Aug. 4: A couple random notes (pretty quiet out there); state lending law changes continue – the MBA weighs in

“Rob, this week you had a lead paragraph about builder costs, and a chart of where their money goes. Have you heard that under the Trump Administration, asbestos is going to make a comeback?” Politics aside, apparently the EPA has loosened the guidelines, despite the link to cancer, for using asbestos. Whether or not builders are going to use it remains to be seen.

On the dire side of things… “Rob, when will you figure out that any item sold in a Costco store is a commodity? Avocados, nuts, computers, chicken, mortgages, whatever. I think that the commoditization of a mortgage will continue until any inefficiencies are phased out of the marketplace. And one can expect the same thing to happen with real estate agents – do they really need to have all those offices, and lease all that space?”

“Rob, are you seeing companies eliminate escrow waiver fees?” Yes, although nothing is free in this business, right? Most lenders prefer that the borrower pays property tax and homeowner’s insurance into an impound or escrow account. The traditional alternative is to pay an extra fee and have them waive that requirement – often .25% of the loan amount. So, on a $200,000 loan, a borrower would pay an additional $500 on top of all the standard loan closing costs. An alternative option is the lender will increase the borrower’s interest rate to cover the cost. Don’t forget that in California the escrow interest law (California Civil Code Section 2954.8(a)), requires that financial institutions pay borrowers at least 2 percent annual interest on funds held in the borrowers’ escrow accounts. I’ve heard it argued that companies eliminating escrow waiver fees are (as noted above) increasing other rates/costs to compensate, or have little experience with servicing loans. Cynics say they’ll be adversely selected by the market and start to understand the concept of paying interest on escrow funds to borrowers (OR), plus processing escrow payments to some counties 4X a year.

State laws

Even if federal regulators, such as the CFPB, scale back, lenders still must work with the states. For the last few weeks I’ve been playing catch-up on some state-level law changes related to lending. Although there was plenty of griping about national-level rules and regulations, when you have 50 states with varying takes on things like notaries, signatures, documents, real property law, and licensing, it just makes things more difficult for any multi-state originator.

From the MBA William “Koop” Kooper scribed, “Just a short update on a few developments in recent months with respect to MBA’s efforts to enact consistent state laws and rules to permit remote online notarization (RON) for real estate finance transactions. Last year, MBA and the American Land Title Association (ALTA) partnered to draft model state legislation based largely on the statute enacted in Texas during 2017. Thus far, Tennessee, Minnesota, Indiana and Michigan have enacted laws this year which follow the contours of the MBA-ALTA model. They joined Montana, Virginia, Texas and Nevada, which already permitted RON.

“Several other states proposed bills this year, but their legislatures adjourned before they could be approved. While we are pleased with results of our campaign thus far, we’re very optimistic that even more can be achieved when legislatures convene in 2019. First, last week the non-partisan Uniform Law Commission (ULC) approved revisions to their Revised Uniform Law on Notarial Acts (RULONA) to authorize RON in a manner that is substantially aligned with the MBA-ALTA approach. Because many states have already adopted RULONA, this development could accelerate action on RON legislation in those states next year.

“In addition, earlier this year the National Association of Secretaries of State approved their suggested RON implementation standards for their members to rely on when implementing RON regulations. These standards track very closely to the draft product of MISMO’s RON Development Working Group. The MISMO draft standards are also reflected in the recently proposed rules in Texas to implement their law, which we expect to see finalized in the coming days. Lastly, just this week the U.S. Treasury Department released its long anticipated white paper on non-bank fintech which not only encourages states to adopt RON laws, but also to do so in a manner that results in greater standardization and alignment among states. MBA staff and several member company executives met with the Treasury Department earlier this year to provide input to this report and made this specific recommendation.

 

“All of these results were driven by MBA and ALTA members and staff as well as by both organizations’ state and local association partners. If you’re readers want to get involved, they should contact their state associations and check out the MBA’s RON resource center at www.mba.org/remoteonlinenotarization for the latest updates.” Thanks Koop!

Pennsylvania Department of Banking and Securities has published its quarterly newsletter. Included in this newsletter is “The Impact of Gender Diversity on Business.”

The Pennsylvania Department of Banking and Securities has amended Title 10 of the Pennsylvania Code by adding Chapter 59. This chapter is effective immediately. Chapter 59 concerns mortgage servicing issues. The topics covered are set out into fifteen parts: 1) Purpose; 2) Scope; 3) Definitions; 4) General disclosure requirements; 5) Mortgage servicing transfers; 6) Timely escrow payments and treatment of escrow account balances; 7) Error resolution procedures; 8) Requests for information; 9) Force-placed insurance; 10) General servicing policies, procedures, and requirements;11) Early intervention requirements for certain borrowers; 12) Continuity of contact; 13) Loss mitigation procedures; 14) Coordination with existing law; and 15) Additional notices.

The purpose of this new chapter is to set forth mortgage servicing standards that conform to the Consumer Financial Protection Bureau’s mortgage servicer regulations. Chapter 59 applies to any mortgage loan which is serviced by a mortgage servicer licensed by the Department of Banking and Securities.

Paul H. Wentzel, Jr., Sr. Legislative Director, Pennsylvania Department of Banking and Securities, recently provides his observations regarding interest that can be charged on loans in Pennsylvania. How much interest can I be charged for a loan? Seems a simple enough question, but the answer is surprisingly complicated. What the money is being borrowed for and the type of business lending you the money will determine the answer and many consumers can find themselves confused trying to figure it out. Take automobile financing as an example of just how confusing it can be for a consumer to understand what interest rates can be charged on a financial transaction. If you purchase a vehicle through an auto dealer and finance your purchase through them, your interest limits are based on the age of the car. If the car is two years old or newer, you can be charged up to 18 percent interest annually. If the car is older than two years, you can be charged up to 21 percent interest.

