving needing to use the oven and the stove. Honest to God, I thought you might have learned after two wives – date them longer and save us all the agony of another divorce.

Will, this year, the house rules are slightly different because I have decided that 47% of you don’t know how to take care of nice things. Paper plates and red Solo cups might be bad for the environment, but I’ll be gone soon and that will be your problem to deal with.

House Rules:

1. The University of Texas no longer plays Texas A&M. The television stays off during the meal.

2. Laura, the “no cans for kids” rule still exists. We are using 2-liter bottles because your children still open a third can before finishing the first two. Parents can fill a child’s cup when it is empty. All of the cups have names on them and I’ll be paying close attention to refills.

3. Sheryl, last year we were at Bob’s house and I looked the other way when your Jell-O salad & Fritos showed up. This year, if Jell-O salad comes in the front door it will go right back out the back door with the garbage. Save yourself some time, honey. You’ve never been a good cook and you shouldn’t bring something that wiggles more than you. Buy something from the bakery.

4. Grandmothers give grandchildren cookies and candy. That is a fact of life. Shane & Daniel, your children can eat healthy at your home. At my home, they can eat whatever they like as long as they finish it.

5. Christina, I cook with bacon and bacon grease. That’s nothing new. You’re being a vegetarian doesn’t change the fact that stuffing without bacon is like egg salad without eggs. Even the green bean casserole has a little bacon grease in it. That’s why it tastes so good. Not eating bacon is just not natural. And as far as being healthy… look at me. I’ve outlived almost everyone I know.

6. Mimi & Claire, salad at Thanksgiving is a waste of space.

7. Sareen & Sarah, I do not like cell phones at family get togethers. If you sit at the table and text on your phone when here, or if you decide you must talk to someone during dinner, I will take it from you and drop it into a pot of crackling hot bacon grease on the stove that is there just for that purpose.

8. Andy & Timmy, I do not like video cameras. There will be 32 people here. I am sure you can capture lots of memories without the camera pointed at me.

9. Being a mother means you have to actually pay attention to the kids. I have nice things and I don’t put them away just because company is coming over. Jen & Steve, watch your kids and I’ll watch my things. I know what is here, so don’t force me to frisk and search when the party is over.

10. Nancy, a cat that requires a shot twice a day is a cat that has lived too many lives. I think staying home to care for the cat is your way of letting me know that I have lived too many lives too. I can live with that. Can you?

11. Words mean things. I say what I mean. Let me repeat: You don’t need to bring anything means you don’t need to bring anything. And if I did tell you to bring something, bring it in the quantity I said. Really, this doesn’t have to be difficult.

12. Dominos and cards are better than anything that requires a battery or an on/off switch. That was true when you were kids and it’s true now that you have kids.

13. Amber, showing up for Thanksgiving guarantees presents at Christmas. Not showing up guarantees a card that may or may not be signed. 

Bryan, in memory of your Grandfather, the back fridge will be filled with beer. Drink until it is gone. I prefer wine anyway. But one person from each family needs to be the designated driver and must have a valid driver’s license. 

I really mean all of the above. 

Love You,

Grandma

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 16: AE jobs; profitability and commission products; new products incl. HELOCs, servicing, digital…geocoding bid tapes!

Why is the housing market sluggish despite a solid U.S. economy, solid demographics, and pent-up demand? Those don’t matter if prices are out of reach relative to incomes, and housing appreciation has outpaced income growth for a long time. And lending standards have remained more rigorous than they were during the last housing boom, so it has been harder for people to stretch to buy a home. (Veteran lenders will tell you, however, that not everyone deserves to own a home.) The inability of people to buy homes they can’t really afford is great news in terms of avoiding another crisis or even a bubble, but not so great for the near-term outlook for housing.

Jobs & layoffs

Ethos Lending is looking for the best AEs. “In a rising and volatile rate environment, just one day’s market movement can mean the difference between winning or losing a borrower. Ethos Lending – the mortgage industry’s best kept secret – can help solve that problem. Our proprietary technology gives us the ability to significantly reduce the cost to manufacture a loan, which allows for Ethos to consistently offer a top-3 price in both agency and Non-QM. In addition, our lock to fund velocity is 50% faster than the industry and our world class operations provides industry leading customer service, including direct access to underwriters. While the rest of the industry is contracting, we are expanding. We are looking to add only best-in-class sales professionals and have select territories open across the country. If reading this excites you, please contact Bryson Bede.”

Wells Fargo notified 1,000 employees, including 900 mortgage lending professionals, that their jobs will soon be eliminated. It’s the first major round of layoffs in a previously announced plan to cut the bank’s workforce by as much as 10% over the next three years. The decreases in the company’s mortgage division primarily reflect ongoing decreases in the number of customers in default and declines in application volume. In Des Moines, where its home lending division is based, “The Coach” will eliminate 400 jobs. (Those impacted can post their resumes for free online at www.LenderNews.com.)

