June 29: LO & Sales jobs; MSR, marketing, leads products; training & webinars from home

Does this mean we can no longer say, “Hindsight is always 2020”?! It’s too bad that the Tiger King is the most normal thing about 2020. For the people who still think it is a hoax, and pushing for your right to not wear a mask around others, well, you can read the tales of survivors. Certainly, conditions are impacting the economy. Remember Blackstone and other venture capital firms gobbling up housing inventory ten years ago? Blackstone skipped its payment on $274m hotel loan. Shale pioneer Chesapeake Energy filed for bankruptcy. And the “resi” industry is digesting the latest legal preceding involving G-Rate and non-solicitation (Cook County Case No. 2020 L 371, Guaranteed Rate as Plaintiff and Harry Richter as Defendant). The judge found that G-Rate’s non-solicitation provision was “unreasonable” because it was overly broad and needed to specify employees that were covered. Speaking of employees…

Employment & transitions

Caliber Home Loans is pleased to announce the new PRIDE Employee Resource Group: Promoting Respect, Inclusion, Diversity, and Equality. Caliber and PRIDE are committed to offering a welcoming and inclusive culture for those who identify as LGBTQ+ and advocacy efforts for a better world. PRIDE will encourage honest and sincere conversations, education, equality, and our basic human right…civility. We are currently looking for passionate employees to join the cause! Join team Caliber, a place where everyone can work safely and openly while climbing toward progress together. If you have an interest in one of our posted job opportunities, please contact Jonathan Stanley for consideration. If you are interested in a sales opportunity at Caliber, please contact Brian Miller for immediate consideration.

Movement Mortgage makes another splash in the Midwest, hiring back 17-year industry veteran Brian Sumption to lead the Columbus, Ohio market. Sumption previously worked for Movement from 2015-2018. “I came back to Movement for many reasons,” says Sumption, “but when a company’s priorities of God, Family, Community, and Business align with yours, it’s a no-brainer. I am thrilled to be back where I belong.” Sumption rejoins Movement in the middle of the company’s incredible record-breaking spree. June is projected to be the company’s first $3 billion month. Sumption is part of a one-two punch as Movement expanded its Cleveland market just last month. Sumption will report to Regional Director Chris Shelton. If you’re interested in seeing if Movement is right for you, contact Shelton directly.

“What’s been cooking at PrimeLending besides record-breaking production months? Delicious home cooked meals! This week we hosted eCuisine with the PrimeLending Team, our first in a series of virtual cooking classes designed as a fun way for our team to spend quality time with their families and say ‘thank you’ for all their incredible hard work. We take work/life balance very seriously at PrimeLending and wanted to do something special to bring everyone together to learn, laugh and enjoy a gourmet Italian meal. The results? Hundreds of team members and their families shared a great evening creating yummy food and even better memories. It’s no wonder so many teammates describe our award-winning culture as a family – we work hard and play hard together. If you’re ready to join a company that cares about your quality of life, contact Nic Hartke.”

“Wyndham Capital Mortgage sits at the intersection of being a leader in the digital home lending space while keeping top-level customer service as a priority. With Wyndham, you can fill your pipeline with high-quality digital leads that set you up to close more loans, experience close times almost twice as fast as the industry average, and gain more valuable experience while creating a work-life balance that fits you best. With the implementation of intelligent automation and technology-focused platforms, gone are the days of manual data entry, time-consuming information gathering and rigid scheduling needs. Instead, you have in front of you the tools for success. But we don’t just say that – we have the success stories to back it up. Whether it’s working from home and earning a top spot in the Scotsman Guide or working four days a week and funding hundreds of millions of dollars in loans each year, Wyndham Capital allows you to work in ways you’ve never imagined. Click here to learn more about joining the Wyndham team.”

Marlene Hoover has joined Banner Bank as Vice President Regional Manager of the bank’s Southern California Mortgage Banking team and she is building a team of experienced lending professionals with opportunities in the Inland Empire and LA County. Serving the west coast for more than 130 years, Banner Bank is Money Magazine’s Best Bank in the Pacific Region of the U.S. “Banner has a top-notch portfolio of products, including single-close construction, Lot Loans, state housing programs and portfolio lending, as well as an excellent in-house loan servicing team and a market-leading compensation plan,” said Hoover on the reasons she chose Banner. If you’re a mortgage loan officer in Southern California interested in a career that ensures you have high-quality products to support your clients, marketing and sales support, workplace flexibility and highly competitive compensation, consider Banner Bank.

FHA is hiring a Director for Program Operations and Customer Service Division in Philadelphia. Salary range is $117,188 to $152,342 per year. Apply by Thursday, 7/9/2020. And in Denver, FHA has two vacancies for a Program Assistant ranging from $47,421 to $61,643 per year. Posting closes on Monday, 7/13/2020.

Lender services and products

Mortgage servicers are struggling to right-size preparedness for when forbearance ends and moratoriums are lifted. There really is no way to predict staffing levels needed over the next 12+ months to prepare for the imminent spike in loss mitigation activity. This webinar will introduce self-service options to allow borrowers to secure post-forbearance relief in minutes, while avoiding manual credit processing and operational errors. With the expected uptick in loan modifications, short sales, mortgage releases and foreclosures, the right technology can considerably reduce operational strain, regardless of the source system or collections platform. REGISTER NOW.

Record sales and 50% lower cost per loan! How Steven J. Sless and his PRMI Reverse Division rocked their best months ever using direct mail: “You know, PRMI is just a powerhouse in the mortgage industry now. And Monster Lead Group has been an unbelievable partner. Monster knows what they’re doing, they know how to make the phones ring, they know how to generate business, but they also know how important it is to help us grow a brand at the same time. It’s a real marketing system. It’s not just sending mail. I think the consistency of the campaigns is what we rely on… Our cost per funded loan is about 50% of the industry average… So that story should be told. We’re able to grow and scale our operation because of the predictability of the Monster campaigns. That is what’s allowed us to get to this point.” Better direct mail: www.monsterleadgroup.com/better-results.

“Willingness to pay” is a key behavioral risk attribute that ‘overlays’ ignore & credit scores fumble. Houses, jobs, assets & credit reports don’t pay the mortgage, people do. And people can be wildly unpredictable, and credit scores commonly over/understated, amidst extreme socioeconomic stress. The actionable Mortgage Risk & Fairness Score is a predictive, data-driven “intelligence” tool to understand borrowers, holistically. Then use that deep insight to originate, underwrite, fulfill, buy, sell, and monitor most efficiently. It’s plug-n-play and enables quick deployment of advanced risk & behavioral analytics — propensity, segmentation, ability, and “willingness” to pay – that are validated (top 10 bank) & vetted (CFPB, OCC, Fed). “The Score” doesn’t require change to tech, or vital processes. But, used up-front, and as an adjunct to underwriting, secondary, and servicing, will increase volume, inclusion, confidence, margins, efficiency, and capacity, while decreasing risk. CLICK for Info.

 

Ready to learn how Q2 2020 market volatility has affected your MSR portfolio? With MCT’s servicing portfolio valuations, you’ll get a first look at how market volatility, forbearance, prepayment speeds and other factors have affected your MSR portfolio! MCT can also help you plan for cash advances based on the impact of market volatility on your portfolio. Contact MCT’s MSR services team today for more information.

Training & events in the next week or two

Join MCT on July 7th at 11AM PT for a webinar on the Power of Bid Tape AOT featuring Wells Fargo. In the webinar, MCT’s COO, Phil Rasori, and Wells Fargo’s SVP of Correspondent Pricing, Greg Vacura, will discuss recent enhancements to the AOT functionality. They will also review cash management benefits for lenders, managing timelines with AOT’s and aggregate stats on AOT executions and savings.

MGIC’s July webinars include a 3-part webinar series, “The Fundamentals of the Mortgage Process”. During these sessions, we’ll discuss the mortgage cycle, taking the loan application, processing the loan, and evaluating credit, capacity, capital, and collateral. MGIC offers complimentary webinars every month to help customers succeed in today’s mortgage insurance industry.

Arch MI is offering mortgage lending education through up-to-date content, expert trainers and convenient formats. And starting in July, when you complete three of Arch’s webinars, you’ll earn its Arch MI Academy Certificate of Education.

The FAMC July 2020 Wholesale “Customer Training Calendar” offers a variety of training opportunities such as: Mortgage Fraud, Getting Your Name Out, Best Practices in Loan Processing, Evaluating Borrower Assets, How to Avoid the Email Delete Barrier and Get More Replies and Selling in a Purchase Market.

Genworth Mortgage Insurance provides complimentary webinar courses to help customers manage, protect, and grow their business, delivering you-centric solutions that matter. Check out the new That MI Guy course entitled “Leverage Your CRM,” to help you close more loans; get all the details on ALL of the GSE communications from Q2 in “Quarterly Agency Updates,” and brush up on Fannie Mae and Freddie Mac’s renovation products as well as HomeReady® and Home Possible®. View the July Training Calendar here.

Join AEI’s Housing Center director Edward Pinto and director of research Tobias Peter for the monthly update of AEI’s Housing Market Indicators on Wednesday, July 1st, 11:00–11:45 AM. Please RSVP by 4:00 PM ET this Tuesday, June 30th to receive call-in information for the briefing on Wednesday, July 1st.

Statistics show that the average consumer will obtain 7-11 loans over the course of their lifetime but only 25% will go back to their original lender when they are looking for another loan. Register for Insellerate’s New Webinar on July 7th – “How To Retain A Customer For Life Through Modern Automation” hosted by Josh Friend, CEO Insellerate and Grant Moon, CEO Home Captain.

Refinitiv’s Eikon Platform Webinars can be used to stay on top of markets, help generate alpha, and enhance your ability to service your clients. CE credits will be provided for each course attended: Technical Indicators: July 8th at 14:00 EDT This session will explore some of the key technical indicators. Learn how to differentiate between convergence and divergence signals. This class will help you improve your understanding of when to use the appropriate technical indicator.

Capital markets

For those that spend their lives worrying, are the new coronavirus cases across the U.S. part of a second wave? Or did the first wave never end? With a record number of cases reported in successive days last week, I’m not sure the semantics matter so much. What really matters is that I cannot go to the bars in Florida or Texas for the foreseeable future. Fortunately, I avoid state income taxes in Nevada, and the bars are still open here! MBS and Treasuries rallied sharply in a risk-off trade to close out last week, not only because investors realized the virus is far from contained, but also due to increased tensions between the U.S. and China, along with the adverse reaction to the bank stress test results from late Thursday. The 10-year yield closed the day -4 bps, -6 bps for the week.

Aside from paranoia surrounding the virus moving markets, there were some actual economic releases on Friday. Consumer spending surged by a record 8.2 percent in May as Americans spent relief payments on newly opened stores and restaurants. Still, the number missed consensus and remains well below pre-pandemic levels. Incomes dropped 4.2 percent, less than the 6 percent decline forecast following a 10.8 percent increase in April due to stimulus checks. The important takeaway is that the personal savings rate, as a percentage of disposable income, remains very high at 23.2 percent. While the figure is down from 32.2 percent in April, a high savings rate means less spending activity, which means less economic growth. Separately, the final University of Michigan Index of Consumer Sentiment for June fell from the preliminary reading, slightly missing expectations. It was still a higher sentiment level than May, and moving forward, consumer attitudes and demand will be influenced by the progress or regression against the coronavirus.

Today’s economic calendar is very light, with May Pending Home Sales and the Dallas Fed Manufacturing Index slated for later this morning. We will also have some Fed speak, with San Francisco Fed President Daly and New York Fed President Williams delivering remarks. Things pick back up tomorrow with the April S&P Case-Shiller Home Price Index, June Chicago PMI, and June Consumer Confidence. Additionally, Chair Powell will testify before the House Financial Services Committee on the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

The midweek calendar brings the usual Weekly MBA Mortgage Index, June ADP Employment Change, May Construction Spending, the June ISM Manufacturing Index, and the minutes from the June 9 / 10 FOMC meeting. Thursday is understandably busy ahead of the Independence Day holiday on Friday, and will include an early close. Releases include the June Payrolls report, May’s Trade Balance, weekly jobless claims, and May Factory Orders. With regards to MBS and in addition to tomorrow’s month-end trade, the Desk is scheduled to purchase up to $18.142 billion MBS between Monday and Thursday’s early close. Today, the NY Fed will conduct a repeat of Friday’s schedule totaling $4.665 billion when they purchase $1.768 billion GNII 2.5 percent and 3 percent followed by up to $2.897 billion UMBS30 2 percent through 3 percent. We begin the day with Agency MBS prices worse a shade and the 10-year yielding .65 after closing last week at 0.64 percent on not much news.

2020: Written by Steven King, directed by Quentin Tarantino.

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, “Knowing a Borrower’s Mind”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 27: Morale & innovation in WFH environment; Fannie’s recent secondary deals; Company spotlight: Mortgage Sentinel

With the dramatic increase of COVID-19 cases in the United States and the world, and returning to captivity at home, it is never too early to start working on that bathing suit body for… 2021. Sure you’ve proved you can work from home. Productivity has gone way up, arguably because there isn’t much else to do besides work. LOs and AEs and other salespeople have been doing that for decades. But what about office culture, or encouraging innovation? How does management make it different working from home as an underwriter for Quicken Loans, United Wholesale, Freedom, Fairway Independent, Bay Equity, U.S. Bank, Caliber, or whoever? Companies are trying online plank-holding contests, daily chats from senior management, virtual co-worker happy hours, walk and talk Zoom meetings, guided meditation, and other things in an effort to build brand loyalty. And where do ideas come from, when in the past they came from chatting informally at lunch, passing by a co-worker’s desk, or on the way to the car at the end of the day? It is easy to argue that innovation is impossible to schedule for a WebEx call. But companies are trying. And executive coaching services are focused on boosting remote morale.

Saturday Company Spotlight

This week we highlight Mortgage Sentinel’s focus on the founding, growth, employee mentoring in a work from home environment, entrepreneurship and charity work, and spoke to Jim Paolino (CEO of LodeStar Software Solutions, a partner in Mortgage Sentinel).

In 3-5 sentences, describe Mortgage Sentinel (when was it founded and why, what it does, where, recent growth, and plans for near-term future growth). The company was founded in Philadelphia in 2020, and provides QA services to the mortgage industry that feature “secret shopping” techniques. This is a first of its kind service for mortgage lenders and helps originators gain insight into the interactions their team has with borrowers. We can help improve the overall sales performance while helping to ensure lenders are compliant with consumer-focused guidelines and regulations.

 

Mortgage Sentinel is a partnership between two industry leaders: LodeStar Software Solutions specializes in web-based compliance tools for the mortgage and title insurance industries, and RDAssociates, Inc. a competitive intelligence, market research and business development firm. They are experts in quality assurance and regulatory compliance research techniques.

 

Tell us about company culture and what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why. Because we are a newer brand, we are still building our corporate culture, which includes the charities we will support most. But both the founding companies have a history of helping various not-for-profit organizations in Philadelphia, including Philabundance, the area’s largest hunger relief organization.

 

What things you are most proud of that don’t have to do with sales? Mortgage Sentinel is founded on the ideals of bringing equality and transparency in the mortgage industry. By the nature of its service, Mortgage Sentinel helps mortgage originators ensure that all borrowers are being treated fairly regardless of their demographic or overall circumstances. Given the biases that exist in society at large, it is imperative that all organizations take a look at how they treat their customers. Mortgage Sentinel is in a unique position to assist with this process.

 

What does Mortgage Sentinel hope to achieve in the next five years? We founded Mortgage Sentinel on the concept that we, as an industry, can do even better in playing our part to ensure fairness and equality in the greater economy. We are also disappointed when we see companies being notified of violations at the point of borrower/originator contact (e.g. loan officers, account executives) for the first time by way of violation and penalty. We feel it’s nearly impossible to truly track or monitor what a company’s borrower-focused employees are doing at all times, and that there needs to be a proactive way to catch violations, many of which may be unintentional or the result of inadequate training (or even inadequate guidance by the regulating agency), and correct them before that firm needs to be penalized. Mortgage Sentinel is our vision for providing just that.

(For more information on having your firm featured, contact Chrisman LLC’s Anjelica Nixt.)