If you go to your bank or credit union, however, there is no limit on the amount of interest or fees that can be charged. The financing you choose will be governed by different Pennsylvania laws with different requirements and limitations. Many any interest rates now are tied to the high interest economies of the late 1970s and early 1980s. Back then, lenders found themselves having to pay so much for the money they would lend that they needed to be able to charge higher interest rates to recoup their costs and be a profitable business. During that period, there was a push by lenders to increase interest rates to be able to make more money from the loans. Back then, the idea of a home loan with less than a 10 percent interest rate was unthinkable. Also, at one time, credit card interest rates were capped at 15 percent, and then were eventually raised to 18 percent. Flash forward to today when the average current mortgage interest rates are right around 4.73 percent for a 30-year fixed rate mortgage. In an effort to help Pennsylvanians better understand allowable interest rates so they do not find themselves paying more than they should, the department recently introduced a new video series. These videos are a useful resource to consumers and offer a straightforward answer to the question, “what interest rate can I be charged for this loan?”

Pennsylvania’s Secretary of Banking and Securities Robin L. Wiessmann announced the release of a new series of videos that explains the amount of interest Pennsylvania consumers can be charged when borrowing money. “Finding out how much interest you can be charged can be a complicated task, depending on who is lending you the money, what you are purchasing, or whether you are a member of the military,” said Wiessmann. “These new videos take a plain-English approach to answering the basic question ‘what interest rates and fees am I going to be charged?’” The six-minute “Consumer Interest Rates in Pennsylvania” video can be found online. In addition, a series of 13 shorter videos on specific lending types can be found on the department’s YouTube channel.

Pennsylvania’s Secretary of Banking and Securities Robin L. Wiessmann reminded non-bank mortgage servicers that the department will begin accepting license applications beginning April 1, 2018. She also announced that frequently asked questions and answers on the licensing process have been posted online. Mortgage servicers can apply for a license through the NMLS. The deadline for licensing applications is June 30, 2018. Anyone with questions about license and the application process can email the department at mortgageservicing@pa.gov.

Mortgage Solutions Financial posted information regarding Texas severe storms and flooding.

Due to the active volcano, Flagstar Bank is suspending funding in various zip codes. It will continue to monitor and update the zip codes as necessary. Once funding has resumed a re-inspection may be required in the counties identified.

Last month, MBA-NJ Executive Director E. Robert Levy testified before the Senate Commerce Committee in Trenton, New Jersey on the bill to amend the Residential Mortgage Lending Act (RMLA) that includes a provision for the allowance of transitional mortgage licensing in the State. There is one floor amendment needed to conform fully with the transitional provisions added to the SAFE Act by the recently enacted Federal Law. Once enacted into law, the bill will be one of the earliest to track the new SAFE Act transitional licensing requirements providing a 120-day period for a state MLO moving to a company in another state or a registered MLO leaving a depository institution to work for a state -licensed mortgage company to continue to work while meeting all the state’s licensing requirements. The state-licensed company hiring the transitioning MLO is responsible to see that the individual is in compliance with all legal/regulatory requirements in the performance of his/her duties with the company during the transitional period.

New Jersey Commissioner of Banking and Insurance posted a bulletin warning the Industry About Theft of Mortgage Funds. Banks, credit unions, mortgage lenders, loan originators, title insurers, title, real estate agents, and consumers in the state of New Jersey need to be on the lookout for hackers that are trying to steal mortgage funds during the transactions. Acting Commissioner Marlene Caride stated “They all share one unfortunate result: the funds diverted through these criminal acts are nearly impossible to recover. The purpose of today’s bulletin is to remind those New Jersey firms involved in wire transfers to take every step necessary to protect small business owners, consumers and themselves against this constantly evolving fraudulent threat.” Caride added, “These industries handle millions of dollars in wire transfers every day in connection with mortgage loans and taking precautions to safeguard these transactions should be a high priority.”

The Massachusetts Supreme Judicial Court recently held in Dorrian v. LVNV Funding, LLC, that “passive debt buyers” are not “debt collectors” required to be licensed under the Massachusetts Fair Debt Collection Practices Act (“MDCPA”). Specifically, the Dorrian court held that a defendant passive debt buyer did not meet either definition of “debt collector” under the MDCPA because, among other things, it did not have any direct contact with consumers, and it only collected debts it owned as opposed to those owned by others. The full article is available here.

Virginia modified its provisions relating to notaries and fee agreements with an employer. The amendment provides that “any employer may require a notary in his employment to surrender to such employer a fee, if charged, or any part thereof, provided that the notarial act for which the fee is charged is performed during the course of such employee’s employment.” The amendment takes effect on July 1, 2018.

Vermont modified its provisions relating to data security and consumer privacy through House Bill 764, effective January 1, 2019. This bill contains provisions dealing with the protection of personal information and the regulation of data brokers and data collectors. Through House Bill 764 Vermont will require data brokers to register with the Secretary of State, pay a $100 annual fee, and disclose information related to their debt collection practices. Data brokers have a duty to protect personally identifiable information and must maintain appropriate information security programs and adopt safeguards for the protection of such information.

The bill also eliminates fees for obtaining a security freeze.

Seen on a T-shirt in Reno, Nevada recently:

EXERCISE

…Ex…er…cise

…Ex…ar…size

…Eggs…are…sides

…for bacon

BACON

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

 

Aug. 3: LO, AE, Bus. Dev. jobs, doc product; jumbo & Alt product trends; AOT product; yield curve update

I don’t think Brookstone, which declared bankruptcy yesterday, ever sold them, but is the “Tiny House” movement getting big? If you’re near Colorado Springs this weekend, there’s a festival celebrating them. One step away from CO, at Four Corners, in Arizona, a school district near Tucson is building a tiny-home community for faculty to help address the affordability issue. Hey, they’re okay with the Agencies if comps can be found, right?!