Lender services & products

Is your correspondent lending business prepared to grow in 2019? To find out, check out this new and trending industry blog from TMS. Don’t risk your business by not being ready for the next year! As a top 15 correspondent lender with more than 20 years of experience, TMS taps into the expertise of its leaders to give a fresh take on what you need to know to increase your margins now and through all of next year. Learn about industry trends, the latest news around the election, and how to grow your business in TMS’s CAREspondent Connection.

“Tired of fighting your software only to end up behind a stack of spreadsheets? After spending over a year trying to configure its generic commission management system to meet its mortgage industry-specific needs, BBMC Mortgage (which will soon join forces with Synergy One Lending/Mutual of Omaha Mortgage) had to cut its losses. Producing over $2B annually, BBMC needed a technology partner that understood the difference between a first and second lien and a system that could automatically handle tiered commission plans based on custom business rules. That’s why BBMC turned to LBA WareCompenSafe™, the first mortgage industry-specific automated compensation calculation platform. According to Stephen Bennett, BBMC’s senior vice president and regional director, implementing CompenSafe has cut payroll processing time by 95% and all but eliminated payroll errors. Download the free case study to learn how CompenSafe helped BBMC take the spreadsheets out of payroll and automate a tiered commission program.”

Evolve Mortgage Services offers a seamless way to reduce costs and increase profitability without worrying about LO Comp or lengthy technology integrations. For 25+ years Evolve has offered a truly variable cost model that helps you scale your business during periods of growth, and greatly minimizes losses during slow periods. We provide cohesive solutions across the entire loan lifecycle that interoperate or work independently. From Safe Act underwriting, to closing and loan delivery for originators and acquisition due diligence for investors, we adapt our solutions to fit your business. Plus, if you already deliver to one of our many large aggregator clients, we can offer additional cost-saving opportunities and benefits. Our unique structure allows us to deliver off-shore cost structures using on-shore resources. Whether you are a retail, wholesale, or correspondent lender, Evolve can help you manage your business and improve your margins in this increasingly challenging environment. Click here to learn more.

What’s new out there?

It’s always good for lenders and vendors to have a sample of who’s doing what out there. In no particular order…

Think there’s no new companies or innovation in loan servicing? I hinted at that recently in Kansas, and the head of capital markets with whom I was speaking countered with, “Have you heard of Scratch?” I hadn’t.

HELOCs are a hot topic what with millions of borrowers happy with their 3.5% 30-year fixed-rate mortgages. Prosper, a leading peer-to-peer lending firm, is launching a new digital HELOC product in January 2019 that will deliver loan estimates in 1 to 2 seconds and a soft pull on credit. “Applying for and obtaining a HELOC has historically been a difficult and lengthy process, leaving many consumers frustrated with an approval process that can take days to weeks. According to a recent TransUnion study, as home values rise, more and more people will be looking at a HELOC as a potential option for accessing credit. The study reported that an estimated 10 million consumers will take out HELOCs between 2018 and 2022, which would be more than double the number originated from 2012-2016.” (Go to Prosper if you have questions.)

Equator, a leading provider of residential loan default software and marketing solutions for many of the country’s top servicers, real estate agents and vendors, announced the launch of a mortgage servicing blockchain solution. Through an agreement with Factom, Inc., the Factom® Harmony blockchain-as-a-service (BaaS) platform is integrated into the Equator® PRO software-as-a-service (SaaS) solution. The addition of Factom’s Harmony provides Equator customers the opportunity to incorporate the recordation of data, documents and key audit events onto Factom’s blockchain solution. Factom’s Harmony provides options for individual loans to be tracked as individual chains of data on the blockchain. This design allows Equator PRO customers the option to embed blockchain preservation into their various workflows, allowing for an immutable and encrypted blockchain audit record to be built for each loan and each workflow step.

Digital home loan closings? Redfin has partnered with Notarize: Online closings are now available to customers of Title Forward, Redfin’s title and settlement company, and Redfin Mortgage, Redfin’s lending arm.

Mortgage fintech LoanSnap launched VA Smart Loans, which will provide personalized options to current and former service members applying for a home loan.

Citadel Servicing Corp. debuted its new product for five to 35-unit properties and mixed-use containing a livable unit with a bed. The Outside Dodd-Frank Plus Program builds on the company’s highly successful Outside Dodd-Frank Program to offer loans on properties up to 35 units. Loan amounts are up to $3 million with a max LTV of 75%. “Basically, if it has a bed or living residence attached to it, we can fund it”, said CSC’s founder and CEO Daniel Perl. Kyle Gunderlock, President & Chief Operating Officer, stated, “We saw the need in the market and created a program that would build on our popular ODF product.” For the first time, CSC will offer products to business entities and trusts. A Personal Guarantee is required as the major addition to the normal and usual due diligence items.

You can qualify your self-employed and 1099 borrowers with 12 Months of Bank Statements. Contact inquiry@citadelservicing.com for more information.