Borrower’s rates helped by the capital markets

The Agencies (aka Freddie and Fannie) continue to help that process in both the primary and secondary markets, hoping to achieve competitive pricing in the secondary market while limiting risks borne by taxpayers. Along those lines, billions of dollars of conforming conventional loans have been bundled into CRT (Credit Risk Transfer) bond deals, nonperforming, or multifamily deals, which help reduce taxpayer exposure to the large book of mortgages guaranteed by the two housing giants and help the Agencies manage their capital.

These deals involve sharing part of the credit risk with third party investors – for a price. In the deals, the investors pay cash up front and purchase debt securities that are designed to absorb the credit losses on GSE (government sponsored enterprises) loan pools. The goal is to attract private capital into the mortgage market and shift some risk away from taxpayers since we are currently on the hook for Freddie & Fannie. Fannie Mae and Freddie Mac have still been pricing transactions to aid liquidity in the mortgage space, providing support for its borrowers and up-to-date disclosures for our investor base. And that helps rate sheet pricing for borrowers! Let’s see what Fannie has been up to lately.

First a walk down Memory Lane. Fannie Mae’s Capital Markets team provided a very well-written recap of recent MBS liquidity in the market. Daily origination volumes, which averaged $3.9 billion in the first two months of the year, doubled to $7.8 billion in the first two weeks of March. Volumes peaked to 2.36 times the yearly average a week ago (Tuesday), when the market was forced to digest $13.1 billion in mortgage supply. With the 10-year Treasury rallying to an all-time low of .36 percent last Wednesday, lenders have been challenged by capacity constraints. Limited demand for TBAs caused mortgage spreads to widen to levels not witnessed since the 2008 financial crisis, and large pickups in production over this month have caused specified pool pay-ups to fall dramatically since the March Class A settlement. Volatility has been the main hamper on MBS liquidity, with no end in sight. Bid-Ask spreads on TBA prices remain significantly wider than screens currently reflect, making it extremely difficult for the desk to execute TBA trades as pockets of liquidity have been rapidly disappear. Fannie experienced regular covers that were several ticks behind the winning levels, and liquidity became scarce enough that subsequent trades were met with even wider cover levels. Going forward, finding liquidity will continue to be challenging and Bid/Offers will likely continue to trade in a volatile range as dollar prices reflect the current state of the market’s depth.

On June 10, Fannie Mae priced FNA 2020-M29, its sixth Multifamily DUS REMIC in 2020 totaling $719.5 million under its Fannie Mae Guaranteed Multifamily Structures program. All classes of FNA 2020-M29 are guaranteed by Fannie Mae with respect to the full and timely payment of interest and principal. The structure details for the multi-tranche offering are as follows. Class A1 has an original face of $90,800,000, a weighted average life of 5.79 years, a fixed coupon of 0.946 percent, and an offered price of 100 with a S+46 spread. Class A2 has an original face of $513,729,819, a weighted average life of 9.86 years, a fixed/AFC coupon of1.492 percent, and an offered price of 102 with a S+51 spread. Class 2A3 (I think that is Elon Musk’s baby’s nickname) has an original face of $115,000,000, a weighted average life of 9.79 years, a fixed coupon of 1.449 percent, and an offered price of 102 with an S+47 spread.

Earlier in the year Fannie Mae priced its second Multifamily DUS REMIC in 2020 totaling $1.03 billion under its Fannie Mae Guaranteed Multifamily Structures (GeMS) program. In addition to the traditional 10-year fixed-rate collateral, the February M5 deal offered a floating-rate execution off of an ARM with a LIBOR-based floater and an embedded 6 percent cap on the pass-through rate. Fannie will now work to develop a SOFR-based variable-rate product. All classes of FNA 2020-M5 are guaranteed by Fannie Mae with respect to the full and timely payment of interest and principal. The $219.4 million Group 1 is comprised of 35 Fannie Mae DUS MBS based primarily in Texas (41.8 percent), Illinois (10.5 percent) and Indiana (9.6 percent) with a weighted average debt service coverage ratio of 1.47x and a weighted average LTV of 69.1 percent. Group 2 is comprised of $817.7 million in UPB across 69 Fannie Mae DUS MBS, primarily in Texas (14.6 percent), Virginia (13.5 percent) and Georgia (9.6 percent), with a weighted average DSCR of 1.50x and a weighted average LTV of 67.4 percent. For additional information, please refer to the Fannie Mae GeMS REMIC Term Sheet (FNA 2020-M5) available on the Fannie Mae GeMS Archive page.

And Fannie Mae priced its fourth Multifamily DUS REMIC in 2020 totaling $1.07 billion under its Fannie Mae Guaranteed Multifamily Structures (GeMS). Per Fannie Mae, the M14 deal captures the appeal of conservatively underwritten, Fannie Mae multifamily collateral in the face of recent volatility. Fannie Mae remains committed to transparent disclosure for investors in navigating the challenges of the current commercial real estate market. Group 1 collateral consists of $624.528 million in UPB across 43 Fannie Mae DUS MBS, primary geographic distribution in CA (34.07 percent), NC (13.86 percent), and WA (10.54 percent), with a weighted average debt service coverage ratio (DSCR) of 1.87x and a 64.5 percent LTV. Group 2 collateral consists of $448.329 million in UPB across 70 DUS MBS with primary geographic distribution in VA (12.00 percent), NY (11.39 percent), and FL (11.03 percent), with a weighted average DSCR of 1.33x and a weighted average 73.1 percent LTV. All classes of FNA 2020-M14 are guaranteed by Fannie Mae with respect to the full and timely payment of interest and principal.

Fannie Mae announced the completion of its first multi-tranche Multifamily Credit Insurance Risk Transfer (MCIRT 2020-01) transaction of 2020 covering a pool of approximately $8.7 billion of existing multifamily loans in the company’s portfolio. The covered loan pool for the transaction consists of 1,017 loans acquired by Fannie Mae from July 2019 through September 2019. These loans are secured by 1,019 properties. Each loan has an unpaid principal balance of less than $30 million. With MCIRT 2020-01, which became effective February 1, 2020, Fannie Mae will retain risk on the first 75 bps of losses on the reference pool. The C tranche will transfer risk to reinsurers covering losses between 75 bps and 150 bps. The B tranche will transfer risk to reinsurers covering losses between 150 and 275 bps. The A tranche will transfer risk to reinsurers covering losses between 275 and 400 bps. Once the pool has experienced 400 bps of losses, the credit protection will be exhausted and Fannie Mae will be responsible for any further losses. This new transaction is the eighth Multifamily CIRT transaction, and transfers approximately $283 million of risk to reinsurers and insurers as part of Fannie Mae’s ongoing efforts to increase the role of private capital in the multifamily mortgage market. Fannie now expects regular programmatic issuance in the market with one transaction in each quarter. Since 2016, in addition to the risk retained by Fannie’s DUS lender partners, Fannie Mae has transferred a portion of its credit risk on multifamily mortgages with an aggregate unpaid principal balance of more than $80.6 billion through the MCIRT program.

And Fannie Mae announced that it priced its second Multifamily Connecticut Avenue Securities (MCAS 2020-01) transaction as part of the company’s ongoing efforts to expand the types of loans covered and promote the continued growth of the credit risk transfer market. MCAS Series 2020-01 is a $425.6 million note offering that complements Fannie Mae’s Delegated Underwriting and Servicing (DUS) and Multifamily Credit Insurance Risk Transfer (MCIRT) programs. The reference pool for MCAS Series 2020-01 consists of approximately 218 multifamily mortgage loans with an outstanding unpaid principal balance of approximately $12 billion. The reference pool includes first-lien multifamily loans underwritten according to Fannie Mae’s standards and acquired by Fannie Mae from January 1, 2019, through June 30, 2019. The loans included in this transaction are a combination of fixed-rate and adjustable-rate multifamily mortgages with unpaid principal balances equal to or greater than $30 million and that have terms less than or equal to 12 years, in addition to other select eligibility requirements. Pricing for the three offered classes is as follows. Class M-7 has an offered amount of $43.2 million, expected initial credit support of 4.793 percent, and is priced at 1-month LIBOR plus 195 bps. Class M-10 has an offered amount of $339.8 million, expected initial credit support of 1.200 percent, and a pricing level of 1-month LIBOR plus 375 bps. Finally, Class C-E has an offered amount of $42.5 million, expected initial credit support of 0.750 percent, and a pricing level of 1-month LIBOR plus 750 bps.

(Thank you to Rhonda M. for this one.)

“I’m from the Gumamint and I’m gonna help you!” Here is an amusing story, as well as a reply to an over-reaching bureaucracy that seldom sees itself on the other end of its ridiculous regulations.

The State of Oregon Department of Fish and Wildlife sent a letter to a home/landowner asking for permission to access a creek on his property to document the decline in a certain species of unheard-of frogs. The property owners’ response in the second letter is worth the read.

Original Letter from Oregon Dept. of Fish & Wildlife:

Dear Landowner:

ODFW Staff will be conducting surveys for foothill yellow-legged frogs & other amphibians over the next few months. As part of this research we would like to survey the creek on your property. I am writing this letter to request your permission to access your property.

Recent research indicates that foothill yellow-legged frogs have declined significantly in recent years and are no longer found at half their historic sites. Your cooperation will be greatly appreciated and will help contribute to the conservation of this important species.

Please fill out the attached postage-paid postcard and let us know if you are willing to let us cross your property or not. If you have any concerns about this project please give us a call. We would love to talk with you about our research.

Sincerely,

Steve Niemela

Conservation Strategy Implementation Biologist

RESPONSE FROM LANDOWNER:

Dear Mr. Niemela:

Thank you for your inquiry regarding accessing our property to survey for the yellow-legged frog. We may be able to help you out with this matter.

We have divided our 2.26 acres into 75 equal survey units with a draw tag for each unit. Application fees are only $8.00 per unit after you purchase the “Frog Survey License” ($120.00 resident / $180.00 Non-Resident). You will also need to obtain a “Frog Habitat” parking permit ($10.00 per vehicle).

You will also need an “Invasive Species” stamp ($15.00 for the first vehicle and $5.00 for each additional vehicle) You will also want to register at the Check Station to have your vehicle inspected for non-native plant life prior to entering our property. There is also a Day Use fee, $5.00 per vehicle.

If you are successful in the Draw you will be notified two weeks in advance so you can make necessary plans and purchase your “Creek Habitat” stamp. ($18.00 Resident / $140.00 Non-Resident).

Survey units open between 8 am and 3 pm. but you cannot commence survey until 9 am. and must cease all survey activity by 1 pm. Survey Gear can only include a net with a 2″ diameter made of 100% organic cotton netting with no longer than an 18-ft handle, non-weighted and no deeper than 6′ from net frame to bottom of net. Handles can only be made of BPA-free plastics or wood.

After 1 pm. you can use a net with a 3″ diameter if you purchase the “Frog Net Endorsement” ($75.00 Resident / $250 Non-Resident). Any frogs captured that are released will need to be released with an approved release device back into the environment unharmed.

As of June 1, we are offering draw tags for our “Premium Survey” units and application is again only $8.00 per application. However, all fees can be waived if you can verify “Native Indian Tribal rights and status”.

You will also need to provide evidence of successful completion of “Frog Surveys and You” comprehensive course on frog identification, safe handling practices, and self-defense strategies for frog attacks. This course is offered on-line through an accredited program for a nominal fee of $750.00.

Please let us know if we can be of assistance to you. Otherwise, we decline your access to our property but appreciate your inquiry.

Sincerely,

<name removed>

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, “Knowing a Borrower’s Mind”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 26: LO, Ops jobs; DPA, forbearance, broker products; FHA, USDA tweaks; Treasury/MBS spread update

There are plenty of tricks in any trade. Just-opened cellulose sponges are already damp because many are premoistened with sterile water. (Without H20, the material shrivels and hardens and looks unattractive in the store.) Watch a car commercial on TV: many have the street watered down to make the asphalt dark and the car reflect. Don’t ever, ever put anything on a hospital floor. In the old days, when there were open houses, a smudge of vanilla on a light bulb made the house smell like cookies. We’ve all heard of Freedom of the Press. What about “Freedom of the Font?” Under the category of “you can’t make this stuff up,” Goldman Sachs released a new font with which you’re not allowed to criticize Goldman Sachs! Lastly, in keeping with this non-mortgage opening paragraph, did you know that, for the highway engineering trade, expanding a highway makes the traffic worse?

Employment & hires

Bluepoint Mortgage is hiring key positions to aid in its continued success and growth. BPM is currently hiring DE, VA, and Conventional Underwriters, Quality Control Specialists, Account Managers, Disclosures, Funders, and Account ExecutivesWhen polled, Bluepoint employees named the top five reasons to work at Bluepoint as leadership, recognition, growth opportunities, inclusion, and comradery. Being the #2 wholesale lender in CA and #9 in the nation is serious business and takes dedication. That said, BPM knows how to have some fun and break up the day to keep employees engaged and motivated. Please email careers@bluepointmtg.com to inquire about open positions. For more information on Bluepoint, or to become an approved broker, please visit www.bluepointmtg.com.

People’s United Bank has opportunities for talented mortgage loan originators to join our growing organization. Our Mortgage Loan Officers are supported by an experienced team that creates an environment for growing your business and providing your clients excellent service and products. Positions are currently available in Westchester and Rockland Counties in New York. As an Assistant Vice President, Mortgage Loan Officer, you will originate residential mortgages through our retail branch network and self-generated referral sources. We are a portfolio lender offering a wealth of portfolio products to our customers. To learn more about these positions and to apply online, please visit our website at www.peoples.com/careers or you can email your resume to Elise Saltzman. Join us and show what your know-how can do.”

Wyndham Capital Mortgage knows the advantages of implementing digitally driven solutions don’t just apply to borrowers. With the launch of its partnership with Workday, Wyndham Capital is fusing its employee experience with the latest in human resources technology. Whether it is a potential employee working through the application process, or a current employee researching information or increasing their knowledge base, leveraging this technology will have impacts across the board. Wyndham Capital is currently driving the transition to the Workday platform for all employee and recruiting needs. What does this mean? That once again, Wyndham is recognizing the force technology can have to create a smarter, smoother, more efficient organization. As the leading digital home lender, Wyndham Capital is bringing next-generation benefits to today’s workplace, building an organization where employees are given the tools to streamline their days and maximize their success. Click here to learn more about joining the Wyndham team.

Northpointe Bank is recognized as a top-performing bank in the nation by the Independent Community Bankers of America. Northpointe is honored, once again, to be named a top-performing bank by the ICBA, according to FDIC return-on-asset and the institution’s focus on efficiency and personal service. This is the seventh year in a row Northpointe Bank is ranked a top performing bank in the nation out of approximately 5,000 ICBA member banks. Northpointe attributes its consistent success to its client-first culture.  “Our customers are offered more loan products, including zero down payment loans, construction and renovation lending and personalized portfolio loans,” said Michael Winks, president, lending & retail banking at Northpointe. “Also, we have leveraged proprietary technology, such as Home, our lending app that allows borrowers to submit an application, upload and e-sign documents, as well as make their loan payments all from a single secure login”, Winks added.

A mid-sized publicly held depository bank is continuing to expand its residential mortgage reach, and is looking for branches and originators in Texas. Capacity has not been an issue for this Bank, and it has a wider variety of programs than most, and is Ginnie, Fannie, Freddie approved. Confidential resumes/notes of interest should be submitted to me for forwarding; please specify the opportunity.

Total Expert, a fintech software provider for bank, mortgage, and credit union marketing and sales teams, welcomes Josh Lehr as its Director of Strategy, Consumer Direct. Josh will expand Total Expert’s mortgage technology solutions for lenders and loan officers, focusing on lead management and sales productivity offerings. Congratulations!

Lender products & services

Mortgage servicers are struggling to right-size preparedness for when forbearance ends and moratoriums are lifted.  There really is no way to predict staffing levels needed over the next 12+ months to prepare for the imminent spike in loss mitigation activity.  This webinar will introduce self-service options to allow borrowers to secure post-forbearance relief in minutes, while avoiding manual credit processing and operational errors.  With the expected uptick in loan modifications, short sales, mortgage releases and foreclosures, the right technology can considerably reduce operational strain, regardless of the source system or collections platform. Register now.