Employment

If you believe your company should be providing you with stronger support and a higher level of customer service for your clients, Firstrust is interested in speaking with you. “We are looking to expand our Wholesale team in the CT, North Jersey and Florida markets. Firstrust offers the traditional product set along with a unique portfolio product including high LTV jumbo financing.  If you are interested in making a move, please forward you information to Mike Scheier. Firstrust is a privately-held bank with assets of $2.7 billion. Safe and sound for more than 80 years.”

Centennial Lending Group, LLC is expanding its branches in the Southeast! “Centennial Lending Group, an award-winning mortgage lending company with multiple locations, is looking for talented loan officers. CLG is recognized as National Mortgage Professional Magazine’s Top Mortgage Employer for 2017 & 2018, Philadelphia Corporate Culture Award Winner 2017, and Montco Happening Winner 2017 & 2018. We offer great benefits, a flexible schedule, personal sales coaching, guidance from highly experienced senior mortgage officers to help build a successful sales playbook, a clear path to give full support necessary to grow professionally and personally, a marketing team support with social media, realtor presentations, print campaigns, videos, marketing coaching, online campaigns, CRM, mobile app and more, and full digital support to provide seamless access to borrowers and realtors. If you are interested in taking your career to the next level, please contact careers@clg-llc.com today and see the difference!”

Mike Miller who currently oversees the Wholesale Mountain Region for PRMG will now have the additional responsibility of overseeing and recruiting for the entire Midwest Region. “Over the last year with PRMG, Mike has demonstrated himself to be a strong leader along with a direct hands-on approach. He is always working toward building an elite team of Wholesale and Non-Delegated Correspondent Account Executives who as he states are ‘Noticeably Different.’ If you’re ready to join a top-tier team and company, then it’s time to talk! Contact Mike Miller (303.957.8390).”

DocProbe is looking for a Business Development Rep to represent the Central-Northeast region – see note below.

 

Congratulations are due: Roostify announced that Eric Amblard has joined the company as Chief Financial Officer. Rajesh Bhat, the CEO of Roostify, stated, “…Eric will also manage the company’s internal regulator, compliance and contract teams.”

Lender services and products

Patty Gong EVP, Secondary Marketing at Parkside Lending (San Francisco, CA) notes DocProbe has been a built-in part of our team since 2014. They work the Final Docs on both our business channels (correspondent and wholesale) and ensure that every trailing document is handled through best practices. The DocProbe team, process, and software coordinate flawlessly with ours. During one bulk sale, our investor misplaced some of our trailing documents; DocProbe handled a tedious reconciliation and resolved the issue. All in all, DocProbe has been a fantastic vendor to service and manage our trailing final documents.” DocProbe will be attending the LendersOne conference in Salt Lake City next week. “We look forward to spending time with our clients, the L1 team, and the L1 membership. We are looking for a Business Development Rep to represent the Central-Northeast region. Email Nick Erlanger to set up a call to learn more about our service or to submit your resume.”

GSF Mortgage continues to expand its Construction Lending Platform, offering a true Single Close Option for FHA at 96.5 LTV, USDA at 100% LTV, VA at 100% LTV, Conventional at 95% LTV. All underwriting requirements are the same as a traditional resale property for a resale property. This product suite has stabilized volume in this era of tight inventory. GSF is accepting Correspondent Lender applications. Please contact bolster@gogsf.com. All retail interest please contact cjampedro@gogsf.com.

Jumbo/non-conforming/guideline shifts

Newfi Wholesale recently announced an expansion of its proprietary Sequoia Portfolio Plus loan program. With Sequoia, Newfi makes all credit decisions and exceptions in-house, delivering flexible qualification standards and faster approvals on loan amounts up to $2.5 million. Sequoia Portfolio Plus accepts multiple documentation options including asset depletion and bank statements.  Loan scenarios and same-day exceptions are supported through its dedicated team of product experts. Newfi is committed to the return of make-sense lending, considering a borrower’s unique income and asset circumstances. “We wanted to create a loan program that combines the best of jumbo and non-traditional lending options,” said Newfi CEO Steve Abreu. “With Sequoia Portfolio Plus, we are empowering brokers to serve more homeowners in a tight market.” To support this product expansion, Newfi is actively seeking Wholesale AEs in key markets – resumes should be sent to Steve.  Learn more about Sequoia Portfolio Plus here.

Wells Fargo Funding is adding a new market classification level called Market Classification 2 Restricted for Non-Conforming Loans. Market Classification 2 Restricted counties will be subject to LTV/CLTV restrictions based on Loan Score. Note there are no counties listed in the new classification level at this time. Wells is notifying of the change now in preparation for when counties are added in the future. There will be an Alert Newsflash once Market Classification 2 Restricted counties are identified.

And Wells Fargo Funding has simplified its number of appraisals policy for Non-Conforming Loans including eliminating the requirement for desk reviews. Previously, appraisal requirements for Non-Conforming Loans were based on multiple criteria, total loan amount provided by Wells Fargo, LTV, and median home price. Now, the number of appraisals required is determined solely by the total loan amount provided by Wells Fargo.

Pacific Union Financial posted the following: Automated Underwriting System (AUS) approved 2-unit property transaction types are no longer restricted to a maximum 50% DTI: When any borrower is a first-time homebuyer, regardless of geographic area; or if the property is in New Jersey.

Mountain West Financial will now be offering FHA and VA 5/1 Treasury ARMs for High Balance loans.