Pacific Bay Lending Group has a new product: Pacbay Portfolio VOE (PBPV) starting at only 4.65%. Contact Jennie Ensunsa (323-346-7474) for details.

LoanStream Mortgage has an all new Credit Grade on NanQ Product Line: LoanStream “Select”. Questions? Contact LoanStream at Inquiries@lswholesale.com

The Lending Answer’s SIVA Elite is now available to both W2 and Self-Employed Borrowers. An incredible product for individuals who have too many write-offs on their tax returns to qualify for a Full-Doc Mortgage or just haven’t had long enough seasoning at their current employment. Contact The Lending Answer for details.

A bank statement loan is the perfect solution for the self-employed who do not have the tax documents proving their ability to repay. Contact Angel Oak Mortgage Solutions for non-QM alternatives: info@angeloakms.com

PennyMac posted an announcement: Release of Non-Delegated VA.

Have you been searching for NIVA loan options? Check out the ACC Mortgage product matrix and contact Kelly Brown for details.

DocMagic Inc. announced that QRL Financial Services, a nationwide provider of residential mortgage lending services for community banks and credit unions, has leveraged its eVault technology to purchase eNotes. The deal will make QRL one of the first investors outside of the GSEs to begin purchasing eNotes. Because QRL is using DocMagic’s SmartDocs, all documents retain a tamper evident seal to ensure data and document integrity. “Offering a truly paperless solution is the future. Consumers will expect and demand a closing experience that is more timely, convenient and informative,” says Alex Rivera, managing director at QRL Financial Services. “QRL’s ability to purchase and service eNotes will allow the credit unions and community banks that we service to stay ahead of the technology curve as they compete with the larger institutions in the race to improve the mortgage experience.”

Capital markets

Based on analytics from MCT, approximately 90% of all secondary market transactions expose borrower addresses to non-buying bidders. This dissemination of address data is a growing data security concern, especially for parties concerned with EPO performance and servicing pre-payment speeds. MCT is moving to improve this process by replacing addresses with geocode data during whole loan bidding, an industry first. “The only investor that should eventually see the property address is the winner of the loan,” stated Phil Rasori, COO. “Our solution to this security concern is a proprietary geocoding process specific to our BAM platform that enables investors to price LMI-CRA incentives without the address.”

MCT is currently coordinating with all correspondent investors on implementing this upgraded process with a goal of completely replacing addresses by 2019. Learn more about the most efficient, secure, and profitable way to conduct loan sales by registering for an upcoming webinar on MCT’s Bid Auction Manager (BAM).

Western Asset Management which specializes in fixed income, has a new research report about the Freddie/Fannie Single Security. The good news is that Western is viewing the new security exactly as Fannie and Freddie had hoped – as a fungible security (meaning there’s no distinction between the two GSE issuers) with a Treasury backstop. Lisa Tibbitts with Legg Mason writes, “As we move closer to June 2019, when the UMBS will first be issued, it’s noteworthy that a large fixed income investor is on board and working with its clients to be sure they understand UMBS. This was a big unknown about three years ago when the GSEs began working toward a single security.”

Blue Water Financial Technologies announced it has developed an electronic co-issue pricing and trading platform, MSR-X. This cross investor and fully integrated web-based technology solution for co-issuing purposes allows lenders and investors to view portfolios and transactional data in real time. The platform brings greater efficiencies to the co-issue process and lowers costs for both investors and originators by reducing any manual input of pricing and increasing the immediacy of information. Buyers and sellers can access MSR-X via the web and view information in real-time. Originators can use the platform to reduce margin exposure, lower costs and streamline their secondary market operations. And the originators don’t pay to participate, rather, the investors do. In return, the investors obtain transactional data, they have better yield certainty through the purchase process and much of the administrative paperwork has been simplified. If you are an originator or investor who would like to access MSR-X, call 866.217.0246 or email inquiries@bluewater-fintech.com.

Turning to yesterday’s bond market, and therefore rates, the U.S.10-year halted this week’s downward trend Thursday, closing yesterday’s session unchanged at 3.12% as Treasuries across the curve ended the day on a mixed note. Across the Pacific, China presented a list of several concessions that officials would be willing to make in order to resolve the ongoing issues with the United States, though the list does not mention structural reforms that have been demanded by President Trump. Across the Atlantic, British Prime Minister Theresa May said she intends to push forward with her draft of the withdrawal bill despite the resignation of four ministers, including Brexit minister Dominic Raab. Despite some international doom and gloom, the week hasn’t been short on optimism, with optimistic comments from both Fed Chair Powell on the economy and U.S. Trade Rep Lighthizer on the next tariff tranche on Chinese imports potentially being put on hold.

 

Today sees a busy economic calendar which precedes a light U.S. calendar next week with markets celebrating the Thanksgiving holiday: October industrial production and capacity utilization at 9:15am ET, the KC Fed Manufacturing Index for November at 11AM ET, Chicago Fed President Evans in a moderated Q&A, and finally, at 4PM, the Treasury will release the September TIC data. Friday begins with rates little changed from Thursday’s close: the 10-year is yielding 3.09% and agency MBS prices are unchanged.