The results are in and Scotsman Guide has ranked Bluepoint Mortgage a Top Ten Mortgage Wholesaler in the Nation for the second year in a row. Tremendous year-over-year growth has hurtled Bluepoint onto the major playing field of wholesale mortgage banking, funding hundreds of loans per month with a lending footprint in 29 states and counting. Managing Partner, Mark Matta, attributed Bluepoint’s success to its long-standing commitment to lend responsibly and transparently to the Broker Community and its borrowers. Becoming one of the Nation’s Top Lenders is also credited to the people who make up Bluepoint. On the list of Scotsman Guide’s Top Account Executives are Chris Calderon ranked #2 in the entire country, Allen Samuel ranked #35, Diego Chavez ranked #115, Demanche Clemente ranked #125, Rebecca Raff ranked #131, Steven Peinado ranked #139, and Mynor Arevalo ranked #142. Become an approved Broker with Bluepoint!

Altisource, your one source for real estate and mortgage solutions, has released a white paper entitled “Navigating the Challenges of COVID-19 Now and in the Future.” On May 6, Altisource hosted the Mortgage Industry Pandemic Summit, a virtual symposium with 28 leading experts discussing the operational and economic challenges mortgage, real estate and financial companies are facing as a result of COVID-19. The company’s new 24-page white paper summarizes the summit’s key ideas, best practices, guiding principles and expert advice. It also includes the results and analysis of 20 poll questions conducted during the sessions. Read the paper now to see how other mortgage industry professionals are responding to the current pandemic. Click here to download.

 

Compass Analytics, part of Black Knight, introduced new forbearance modeling capabilities in its latest release of CompassPoint, an industry-leading platform for pipeline risk management, hedge advisory services and MSR valuation. The new forbearance model enables lenders to explicitly model the price impact of loans in forbearance, including the expected forbearance period, additional cost to service, likelihood of curing successfully, monthly payment considerations and more. This powerful new functionality, in conjunction with the Servicing Advance Calculator released in late March, arms clients with the tools they need to make optimal servicing retention decisions in a challenging market. Please visit https://compass-analytics.blackknightinc.com/compasspoint/ to learn more about CompassPoint.

Chenoa Fund demonstrates how responsibly run national DPA programs benefit the consumer. Innovative financial solutions, such as our CRA Note Exchange, have allowed us to offer the Rate Advantage program, which offers rates competitive with standard FHA loans, even with DPA included. Also, by running mortgage banking in-house vs. outsourcing operations through large bankers, we have brought costs down to consumers, while helping lenders avoid losses on DPA. Additionally, through careful monitoring of our loan defaults, we added overlays to mitigate risk without eliminating offerings to underserved populations. Independent financial/operational audits are conducted throughout the year to assure partners our compliance with all industry requirements.  We constantly strive to improve our offerings, pricing, and service.  These measures allow us to serve significantly more minority homebuyers than any other DPA program (54% of borrowers are minorities).  We sincerely thank each of our amazing correspondent lenders, making our program available where most needed.

FHA & USDA

USDA released an announcement informing lenders of foreclosure and eviction moratorium for all USDA Single Family Housing Guaranteed Loans Program (SFHGLP) loans that has been extended through August 31, 2020, in connection with the Presidentially declared COVID-19 National Emergency.

FHA issued an Extension of Foreclosure and Eviction Moratorium in connection with the Presidentially Declared COVID-19 National Emergency. ML 2020-19 announces a second extension of the foreclosure and eviction moratorium through August 31, 2020. Read the Press Release.

USDA is in the process of building a new Guaranteed Underwriting System (GUS) user interface (UI) to support the new Uniform Residential Loan Application (URLA) and Uniform Loan Application Dataset (ULAD) and to modernize GUS. To prepare lenders for the March 1, 2021 mandate and gain insight to what is occurring, the SFH Guaranteed Loan Program URLA/ULAD implementation timeline and testing timeframes are available for review.

As part of Wells Fargo Funding response to the COVID-19 national emergency, they’re implementing a temporary minimum Loan Score of 680 for all FHA, VA, and Guaranteed Rural Housing (GRH) Loans, regardless of automated underwriting system (AUS) decision. Effective for Best Effort Registrations, Locks, relocks, and renegotiations on and after April 1, 2020 and Mandatory Commitments on and after April 1, 2020

Hyperion Bank broadened service-centric offerings with major mortgage expansion with the launch of Hyperion Mortgage, LLC, a significant expansion of its existing mortgage program. Promising comprehensive lending options tailored personal service and local decision making; Hyperion Mortgage offers conventional, jumbo, FHA, VA, construction-to-permanent, home renovation, home equity (HELOC) loans, portfolio mortgages and more.

All VVOE/VVOIs must be completed by an HR representative, owner, digital vendor, or a supervisor as indicated by the payroll system and be completed within the below timeframe:

Caliber Home Loans posted an update to COVID-19 overlay regarding Wage Earner VVOE and VVOI for Conventional, FHA, VA, and USDA Purchase and Rate Term Refinance Transactions. VVOE must be completed within 6 business days of the note date and VVOI must be completed within 15 calendar days of the note date. Cash out transactions: VVOE/VVOI must be completed within 3 business days of the note date.

Effective with new commitments taken on and after 6/23/2020, for FHA Streamline Refinance transactions, AmeriHome Mortgage will require a verbal VOE or third-party verification of income source will be required for both Credit Qualifying and Non-Credit Qualifying refinances.

Mountain West Financial® has added 2%, 3% and 5% down payment and closing cost assistance (DPA) options for Texas Department of Housing and Community Affairs (TDHCA) FHA loans. For complete details, refer to the Texas Department of Housing and Community Affairs Matrix and Overview.

Capital markets

With the 10-year yield content around .70 percent, and 30-year mortgage rates around 3.00 percent, what now? Any decline in rates will likely come from reduction in the primary/secondary spread, which measures the difference from where the lender can sell a home loan into the secondary market and where the lender will offer one to a borrower. Over the last five years, the spread has averaged roughly 1 percent, but is currently well above that, 1.72 percent this week. The spread is part of a measure of how much risk lenders believe there is within mortgages, and has recently kept rates higher than they otherwise would be, due to economic damage from the coronavirus and forbearance. As the economy improves, lenders will gradually tighten the primary/secondary spread back towards that 1 percent figure, which could reduce mortgage rates by up to three-quarters of a percent. Granted, as the economy improves, mortgage rates will naturally rise.

We live in a 24-hour news cycle, but it seems the headlines this week have all been the same: the coronavirus is continuing to spread, with a record 37k new domestic cases reported on Wednesday, and it is forcing businesses to rethink their plans to reopen. MBS prices and Treasury yields were roughly unchanged yesterday, maybe because of the lack of “new” news. The concerns weighed on risk tolerance, but did not fuel much of a risk-off response. As far as economic releases went, jobless claims showed an eye-watering 47 million people have signed up for benefits since mid-March. The downward trend may not accelerate until after the benefit boost expires at the end of July, but new worries abound as the reacceleration in coronavirus case counts and a rethink of reopening efforts may cause another wave of layoffs. With parts of the economy potentially needing to shut down again to control the pandemic, it is looking increasingly likely that rather than a “V” or “U” shaped recovery, it may be a series of W’s. New orders for durable goods increased by 15.8 percent in May after dropping by 18.1 percent in April, with all major categories except commercial aircraft experiencing a bounce back. Let’s not get ahead of ourselves: new order levels year to date are 13.6 percent lower than the same period a year ago on a not seasonally adjusted basis.

May personal income and spending (-4.2 percent, +8.2 percent, respectively, both lower than expected) kicked off today’s week-end calendar. Additionally, we have had Core PCE prices (+.5 percent). Later this morning brings final June Michigan sentiment. The NY Fed will conduct two FedTrade MBS purchase operations totaling up to $4.665 billion starting with up to $1.768 billion GNII 2.5 percent and 3 percent followed by up to $2.897 billion UMBS30 2 percent through 3 percent. We begin today with Agency MBS prices little changed (like all week!) and the 10-year yielding .66 after closing yesterday at 0.67 percent.

2020 is going to be synonymous for “crazy” for the rest of time.

“Hey, stay away from that guy in accounting over there. He’s 2020.”

“That borrower went 2020 when I scolded her about buying a car two days before closing.”

“Your Honor, I gained control of the car after avoiding the pedestrian, but then things went 2020.”

“As soon as I let the cow into the pen, the steer went 2020.”

“That loan officer is driving me 2020!”

“I’d have to be 2020 to approve that loan!”

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, “Knowing a Borrower’s Mind”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 25: Management, Ops, LO jobs; marketing, processing, default products; primer on high bal pricing

Some things are uncertain, like whether colleges, driven by ticket & TV income, bring back their football players when the rest of the student body “remains virtual” this autumn. (Harvard law school is online for the fall semester, for example, leading to a tuition lawsuit, of course.) Or if your company is giving you July 3 off (the bond markets are closed). Other things are certain, like the mortgage-level data from the 5,500 institutions reporting HMDA data for 2019. Or states putting anyone who visits certain states into quarantine. I receive emails all the time from brokers and LOs who are certain their high balance pricing is the worst in the industry. Why? An explanation is below in the Agency section.

Employment

Caliber Home Loans is taking positive action, building diversity, raising our voices, and looking ahead. Our reputation as a great company to work for is illustrated by Caliber’s sponsorship of Employee Resource Groups (ERGs) which provide career networking for professional and personal development. These principles begin at the top with Sanjiv Das, CEO, and are echoed throughout our leadership and by Caliber team members. Currently, we have ERGs representing Military Veterans, Women in Business, and the LGBTQ community. Join Caliber, where diversity is celebrated, and mutual respect is core to our culture. If you have an interest in one of our posted job opportunities, please contact Jonathan Stanley for consideration. If you are interested in a sales opportunity at Caliber, please contact Brian Miller for immediate consideration.”

 

Synergy One Lending (“Synergy One”) is pleased to announce the Management-led asset purchase (“MBO”) of the company’s distributed retail channel and the Synergy One brand from Mutual of Omaha Mortgage. The terms of the acquisition were not announced. The MBO was led by industry veterans Steve Majerus, CEO, and Aaron Nemec, President. Synergy One has quadrupled its loan production in three years, breaking into the top 100 retail mortgage lenders in 2019 ranked #53 in Scotsman’s Guide. “Aaron and I are sincerely grateful for the opportunity to lead Synergy One into the future. Our confidence in our team and our collective ability to execute couldn’t be higher,” said Majerus. Synergy One is based in San Diego, CA, is currently licensed in 29 states and has Operational HUBS in Roseville, CA, Boise, ID, Denver, CO and Dallas, TX. If you’re looking for high growth opportunities contact Aaron Nemec.

 

A profitable, well-capitalized, regional full-service independent retail mortgage banker is looking for an established Regional Production Manager to help create and develop mortgage origination branch opportunities in the midwestern part of the country, Colorado, Arizona, Kansas, and New Mexico markets. “We are searching for an outstanding talent and proven retail sales leader with a demonstrated track record of hiring and managing multiple production offices across several states. We offer an entrepreneurial sales support environment, FNMA/FHLMC/GNMA direct seller/servicer/issuer status and are well-positioned to compete for more growth with state-of-the-art operations/support technology and a company -wide commitment to providing exemplary customer service. The Regional Production Manager will report to the CEO. If interested in the next step, please send a confidential resume and qualifications to Chrisman LLC’s Anjelica Nixt.”

 

“We’re hiring! Home Point Financial just announced 400% year over year growth, and we continue to grow at record pace. As a result of our growth (not just the current environment) we’re hiring an additional 69 senior underwriters as well as 105 operations positions. At Home Point, we offer an incredible bonus program, opportunities for overtime, and 100% remote work to fit your lifestyle during today’s challenging times. However, it’s our culture that makes us shine. Our ‘We Care’ commitment is a verb not a noun, which is evident through our initiatives. This, coupled with a supportive leadership team and multiple career development opportunities, makes Home Point a premier place to call home. We are the second-largest wholesale mortgage lender (per IMF), have an amazing partnership between sales and operations, and have welcomed 445 team members to our family since March. Join us! To apply please visit the careers section of our website or send your resume to John Eite.”

ACC Mortgage is hiring additional remote Non-QM underwriters and experienced AE’s to handle the increased volume and return of a healthy Non-QM market. ACC not only has the most complete Non-QM offering, we provide accounts, leads, and the support for the account executives to be successful. We have a leading comp plan with support, leadership, and stability.  If interested in joining our family, please send your resume to the president, Robert Senko, for consideration.”

Guaranteed Rate Affinity, a mortgage origination joint venture between Guaranteed Rate and Realogy, has hired industry veteran Joe Daly as National Renovation Sales Leader to advance the company’s renovation lending programs. Congratulations!

Lender services and products

Overstated & Understated Credit Scores are byproducts of socio-economic volatility. Heck, not all 700s are safe (or 600s risky) in the best of times! What’s your plan to understand borrowers holistically? Then, originate, fulfill, buy, and sell most efficiently across all channels using that deep insight. The actionable Mortgage Risk & Fairness Score is predictive, data-driven “intelligence” to pro-actively manage COVID-19, credit quality, financial inclusion, and capacity risk. It enables lenders to easily deploy advanced risk & behavioral analytics (propensity, segmentation, ability, and “willingness” to pay) that are validated (top 10 bank) & vetted (CFPB, OCC, Fed). Backward-looking Scores+DTI+LTV+ATR data & calcs struggle with this. “The Score” doesn’t replace existing acquisition or underwriting processes. But, at the tip of the spear, and as an ‘intelligence’ adjunct to underwriting, it will increase volume, inclusiveness, confidence, margins, efficiency, and capacity, and decrease risk. Click for info.

 

As COVID-19 continues to profoundly impact every aspect of business, Sourcepoint understands mortgage servicers must adapt quickly to a new normal. Its experienced Omnichannel Contact Center and Collections teams, and default support staff are available to serve your borrowers and ease their concerns, not only during normal times but also during periods of uncertainty. Backed by the most comprehensive set of servicing and collection licenses and a 5,000+ global workforce with US and global centers, Sourcepoint’s teams are well equipped to help your borrowers through these difficult times, whether fielding customer service inquiries, navigating through a forbearance application and the approval process to ensure they get the assistance needed in a timely manner, or working through loss mitigation or modification strategies, Sourcepoint is here to help. Learn more about Sourcepoint’s default servicing capabilities.

“Mortgage lenders today are all trying to find the right resources to maximize the opportunity of today’s rate environment. At Sutherland, we partner with our clients to create operational flexibility, scale, and process expertise. Being an experienced Business Process Transformation company with a global reach enables us to reduce costs while aligning the right mortgage specific resources that are experienced in Processing, Underwriting, Closing and Quality Control support. Whether you are looking to close more loans or increase your quality assurance scale, Sutherland is here to achieve your goals. To schedule a discovery call on our capabilities, email Neil Armstrong, AMP.”

Maxwell is back with another blog series: The Land of Unequal Opportunity takes an honest look at the housing & mortgage industry’s troubled past and the role we’ve played in perpetuating racial inequality. Our history might be uncomfortable to confront, but building a better future starts with accountability for our past mistakes. Thus, Part 1 tackles the problematic history (and enduring legacy) of redlining that continues to suppress Black homeownership rates and widen the racial wealth gap today. Read “The Land of Unequal Opportunity, Part 1: A History of Redlining and Its Lasting Impact on Black Homeownership” here.

 

The Agencies Never Sleep

Where the Agencies go, the industry will follow. Just think what would happen if we didn’t have them?

At some level, pricing matters. “Rob, my high balance conforming pricing stinks. Why?” Recall that around Thanksgiving Freddie and Fannie come out with the conventional conforming loan amounts for the following year, including loan amounts for high-cost areas. Conforming loan limits impact high-balance loans and jumbo loans. LOs know that the various programs come with different lending rules, potentially higher interest costs, down payments, and lending fees. Rates, vary, of course, and high-balance loans typically come with tighter requirements than regular conforming loans. Interest rates for jumbo loans can higher than for conventional loans because a borrower is asking for more money, so the loan carries more risk for a lender. But remember that jumbo loans do not have a 50+ gfee, which is why jumbo rates can be lower than conforming rates.

A big piece of the pricing pie is composed of the propensity to prepay the loan. And that hurts high-balance conforming loans, and has since SIFMA, the organization that creates delivery requirements for securities, set up the percentage of loans in high-cost areas that are allowed in mortgage-backed security pools. SIFMA laid out the definition of loans to borrowers in high-cost areas as “defined in 12 U.S.C. 1717(b)(2) (i.e. areas where 115% of the median home price exceeds the conforming loan limit) where the balance of the loan exceeds the conforming loan limit (“Superconforming Loans”) should be limited to no more than 10% of the total principal balance of a pool at the time of issuance to be eligible for good delivery in TBA (the loan details making up the pool “to be announced” when the security is created) trades.”