Loan Stream is offering ITIN loans. Program highlights include: Purchase, Rate/Term & Cash Out Refinance, 620 Minimum FICO, Full Doc and 24 Month Bank-Statement Options, Blended Income Allowed, Options for First Time Homebuyers, Owner & Non-Owner Allowed, Non- Documented VISA or Residency Status OK, ITIN Number Must Show on 2 Years Tax Returns if Full Doc, Credit Must be Pulled with ITIN Number. Contact Serene Vernon with questions.

Capital markets

MCT has announced the automation of Tri-Party Agreement for bid tape AOT programs via its Bid Auction Manager (BAM) technology. A first of its kind technology, the solution benefits all counterparties and establishes newfound efficiencies for bid tape AOT executions. Company officials at MCT say that this execution is poised to gain rapid adoption and will likely account for a substantial portion of agency commitments. MCT collaborated with Wells Fargo to streamline the process leveraging eSignature technology. “Historically, Tri-Party Agreement made the AOT process extremely inefficient, as the form had to be printed out, wet-signed, scanned, stored, and in some cases faxed,” stated Phil Rasori, COO at MCT.  “BAM automates this process, allowing parties to generate, eSign, and securely deliver agreements, all with the click of a button.”  BAM is a component of MCT’s suite of Best-Execution technology that helps lenders and investors manage whole loan trading securely and efficiently.

Why should MLOs care about the yield curve? Because if it inverts, all LOs lose their license automatically.* The spread between the 10- and 2-year yields has fallen below 30 basis points, marking the narrowest spread since 2007 and causing further speculation on the risk of an imminent recession. The flattening yield curve in the past has possessed an alleged ability to signal a recession, as inversion in the yield curve has occurred prior to each of the past seven recessions, leading some to consider an inversion to be a good predictor of an economic downturn on the horizon. The yield curve can provide a valuable indication of forthcoming economic activity, but it represents only one factor in an economic outlook. Remember that the Fed is buying long-dated securities, artificially keeping long rates low, and thus a flatter curve. (* just kidding.)

In the short term, movements in the curve are largely a result of investor expectations, or where investors are assigning risk. Others have called to heed recessionary concerns, noting that current policy dynamics that are unique to this cycle are affecting the shape of the curve. The continued tightening in the federal funds rate by the FOMC is shifting the short end of the curve higher, while the unwinding of the Fed’s balance sheet will reduce buying at the long end. More broadly, forward-looking policy changes related to the budget deficit and ongoing fiscal stimulus could provide a lift to long-term bonds, a dynamic that typically does not occur late in the economic cycle, furthering the understanding that the flattening of the curve is something to pay attention to, but not a means for immediate concern.

How’s our friend – the consumer – helping the economy? Consumer spending continued is strong pace in June after surging in May and likely has contributed to potentially strong economic growth in Friday’s upcoming GDP report. Retail sale rose 0.5 percent in June and May’s 0.8 percent gain was revised up to 1.3 percent, fueled by sales gains at car dealerships and gas stations. Gas prices are up nearly 21 percent year-over-year and consumers are on pace to spend almost $5 billion more on new vehicles through the first half of the year than in 2017. Industrial production was also strong in June, rising 0.6 percent and reaching a new high. Despite the increases in manufacturing production, there is still plenty of room to grow as capacity utilization was at 75.5 percent in June compared to the mining sector which was at 92.7 percent utilization. The leading economic index, which is a composite of ten indicators designed to identify peaks and toughs in the economic cycle, increased 0.5 percent in June and is consistent with a positive outlook for the economy. Constraints on labor and resource supplies and their effects on wages and prices, however, are potential risks as we move into the second half of the year and beyond.

The advance estimate for real gross domestic product came in about as expected at a 4.1 percent annualized rate, driven by a 4.0 percent increase in consumer spending which coincided with comprehensive tax reform. Business investment was also a positive to headline GDP, however real inventories declined by a surprising $6 billion and reduced GDP growth by a full percentage point. Net trade added 1.1 percent and government spending, boosted by a 5.5 percent increase in federal defense spending, also added to the headline. Other recent economic releases included durable goods orders, which increased by 1.0 for the month of June after declines in April and May. Initial unemployment claims remain at a low 218k, up only 1k from last week. The negative data of the week was both new and existing home sales. New home sales declined 5.3 percent and existing home sales declines 0.6 percent in June. Supply for new homes increase to 5.7 months’ and supply of existing homes increase to 4.3 months’, indicating supply remains tight.

In the bond market, rate-wise, nuthin’ much doin’ out there. Yesterday the U.S. 10-year closed just below 3% as the BoJ was forced to act once Japan’s 10-yr yield crossed above the 0.14% level and the Bank of England voted unanimously to increase its official bank rate by 25 basis points to 0.75%. Despite the hawkish rhetoric, the pound still dropped as investors did not fully buy into a brighter economic outlook. There is a lot of talk surrounding a trade war between the U.S. and China, but the economy has been chugging along at a very healthy clip, as evidenced in the recent corporate earnings reports and today’s jobs report.

This morning we’ve had July’s employment data. (The June trade deficit was also released, but no one cares that it was $46.3 billion, and later we’ll have July Markit Services PMI and ISM Nonmanufacturing PMI, and no one cares about those either.) The unemployment rate (3.9%), hourly earnings (+.3%), and nonfarm payrolls (157k, low, but a decent back-month revision) all about as expected. So, we start Friday with the 10-year yielding 2.98% and agency MBS prices are nearly unchanged versus last night’s close.

I was on a panel for prospective jury duty. The first lawyer came across as an intimidating, pompous showman.

After several questions, he asked, “Do any of you here today dislike lawyers?”

There was an awkward silence. All of a sudden, we heard, “I do.”

The lawyer looks around the courtroom, and then turns to the judge. “Your Honor, I wasn’t asking you, I was asking the jurors.”