Set your Wi-Fi password to 244466666

That way you can say your password is 123456.

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 15: AE, QC, LO jobs; accounting, subservicing, warehouse products; Freddie & Fannie changes roll on

With only week until Thanksgiving there’s a lot going on – every one of these stats impacts lenders. CoreLogic tells us that there are 48,390 homes at risk from the current California wildfires. Believe in climate change or not, or in science or not, one study shows 386,000 homes are said to be at risk in the coming decades due to rising sea levels and coastal flooding. And according to the RV Industry Association, there are now a million Americans living in RVs full time. (Try counting them in the census, figuring out where they vote, where/if they pay taxes, or if 500 KOA Kampgrounds are enough.)

Jobs

A heavily-capitalized wholesale lender is looking across the country for a sales team to join its growing company. This nationwide lender offers competitive rates alongside a vast product portfolio and can leverage a centrally located and seasoned fulfillment team to scale quickly. Deeply experienced and committed leadership is looking to explode into the market in 2019. If your team is ready to kick off the new year with new opportunities, send me a note.

The Lakeview Wholesale team continues to grow and is pleased to announce the “recent additions of Account Executives Dan Tyner and Brandi Green-Lozano to serve our Southern California brokers. Having grown over 700% since 2017, Lakeview is one of the fastest-growing wholesale lenders and features innovative products such as No MI Platinum, an aggressively priced alternative to LPMI loans. ‘If a loan officer is even thinking about an LPMI loan, they’re crazy not to price it out against our No MI Platinum,’ says Greg O’Connor, Head of Wholesale Lending. ‘We’re extremely aggressive with our pricing on it and it’s a great option for first time homebuyers.’” The Lakeview Wholesale team has open positions with large territories for experienced Wholesale Account Executives in Arizona, Seattle and Northern California. Interested parties should contact Michael Cullen.

The Compliance Group, Inc. is seeking a full-time Quality Control Loan Processor and a full-time Quality Control Administrative Assistant. QC Loan Processors perform loan processing activities in accordance with agency requirements, government agencies and private investors, and can work at a remote location. QC Administrative Assistants perform administrative and reporting functions to support our QC Team in managing client projects. The QC Administrative Assistant would work in our Carlsbad, California office location. “We would love for you to be a part of our growing team!” Qualified applicants please send resumes to Michelle Doyle.

Fidelity Bank Mortgage is headquartered in Atlanta, Georgia with Retail Mortgage production offices throughout the Mid-Atlantic and Southeast. Since 2008, the Mortgage division has grown to over 36 offices and over 500 employees. Fidelity Bank Mortgage is a Fannie Mae, Freddie Mac and Ginnie Mae seller/servicer offering specialty products such as Portfolio Doctor Loans for eligible doctors, Construction-to-Permanent Loans, Escrow Holdback, and more. “The majority of our operational support is in the local markets, providing for the best possible customer service. Fidelity Bank Mortgage has one of the highest production averages per Loan Officer according to MBA/STRATMOR Peer Group Surveys and boasts well above average Performance and Loan Officer Loyalty. We are expanding into new markets and interested in Top Sales and Leadership Talent. Click here to contact David Rapson, Senior Vice President, Mortgage Production Manager, for more details.”

PrimeLending’s VA No Lender Fee home loans are a game-changer for veterans and active military looking to achieve their homeownership goals. Our heroes deserve a simple and stress-free home loan process with significant savings and benefits, and that’s exactly what they get with the PrimeLending VA Loan Program. Along with exclusive no lender fees, veterans also benefit from no down payment, no private mortgage insurance and competitive rates — that’s a combined savings up to thousands of dollars in upfront costs alone. With all of the VA perks, it’s easy to see why PrimeLending is a premier lender for VA homebuyers across the country. If you’re ready to deliver the ultimate VA loan experience, close more VA loans and help more military members become happy homeowners, contact Brian Miller today.

Lender products and services

As of October 2018, 100 mortgage lenders have signed with Loan Vision to utilize its financial management and accounting solution. Martin Kerr, President of Loan Vision shared, “On a monthly basis there is approximately 60,000 loans and $14 billion being accounted for across the US using Loan Vision. When you annualize that, those numbers are staggering to me. We absolutely believe the lenders embracing Loan Vision are doing that to have best in class systems across the organization, to streamline their whole organization to better serve the borrower.” For more information, read the press release about Loan Vision’s

journey to 100 customers or contact Carl Wooloff.

Join National Mortgage Professional Magazine for another complimentary nmp Webinar How to Generate More Referrals with Social Media” Today, November 15, 2018 at 2:00 PM EST sponsored by REMN Wholesale. Millions of people are flocking online every day to buy, sell, collaborate, and connect. We know that the attention is no longer on worn out billboards or bulky yellow pages. But how can you stand out in an over saturated digital marketplace where the technology and the rules are constantly changing? In this 60-minute webinar, social media influencer Michaela Alexis, will take you behind-the-scenes to show you the secrets of success when it comes to leveraging social media to drive your pipeline forward. Register for this free webinar here.