The TBA market is the most liquid, and consequently the most important secondary market, for mortgage loans. Investors don’t like a lot of variance in the loans making up a pool, so homogeneity is important. In an effort to “minimize liquidity disruption in this important market,” SIFMA limits the inclusion of higher-balance loans to 10 percent of the total balance of a pool eligible for TBA delivery. (SIFMA said “minimize,” not “eliminate.”) Borrowers in high-cost areas can still have access to Freddie Mac and Fannie Mae’s programs, so are not penalized by living in those areas and needing financing. But at a price.

Investors are concerned that prepayment behavior on high balance conforming mortgages is quite different than “regular” conforming conventional loans. Basically, if an investor buys a $1 million pool, and one loan for $100,000 pays off, oh well. If a $600,000 loan pays off, that is a problem. So SIFMA limits the higher-balance inclusion to 10 percent of a given pool, helping investor modeling and expectations, and thus helping the liquidity of the market. A portion of loans, instead of being underwritten to jumbo criteria, flow through DU and LP and into GSE hands and out of the private mortgage market. And lenders are very cognizant of that 10% cap, and price high-balance conforming loans accordingly: originating conforming conventional loans that can’t fit into securities for good delivery will sit on a warehouse line until they fit into a pool. And investors and lenders will price to avoid that.

To help limited English proficiency (LEP) borrowers who are experiencing mortgage-related difficulties due to the coronavirus national emergency, FHFA in coordination with Fannie Mae and Freddie Mac added new translations to the Mortgage Translations website. Site visitors can now choose English, Spanish, traditional Chinese, Vietnamese, Korean, or Tagalog when accessing scripts that servicers use when discussing COVID-19 forbearance with borrowers. The revised Mortgage Assistance Application (MAAp) is also available in the same six languages. For additional information about the assistance and protections provided by the Federal government during the pandemic, visit CFPB.gov/housing.

Yesterday Fannie Mae updated LL-2020-02, Impact of COVID-19 on Servicing, to modify the financial eligibility and reporting requirements for non-depository sellers/servicers. “The temporary policy change relates to the calculation of the liquidity requirement for sellers/servicers who service mortgage loans that are in a forbearance due to COVID-19 hardships. Fannie Mae Form 1002, Mortgage Bankers Financial Reporting Form, is being updated to capture COVID-19 forbearance activity. This Lender Letter update also extends the suspension of foreclosure-related activities through June 30.”

Fannie Mae’s Here to Help campaign offers servicers the resources and information needed to assist homeowners facing a hardship related to COVID-19.

Fannie Mae posted updated In Case You Missed It (ICYMI) which includes an overview of Selling Guide updates, Servicing Guide updates, new and updated Lender Letters, and Desktop Underwriter®/Desktop Originator® release notes.

As of June 17th, Fannie Mae has updated nine of the AAA matrices. Review each jurisdiction-specific AAA matrix revision history for additional details.

Capital markets

Markets have increasingly moved more due to news headlines surrounding COVID-19 than actual economic releases. It was a similar story yesterday, as coronavirus concerns weighed amid more record increases in certain hot spots, and Treasuries and MBS rallied across the curve as a result. Florida and California both set daily records for new cases. New York, New Jersey, and Connecticut now require visitors from virus hot spots to quarantine for 14 days. And the WHO warned cases in Latin America haven’t yet peaked even after rising 25 percent to 50 percent within the past week in some countries.

Separately, the U.S. is weighing new tariffs on $3.1 billion of exports from France, Germany, Spain, and the U.K., which could proliferate into a trade fight later this summer. As far as economic releases went, the FHFA Housing Price Index for April increased 0.2 percent. Chicago Fed President Evans warned that recurring outbreaks will probably hurt U.S. growth and keep unemployment levels elevated for some time, saying that spikes of infections “might be made worse by the faster-than-expected reopenings.” Fed speak rolls on today, with Dallas Fed President Kaplan, Atlanta Fed President Bostic, and Cleveland Fed President Mester all set to take the stage. Also with regards to the Fed, bank stress test results will be released in the afternoon. The central bank has purchased a massive $765 billion of mortgage bonds since March 16, and while the Federal Reserve is unlikely to slow its latest bout of quantitative easing, the 10-year Treasury yield isn’t forecast to drop any further, which does not bode well for lower mortgage rates.

Today’s economic calendar is just about done and dusted. Initial Claims for week ending June 20 (1,480,000, -60k) and Continuing Claims for week ending June 13 (19.5 million), Durable Goods Orders for May (+15.8 percent, strong) and orders, excluding transportation (+4.0 percent). Q1 GDP – Third Estimate (still -5.0 percent). Advanced Retail Inventories (-6.1 percent), and Advanced Wholesale Inventories (-1.2 percent). For those who like Treasury news, there are results from a $41 billion 7-year Treasury note auction this afternoon. The NY Fed will conduct two FedTrade purchase operations totaling up to $4.35 billion starting with $1.373 billion UMBS15 2 percent and 2.5 percent followed by $2.977 billion UMBS30 2 percent through 3 percent. We begin the day with Agency MBS prices nearly unchanged again and the 10-years yielding .66 after closing yesterday at 0.69 percent after the jobless claims and durable goods data.

You think you’ve had bad days? Keep an eye on the driver of the scooter near the top center of the screen – like an LO trying various programs for their borrower.

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, “Knowing a Borrower’s Mind”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

June 24: Ops, AE jobs; marketing, broker, tax products; VA, construction webinars; tech partnerships

Companies worldwide are grappling with continued travel bans, and how to bring back employees in waves, if at all. Others are re-designing office layouts, thinking about renting more space, and looking at the cost of footprint changes. Some employees can’t wait to return to office life, others are doing fine without commuting, and still others will spend part of the workweek at home and in the office, all the while helping clients & borrowers. Most “experts” expect less office space to be required. It’s crazy! Traditional economic models and measurements are in disarray as well, as any economist worth their salt will tell you. For starters, many of the government’s statistics are driven by surveys, and distressed people and businesses often aren’t wild about answering surveys. Federal Reserve Chairman Jerome Powell said the economy faces potentially significant long-term damage from higher unemployment and a wave of small business failures due to the coronavirus pandemic despite recent signs of an economic rebound. “Until the public is confident that the disease is contained, a full recovery is unlikely,” Mr. Powell told the Senate Banking Committee. Low rates ahead.

Employment, transitions, & retirements

A well-capitalized lender in Los Angeles is aggressively looking to bring on exceptional talent and is seeking an experienced VP of Operations to assist in continued growth by hiring, building, and managing a robust operations team of experienced Processors and Underwriters. The lender is operating on Encompass and originating all products including Conventional, FHA/VA, Jumbo and Non-QM. Excellent compensation and bonus structure and full benefit package. Please forward resumes to Chrisman LLC’s Anjelica Nixt.

“Looking for a company offering continuous growth, a full-scale marketing strategy, continued training, career improvement courses? At Carrington Mortgage we offer a complete suite of products including FHA, VA, FNMA, FHLMC and a robust menu of loan programs which has further fueled our growth. We are currently recruiting for an experienced AE with FHA and VA experience for the Chicago, IL, or if you are located in or around Plano, TX, join our Inside Sales team and make Chicago your calling territory. If you feel your sales skills and experience would be a fit with Carrington, please email John Cervantes.”

Would you like to be a Radian Account Manager in the Pacific Northwest? Here you go. Radian is looking

Interfirst Mortgage Company, a private equity-backed mortgage originator, announced that Lou Friedmann has been named Chief Marketing Officer where he will lead all of Interfirst’s strategic marketing and communications as the Company relaunches under a new business model that includes an integrated retail and wholesale residential mortgage origination offering.

It is the end of an era at MBS Securities as Gail Schaumann announced her retirement (set for the end of the month) and turning the proverbial reigns over to Sara Weber. “After more than 30 years in the securities industry, it is time to have time! I will forever appreciate, and be grateful for, all the wonderful people I have come to know in the mortgage banking and securities industries.”

Lender services and products

First American TaxSource property tax reporting delivers full national coverage with the most current tax status and rapid results through the latest technology and data resources vetted through multiple validations from one reliable, trusted partner. Lending professionals need on-demand, real-time tax status reporting outside of the cyclical tax cycle for transactional data that shows the currency of property tax payments to make informed decisions and mitigate risk. First American property tax status reporting creates workflow efficiencies in a single-source solution, delivered via robust, seamless API integration or online self-service PDF reports. As the industry leader in data and technology, American expertise, innovation, and consultative approach provide the best in tax status reporting services. From managing defaults or selling off a package of loans, to monitoring tax liabilities, procuring tax status reports outside of annual cycles is now easy!

Start doing business faster with Stearns Wholesale Lending. Secure a lock in 3 steps. Log into Stearns SNAP broker portal and use PriceIt to input loan data to generate pricing. Then, select your program and rate to forward lock and enter borrower’s first name, last name, address and social and lock instantly. If you’re not ready to lock you can save the scenario and revisit at a later date. The portal continues to be enhanced with tools such as Calc My Income, Instant VOI, MI Price It, and LO Portfolio making it easier for clients to submit a loan. If you’d like to be contacted by an Account Executive, Click HERE.

Record sales and 50 percent lower cost per loan! How Steven J. Sless and his PRMI Reverse Division rocked their best months ever using direct mail: “You know, PRMI is just a powerhouse in the mortgage industry now. And Monster Lead Group has been an unbelievable partner. Monster knows what they’re doing, they know how to make the phones ring, they know how to generate business, but they also know how important it is to help us grow a brand at the same time. It’s a real marketing system. It’s not just sending mail. I think the consistency of the campaigns is what we rely on… Our cost per funded loan is about 50 percent of the industry average… So that story should be told. We’re able to grow and scale our operation because of the predictability of the Monster campaigns. That is what’s allowed us to get to this point.”

Events for training & information

Mark your calendars Calyx customers: CalyxVision 2020 is headed your way! A completely reimagined, next generations user event, Vision 2020 will deliver both hands-on software training and strategic insights in an engaging, online format accessible from your own location. Join us from August 18-20 for live interaction with our software specialists, lenders, integrated service providers, insightful keynote sessions, overviews of the newest Calyx products and more! For more information, please visit the Registration page  or contact Calyx directly at calyxvision@calyxsoftware.com.

GSF Mortgage Corporation’s SVP of Construction Sales, Robert Stephens, will be hosting a webinar for partners, builders, and single close clientele on July 9th at 12:00 pm Central. As the construction market starts to see signs of recovery, Robert will give an update on the current market and on the Single Close Construction program offered by GSF Mortgage Corporation. Register here or reach out to Robert Stephens.

Join National Mortgage Professional Magazine and Boots Across America for a very special on demand webinar to become a “Certified Military Home Specialist.” This one of a kind webinar will help you build a rapport with your military niche market and provide them with the specialized skills they deserve, whether they’re seeking a VA loan or some other form of financing. Upon successful completion, you will receive your Certified Home Military Specialist certificate. Topics to be covered include: Increases knowledge and confidence to better serve military clients, establishing credibility specifically with this market, service members Civil Relief Act guidelines and benefits to share, pay and allowance categories and which ones to use, special situations, disability and retirement benefits, and resources to use and share. You may take and complete this course at your leisure. Click here to register.

Technology partnerships march on

Lenders, don’t miss your chance to have great insight into the CRM, Point of Sale, Origination, Closing and collaboration tools: All the mortgage technology solutions available in the market today. Participate in the System Survey, the first survey of STRATMOR’s 2020 Technology Insight Study, and get the answers you need. The System Survey can be completed in less than 10 minutes and lenders who participate receive the report for the survey for FREE. Take the System Survey now and rate the systems you’re using — hurry, this survey closes July 10!

Hey, did you know that there is actually whistle blower software!? There’s a lot of tech news out there; let’s take a random walk through what has crossed my desk lately about who’s partnering up.

IDS announced it has expanded its partnership to become the exclusive integrated document preparation vendor of Mortgage Builder. The newly rebuilt integration now fully incorporates the IDS eSignature platform and custom form generation capability and includes the migration of Mortgage Builder’s client base to idsDoc, IDS’ flagship document preparation platform, which is recognized for unequalled customization and superior customer service. The integration also supports new data points to meet more recent demands and upcoming needs, including TRID documents, eClosing process fields and impending URLA updates.

Ameriprise released an announcement on its new partnership with Embrace Home Loans giving Ameriprise clients’ access to mortgage products and services to complement their existing relationship to financial advisors. Ameriprise clients will gain competitive interest rates, no application fees, and a streamlined application process with a dedicated loan consultant from pre-qualification to closing.

OptifiNow integrated its platform with the Ellie Mae Digital Lending Platform, including using Encompass Partner Connect API technology. This integration allows lenders to share data efficiently and securely between the two to drive quality and efficiency in the loan origination process. OptifiNow’s extensive integration capabilities enable lenders to create an advanced sales and marketing process that connects data with Encompass and other vital systems.

SimpleNexus and Mortgage Coach have enhanced their integration with real-time data syncing for instant analysis of lifetime loan costs. The original integration ensured that every borrower who applies for a mortgage loan via SimpleNexus immediately receives Mortgage Coach Total Cost Analysis (TCA), improving the borrower experience by updating key loan information in real time and enabling loan professionals to incorporate video narration into TCAs from within the SimpleNexus app.

LBA Ware has announced that Centier, Indiana’s largest private, family-owned bank, has implemented CompenSafe to automate incentive compensation for its residential lending department. Built for the mortgage industry, CompenSafe is an automated ICM platform that bridges the gap between lenders’ loan origination and payroll systems to eliminate manual data entry and provide actionable insight into staff performance and profitability. Since implementation, Centier has reduced man-hours spent on calculating incentive comp by 99 percent.

Amid current challenges and social distancing measures, the new integration between Wipro Gallagher Solutions (WGS), and DocMagic, Inc., offers state-of-the-art, relevant functionality for lenders, settlement providers and other stakeholders. It allows borrowers to easily eSign documents and execute completely paperless eClosings, and will enable WGS to advance digital mortgage processes via a seamless integration to DocMagic services. With this partnership, WGS is expanding the scope of its NetOxygen suite of products to better equip lenders to overcome new lending challenges and provide seamless digital experience.

Sterling Federal Bank has selected Finastra’s Fusion Phoenix as its core technology to support its efforts to expands its business from consumer banking and mortgages to one with a strong presence in the commercial banking scene. Sterling Federal Bank already uses Finastra’s Fusion Mortgagebot and Fusion LaserPro for consumer loan and mortgage origination, servicing, and documentation. Fusion Phoenix will provide exceptional integration with these platforms, saving the bank over 50 hours of redundant data entry per month. Fusion Phoenix was also favored for its ability to service various loan types in a single system so staff only need to be proficient in a single system and will have all the information they need in one place.

Not so much technology but certainly a partnering, Ally Lending is offering home improvement financing partnering with Authority Brands, LLC, a leading provider of home services that includes more than 250 franchisees of Benjamin Franklin Plumbing, Mister Sparky Electric and One Hour Heating and Air Conditioning. Customers seeking assistance with unexpected and planned plumbing, electrical, and HVAC expenses now have access to financing solutions backed by 100 years of lending experience.

Clarifire, a leader in workflow automation, announced that the Idaho Housing and Finance Association has selected CLARIFIRE as its loss mitigation platform. “Idaho Housing will rely on the flexibility and automation capabilities of CLARIFIRE to increase the efficiency of its loss mitigation services.”

Capital markets

Mortgage rates, and Treasury rates for that matter, have hit the summer doldrums for volatility. Look at the mix of news from last week. The rebound in retail sales in May was met with mixed reviews. The big headline gain that easily beat everyone’s forecasts was impressive, but the number was 6.1 percent below May 2019’s level. (For example, clothing store sales gained 188 percent for the month, but were 63.4 percent below their level from one year ago. Food services and drinking places saw a 29.1 percent monthly gain, but were down 39.4 percent year-over-year.) This is the pattern with most of the categories on the report with the notable exception of non-store retailers. Clearly there was pent up consumer demand as stay at home restrictions began to be lifted, but it’s a long way to go before the economy is back to its normal state. While the quick rebound provides hope for growth in the second half of the year, there were 21 million people unemployed in May whose extra benefits will expire next month.