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

Aug. 2: Sales, marketing jobs; reno, non-QM products; Wells settlement; more decent economic news

When I was a young teen one of my summer jobs was working for a successful contractor in Cupertino, California at about $5 an hour. Comp has gone up significantly, as have all costs, and any originators working with builders should look at this graphic of where the money goes in building a home. While I am yammering about builders, the President issued an executive order on workforce development that will establish the National Council for the American Worker. “NAHB will help do it part to invest in the future workforce by pledging to train 50,000 new workers over the next five years for a career in the construction trades.” Speaking of builders, it turns out even they don’t quite know how to calculate the price per square foot of what they’re building! (Measure to the inside of the wall, or the outside dimensions? Semi-finished basement?)

Employment

Congratulations to a good friend of this commentary and industry veteran, Allen Friedman, who is entering his 10th year at iServe Residential Lending overseeing Western U.S. sales.  There is not a better testament to any individual or company when you see that type of longevity, especially in this industry. Here’s to his next 10 and iServe’s continued growth!

 

Here is something a little off the beaten path for someone good at sales but is a little weary of mortgages. Due to continued growth, Inheritance Funding Company, Inc. is looking to hire an additional Funding Officer for its San Francisco Financial District home office. Inheritance Funding Company, Inc. (IFC) has provided heirs waiting for their inheritance distribution with capital advances for nearly 25 years. “With nearly $200M advanced to heirs in all 50 states, IFC is the oldest and largest purveyor of inheritance advances in the country. With continued growth in this lucrative sector, IFC is looking to hire the right talent to catch up with increased demand. Inheritance/Probate experience is neither expected nor required though some understanding of legal process is a plus. The right candidate will showcase a blend of sales expertise, analytical reasoning, and strong client communication skills. Competitive base salary and uncapped incentive pay for strong performers.” Send all resumes and inquiries to Eric Holdsworth, VP of Marketing.

Are you a creative marketing professional with a solid track record of management along with a passion to help Loan Officers grow their originations? A large regional $4B mortgage bank located in the Southwest is looking for their next superstar Vice President of Marketing. The ideal candidate will have 7 to 10 years of solid marketing management experience, mortgage industry preferred, strong marketing through branding background along with a strong background in evaluating and implementing state of the art marketing technology and digital platforms. The ideal candidate will have experience managing an advertising budget of over $6.5 million that drives results and will be able to build strong internal and external communication plans and ensure their timely execution. If you are ready to work for a dynamic and growth-minded mortgage lender and lead a team of 20 +talented marketing professionals, please send your confidential resumes to me for forwarding.

Lender products & services

“Does your pricing seem a little bit too high? Are you losing deals over rates? Is your ability to earn money limited by your company’s high pricing? If you answered yes to any of these, chances are your company has too much padding or extra margin built into their rates, costing you money, deals, and possibly even referral relationships! Even worse, some companies build even more padding into your rates when their business slows down to keep their ‘high-profit appetite’ fed. Now there’s a way to see ‘behind the curtain’ to make sure you’re getting the best deal possible. Check out this “Pricing Lie Detector” – a free tool that shows you in 10 seconds how much money you may be leaving on the table due to over-inflated rate sheets from your company.” (Note: I have not verified the accuracy of this recruiting product.)

How can artificial intelligence help realtors and loan officers build authentic relationships? Thanks to a new partnership, marketing and CRM company Usherpa and borrower intelligence service Sales Boomerang can show you how. Together, these two powerhouse services can work in tandem to help users connect with leads at the right time, so they can close more deals with less effort. Register today for a new webinar coming August 8 and receive actionable advice on how to leverage AI to connect with your clients and prospects.

New Penn Financial’s SmartSelf product is part of the proprietary non-QM SMART series, comprised of four distinct product offerings to meet the diverse needs of specific borrowers. SmartSelf is a product designed for self-employed borrowers to document income with bank statements for loan amounts up to $3 Million or financing up to 90% LTV with no tax transcripts or tax returns required. Use 12 or 24-month bank statements or asset depletion to qualify with a minimum 620 FICO. SmartSelf Plus available for borrowers with 2-4 years derogatory credit for loan amounts up to $1.5M with 85% LTV. Call your rep for more information or go to www.gonewpenn.com.

Caliber Home Loans, Inc. Correspondent Lending is poised to be the top renovation investor in the industry. Caliber understands the challenges lenders face in originating and executing renovation production. Our Renovation Lending Professionals and dedicated operations team provide lenders the guidance and support they need through every step of the renovation loan process, which gives them confidence that they’re executing efficiently, effectively and compliantly. Beyond Caliber’s execution model, its team of Renovation Lending Professionals can provide lenders with sales and marketing support to help them capitalize on the significant incremental opportunities that renovation financing can provide — not only in the purchase market, but in the renovation refinance market as well. Even in markets with limited inventory, Caliber’s overall renovation offering can help lenders provide borrowers and Realtors with more options in terms of properties to consider which will help close more transactions. Contact your Caliber Correspondent Sales Executive for more information.

 

Many agree that there’s been no individual that’s had such a powerful impact on the industry as David Stevens, current MBA President and CEO. He’s had a positive impact on the careers of countless mortgage professionals as an executive of some of the most powerful mortgage firms, followed by his impact on policy as a public servant when he served as HUD US Assistant Secretary of Housing. Mr. Stevens is concluding his long running success as an exemplary leader of the MBA, and National Mortgage Professional Magazine decided to feature David Stevens in the September 2018 issue as their first-ever Mortgage Professional of the Year. This is your chance to share your congratulatory message and retirement best wishes for Mr. Stevens in National Mortgage Professional Magazine’s September 2018 print and digital editions. This includes an opportunity to record a video message at the MBA Annual Convention in Washington, DC or to send your own recorded message. This video will be distributed via Mortgage News Network and via our nmp and MNN social networking profiles. Click here to share your congratulatory message by Friday, August 10th.