Unfortunately, as we have all witnessed, natural disasters and hurricanes will happen. The real question, though, is do you know if your subservicer is prepared to handle the aftermath of the crisis? Don’t wait until it’s too late to test the strength of your subservicer. They need to be proactive — not reactive! To help ensure your borrowers move through the recovery process as efficiently as possible, run through this new checklist from TMS that goes through everything your subservicer needs to be doing to successfully navigate a crisis.

Are you looking for a warehouse lender that understands your business needs? Maybe one that is not competing for market share with your branches or correspondent division? Comerica Bank’s approach to warehouse lending spans six decades and is just one piece of a much-larger, diversified business banking strategy. Comerica Bank is a $71 billion bank that focuses on serving the needs business owners. At Comerica Bank, our relationship begins with you, the mortgage banker. Please allow us the opportunity to tailor a warehouse solution to support your strategy and goals. With lines of credit from $5 million to over $100 million, we are proud to serve a broad spectrum of mortgage companies across the country. To see how Comerica Bank can raise your expectations of what a bank can be, contact Von Ringger (313-222-9285). Member FDIC. Equal Opportunity Employer.

Fannie & Freddie don’t stop

Let’s play some catch up on Agency news. It’s good to see what they’ve been up to in the primary markets over the last several weeks to keep things in context, especially as lenders inevitably follow their lead. So, in no particular order…

The Freddie Mac Guide Bulletin 2018-20 provides temporary selling requirements and flexibilities for certain mortgages secured by properties, or for borrowers with places of employment (as applicable), in eligible disaster areas impacted by Hurricane Michael.

announcing an update to our Private Mortgage Insurer Eligibility Requirements (PMIERs), which will become effective on March 31, 2019. Many of the changes to the eligibility standards have been previously announced via the PMIERs Guidance. Our announcement underscores Freddie Mac’s commitment to working with the Federal Housing Finance Agency (FHFA), mortgage insurers and other stakeholders in the housing industry to strengthen the housing finance system.” For more information see PMI Eligibility Requirements and Frequently Asked Questions.

So yes, under the direction of the FHFA, Fannie Mae has worked jointly with Freddie Mac to update the Private Mortgage Insurer Eligibility Requirements (PMIERs), which were issued Sept. 27. The effective date for these PMIERs is March 31, 2019. Refer to FHFA’s news release and Fannie Mae’s Mortgage Insurers page for more information.

Freddie Mac has expanded its support in shared equity and sweat equity . Read the Single-Family News Center article to learn more about financing opportunities for rural housing and preserving affordable housing.

For certain home purchase transactions in rural high-needs areas, Fannie Mae may offer to waive the appraisal in exchange for a mandatory home property inspection. The rural high-needs appraisal waiver seeks to help low- to moderate-income borrowers avoid unanticipated, potentially high-cost, post-purchase repairs. This offer will be considered only for property locations designated as rural high-needs by the Duty to Serve requirements. Click here to view a heat map of the High Needs Counties throughout the United States.

Freddie Mac has a Loan Advisor tool… its Condo Project Advisor. Request unit-level condo waivers for existing condo projects that need special review or consideration.

It’s well known that Native Americans face homeownership challenges, which has made them one of the most underserved populations in the country. To better understand this group’s unique cultural views on homeownership, Fannie Mae has conducted interviews with a small sample of lower-income Native Americans who plan to purchase, or have recently purchased, a home on tribal lands. Read the blog by Kellie Coffey, product development manager for rural initiatives at Fannie Mae, or check out the full report.

You can now submit to Loan Product Advisor® and start delivering Freddie Mac’s consolidated Home Possible® mortgage – with new flexibilities for your borrowers with very low to moderate incomes. Read the Single-Family News Center article for additional information on what’s been added to Home Possible and how it can help you expand your business.

As part of normal operations and prudent risk management, Fannie Mae is implementing DU® Version 10.3 the weekend of Dec. 8th. The release notes have been updated to include a reserve requirement for cash-out refinance loan casefiles with debt-to-income ratios exceeding 45%. This update is a part of adjustments to the DU credit risk assessment to account for 2018 market conditions (rising interest rates, waning refinances, and higher loan-to-value lending). Refer to the “Debt-to-Income Ratio” section of the release notes for details.

Fannie Mae issued a reminder that applications for DU Refi Plus™/Refi Plus™ under the Home Affordable Refinance Program® (HARP®), will be accepted through the end of this year. DU Refi Plus/Refi Plus applications must be started no later than Dec. 31, and loans must be delivered by Sept. 30, 2019. Visit the Making Home Affordable page for more information.