Yesterday features another slow session with minimum movement of U.S. Treasuries, though fears around the U.S. – China trade deal continued unabated. New home sales increased sharply in May, rising 16.6 percent month-over-month to a seasonally adjusted annual rate of 676,000 after a sharp downward revision for April. On a year-over-year basis, new home sales were up 12.7 percent. The increase in contract signings reflect some dissipating COVID-19 shutdown pressures, and should aid expectations that sales activity will continue to improve in coming months given the tight supply of existing homes for sale, low mortgage rates, and pent-up demand.

But turning to today, the Weekly MBA Mortgage Index showed mortgage applications decreased 8.7 percent from one week earlier for the week ending June 19. Both refinance and purchase activity fell despite a record low 30-year rate for the survey (3.30 percent). Later this morning brings the release of the June FHFA Housing Price Index, while the afternoon brings $47 billion 5-year Treasury note auction results. The Desk of the NY Fed will conduct two FedTrade purchase operations totaling up to $4.721 billion, and there is some Fedspeak with both Chicago’s Evans and St. Louis’ Bullard taking the stage. We begin the day with Agency MBS prices unchanged again and the 10-year yielding .73 after closing yesterday at 0.71 percent.

Email from a reader: “Yesterday my husband thought he saw a cockroach in the kitchen. He sprayed everything down and cleaned the room thoroughly. Today I’m putting the cockroach in the bathroom.”

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, “Knowing a Borrower’s Mind”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 23: QC, sales, LO jobs; outsourcing, DPA, marketing products; thoughts on the CFPB’s non-QM proposal

There are all kinds of things that I don’t, or didn’t, know. For example, the other day I learned that when dogs lap water, they’re actually scooping up water with the back of their tongue, which is curled like an elephant’s trunk. Now I’ve learned that the term “master bedroom” is being abolished and changed to “bedroom 1” or “primary bedroom” and “autism” is “neurally diverse.” Mary Poppins has a racist scene? Really? Smart builders like Lennar continue to “take advantage” of COVID and the shutdown and are training displaced restaurant and retail workers in construction. Anything to alleviate the construction labor shortage, right? Rates are great, and refinancing possibilities abound, but Black Knight tells us that mortgage delinquencies increased another 20% in May to hit their highest level since 2011. Total borrowers more than 30 days late surged to 4.3 million in May after a record jump to 3.4 million in April, and more than 8% of all US mortgages were either past due or in foreclosure, the report showed. Yup, Americans are skipping millions of loan payments due to the coronavirus.  In high-cost areas, jobless benefits aren’t enough to help debt-laden borrowers pay down their bills.

Employment

Sutherland, a leading Business Process Transformation and Outsourcing provider is pleased to announce a new addition to the executive team. Kevin Norris has joined the Sutherland Mortgage team as Director of Client Engagement, bringing over 20 years of experience in financial services, primarily in the mortgage sector. Kevin has spent the majority of his career working for large Fortune 500 companies including Morgan Stanley, Discover Financial Services, PHH Mortgage, and Realogy Corporation and has held various roles within these firms including running large operation centers, product and business development, e-commerce, process improvement, account management, and various other leadership management positions. In his new role at Sutherland, Kevin will lead the effort around maximizing the alignment of Sutherlands offerings to their growing client base enabling both cost reduction and revenue growth opportunities. “Kevin brings a great deal of knowledge and experience. As we continue to grow with our clients, Kevin will provide a critical role in taking our customer’s needs into action,” said Neil Armstrong, AMP of Sutherland.

Quality Mortgage Services is a team of QC mortgage audit professionals ready to execute mortgage QC, due diligence, and audit functions so today’s lenders and servicers have the best mortgage analysis reports possible. We are expanding our residential mortgage auditing team by adding experienced and knowledgeable quality control auditors interested in working collaboratively with peers in a remote environment allowing for more work-life balance. Ideal candidates have a minimum of 10 years’ experience in residential mortgage underwriting or auditing for quality control, be proficient with Conventional and Government underwriting guidelines, FHA Direct Endorsement – VA SAR Certifications preferred, strong understanding of compliance, and solid knowledge of the Secondary Market. If interested, please send resumes directly to Claudia Duncan or Laura Kate Davis.”

Innovation, Efficiency, and Family are the three most common attributes new hires point to regarding their decision to join Thrive Mortgage. Case in point are the additions of industry veterans Jamal Chubb and Josh Harvith to expand Thrive’s Talent Attraction & Career Team. Asked about why he joined Thrive, Chubb responded, “This career move allows me to offer growth opportunities to Originators and Ops Professionals across the country. I am excited for my future with Thrive and the future for my family.” Harvith also explained, “The culture of excellence in our company runs very deep. Our process is world-class, but it’s our people who drive our success!” Thrive Mortgage is growing in markets across the U.S. and is looking for ‘Humble, Hungry, and Smart’ professionals who want to be a part of something special. Contact Jamal, Josh, or Chris Karageorge to inquire about open positions. We can’t wait to meet you!

Academy Mortgage achieved record-breaking volume in April and May and is on pace for another record-high volume total in June. Achieving this incredible success in an extraordinary time for the housing and lending industries is the result of a strong sales team, dedicated operations team, and the hard work of Academy’s 1,900+ team members nationwide. More good news for the independent lender: Academy was recognized by Scotsman Guide as a Top Mortgage Lender for 2019, ranking in the top 25 for Top Retail Volume and Top Overall Volume. In addition, Academy had 100 Loan Officers named as Top Originators by Scotsman Guide, which is a company best. Academy Loan Officers were also included in top producer lists by Mortgage Executive Magazine and National Mortgage News. If you’re interested in joining an award-winning company to power your Potential, contact SVP Bill Sohan.

Many LOs struggle to trust their leadership & company’s stability. Churchill Mortgage not only has a world class leadership team, but it’s also an E.S.O.P! Our employees are partial owners. We’re a company of leaders, focused on the success of our company & our customers. We’ve been voted a Top Workplace for 7 consecutive years! According to LinkedIn, Churchill Mortgage loan officers have an average tenure of 4.3 years compared to the industry average of 1.7 years! Also, 13% of our Loan Officers have been with us for over 7 years. “I’ve been in the mortgage and finance business for over 40 years, & have found it’s truly a ‘people’ business where there must be a relationship of trust,” explained Churchill Mortgage president and CEO, Mike Hardwick. We’re proud of our past & confident in our future. If this type of environment and leadership mentality interests you, contact Churchill Mortgage.

Lender services and products

Join National Mortgage Professional Magazine on Thursday, June 25 at 1 PM Eastern/10 AM Pacific, for “How American Pacific Mortgage Wins the Hearts of MLOs with their Tech Stack.” American Pacific Mortgage has one of the best tech stacks in the industry and their most basic objectives are that their Loan Officers actually adopt and utilize the technologies that have been made available to them. This webinar will focus on how APM builds the case for any new technology or service, disseminates it throughout the organization, and measures the impact it has on their business. You will learn how to invest in technologies that produce the biggest return; the playbook on technology adoption in the mortgage industry; how technology impacts your bottom line; and why technology utilization and adoption can be just as important as ROI. *T-shirts will be given out to the best questions during the webinar. Click here to register.

Mortgage lenders spend a lot of time and energy optimizing their customer experience, but many lack the time and resources to put the same amount of focus into their recruiting experience. And in order to seamlessly move candidates from one stage to the next, mortgage lenders need to have the right processes in place to deliver hyper-relevant, personalized communications from first touch to onboarding. Register for this webinar with Total Expert Founder & CEO Joe Welu and Chief Customer Officer Sue Woodard and learn 5 best-kept secrets that every mortgage company can rely on to identify, attract, and retain top talent. Register now.

Monitored Marketplace: It appears HUD is considering regulating the benefits to, and geographical operating areas of, governmental entities providing DPA, like CBC Mortgage Agency. But Miki Adams, vice-president of CBC, which operates the Chenoa Fund program, says there is a better way: a monitored marketplace that tracks the pricing and performance of loans by individual governmental DPA providers, something HUD doesn’t currently do but easily could. This would allow HUD to establish performance standards for DPA loans and ensure there is a competitive market so that borrowers get the lowest costs and a variety of products. After collecting sufficient data, HUD could use the pricing and performance statistics to support rulemaking. But “HUD intends to do just the opposite: regulate without supporting data, creating onerous requirements for government DPA programs,” Adams says. “That will inevitably produce fewer options and less benefit to borrowers.” Read about the Monitored Marketplace here.

Free eBook from Maxwell: It has been increasingly difficult for lenders, particularly small to midsize lenders, to adequately staff to handle volume when business is booming without taking a hit when things go bust. Outsourcing can be a low-risk, high-reward solution for moderate-sized lenders who are growing too quickly to manage all their loan production in-house. Digital mortgage leader, Maxwell, has put together an incredibly helpful eBook, “Outsourced Fulfillment: Benefits, Myths, & Opportunities”. A great read for any moderate sized lender looking to better manage scale, growth, and opportunities for their business. No form required, free download.

CFPB & non-QM loans

The long awaited proposed (proposed only at this point) changes in the QM versus non-QM dividing line came out yesterday. The Consumer Finance Protection Bureau issued two notices of proposed rulemaking (NPRMs) to amend the ATR-QM Rule. “The first NPRM would extend the sunset date for a temporary category of qualified mortgages sometimes referred to as the temporary GSE qualified mortgage category or as the GSE Patch. The second NPRM would amend the definition of a permanent category of qualified mortgages sometimes referred to as the general qualified mortgage category.”

(If you just want to see the changes, here you go.)

Non-QM lenders and investors are especially interested in the proposal to replace the DTI limit with a price-based approach. The Bureau suggests replacing the existing 43% DTI ratio threshold in favor of a loan pricing threshold based on the difference between a loan’s annual percentage rate (APR) and the average prime offer rate (APOR) at the time the rate is set for a comparable transaction. Why? Because it preliminarily concludes that a loan’s price, as measured by comparing a loan’s annual percentage rate to the average prime offer rate for a comparable transaction, is a stronger indicator and more holistic and flexible measure of a consumer’s ability to repay than DTI alone.

So for eligibility for QM status under the general QM definition, the Bureau is proposing a price threshold for most loans as well as higher price thresholds for smaller loans, which is particularly important for manufactured housing and for minority consumers. The NPRM also proposes that lenders take into account a consumer’s income, debt, and DTI ratio or residual income and verify the consumer’s income and debts.

Comments on the changes to the general QM definition rulemaking are due 60 days after publication in the Federal register. Comments on extension of the Patch are due 30 days after publication in the Federal Register.

The announcement prompted attorney Brian Levy to write, “The CFPB just came out with its proposal to extend the patch until the first to occur of either (i) GSE exit from Conservatorship or (ii) implementation of the just proposed new QM rule that defines QM based on the price of the loan instead of 43% DTI. For my comments on this proposal, see my Musings from Leap Day 2020. “Consumer groups seem to admit that 43% DTI isn’t very predictive of affordability, but they (and conforming loan MBS securitizers) want to use pricing alone as the QM determinant for ability to repay. That makes no sense in that the price of the loan tells you nothing about the borrower’s ability to repay it.”

What is the scope of the change? Bose George with KBW scribed, “The QM Patch had allowed the GSEs to underwrite mortgages with DTIs greater than 43%, and we estimate that these loans account for roughly 15% of GSE mortgage volume. The proposed rule should ensure that a large percentage of high-DTI loans remain in the QM category, which allows the GSEs to continue guaranteeing them. We see this as positive for the mortgage industry as a whole, and especially for the mortgage insurers… We estimate that loans with DTIs over 43% accounted for up to 25% of new insurance written (NIW) for some mortgage insurers in 2019.”

President and CEO Bob Broeksmit, CMB, weighed in. “MBA appreciates the CFPB’s proposed changes to the QM Rule and extension of the GSE Patch. As proposed, the regulatory changes would seek to ensure creditworthy borrowers have access to sustainable mortgage credit without disruption to the overall mortgage market. MBA looks forward to reviewing and commenting on both rules, and we will continue to work with policymakers and all other stakeholders to ensure borrowers are both protected and have access to credit throughout the mortgage lending process.”

CoreLogic’s Pete Carroll opined, “The CFPB’s ATR/QM proposed rulemaking has significant bearing on the balance between homeowner ability to sustain their mortgage payments and broad access to affordable mortgage credit. The ATR/QM blog series from CoreLogic seeks to provide policymakers and industry stakeholders alike with evidence-based insights to consider as they deliberate on the important policy questions raised by the proposal, including market sizing, loan performance, underwriting factors, credit availability, and more.”

Capital markets

Data over the last week has showed improving economic conditions coming off record lows observed during March and April. Retails sales rebounded in May due in part to an increase in auto sales but were still 8.3 percent below January’s peak. Housing starts increased modestly in May as delayed multi-family projects resumed. Single-family starts were little changed for the month although single-family permits jumped over 14 percent. Builder confidence has also increased, signaling stronger construction numbers in the coming months. Industrial production in the US is beginning to restart after significant declines in March and April. One of the most watched numbers as of late, initial unemployment claims, declined for the eleventh straight week for the week ending June 13 although the rate of decline has weakened. The positive news over the last week has been welcomed by financial markets. But there is an underlying concern as some areas of the country are seeing an increase in new Covid-19 cases. Large month-over-month improvements are nice, but the year-over-year data show there is still a long way to go before the economy is back to where it once was.

For those who enjoy steady mortgage rates, the last couple weeks have been a welcome respite from prior months. U.S. Treasuries ended Monday on a mixed note, and by mixed note I mean with either unchanged yields for shorter durations or 1 bp off of opening levels for longer maturities. Why? Limited data and headlines, though there is always news to go around. Existing home sales declined 9.7 percent month-over-month in May, missing expectations as the reading marked the third straight month of a decline in sales. Total sales were down 26.6 percent year-over-year and are now at the lowest level since 2010. On the bright side, closed sales in May reflect most contract signings completed in March and April, so coming months should feature stronger sales activity.

Investors in mortgage-backed securities are worried about U.S. home-loan delinquencies spelled out in the first paragraph. The number of borrowers more than 30 days late ballooned to 4.3 million, up 723,000 from April, according to Black Knight. That means more than 8 percent of all mortgages are now past due or in foreclosure. Mississippi had the highest rate, followed by Louisiana, New York, New Jersey, and Florida. Separately, the Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased for the first time since the survey’s inception in March, from 8.55 percent of servicers’ portfolio volume in the prior week to 8.48 percent as of June 14, 2020. According to MBA’s estimate, 4.2 million homeowners are now in forbearance plan, down from almost 4.3 million homeowners the prior week.

Today’s economic calendar is already underway with the Philadelphia Fed nonmanufacturing indices for June, going from -41.4 to +7.3! Later this morning brings Redbook same store sales for the week ending June 20, preliminary June Markit Manufacturing and Services PMIs, the ever-important May new home sales, and finally, Richmond Fed Manufacturing and Services indices for June. The NY Fed will conduct two FedTrade purchase operations totaling up to $4.349 billion. With the Fed’s balance sheet is set to top $10 trillion this year, Boston Fed President Rosengren said yesterday that the Fed is a long way from raising rates and that rates on the short and long end need to be kept low. We begin the day with Agency MBS prices nearly unchanged and the 10-year yielding .72 after closing yesterday at 0.70 percent.

Did you hear about the crossed-eyed teacher who lost her job because she couldn’t control her pupils?

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, “Reducing Friction”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 22: AE, LO, Ops job; marketing, TPO, cost analysis products; June’s remaining training & events

After nearly 100 years, Eskimo Pie ice cream will get a new name. (The name “Eskimo” is commonly used in Alaska to refer to Inuit and Yupik people, according to the Alaska Native Language Center at the University of Alaska. This name is considered derogatory in many other places because it was given by non-Inuit people and was said to mean “eater of raw meat.”) George Carlin had a thing or two to say about words and political correctness. (Rated a serious R.) Some suggest ridding ourselves of every library, town, or road named, or statue erected, after a Founding Father who owned slaves? Looking at who’s on the currency and coins of the United States, one can find something wrong with Washington, Jefferson, Roosevelt, Jackson, Kennedy, Franklin, Lincoln, and Grant. I raise this issue, not whether we’re correct or being over-sensitive, but because the mortgage industry is not immune from controversy. The latest example is Atlanta’s Equity Prime Mortgage which fired Melissa Rolfe, the stepmother of the Atlanta police officer who fatally shot Rayshard Brooks, and then posted the reason on Twitter. The termination made Fox News.