Settlement & legal matters – TSA can do what?

Billion here, billion there, pretty soon it adds up. I don’t track how much lenders, banks, rating agencies, and investment banks have paid in fines over the last ten years, but yesterday was a chunk. Wells Fargo has agreed to pay a $2.09 billion fine for issuing mortgage loans it knew contained incorrect income information, the Justice Department announced Wednesday. “The bank pointed out that the Justice Department has previously reached settlement agreements with other banks over similar issues, and that “importantly, there were no claims that individual customers were harmed because of the alleged conduct.”

A federal judge in Philadelphia sentenced George Barnard to five years after he pleaded guilty to multiple fraud counts. The U.S. attorney’s office says Barnard used the money from the scheme to buy yachts, luxury cars and beach homes. In addition to his prison term, Barnard was ordered to pay $12.7 million in restitution and to forfeit $4.2 million in illegal proceeds. Barnard was one of two owners of Capital Financial Mortgage Corporation. Between 2005 and 2013 he defrauded banks by using money he borrowed for his personal use instead of funding loans for borrowers or paying off borrowers’ existing mortgages.

Although not directly mortgage-related, plenty of mortgage folks fly, and may be interested to learn that TSA agents and security screeners can’t be sued for false arrests, abuse, or assault, according to a ruling from a federal appeals court in Pellegrino v. the United States of America Transportation Security Administration, reports travel news and advice site The Points Guy.

According to the US Court of Appeals for the Third Circuit, TSA officials have sovereign immunity while working in their official functions as screeners and security agents under the Federal Tort Claims Act. While that law ordinarily doesn’t cover law enforcement officers, the court ruled in a 2-1 decision that TSA agents aren’t considered law enforcement and therefore are covered under the law.

Per the court’s decision, TSA searches are considered “administrative searches,” and as Circuit Judge Cheryl Ann Krause notes in the decision, “Congress to date has limited the proviso to ‘investigative or law enforcement officers,’” which the TSA searches wouldn’t fall under. According to Judge Krause, it would be up to Congress to enact legislation that could hold TSA agents accountable. But as the law stands now, it seems that there’s very little that individuals wronged by the TSA can do to have their problems addressed.

Capital markets – cuz that’s where the capital is

Despite the Fed’s increases in short-term rates, the U.S. economy continues to move forward, an example is the recent measure of Gross Domestic Product. Last week’s GDP print didn’t really move markets that much as it came in at 4.1 percent, about as expected. The data included new methodologies as well as new data sources and a base year change from 2009 to 2012. The revisions mean a restatement of previous years’ growth and from 2012 to the first quarter of 2018; the economy grew at a 2.3% average annual pace – in line with what has been previously reported.

Likewise, growth since 2007 was improved from a 1.4 percent annual average to 1.5 percent. The savings rate from 2016 through 2017 was restated at 6.2 percent versus a previously reported 4.2 percent. Finally, the Bureau of Economic Analysis sought to improve their reporting of Q1 GDP since the recession due to evidence that the seasonality adjustment was artificially understating first quarter performance. As a result, most of the Q1 over the past few years were revised higher. Overall, while some of the individual numbers have changed with this year’s revision, the narrative of the last 10 years remains intact.

The yield on 10-year Treasuries closed at 3 percent for the first time since June after the Federal Reserve held borrowing costs steady while signaling its intention to raise rates amid robust economic growth, as expected. The hawkish language used sets the stage for a rate hike in September. That news came separately from reports that President Trump is planning to increase tariffs on $200 billion worth of Chinese imports from 10.0 percent to 25.0 percent. Elsewhere internationally, central banks in the U.K. and Brazil are still to meet this week. The Bank of England is expected to hike even amid Brexit issues, while Brazil’s central bank is seen standing pat, and the RBI increased its repurchase rate by 25 basis points to 6.50% while the reverse repurchase rate was increased by 25 basis points to 6.25%. This was the second consecutive rate hike, matching expectations. The biggest piece of news remaining this week is the U.S. jobs report is on Friday, which is predicted to show a healthy labor market, with 190,000 new jobs.

Looking back at yesterday’s economic releases, the ADP Employment Report easily beat +175k expectations, registering at +219k. The ISM Manufacturing Index dipped below expectations in July but is still running at a healthy clip. Total construction spending declined in June, but an upward revision to spending in May mitigated most of the headline disappointment for June, which implies the June downturn is not as bad as it appears.

This morning traders are looking at England where the increase in interest rates by the Bank of England, although expected, is a significant moment as it is the first time the Bank of England has raised interest rates above 0.5 in nearly a decade. This is in large part down to the rate of inflation far outstripping interest rates in the UK, even with today’s increase. In simple terms this means that if your savings earn 0.75% interest they are being eaten into by the effects of inflation.

Job layoffs from Challenger, Gray & Christmas kicked off today’s calendar to no effect. Weekly jobless claims: +1k to 218k. At 10AM ET, June factory orders are expected to increase 0.8% MoM and 0.5% ex-transportation. Finally, At 2PM the NY Fed will report MBS purchases for the week ending August 1 which are expected to total $1.218bn net. We start Thursday in the U.S. with the 10-year yielding 2.98% and agency MBS prices a few ticks up/better versus Wednesday’s close.

Apparently, you can’t use “beefstew” as a password.

It’s not stroganoff.

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

Aug. 1: broker opportunity, LO jobs; digital & tech news – a blockchain mortgage in China; FAMC & Nationstar updates

I imagine the Congressional kickball match is really something to watch at its summer picnic. That branch of the government has become very adept at kicking things down the road, this time with flood insurance. (Good luck having them act on something substantive like Fannie and Freddie’s future!) Just hours before the National Flood Insurance Program was set to expire yesterday, the Senate approved a four-month extension that will keep the program alive through Nov. 30. President Trump said he would sign the extension (which passed the House last week). Everyone is hoping for a longer-term NFIP extension; cynics say, “fat chance – we’ll be doing this again after Thanksgiving.”