Freddie Mac has released its third, fourth and fifth white papers of the eight-part Duty to Serve series designed to shed light on underserved multifamily housing markets. The papers examine state incentives through the Low-Income Housing Tax Credit (LIHTC) program that encourage affordability in high opportunity areas, and the use of mixed-income housing in areas of concentrated poverty.

Fannie Mae has updated the Servicer Self-Assessment to help you effectively manage the Fannie Mae loans you service and ensure that you meet its requirements. Two new sections, “Master Servicer Oversight” and “Shared Processes,” will provide additional guidance. Visit the STAR Program page to find more resources, and contact your Fannie Mae account team if you have questions.

Capital markets

Rates have slid lower with the 10-year settling last night at 3.12%. Why? Thoughts that the Administration’s policies are hurting the U.S. economy, more international geopolitical news, this time surrounding Brexit. British Prime Minister Theresa May announced that her cabinet has approved the draft withdrawal agreement. Elsewhere, the Italian government replied to the European Commission’s request for a corrected budget, but the main points of the plan were left unchanged. The European Commission will issue a formal reply next week. And China reported disappointing Retail Sales for October (+8.6% YoY; expected +9.2%).

Domestically, CPI figures point to a firming in consumer inflation, which fits the Federal Reserve’s inclination to raise rates again in December. Markets this morning are digesting remarks from Fed Chair Powell and Dallas Fed President Kaplan, though neither showed much wavering in the Fed’s commitment to hike rates December, with odds still over 75%.

 

We’ve already had a busy economic calendar today: Retail Sales (+.8% vs. expected unchanged), import prices (expected unchanged, imports were +.5%), weekly jobless claims (216k, about as expected), and both the Empire State (expected to decline, it rose to “23.3”) and Philadelphia Fed’s (down to “12.9,” as expected) manufacturing indices. September business inventories are seen increasing 0.3% MoM versus 0.5% previously. Today’s Fed speak calendar also starts at 10AM ET with Governor Quarles, Chair Powell, Atlanta’s Bostic, and Minneapolis’ Kashkari all on the docket. After the initial spate of news, we find rates slightly lower with the 10-year at 3.10% and agency MBS prices better by .125. Deceleration?

 

(Thanks to Rich B. for this one.)

A loan officer took his real estate agent client to an NFL game one Sunday afternoon. They had great seats right behind their team’s bench. After the game, the LO asked him how he liked it.

“Oh, I really liked it.” the agent replied, “Great game, exciting, but I can’t understand why they were killing each other over 25 cents.”

Dumbfounded, the LO asked, “What do you mean?”

“Well, they flipped a coin, one team got it and then for the rest of the game, all they kept screaming was…’Get the quarterback! Get the quarterback!’ I’m like…Helloooooo? It only 25 cents!”

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)

Nov. 14: LO jobs; webinars for LOs; non-QM product; chatter on QM patch, MBS/UMBS; Agencies address languages

Want to spend $100 monthly to pay for $40 parking and $20 beers, but not see the basketball court? Contact the Warriors for your pass. Speaking of monthly payments, borrowers are sometimes confused when they’ve been sending their P&I to one company, and they receive a letter stating their “servicing has been sold” and to start sending their payments somewhere else. LOs should know that servicing values impact borrower pricing just as much as the mortgage-backed security market. Rates go up, servicing becomes more valuable; rates go down and values go down due to refi risk. I have a few notes worth a skim of current servicing trends.

Jobs & business opportunities

A seasoned and highly productive Michigan-based Consumer Direct team, in the process of being misplaced through bank acquisition, is seeking a new home. The opportunity includes 1 executive leader, 1 producing sales manager, 8 originators, 2 processors and 1 sales coordinator. The platform specializes in purchase and refinance portfolio retention (inbound, outbound, credit triggers, home for sale leads, CRM) as well as new customer acquisition. The team works extremely well together and is highly motivated to stay intact as either an addition to an existing operation or as a start-up / build. A chartered bank is preferred but will entertain independent lenders as well. If seriously interested in learning more about this opportunity, please send inquiries to John Korch.

“It seems like every time you turn on the news, you hear something negative about mortgage industry layoffs. 180 there, another 400 over there…it can seem dire. But the good news? At Motto Mortgage, a rapidly expanding franchise network, we just don’t see it. In fact, the Motto Mortgage network is hiring. Motto is aggressively recruiting for Loan Originators in the following states: Florida, Michigan, New Jersey, Nevada, Ohio, Pennsylvania, Tennessee, Texas and others. Haven’t heard of us? Well, you will. With over 60 offices open in 28 states, the potential is limitless. Take that next step for your career and finally feel good about how you spend your 9-to-5. Contact us (866.668.8649) to learn more on why joining a Motto Mortgage office could mean big things for your career.”