Employment & transitions

“Do not miss out on this unique opportunity! PCF Wholesale is looking to hire top notch Sales Associates who are actively producing a high volume of business. We PAY for proven production both in sign on bonus and increased commissions while ramping up. Get in early with a proven wholesale lender. Tired of legacy issues with a potential employer?  Not getting compensated what you deserve? As a Top Priced Lender on Loan Sifter from agency to FHA/VA, we have a home for your broker’s loans. We have tested and perfected and are now ready to expand. If you are an Account Executive, Sales Manager, and or Regional Manager (South East) in the Wholesale Mortgage Space, and are currently funding at least $5 million per month, we want to talk to you. If you are interested, please email Tom@pcfwholesale.com or visit PCFwholesale.com. Built for Brokers.”

Caliber Home Loans to fill 150 jobs in DFW! Team Caliber is thriving with the support of our engaged leadership team. Ann Thorn, EVP of Operations and Servicing, was recently interviewed by CBS on June 16th to promote Caliber’s incredible workforce growth. Our full-time openings cover the full spectrum of the mortgage business. We offer competitive salary and benefits as well as perks that go along with being a member of Team Caliber. No mortgage experience? That’s okay, we offer instructional programs to secure the foundation of your success. Now is the time to join this winning team! If you are interested in a sales opportunity at Caliber, please contact Brian Miller. For all other opportunities, please contact Jonathan Stanley for immediate consideration.”

“At ACC Mortgage, it is Christmas in July. The oldest Non-QM lender, who never stopped lending, is proud to announce the full return of all Non-QM products: DSCR, Super JUMBO, ITIN, P&L Lending, 80% Bank Statement. Feel free to use www.NonQMPricer.com. Join the NMP Deal Desk webinar with Robert Senko on July 2nd to talk about the new products and go over specific deal scenarios. https://madmimi.com/s/9986d01. We still have room for a few more experienced Non-QM AEs looking for a stable long-term home. We have the top comp plan in the industry with support, leadership, and stability.  If interested in joining our family, please send your resume to the president, Robert Senko, for consideration.

 

Freedom to Succeed! Freedom Mortgage is growing and looking for talented and experienced Wholesale operational professionals to help us serve the needs of borrowers, brokers, and wholesale correspondents across the nation.  Work from home opportunities for Loan Processors, Closers and Underwriters are available throughout the continental U.S. Prior to the COVID-19 pandemic, the vast majority of our teams already worked from home, so you will be ready to seamlessly and efficiently contribute to our goals on day 1! If you are fueled by your entrepreneurial spirit and are looking for a great work culture, please visit bit.ly/FMRecruiting to review available positions and submit your resume.

 

Sierra Pacific Mortgage is excited to announce the hiring of Jeff Lochmandy as its Vice President, Divisional Sales Director for TPO. Lochmandy joins Sierra with over 30 years of diverse leadership experience in mortgage lending. Previously, Lochmandy served as the Managing Director for Home Point Financial and its predecessor organization, Stonegate Mortgage and was a contributor to market share growth at both firms. Lochmandy’s deep skill set aligns with our dynamics during a time when the wholesale marketplace calls for insight and innovation. His successful track record in business development, sales leadership, and market share growth, make him a significant asset to Sierra. Sierra Pacific Wholesale is actively recruiting AEs who want to be part of an organization where they have a voice and can make an impact.  If you are in the Central or Eastern US, please contact Jeff directly (770.597.4672). Other states inquire at tposales@spmc.com.

 

“Too Many Leads. You may have seen our Intelliloan.com TV Campaign and its working too well. To many inquires not enough loan officers. Due to the recent Covid19 pandemic we are now hiring home-based experienced Loan Officers, nationwide. Start making money right away. If you hold a CA DBO License and at least one other state that aligns with our footprint, you will be a good fit. In business for over 25 years, we service our loans and know how to close them fast. We offer innovative technology, quality leads, and fast fulfillment. If you’re not making at least $25K per month, you need a change. Make Money, Have Fun, Help People. Contact Careers@intelliloan.com.”

Incenter, a Blackstone Portfolio Company, announced that Nick Costas has joined its team as SVP, National Sales working with Incenter divisions Incenter Appraisal Management, Incenter Insurance, Incenter Marketing, Incenter Technology and Silvernest, and its brands Boston National Title, CampusDoor, Incenter Mortgage Advisors (MSR trading) and underwriter Agents National Title Insurance Company (ANTIC).

Stewart Title welcomed Rich Shackelford as the new SVP of Sales for Lender Services to identify new business opportunities and maintaining key industry relationships to grow Stewart’s lender services offering. (Rich will report to SVP and National Director of Lender Sales Rich Kuegler.)

East West Mortgage announced that Steve Borgerson has been appointed President.

Scott Henley has joined Certainty Home Loans as the Division President – West Division, where he will be focusing on growth in the company’s existing Texas, Oklahoma and Colorado markets, as well as leading the company’s expansion into new markets.

Lender services and products

 

Informative Research welcomes Sean Rogan as its VP of Client Success. Previously, Rogan was one of the original employees and the Managing Director of National Sales at LoanBeam for over 6 years. He was instrumental in taking LoanBeam to market from early inception to several hundred lender clients, GSE, and aggregator relationships. Before LoanBeam, Rogan worked for CitiMortgage for over 15 years as VP of National Sales and oversaw Wealth Management and Citi Employee Home Loan programs. “Informative Research has best in class technology, service, and support for their clients,” commented Rogan. “Its platform and leadership are tremendous, and continuously pushing the limits of technology. I couldn’t be prouder to be a part of this company and help build on those high standards.” Rogan will be focusing on the Mountain West region and supporting Informative Research’s GSE relationships. Feel free to connect with Rogan.

Mortgage Coach and Homebot have announced an integration to easily generate refinances from your past client database. What’s even better, your past clients initiate the refinance opportunities based upon the data in their home digest available through the Homebot borrower portal. From there, Mortgage Coach steps in to automatically create and share a Total Cost Analysis with the borrower. That means better time management and faster conversions. Register Here for the upcoming “Deep Dive: Homebot & Mortgage Coach”.

 

Once a customer, always a customer? Not with every lender. With homeowners moving 4-6 times in their life, and rates predicted to remain low for the foreseeable future, Home Point Financial’s “Customer for Life” program can significantly contribute to your bottom line. We want you to be there for every milestone of your customer’s needs – from buying their first home to downsizing, refinancing and everything in between. “Customer For Life” keeps you front and center by including your photo and contact information on your customers’ mortgage statements and in our homeownership platform. And, since Home Point services 99% of its loans, that is a difference that compounds on an ongoing basis. It’s time to make repeat business a dependable revenue stream. Ready to experience a true lender-TPO partnership? Contact us now.

 

Record sales and 50% lower cost per loan! How Steven Sless and his PRMI Reverse Division rocked their best months ever using direct mail: “You know, PRMI is just a powerhouse in the mortgage industry now. And Monster Lead Group has been an unbelievable partner. Monster knows what they’re doing, they know how to make the phones ring, they know how to generate business, but they also know how important it is to help us grow a brand at the same time. It’s a real marketing system. It’s not just sending mail. I think the consistency of the campaigns is what we rely on… Our cost per funded loan is about 50% of the industry average… So that story should be told. We’re able to grow and scale our operation because of the predictability of the Monster campaigns. That is what’s allowed us to get to this point.” Want BETTER direct mail? www.monsterleadgroup.com/better-results

Events & training to wrap up June

If you are looking for awesome speakers for your sales rally, your company meetings or your association events; Karen Deis has created Mortgage Women Speakers. Over 55% of the employees in the mortgage biz are women, yet only a handful of the featured speakers are women. Why hire a mortgage woman speaker? Because women add a unique insight to sales and marketing strategies, social media engagement, and providing inspirational messages. Executives include Christine Beckwith, Ginger Bell, Laura Brandao, Jodee Brydges, Tammy Butler, Karen Deis, Cindy Ertman, Susan Meitner, Megan Marsh, Jessica Petersen, Donna Quinsenberry, Kelly Resendez, Louise Thaxton, and Kelly Zitlow. Consider hiring women speakers for your next event and add a new perspective and a unique inspirational message for loan originators and managers.

Today (Monday) TMC is hosting, “State of the FHA Secondary Market” at 3PM ET with Kevin Peranio, Jason Madiedo, and yours truly.

On Tuesday, June 23rdMERS is offering an eNote webinar in which Fairway Independent Mortgage Corporation will share how to evolve eMortgage strategy post-launch and throughout the COVID crisis, and how Texas Capital Bank and Fannie Mae, worked with them. During this MERS webinar, you’ll learn valuable insight from all three companies that will inform your eNote strategy and set you up for success.

FHA’s Office of Housing Counseling is hosting a panel discussion entitled, “Social Distancing and Its Effect on the Housing Industry” on Tuesday, June 23rd. This live, virtual event will explore HUD’s role in helping homeowners in the midst of the COVID-19 National Emergency and the innovative concepts the industry is utilizing to maintain social distancing. Registration is required and space is limited, so early registration is encouraged. In addition, the webinar will be recorded and available for viewing on the Office of Housing Counseling Outreach page at a later date.

Arch MI’s latest online training opportunity, “Educating in the Virtual World,” offers easy, step-by-step instructions to setting up webinars, videos, virtual tours, interviews, demonstrations and more by using the most effective communications platforms in this complimentary June 23rd session.

Freddie Mac offers an Economic Outlook and Housing Trends Webinar on June 24th at 2:00 EST and hear from Rob Chrane, CEO at Down Payment Resource, Sam Khater, Vice President – Chief Economist at Freddie Mac and Laurie Goodman, Co-Director, Housing Finance Policy Center at the Urban Institute.

FHA is offering a free webinar, June 30th to discuss an update to mortgage credit underwriting standards, practices, and policies. The topics for discussion include COVID-19 documentation flexibilities, evaluating credit, income, and assets, manual underwriting criteria, and endorsement protocols.

Capital markets

Despite increased outbreaks of the coronavirus, both around the nation and around the globe, potentially driving down economies, U.S. Treasuries were unchanged to close last week. Let’s quickly review some headlines. Arizona, Florida, Oklahoma, and Texas all reported their largest one-day increases in coronavirus cases last week. Separately, more than 1.5 million Americans filed for unemployment benefits in the most recent jobless claims figures, a larger number than expected and one that suggests a long road to recovery. But applications for U.S. home loans hit their highest level since 2009 as more Americans take advantage of low rates. And China took a step toward trade reconciliation with the U.S., agreeing to accelerate purchases of American farm goods from soybeans to ethanol to comply with the phase one trade deal. With its economy crippled by the coronavirus, its imports of American products are lagging way behind the benchmarks it needs to meet if it’s going to stick to the plan. The country has bought only 13 percent of the goal set in the trade pact in the first four months, but is committed to buying an additional $200 billion of American products by the end of 2021.

This week’s economic calendar is underway with the Chicago Fed National Activity Index for May (+2.61 from -17.89). Later this morning brings Existing Home Sales for May, before tomorrow reveals New Home Sales for May. In addition to the usual mortgage applications in the midweek session, markets will receive the June FHFA Housing Price Index. The busiest day on the calendar this week is Thursday, which sees Jobless Claims, May Durable Orders, Q1 GDP (third estimate), and advance May indicators. The week closes with May Personal Income and Spending, PCE Prices, and final June Michigan Consumer Sentiment Survey. Additionally, the Fed releases stress test results on the largest U.S. banks. Turning back to today, the NY Fed will conduct two FedTrade MBS purchase operations totaling up to $4.721 billion starting with up to $1.744 billion GNII 2.5 percent and 3 percent followed by up to $2.977 billion UMBS30 2 percent through 3 percent. We begin the day with Agency MBS prices basically unchanged from Friday and the 10-year yielding .69 percent after closing last week at 0.70 percent.

Be careful ladies! I received this note from an older gal.

“I took my husband grocery shopping. We got home, took off our masks, and darn it! I brought home the wrong husband!”

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, “Reducing Friction”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 20: The non-mortgage issue on voter expectations, news bias, showing homes, and entrepreneurship

Greetings on the Summer Solstice, made possible by the earth tilting as we circle the sun. (We in the Northern Hemisphere are currently tilted toward the sun, by the way.) This has been the case for billions of years, even before I got into this business, and will be the case long after things like RESPA or the CFPB cease to exist. Freddie and Fannie may actually be out of conservatorship by then. Lenders and vendors touch, and are impacted by, other things besides loan processing, rates and market share. We continue to help individual’s lives, and society in general, homes continue to be shown, news seen and heard, and, despite the presidential election being nearly five months away, be impacted by political policies and procedures.

Saturday Company Spotlight

This week we sat down with Steven Rimmer, the CEO of DocProbe, to focus on growth, employee mentoring in a work from home environment, entrepreneurship, and charity work.

Describe your company, when was it founded and why, what it does, recent growth, and plans for near-term future growth. “DocProbe was founded in 2010, when a lender approached our affiliate, Madison CRES, looking for a solution to alleviate the headaches of its in-house Trailing Docs department. The lender’s challenge was dealing with an inefficient process that was pulling away essential revenue-driving employees from focusing on closing loans. The workforce was also unstable during market fluctuations, all resulting in incurred penalties due to late deliveries to investors.

“DocProbe, through a platform of people, process, and technology revolutionized Post-Closing Final Docs, with dozens of lenders from across the nation now relying on DocProbe to deliver their Trailing Docs to their investors corrected and on-time. The effects of COVID have forced lenders to revamp their operation, and DocProbe has seen a surge in lenders moving over to our outsourcing solution.”

Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why. “DocProbe, together with Madison, regularly hosts educational courses around the country giving enterprising individuals the tools to enter the lending and real estate industry. We have been encouraging employees to become trainers and mentors to the hundreds who have taken our classes over the years.

“We also directly lead and support an in-house initiative to provide the means to educate over 20,000 youths, and we encourage employees to provide their own ideas, as well. The company will often put resources behind these employee initiatives, creating additional motivation for them to get involved in personal charitable activities.”

What does your company do to help elevate your employees’ growth? Describe any mentoring programs, outside classes or training, in-house training. How does the company help people develop? “We understand the value of continued education, and regularly bring in Internal and outside experts to give training to employees to expand their knowledge base, and keep everybody up to date on the latest information in the industries.

“Interestingly, you asked about mentoring because we have actually also adopted an in-house mentoring program to give one-on-one attention to employees on their own level. These mentors go into the various offices across the country and give educational and emotional support as needed.”

Tell us how your company maintains its culture in the office, or in a work-from-home environment if applicable. “Because DocProbe relies on numerous departments to do the work needed to build the efficient process that lenders rely on, it’s so critical for us to create a family feeling and a connection to the mission. To achieve this, we are proactive in bringing these departments and employees together as often as possible. Constant stand-up meetings and regularly scheduled town halls go a long way to creating that atmosphere.

“We want employees to appreciate the greater picture. They get a great feeling of accomplishment when they see the fruits of their personal labor played out in the perfected final product. This includes the development and operation teams, as well as the sales reps around the country who appreciate the ability to come in and say thank you to the people in the trenches getting their clients’ work done for them, quietly and efficiently behind the scenes.”

 

Is there anything else you’d like to share along these lines? “The story of DocProbe going from a disruptive startup helping solve lenders’ Trailing Docs headache to growing into a document digitalization trailblazer, is one of entrepreneurial spirit and transformational vision.

“As we continue to grow, we have not lost sight of what got us to this point and value the hard work and passionate involvement of each employee. We look at every lender that joins our platform as a new partner, and treat them with the respect and appreciation that they deserve for putting their trust in us.”

How can people get in touch with you? “A great place to start is at our website to get a real feel for our product and process. They can also reach out to me directly at srimmer@docprobe.net and I’d be happy to answer any questions they have about us and what we do.”

(For more information on having your firm featured, contact Chrisman LLC’s Anjelica Nixt.)

The Housing Market: Where There’s a Will There’s a Way

From Marin County in Northern California veteran real estate agent Bob Ravasio weighed in on the showing and selling of properties during the time of COVID. “It is more complex, for sure, but is being done. There are still no open houses or brokers open houses. So we don’t get out and see as much in person as we used to. We can, however, view a home with an interested, and qualified buyer, and we have been doing that every week.

“Agents, as always, are adapting. Many listings now have a very good video done of the home, which buyers are required to view before seeing to make sure they like the home. We do it as standard procedure on all of our listings, and if done well, it really helps get a sense of how the home flows, which is critical to a buying decision.