Employment, business opportunities, & company news

An Atlanta-based lender is looking to acquire mortgage broker shops with established self-gen loan officers. The lender prefers the broker shop maintain its management, branding, and culture and allows LO’s to broker to other lenders. The structure lets the broker shop off load compliance and some administrative costs (e.g. accounting, payroll) while normally retaining processors. The lender offers superior technology relieving the broker shop of headaches associated with technical support/maintenance and has proven transition plans/procedures in place for a smooth integration. All communication will be held in strict confidence. Please send me a note/resume for forwarding; excuse any delays due to travel.

Expanding its offering for loan officers, Movement Mortgage is bridging the need for LO personal branding and digital marketing with its new Movement Marketing Suite. VP of Marketing Jake Fehling says Movement Marketing Suite transforms retail mortgage marketing by connecting retail loan officers to a comprehensive suite of technology tools and strategies backed by a team of personal brand and mortgage marketing consultants. Headlining the Movement Marketing Suite are corporate-subsidized partnerships with four new technology partnersYext (SEO and digital listings), leadPops (lead funnels), Social Survey (reputation management) and Yip Yip (automatic social media content). Movement loan officers all get access to the Movement Marketing Suite and are empowered to automate and streamline marketing tasks while accessing resources and customized support from a team of content marketing, branding, social media, video and communications professionals. Learn more about opportunities at Movement Mortgage at MovementLO.com.

 

Efficiency Metrics are on every company’s list of “things that must improve” to lower costs.  Some companies are making drastic reductions in their support staff. Cornerstone Home Lending, with 175 offices in 23 States takes a uniquely different approach in supporting its Loan Officers. For the past 30 years, Cornerstone is known for CLOSING LOANS ON-TIME and management understands that it takes more Loan Processors, Underwriters and Closers to meet the ongoing month-end closing rushes. Compare Cornerstone’s metrics to your company’s metrics for June fundings: 1 Loan Processor for every 1.1 Loan Officers; 1 Underwriter for every 2.1 Loan Officers; 1 Closer for every 4.1 Loan Officers; 1 Technology Specialist for every 3.3 Loan Officers. The result, Cornerstone Loan Officers averaged 8.6 funded units in June, while 10% of its Loan Officers funded 20 or more units! More support creates HAPPY Customers and more production per Loan Officer!  For information about Cornerstone Home Lending contact Tom Lott.

 

“What’s your Plan B? With flat growth, low inventory, and margin compression, 2018 certainly has its challenges – and the 4th quarter is looming. Now is the time to consider a strategic conversation with American Pacific Mortgage. This video describes the unique solution we’ve built, and an invitation from APM’s Chairman, Kurt Reisig, on how we could strategically work together. Our business model empowers independent mortgage banks to operate under their brand and tap into our resources to compete. We provide the support, resources and technology, so you can focus on growing production. Interested in a confidential owner-to-owner conversation to explore a “Plan B” with Kurt Reisig? Please contact Peter Schwartz

(916.770.0053) or Mike Haden (916.223.3627).”

 

Caliber Home Loans, Inc. congratulates its Head of National Operations, Jennifer Corcoran, who was selected by HW as one of its 2018 Women of Influence. The magazine’s annual list recognizes high-achieving women in mortgage banking and real estate. As Senior Vice President, Jennifer and her operations team proved to be a tremendous asset to Caliber by achieving a 12% reduction in cost per loan in Q1 2018 over Q1 2017 and a 15% volume increase during the same period. Caliber produced its highest sales volume ever in 2017— at over $43 billion – and was profitable. To congratulate Jennifer on joining the ranks of such an elite group and thank her for her leadership, comment on Caliber’s LinkedIn announcement!

On August 1, 2018, FAMC will no longer be an independent entity and will instead become a division of Citizens Bank, N.A. There are a few items that will be changing and are therefore effective as of the acquisition date on August 1, 2018: MERS®, Note Endorsements, payment address for goodbye letters, and its Mortgagee Clause.

Stock analysts are dropping coverage of Nationstar Mortgage Holdings, Inc. (NSM) due to the closing of its previously announced acquisition by WMIH Corp. (WMIH). Its shares are being delisted.

Digital & tech updates

Floify, the mortgage industry’s leading point-of-sale solution, continues to live up to its stellar reputation! Not only is their end-to-end automation platform saving LOs valuable time by handling redundant tasks associated with originating loans, they’re making the process more amazing than ever with a slick interview-style 1003, brandable landing pages, and a growing list of third-party integrations. In fact, Floify customers, from single LOs to large enterprises, have become so efficient that many are reporting record-breaking levels of production because of their newly automated mortgage processes. Just ask Floify advocate and top-producing LO, Calum Ross, who recently reported generating more than $165 million in personal production without ever emailing a client – now that’s some powerful stuff! If you’ve been considering Floify for your lending operation, there’s never been a better time to make the transition to this leading-edge mortgage solution. Request a live demo to learn more!

Will investing in an end-to-end digital loan process produce more satisfied borrowers? In the latest MortgageSAT Tip, STRATMOR Group’s MortgageSAT Director Mike Seminari says the benefits of going digital can be measured empirically, specifically by considering changes in Net Promoter Score (NPS). Take for example, automating the process of document collection, which lowers the possibility that a borrower will be asked for the same document multiple times. Solving this problem alone results in a 50-point gain in NPS — 29 more Promoters and 21 less Detractors — which translates to real loan revenue. “There seems to be a clear arrow pointing to revenue opportunity, and we’re already seeing evidence of lenders responding. One lender, recently mentioned in this column, is offering borrowers a .125 bps pricing improvement just for completing a digital 1003 through their digital mortgage app.” The tide is turning toward the digital experience, and the sooner lenders join the party, the sooner they will recoup technology costs and start reaping extended financial benefits. See the current MortgageSAT Tip for three practical steps to take for starting — or continuing — on the digital path.