A mortgage executive with over 20 years of industry experience is seeking a new opportunity. Previous experience includes senior management roles in operations, enterprise risk management, quality control/due diligence, and secondary marketing as well as company-wide workflow and systems development. Career highlights include reducing loan purchase time by 50% by optimizing the loan sale process, building the operations and servicing processes for a startup that grew to more than $4B in originations in less than 2 years, and lowering investor rejections 25% by developing and deploying an automated due diligence management system that streamlined reporting of investor concerns and improved file quality. If you’re interested in a leader with deep industry knowledge who can help you achieve your goals, send inquiries to me to pass along to the candidate.

For Loan Officers or Branch Managers looking for a change, MortgageRight sets itself apart from other companies by offering lower rates, better pricing, and higher compensation. MortgageRight is making a name for itself across the nation by operating with thinner margins than other industry players due to several key strategic factors put into place by ownership in order to help their producers win in a market like this one. Very simply, they can offer lower rates and/or a higher comp and they can back their claims up 100%. But don’t take their word for it. They’ll put any candidate in touch with recent hires and existing LOs to discuss their strengths along with everything else they have to offer. For a pricing engine walk through, contact Mike Russo at (866) 425-5456 or visit them at www.branchright.com.

Lender products and services

In continuing to honor veterans this week, TMS CAREspondent Lending is excited to announce it is now buying and accepting VA Alteration & Repair loans. To be eligible for purchase, the repairs must be completed, and the loan must be guaranteed. It’s a privilege to partner with correspondent lenders, to help those who served our country. For more information go here.

Floify, the mortgage industry’s next-gen point-of-sale, continues to live up to its reputation of delivering huge ROIs for LOs by automating their lending processes with borrowers, real estate agents, and other loan stakeholders. Floify’s interview-style 1003, secure document portal, automated email/text notifications, and dozens of integrations with credit reporting agencies, eSignature/disclosure vendors, and LOS providers, are just a few of the features that have helped mortgage pros hit record-breaking levels of production. Just ask Floify advocate and top-producing mortgage advisor, Alex McFadyen of The Mortgage Pug. With Floify, McFadyen experienced “double the clients” and “half the time spent in document collection,” as well as a “100% increase in profitability” – all without adding more staff. Now that’s some powerful stuff! If you’ve been considering Floify for your lending operation, there’s never been a better time to make your move to this leading mortgage solution. Request a live demo to learn more!

Deephaven Mortgage, a leading Non-QM lender, shines the light on Non-QM through its loan programs & technology, aimed at making loans responsibly for millions of Americans locked out of the market. The primary mortgage origination market continues to experience challenges in the form of margin compression, low inventory, and declining volumes. Originators are actively evaluating the introduction of Non-QM products to help offset some of the current market dynamics. Deephaven continually evaluates its products knowing the target market is significant. Studies show 16+M self-employed Americans (Bank Statement Loans), 83M Millennials (Non-Warrantable Condos), 75M Baby Boomers (Asset Depletion), and 57M Americans earned more in 17′ than 16′ (1 Year Alt Doc), and these are just a few underserved segments that represent a significant opportunity for originators. To find out more about how Non-QM can grow your business, contact Deephaven Wholesale or Deephaven Correspondent. (Sources: Bureau of Labor Statistics, CNN.)

Lender training events

Fintech is evolving faster than ever, and consumer expectations for speed, convenience and personalization are at an all-time high. Lenders find themselves continually identifying and integrating new technologies, often without knowing whether they’re making the right choice to grow their business. Join Total Expert and Guaranteed Rate on Tuesday, Nov. 20 at 1PM CT for a webinar on Best Practices for Better Tech Implementation. Total Expert and Guaranteed Rate will share top strategies to empower your organization with the right technology. Explore how to establish pre-implementation goals that ensure success, avoid common implementation mistakes, onboard in record time, bolster adoption rates and design a future-proof tech stack for revenue growth. Interested but can’t attend? Sign up anyway to receive the recording.

Insellerate is hosting a webinar titled, “3 Secrets to Selling Cash Out Loans. As the mortgage market continues to evolve, top lenders are taking advantage of the cash out loan. They understand the value of this powerful revenue stream. Join the Insellerate webinar to learn an effective step-by-step process to selling cash out loans. This webinar will cover how you can craft the right messaging, develop the right sales approach, and which common myths might be holding you back. 3 Secrets to Selling Cash Out Loans, Thursday, 11/15, at 10am PST.

On Tuesday, November 20th at 10AM PST, Sierra Pacific Mortgage will be hosting a webinar, “Not your Ordinary Assets”. Take this opportunity to become familiar with some common – and not so common – asset types that may support your borrower in closing a mortgage. This one-hour webinar will focus on the less common assets that your borrower may use in their mortgage transactions like tax refunds, real estate commissions, life insurance payments, and loans against retirement funds. Register today. Knowledge is power, and Sierra Pacific is determined to make you more powerful.

A few weeks back, Maxwell hosted “The Mortgage Executive Q4 Outlook” Webinar featuring a panel of seasoned mortgage industry executives sharing their own focus areas for Q4 and discussing how mortgage companies can navigate market challenges. Although we are just about halfway through the quarter, the insights are as relevant as ever for mortgage leaders and executives. They just released their recording of the webinar for all to listen. Click here to listen!