“Before viewing, buyers must sign a PEAD form, or for a Coldwell Banker listing, a COVID 19 Prevention Plan Form. This details everything that must be done prior to, during, and after a showing, including: 1. Showings by appointment only. 2. No hard copies of flyers, promotional material, or disclosure or advisory forms, everything must be done electronically. 3. Sanitizer, wipes, and a disposal bag are supplied in the house. 4. No occupants can be in the home during a showing. 5. Commonly used surfaces are wiped down after each showing. 6. No more than two visitors from the same house and one agent in the house at a time. 7. Six-foot social distancing at all times, and everyone must wear a face covering. 8. Any disposable gloves, booties etc. to be placed in disposal bag upon leaving.

“It requires much more planning now to see a home than it did before, from everyone: buyers, agents, and owners. The situation changes frequently, and we monitor it closely, as we now have two virtual office meeting every week with management to learn about and apply the latest changes.”

Tailor-made news: can you believe money might be involved?

Unlike decades ago, news these days is made to fit the audience. Unfortunately. LO and industry observer Dick Lepre has an opinion. “I used to be a TV cable news junkie but stopped watching news on TV over a dozen years ago. I have two big issues with TV news. The first is that TV news format does not allow taking the time to explain things. This is most easily understood with things about the economy. It uses a format which allows perhaps 20 seconds to explain what is behind the jobs report or the GDP report. The consequence is that a 20 second simple explanation may be completely incorrect when a 60 second explanation is needed. The only TV news with a format which allows enough time for accurate reporting is PBS.

“The larger problem I have is that media and most especially the three cable news networks are not in the business of objective reporting. These are businesses existing to make money. Most of the money they make comes from advertising. Advertising revenue is a function of viewership. These networks, and for that matter most other media outlets, do not attempt to objectively report or analyze news. They slant their reporting to reassure their viewers that their opinions were and still are correct. The proposition has become ‘Tune in this evening and we will reassure you that everything that happened today guarantees that none of your views need changing.’ This reassurance attracts viewers. Reporting to the bias of viewers is the core of their business plans.

“I do not really have a problem with this.  If this is what sells and TV makes money with this business model and provides employment to folks that is fine as long as you don’t believe that what you are seeing is an objective account. I enjoy SpongeBob SquarePants even though I doubt that Bikini Bottom exists.

“Too many people want to watch or read that which reinforces their existing beliefs. This is a form of confirmation bias. One sees this on social media where people post an opinion and say something to the effect of, ‘If you don’t agree with this go ahead and unfriend me.’ That attitude is limiting. How does one learn anything without reading or listening to people who have different opinions? This is not about giving up one’s view and accepting the opposite. It is more a matter of sometimes expanding one’s view to include something you did not think of previously.

“The issue with cable new bias is compounded by the fact that it has become the main source of news for many. Newspaper circulation is falling. This leaves cable news as the main source for national and international news.  It remains to be seen if the internet can provide local news with sites such as Patch.

“This is not about President Trump. Reporting biased to the beliefs of viewers was happening long before Trump but since Trump is so polarizing it is more obvious now. Nor is it about ‘fake news’ if that expression means hoaxes or disinformation. It is more about reporting to the bias of the audience for financial reasons. If that’s what people want, that’s what they will get.

“For me the only reason to watch the news would be to learn something I did not already know. Instead TV news is designed as a reassurance mechanism as a means of obtaining advertising revenue. TV news makes its presentations not only with opinions as much as facts but which an air of ‘there is no discussing this. We are right.’” Thank you, Dick!

A Vote is a Vote, Right?

This month author Miles Parks wrote a piece for NPR on the nine-day delay in counting votes in the Pennsylvania primary earlier this month. “Experts and election officials are already sounding the alarm that voters need to expect the same sort of delay in November’s presidential election. ‘We really need to get into a mindset that we will not know who the winner of the election is on election night,’ said Nathaniel Persily, an election law professor at Stanford University. The biggest reason for the delays is that mail ballots take longer to process than in-person votes. Officials need to verify signatures, open envelopes, and in many states, including Pennsylvania, much of that process can’t begin until the day of the election due to state law.”

“None of that is inherently a problem. It doesn’t mean anything is wrong with the tabulation or the accuracy of the count. If anything, it’s an indicator that election officials are working through the sort of safeguards that prevent fraud or errors. But problems arise because voters don’t understand that, Persily said. And then these sorts of delays can become fertile ground for conspiracy theories.

“’In some ways, this is the worst year to have a pandemic that affects election administration because we were already worrying about disinformation and loss of confidence. And so now we have the additional challenge to voter confidence that’s posed by the possibility that all kinds of votes are going to be counted after Election Day.’”

This scenario has already played out multiple times in the past two years. When the Iowa caucus app famously malfunctioned in February leading to a delay in results, theories flooded the Internet about whether it was an inside job by one of the campaigns. And in recent general elections, such as in California, Florida and Arizona during the midterms, Republicans, including President Trump, questioned the legitimacy of votes counted after Election Day because they skewed more toward Democrats.

“The reason ballots counted after Election Day often tilt in favor of Democrats is because they are usually being processed in densely populated urban voting jurisdictions, where more Democrats are usually clustered (such as South Florida or Philadelphia). The irony is that the delay in results come from the precautions election officials take to prevent the issues with mail ballots about which Trump often worries openly. One of the reasons that the results take longer is [officials are] being diligent… That’s actually what we should be pushing for as a country. So we should celebrate the fact that we’re actually counting every vote.”

“Many states allow local election officials to begin opening mail ballots before Election Day to prepare them to be scanned, as is allowed in most states that process a large number of mail ballots…. the reason conspiracy theories around results ‘have legs’ is because there’s been a failure by election officials, candidates, and journalists to set voter expectations properly.

“There’s the headlines that say this is a disaster if there’s a delay, and that’s not right. If we all anticipate that accurate vote counts, with a higher volume by mail, or for any reason, for a pandemic or for civil unrest, take longer because it takes longer to make sure the count is accurate, then that’s the opposite of a disaster. That’s what every single voter and official should want for this country.”

Phyllis Diller observed, “We spend the first twelve months of our children’s lives teaching them to walk and talk and the next twelve years telling them to sit down and shut up.”

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, “Reducing Friction”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

June 19: Credit, QC, Ops, LO jobs coast to coast; broker, DPA products; residential credit changes

Lots in the news. Congratulations to the California MBA (and the MBA and lenders everywhere, since nearly 25% of residential loans come from California) which made news by being victorious in defeating AB 2501. Kansas has added Alabama to its quarantine list (Alabama’s hospitals are at maximum capacity). These days, there are hundreds of news channels going 24 hours a day, not to mention social media, which slice and dices every utterance and event within moments. It always hasn’t been that way, and today we are reminded of how long it took news to travel in the 1860s. The Emancipation Proclamation was issued by President Abraham Lincoln on September 22, 1862, and effective as of January 1, 1863. General Robert E. Lee’s surrender of the Army of Northern Virginia to Lieutenant General U.S. Grant occurred on April 9, 1865. Today is “Juneteenth” which memorializes June 19, 1865, when Union general Gordon Granger read orders in Galveston, Texas, that all previously enslaved people in Texas were free. Speaking of noteworthy days, plenty of companies will be giving employees July 3rd off (the 4th is on a Saturday this year).

Jobs & transitions

A mid-sized publicly held depository bank is continuing to expand its residential mortgage reach, and is looking for branches and originators in Texas. Capacity has not been an issue for this Bank, and it has a wider variety of programs than most, and is Ginnie, Fannie, Freddie approved. Confidential resumes/notes of interest should be submitted to me for forwarding; please specify the opportunity.

“If you’re an ambitious mortgage professional seeking new opportunities, MiMutual Mortgage invites you to explore the positions currently available within our Operations teams. MiMutual is excited to expand our Underwriting and Closing team, specifically seeking an Underwriting Supervisor in Metro Detroit and remote opportunities for Sr. VA Underwriters, Junior Underwriters and Closers, specializing in Texas loans. A deep-rooted, privately held mortgage bank in 38 states, MiMutual Mortgage expects to continue the same growth trajectory in 2020 that it experienced in 2019 and exceptional candidates are sought to help with this growth. All interested candidates are encouraged to contact Karley Warwick (248-286-9490) for more information.”

“National Lender and leading non-bank originator and servicer NewRez is looking for Licensed Loan Officers to join our Direct to Consumer business channel. NewRez’s DTC platform more than doubled its volume in 2019 and will continue to experience tremendous growth through the remainder of 2020. NewRez offers our loan officers an unlimited number of high-quality leads. No cold calling, as these opportunities are all from existing customers. We are currently hiring in Tempe, AZ; Jacksonville, FL; Columbia, MD; Fort Washington, PA; Charlotte, NC, and other locations. NewRez offers a flexible work environment and easy to use technology. Our fast-track training programs support both new and experienced loan officers, so our new team members are licensed and earning quickly. To hear more about any of our current sales openings or to submit your resume, contact Elisa Morgado. Click here for a full list of our open opportunities nationwide.”

Quality Mortgage Services is a team of QC mortgage audit professionals ready to execute mortgage QC, due diligence, and audit functions so today’s lenders and servicers have the best mortgage analysis reports possible. We are expanding our residential mortgage auditing team by adding experienced and knowledgeable quality control auditors interested in working collaboratively with peers in a remote environment allowing for more work-life balance. Ideal candidates have a minimum of 10 years’ experience in residential mortgage underwriting or auditing for quality control, be proficient with Conventional and Government underwriting guidelines, FHA Direct Endorsement – VA SAR Certifications preferred, strong understanding of compliance, and solid knowledge of the Secondary Market. If interested, please send resumes directly to Claudia Duncan or Laura Kate Davis.”

 

When you’re setting goals and looking for ways to exceed them, you don’t want to be slowed down or derailed by trivial details within the loan process. That’s why Wyndham Capital Mortgage has put in the work to create sales-centered support systems that allow you to close loans faster and smoother. With a combination of technological systems like robotics and A.I., Wyndham has you covered every step of the way to eliminate inefficiencies to reach unparalleled speed and scale of closings. Our average time to close is around 30 days, far below industry average, which is a direct result of our loan officers having more time to spend selling and instead of managing a pipeline, troubleshooting, building a marketing plan, and other tasks that slow you down. To learn more about how you can join the team harnessing the power of tech to the benefit of your career, click here.

“Many LOs struggle to trust their leadership & company’s stability. Churchill Mortgage not only has a world class leadership team, but it’s also an E.S.O.P! Our employees are partial owners. We’re a company of leaders, focused on the success of our company & our customers. We’ve been voted a Top Workplace for 7 consecutive years! According to LinkedIn, Churchill Mortgage loan officers have an average tenure of 4.3 years compared to the industry average of 1.7 years! Also, 13% of our Loan Officers have been with us for over 7 years. ‘I’ve been in the mortgage and finance business for over 40 years, & have found it’s truly a ‘people’ business where there must be a relationship of trust,’ explained Churchill Mortgage president and CEO, Mike Hardwick. We’re proud of our past & confident in our future. If this type of environment and leadership mentality interests you, contact Churchill Mortgage.”

And a well-known independent mortgage bank, headquartered in California, is searching for a Chief Credit Officer with strong Government and Conforming experience, and is well-versed in managing a staff of underwriters in addition to being an expert on credit. Interested parties should send me a confidential resume for forwarding; please specify the opportunity.

ReverseVision has filled its newly created Director of Business Development, Strategic Partners position, with mortgage industry veteran Carissa Orozco who will spearhead strategic integration partnerships that allow traditional mortgage lenders to integrate HECM and private reverse mortgages into the loan qualifying, sales and origination process with ease.

Lender & broker services & products

HomeBinder announces a partnership with the Ellie Mae Digital Lending Platform. With this partnership lenders will have the perfect tool to keep them connected post-close without physical contact. Drive agent referrals by co-branding HomeBinder with the real estate partners you work with. The effortless integration with Encompass® automates the entire process (including loan docs!) View our demo.

Steps taken to help correspondents: Operating as an FHA correspondent lender during the coronavirus crisis has been challenging to say the least. Government providers of DPA have witnessed the secondary market for their loans become exceptionally volatile leading to worse pricing at many. But CBC Mortgage Agency has not only lowered rates, but taken steps to make originating loans with DPA more reliable, including not requiring repurchase for loans which enter forbearance. In addition, CBCMA, which had primarily offered programs with down payment assistance, has launched FHA Classic, which does not include any DPA. The program can be used for home purchases, streamline refinances and rate-and-term refinances. FHA Classic allows loan-to-value ratios up to 96.5 percent, debt-to-income ratios of up to 50 percent and no income limits. There is no first-time homebuyer requirement, either. To find out more about FHA Classic and all of CBC’s programs, visit www.ChenoaFund.org.

QLMS’ partners only have until the end of June to assist their clients in unlocking HUGE savings with Prime29. This unique offering is creating waves across the broker community and has unleashed $186,000,000 in savings for partners’ clients since its rollout. QLMS has slashed the interest rate on a 29-year loan, so the monthly payment equals that of a 30-year conventional loan but saves clients THOUSANDS over its life. Partners have already helped nearly 12,000 homeowners secure this limited time deal – saving them an average of $15,500 over the life of their loan. LOs are coming to QLMS in droves because of differentiators like this. If you are not yet a QLMS partner, click HERE and you can leverage Prime29 and save your clients thousands in as few as 24 hours after placing your application.

Misc. Credit Updates

As lenders reduce friction in processing, they’re keeping an eye on credit policy. What is that? Big lenders have them, but why should a small company have one? The first thing that you need to do is differentiate between policy and procedure. Usually a “policy” addresses issues in broad terms, explaining what it is and the reasons for it. A procedure lists the step-by-step instructions on how to carry it out. So a credit policy is more widespread and addresses major issues, doesn’t change often, and addresses the “what and why”. A procedure is narrower, changes often, lists how to do things in detail and also answers the “who and when.”

Credit risk management is responsible for policy. You should decide who is responsible for implementing and maintaining the procedures necessary to comply with policy. You’ll need to address many topics. In no particular order, time periods, quantitative limits, conditionality, and policy exceptions. And be sure to keep an eye on the format of the write up, tone, style, using good grammar, and making it readable. And mention positions, not names, being responsible for certain items. For any written policy to be followed, it must be easy to read!

Alan Bercovitz caught this. “Regarding your note: ‘Remember that USDA Rural Housing Development announced that publication of revised HB-1-3555 Chapter 10: Credit Analysis is delayed pending USDA publication of a Procedure Notice (PN).’ My understanding is that PN 534 was issued on 3/19/20 and the changes are now fully implemented. The only announcement regarding this delay that I can find is dated 1/28/20.”

QLMS (Quicken Loans) let brokers know that the GSEs have released some new guidance to help lenders evaluate income stability for self-employed clients. “For new registrations on all products starting June 11, there are two new Partner Conditions to qualify self-employment income. At ‘Submit Full Package,’ we now require either a year-to-date audited profit and loss statement, or a year-to-date unaudited profit and loss statement plus the 2 most recent months’ or 60 days’ bank statements to verify the unaudited statement. (Previously, only the most recent profit and loss statement or business asset statement was required.) We will now calculate client income using the year-to-date profit and loss statements. Please note: Any income shown to be decreasing by more than 25% will not be qualified.

“Self-employed clients will need to attest to the stability of their business. This will be a requirement in Partner Conditions after the loan is ‘Conditionally Approved.’ Please contact your client and provide their detailed response describing the impact of COVID-19 on their business and if the income for the business will be stable moving forward within that condition. This condition will be required at “Submit Full Package.” If a client does not expect their income to be stable, their self-employment income cannot qualify. See the COVID-19 Updates page in GURU for more information.”

FCM posted COVID-19 Conventional Update for Self-Employed borrowers in its Delegated Correspondent Announcement 2020-27 and Wholesale Announcement 2020-29

FAMC/Citizens Bank has developed an interim guidance document that summarizes its changes to policy. The COVID-19 Interim Guidance Document provides a summary of the recent policy modifications and denotes the reference bulletin associated with each change. Please visit the FAMC online manual to view the document located in the Underwriting & Credit Policy section.

loanDepot Wholesale/Correspondent published its Weekly Announcement that covers the GSE’s Self-Employed Income Analysis and Documentation Requirements, Fannie Mae Selling Notice 06-03-20, Freddie Mac COVID-19 FAQs, VA’s Funding Fee Guidance Update and VA Circular 26-20-20.

Lakeview Correspondent posted Announcement C2020-03 covering multiple topics which include DSHA Conventional and TSAHC Conventional Program updates, IRS Tax Return & Transcript requirements and an enhancement to Springboard To Homeownership Program and Fahe My Place Mortgage Program.

Capital markets

Rates: up a little, down a little. The yield curve flattened a bit yesterday, including the 10-year yield ending the day -4 bps to 0.69 percent, as there wasn’t much fresh news for markets to digest. Increased coronavirus cases in several states fueled some of the move, as did higher than expected initial jobless claims. For the day’s two operations, the Desk purchased the $4.349 billion maximum with a 35.6 percent hit rate as $12.219 billion was tendered. Roughly one-third was concentrated in UMBS15s with the remaining two-thirds in UBS30s. Since the restart of QE on March 16, the Desk has purchased $751 billion.

Today’s sole economic release was the Q1 current account deficit, which doesn’t move rates. There are at least four virtual Fed speakers scheduled: Boston’s Rosengren, Vice Chair of Supervision Quarles, Chair Powell, and Cleveland’s Mester. The NY Fed will conduct two FedTrade MBS purchase operations totaling up to $4.721 billion starting with up to $1.744 billion GNII 2.5 percent and 3 percent followed by up to $2.977 billion UMBS30 2 percent through 3 percent. We begin the day with Agency MBS prices down/worse a few ticks (32nds) and the 10-year yielding .74.

My cousins wanted to reveal the gender of the baby at our family reunion of about 40 people.

That night, after just finishing up a socially distant BBQ, my cousin and his wife stand up and announce to the family that they are going to have a little baby girl.

Everyone starts cheering, naturally and once the cheers die down a little, I shout out, “Do you have a name for the baby yet?”

My brother replies, “Yeah. Landa Noelle.”

Everyone starts to “Ooohhh” and “Ahhhh” and proclaim how pretty of a name it is.

Then after a moment I shout, “How the heck are you supposed to spell Landa with no L?”

(Thanks to Stephen S. for this one.)

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, “Reducing Friction”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

June 18: Ops, LO jobs; digital, QC, cap. mkts. products; Ginnie & FHA changes & trends

Capital markets folks focus on risk management every day. The public is getting a taste of another kind of risk management when they go to a bar, tattoo parlor, or hair salon. What happens when the government doesn’t specify what masks are acceptable? Should COVID just be part of our health landscape, as many have suggested from the outset, and we should become accustomed to it? (One reader jokingly wrote, “No one should be allowed to drive again until there are no fatal accidents for 14 consecutive days. Then we can slowly begin to phase in certain classes of people who can begin driving again, but only at half the posted speed limit, and wear a helmet.” But don’t scoff: not everyone who dies is 85 and in a nursing home, as plainly detailed in Orange County’s numbers.) While there is transformation everywhere, some things never change, which is the topic of the lead article in STRATMOR Group’s June Insights Report. STRATMOR Sr. Partner Jim Cameron analyzes the three immutable economic truths that have not wavered throughout the months of the pandemic (the laws of supply and demand, unintended consequences and cash is king) and the market reactions and the outcomes show the constancy that exists even amidst even the chaotic change we’ve experienced so far this year.

Employment

“Are you shifting your career path to financial services? Business is booming at Caliber Home Loans as we expand rewarding career opportunities in several regions with best-in-class preparation to guide your success. Our essential team members help fulfill Caliber’s mission of making customers’ home ownership dreams a reality, even during these challenging times. Caliber’s vast military support was evidenced in May as we set a company record of Veteran’s Administration (VA) Loans funded in a single month. The fact that it occurred during National Military Appreciation Month makes it especially gratifying! We have steadily increased the total number of VA loans by 95% year over year. Caliber welcomes Veterans to join our team of exceptional service! Visit the Caliber Careers website for opportunities across the organization!”

It’s time you be in business for yourself, not by yourself. The Motto Mortgage network supports entrepreneurship through industry-leading tools and full-service assistance, all for a flat, monthly fee. You’ll have complete and customized access to best-of-breed technology, business support tailored to you, and enterprise-level wholesale lender relationships for all your loan origination needs. When you own a Motto Mortgage franchise, you own an innovative business that funds dreams and propels your career growth. Discover how franchise ownership can put the control in your hands and the heavy lifting in someone else’s or email us at franchise@mottomortgage.com for more information.”

Lender services and products

SolomonEdwards and Constant have announced a cooperative agreement to offer TotalMod to help lenders and servicers manage the imminent spike expected in loss mitigation activity once forbearances expire. TotalMod includes Constant’s self-service platform that automates loan modifications and other workout solutions, end-to-end without human intervention, and SolomonEdwards’ best-in-class regulatory and compliance services. TotalMod is intended to help servicers avoid large staffing campaigns, reduce phone channel volume, and maintain compliance as enforcement and supervisory actions increase. The technology is ground-breaking in that it progresses borrowers through a series of steps to determine ability and willingness to pay, crafts the right hardship offer based on that analysis, and presents documents for e-signing.

“Today AFR Wholesale celebrates, alongside our business partners, 13 years of bringing families home! Sending a heartfelt ‘thank you’ to our clients, without whom this would not be possible. We are thrilled to celebrate another year focused on helping families. AFR Wholesale fully invests in the success of our business partners by providing an extensive portfolio of products and services, industry-leading technology, professional expertise, and continuous educational opportunities. For a limited time, AFR Wholesale is also pricing its 60-day lock at the 30-day lock price. For more information about becoming an AFR Wholesale partner, go to afrwholesale.com, email sales@afrwholesale.com or call 1-800-375-6071.”

Register for MBA Education’s highly informative webinar, MOVING FORWARD: STRATEGIES FOR SECONDARY MARKETING SUCCESS, on Tuesday, June 23rd at 2:00 PM ET. Featuring industry veterans from Optimal Blue and Wells Fargo, this interactive webinar will examine market conditions and how the mortgage industry is reacting to economic changes in the wake of COVID-19. As the industry moves toward a steady, decisive recovery, the panel of experts will share successful secondary marketing strategies to help lenders navigate these volatile and unique times. For their guests, Optimal Blue has organized complimentary access to this MBA webinar. Please contact sales@optimalblue.com to receive a promo code that will waive your $299 registration fee.

CY 2019 Mortgage QC Industry Trends Report: “Market stability contributed to an overall better 2019 for lending quality. These improvements, however, will be severely tested as data comes in for the coming quarters as we start to see COVID’s impact on mortgage lending”, according to ARMCO EVP Nick Volpe. The Report Summary showed that Q4 2019 ended with a defect rate of 1.73%, an increase of 11% from Q3 2019. The share of conventional loans increased from 56.40% in CY 2018 to 61.99%. Purchase share fell 7.5% in CY 2019 as compared to CY 2018. Regulatory compliance issues were down 51% year-over-year. Loan Package/Documentation defects were volatile in CY 2019 but did post a 12% improvement compared with CY 2018. Income, assets, and credit related defects made up 53% of all critical defects in CY 2019VIEW REPORT.

MeridianLink’s LendingQB, a leading provider of SaaS loan origination technology, has integrated with eClosing platforms to provide a superior digital mortgage lending experience, from the application, and processing, to eClosing. The integrations will allow lenders, borrowers, and settlement agents to complete the eClosing process in a streamlined, safe, and secure way. The first integration with Docutech’s Solex eClosing is complete with IDS and DocMagic to follow. These integrations with LendingQB will bring further process improvement and help lenders safely meet the needs of mortgage lending customers. LendingQB is a browser-based mortgage loan origination system that provides the tools to help mortgage lenders decrease costs by streamlining processes through automation, improves the borrower experience, and increases profitability. This mortgage loan origination system is secure and compliant, integrating with most major core platforms to help eliminate tedious work and reduce errors. To schedule time to speak to someone about LendingQB and eClosing integrations, please click here.

Bringing back an oldie but a goodie episode from the Clear to Close podcast from Maxwell. Released earlier this year, with guest, Patty Arvielo, Co-Founder and President of New American Funding, the episode “Diversity and Inclusion in the Mortgage Industry,” is particularly timely in this moment as unresolved racial tensions in our country come to a head. It’s on all of us to create an open, equal, and welcoming environment in both the workplace and our daily lives. Listen and subscribe through your favorite podcast source below! See all episodes and listen in your browser at  www.himaxwell.com/podcast, Apple, Google Play, Spotify, and Soundcloud.

FHA & Ginnie news

Yes, the Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac (the Enterprises) will extend their single-family moratorium on foreclosures and evictions until at least August 31, 2020. The foreclosure moratorium applies to Enterprise-backed, single-family mortgages only. The current moratorium was set to expire on June 30th.

Likewise, the Federal Housing Administration (FHA) announced a two-month extension of its foreclosure and eviction moratorium through August 31 for homeowners with FHA-insured Single Family mortgages. The extension “applies to homeowners with FHA-insured Title II Single Family forward and Home Equity Conversion (reverse) mortgages, and continues to direct mortgage servicers to: Halt all new foreclosure actions and suspend all foreclosure actions currently in process, excluding legally vacant or abandoned properties; and cease all evictions of persons from FHA-insured Single Family properties, excluding actions to evict occupants of legally vacant or abandoned properties.

The extension brought up the topic of FHA’s forbearance policy. “FHA requires mortgage servicers to offer borrowers with FHA-insured mortgages up to a year of delayed mortgage payment forbearance when the borrower requests it. FHA does not require a lump sum payment at the end of the forbearance period.”

And this week the FHA announced it would impose a 20% first loss penalties on properly underwritten loans that go into forbearance post-closing but before FHA insures them. The Community Home Lenders Association is calling on FHA to rescind and rework this policy. “From the lenders’ perspective, it could create a financial hit on properly underwritten loans from something they have no control over: borrowers invoking the new Congressional right to invoke forbearance. CHLA is also concerned that this creates incentives for lenders to apply credit overlays based on things like guessing who might next invoke forbearance. Put simply, the small savings FHA might make from this policy could be dwarfed by the outsized upfront access to credit impact in terms of underwriting new loans.

FHA published Mortgagee Letter (ML) 2020-16, Endorsement of Mortgages under Forbearance for Borrowers Affected by the Presidentially-Declared COVID-19 National Emergency consistent with the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Here is the press release.

FHA published ML 2020-18 announcing the implementation of a new digital submission process for single or bulk loss mitigation home retention claims. Beginning Monday, June 15, these claims may be processed through the FHA Catalyst: Claims Module. Submission of loss mitigation home retention claims through the FHA Catalyst: Claims Module is optional.

The FHA Single Family Housing Claim Filing Technical Guide has been updated.

Ginnie Mae has added “Update for File Layouts for Single Family MBS Loan Forbearance Disclosure”. Ginnie Mae issued MPM 20-02 to inform interested participants of the updates to the Stripped Mortgage-Backed Securities (SMBS) program, effective for June 2020 transactions. And Ginnie Mae posted February 28 Notes and News. This post includes information on Issuer Operational Performance Profile Enhancements Overview and a reminder regarding Annual Audited Financial Statements.

Ginnie Mae announced that issuance of its mortgage-backed securities (MBS) totaled $57.85 billion in January, providing financing for more than 223,938 homeowners and renters. A breakdown of January issuance includes $55.46 billion of Ginnie Mae II MBS and $2.40 billion of Ginnie Mae I MBS, which includes $1.96 billion of loans for multifamily housing. Ginnie Mae’s total outstanding principal balance of $2.130 trillion is an increase from $2.053 trillion in January 2019.

Don’t forget that as part of Wells Fargo Funding response to the COVID-19 national emergency, it implemented a temporary minimum Loan Score of 680 for all FHA, VA, and Guaranteed Rural Housing (GRH) Loans, regardless of automated underwriting system (AUS) decision.

Orion Lending has made several changes to its FHA program underwriting criteria. Details can be found here.

PRMG posted Product Update 20-15. Products with updates include Chenoa FHA Edge and FHA Rate Advantage, CHFA FirstStep, both Ruby and Diamond Jumbo, Expanded Access, Choice and Choice Plus Conforming and Jumbo, Hybrid Conforming and Jumbo, and Investor Solution Products, VA and FHA products including VA IRRRLs and FHA Streamline, Agency DU Portfolio and HomeReady.

Recall that AmeriHome posted that the minimum decision credit score for streamline government loan transactions, FHA Streamline, VA IRRRL, and USDA Streamlined, will be 680. Effective for new commitments issued on and after Friday, April 3, 2020, the minimum decision credit score for non-streamline government loan transactions will be the greater of the program guide requirement or 640* This requirement applies to the following: FHA Standard Purchase and Refinance, VA Purchase, VA Cash-Out Refinance, USDA Purchase, USDA Rate and Term (Non-Streamlined) Refinance. (That was unchanged from the March 26, 2020 announcement, 20200307-CL Product Announcement – Minimum Credit Scores for Government Loans.)

PCF Wholesale available products include VA IRRRLs.

Capital markets

Rates haven’t done too much since last week when the Consumer Price Index fell 0.1 percent and the Producer Price Index increased 0.4 percent in May after seeing large declines in April. Recall that most of the gain in the PPI was attributed to a rebound in oil prices from record lows. Unemployment numbers continue to improve as new claims for unemployment insurance fell, although the Job Opening and Labor Turnover Survey showed the job openings rate fell to 3.7 percent and the hiring rate fell to a record low 2.7 percent in April. According to the National Bureau of Economic Research, February marked the peak of the last business cycle. Should the gradual reopening of the economy result in steady growth it is possible that the low could be in May or June making the recession of 2020 the shortest of the last 150 years. The Federal Reserve’s latest economic projections showed most FOMC members expect a gradual recovery and that the fed funds rate would remain near zero through the end of 2022.

After all that “risk off” trading I talked about yesterday morning, the day that followed was certainly “risk on.” Beijing said the coronavirus is still on the rise in the city and scrapped more than 1,200 flights yesterday due to a fresh outbreak. Brazil had a record 34,918 new cases, while previously virus-free New Zealand called in the military to enforce border controls after a positive test. Markets fluctuated a bit as investors weighed that increase in coronavirus cases with talk of government and monetary stimulus around the world. The 10-year yield closed the day -2 bps to 0.73 percent.

Fed Chairman Powell delivered the second part of his semiannual testimony on monetary policy before the House Financial Services Panel, saying that the central bank will reduce its purchases of corporate debt ETFs in favor of direct bond purchases. Powell urged Congress not to pull back too quickly on federal relief for households and small businesses amid increasing debate over whether to extend temporary bailout programs, and also warned lawmakers that a full economic recovery was unlikely until people were confident that the virus had been contained. On a positive note, he predicted “strong job creation between now and the end of July.” Separately, total housing starts increased in May, but were well below estimates and down 23 percent year-over-year. Total building permits increased nearly 15 percent month-over-month, but still missed estimates.

Today’s economic calendar is all but done and dusted. We’ve had initial jobless claims for the week ending June 13 (-58k from a revised figure from last week), continuing claims (20.5 million, -62k), and Philadelphia Fed manufacturing for June (+27.5 from -43.1). May leading indicators are due out later this morning, before some Fed speak with Cleveland’s Mester and San Francisco’s Daly. The NY Fed will conduct two FedTrade purchase operations totaling up to $4.349 billion starting with $1.372 billion UMBS15 2 percent and 2.5 percent followed by $2.977 billion UMBS30 2 percent through 3 percent. The Desk will also report on MBS purchases for the week ending June 10. We begin the day with Agency MBS prices better/up by nearly .125 and the 10-year yielding .69.

A little old lady answered a knock on the door one day, and was confronted by a well-dressed young man carrying a vacuum cleaner.

“Good morning,” said the young man. “If I could take a couple minutes of your time, I would like to demonstrate the very latest in high-powered vacuum cleaners…”

“Go away!” cried the old lady. “I’m broke and haven’t got any money!” and she proceeded to close the door.

Quick as a flash, the young man wedged his foot in the door and pushed it wide open.

“Don’t be too hasty!” he said. “Not until you have at least seen my demonstration!”

And with that, he emptied a bucket of horse manure onto her hallway carpet.

“Now, if this vacuum cleaner does not remove all traces of this horse manure from your carpet, Madam, I will personally eat the remainder.”

The old lady stepped back and said, “Well you just stay right there while l get you a fork, cuz they cut off my electricity this morning.”

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, “Reducing Friction”, focused on operations changes. If you have the 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. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)