Borrower customer service

Clear communication is essential throughout the loan process, and the closing is no time to let communications fall off. When lenders call borrowers prior to closing to discuss figures, only 11 percent of borrowers go on to report unexpected rates and fees. Compare this with 38 percent who report unexpected rates and fees when they receive no call. In the latest edition of the MortgageSAT Monthly Tip, STRATMOR Group’s MortgageSAT Director Mike Seminari explores the NPS impact around this topic and answers the question, “How important is it to call the borrower before the closing?” Find this tip and others at MortgageSAT.com.

Fannie & Freddie keep on motoring

Let’s play some catch up on Agency news. It’s good to see what they’ve been up to over recent weeks to keep things in context. In the capital markets, Freddie has been on the common security platform for nearly two years. As a reminder, Freddie doesn’t know who actually owns its securities. It knows the couple hundred custodians. The “MBS” will be moving to “UMBS” (Uniform Mortgage Backed Security) next year, and hopefully lenders will see a cost savings by moving from hedging with Fannie TBAs, pairing off and putting loans into a Freddie security, into hedging and delivering UMBS.

One conversation topic is the “QM patch” that expires in January of 2021. As a reminder for non-underwriters, if a borrower’s loan is run through DU or LP, the DTI might be north of 43% on gross pay and still approved. Let’s say its 50% DTI on $10k per month of income. The borrower will basically have $5k to pay toward the loan payment and other debt, and $5k of cushion. But once you take out the typical borrower’s paycheck deductions, like taxes, medical insurance, and so on, the average borrower is left with very little. That doesn’t even take into account child care, tuition, car insurance, etc. – that cushion can disappear. Using net income may be one answer. Should the industry be focused on net or residual income instead of gross income in the DTI calculation? Let your Agency rep know and stay tuned!

FHFA, Freddie Mac and Fannie Mae have launched Mortgage Translations, a centralized clearinghouse to help borrowers with English language barriers. This clearinghouse of online resources will assist lenders, servicers, housing counselors, and other real estate professionals in serving limited English proficient (LEP) borrowers. The first phase of the launch consists of Spanish-language documents. According to the U.S. Census, persons who speak Spanish as their primary language comprise more than 60 percent of the LEP population in the U.S. Resources in four other languages commonly spoken by LEP households – Chinese, Vietnamese, Korean, and Tagalog will be added in the coming years.

Native American tribes are dispersed widely throughout the U.S. and live predominantly in rural areas. When it comes to housing finance, they’re considered one of the most underserved populations in the country. The Duty to Serve rule issued by the Federal Housing Finance Agency (FHFA) directs the Agencies to improve the availability of mortgage financing for low- and moderate-income families, and specifically calls for a focus on federally recognized Native American tribes because of their unique circumstances and historical lack of access to mortgage lending. Freddie offers a program. In a new study, Kellie Coffey, Product Development Manager of Rural Initiatives, in collaboration with the Fannie Mae Economic and Strategic Research Group examined the unique cultural views on homeownership among Native Americans living on tribal lands by conducting individual interviews with lower-income Native Americans across seven tribes in New Mexico. Read the full report.

(Lots more Freddie, Fannie, conventional conforming updates tomorrow.)

Capital markets

Although oil prices are plummeting, yesterday the U.S. 10-year closed yielding 3.15% yesterday on no real news, save for the Treasury Budget. The Treasury Budget for October showed a deficit of $100.5 billion versus a deficit of $63.2 billion for the same period a year ago. This data is not seasonally adjusted, so the October deficit cannot be compared to the $119.1 billion surplus for September. Larger outlays were mostly due to higher Social Security spending, and higher spending on the Department of Defense, Department of Education, Department of Health and Human Services, and Department of Veteran Affairs. Internationally, the Italian government has reportedly maintained its fiscal targets for 2019 in written response to the European Commission. The refusal to lower next year’s deficit target could be met with disciplinary action from the EU.

Back here this morning, we’ve had weekly MBA mortgage applications for the week ending November 9 (-3.2% with refis at their lowest level in 18 years). After last week’s unexpected jump at the wholesale level, of particular interest is the Consumer Price Index report for October. Expectations were for headline and core to increase 0.3% and 0.2% MoM (versus 0.1% for both previously) and both met expectations. Fed Governor Quarles, Fed Chair Powell, SF Fed President Daly, and Dallas Fed President Kaplan all take the stage at some point today. Hump Day starts with Agency MBS prices unchanged from Tuesday’s close and the 10-year unchanged at 3.15%.

Local police are hunting for the “knitting needle lunatic” who has stabbed six people in the rump in the last 48 hours.

They believe the attacker could be following some kind of pattern.

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, “Servicing: Don’t Underestimate Liquidity.” 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 2018 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.)