Looking briefly overseas, China’s 3rd largest bank issued a farmland loan via blockchain.

Ditech Holding Corporation announced that it has launched a highly personalized mortgage point-of-sale system, customized collaboratively by its in-house Innovation Lab and Tavant, and powered by VELOX, a leading digital lending platform. This system, which will provide a data-driven business platform, is expected to drive excellence in customer experience through streamlined business processes with intelligent automation, improved fulfilment efficiency, and overall digital simplification.

Notarize and Title Resources have partnered up to expand online notarization for 100% digital real estate transactions. Together the companies will enable lenders, independent title agents and customers to benefit from fully digital online closings. This joining will expand online closings to 38 states and the District of Columbia, including new states Michigan, New Mexico and Wisconsin. The addition of these new states represents nearly 265 million Americans now able to complete online closings. Notarize expanded its real estate platform to include Notarize for Title Agents to enable title agents of all sizes to serve buyers and sellers online.

Informative Research (IR) has integrated with LendingQB’s LOS. With this new integration, users will be able to order multiple products including but not limited to Credit Supplements, 4506-Ts, PreClose Monitoring (UDM), Flood reports, and their popular SoftQual solution, which lets lenders pull a soft inquiry on an applicant’s credit report to prequalify.

Colonial National Mortgage has chosen Roostify to provide its applicants with a simple and intuitive platform for obtaining a home loan. Consumers will have the ability to apply and provide loan documents online making it simple for all parties to collaborate in real time to speed up the closing process. “Our goal with Roostify is to provide a superior loan process that offers benefit to both our customers and our loan officers,” said J. David Motley, President of Colonial. “Roostify allows us to deploy a single platform for our retail mortgage channels – and in time, our credit union division — further streamlining our internal processes and ensuring a uniformly excellent customer experience.”

Clallam County, Wash., is the 1800th jurisdiction to join Simplifile’s e-recording network and reap the benefits of e-recording within its day-to-day operations. With this addition, more than 50 percent of recording jurisdictions nationwide are now using Simplifile’s e-recording platform to electronically exchange, process, and record real estate documents within minutes, making it the largest e-recording network in the nation.

OpenClose announced at the CMBA’s 46th Annual Western Secondary Marketing Conference that it unveiled DecisionAssist™ Mobile, which provides fingertip access to the company’s proprietary web-based product and pricing engine (PPE). Using DecisionAssist Mobile, originators can quickly and efficiently compare eligible products and pricing and deliver the results directly to their borrowers from anywhere at any time via any mobile device. Retail originators, wholesale brokers and correspondent sellers can instantly quote multiple loan products for a specific loan scenario on-the-fly and immediately email the borrower comparative details. An email summary of the quoted prices is simultaneously returned to the originator to follow up with the borrower. The result is faster service, convenience, greater transparency, reduced cycle times and increased pull-through rates.

Capital markets

Rates were flat yesterday ahead of today’s FOMC policy statement. Japan is #3 in world GDP, so its markets matter. Overnight, the Bank of Japan released its own July policy statement with no change to the policy rate (-0.10%), but the target range for the 10-yr JGB yield will be widened – as expected. (The central bank acknowledged that its forecast for reaching the 2.0% inflation target in fiscal year 2019 will not materialize.)

Looking back at the bevy of U.S. economic releases from yesterday, they continued to be solid – despite the Fed’s short-term rate increases. The Personal Income and Spending Report for June didn’t produce any real surprises, which should keep the Federal Reserve inclined to think that it can continue to raise interest rates. The PCE Price Index was roughly in-line with expectations and contained comprehensive revisions, including a marked upward adjustment in the personal savings rate for the years 2013-2017. The employment cost index showed wages, salaries, and benefit costs are trending higher, which supports the inflation narrative and the thinking that the Federal Reserve will remain inclined to keep gradually raising interest rates. The Chicago PMI hit a six-month high for July as the Prices Paid Indicator hit its highest level since September 2008, indicative of pipeline inflation. The Conference Board’s Consumer Confidence Index beat expectations for July after an upwardly revised June, but a back-to-back decline in the Expectations Index suggests consumers do not anticipate growth accelerating.

Domestically, no rate hike is expected today (Fed Funds 1.75%-2.00%). Instead, the policy statement will be studied for clues that could solidify expectations for two more hikes before the end of 2018. The Fed Funds futures market points to a 94% implied probability of a rate hike in September while the implied probability of another increase in December sits at 70%. We have already had the weekly MBA Mortgage Index (-2.5%) and the July ADP Employment Change (+219k, stronger than expected), before June Construction Spending (expected 0.2%; prior 0.4%) and July ISM Index. Finally, at 2pm ET, we will have the August FOMC Rate Decision, July Auto Sales (prior 3.97 million), and July Truck Sales (prior 9.61 million). Rates? Yesterday the benchmark 10-year closed yielding 2.98% and this morning it is at 3.00% with agency MBS prices worse nearly .125, based on the continued solid U.S. economic news.

There are no real holidays in August, so how about some non-national holidays? (A cynic would say that this is all that Congress can agree on in this era, if Congress did indeed agree on any of these. Maybe most are special interest groups.) August is National Catfish Month, Romance Awareness Month, and Foot Health Month. August 1 is National Raspberry Cream Pie Day. August 3 is National Watermelon Day. August 4 is Twins Day Festival. August 6 is Wiggle Your Toes Day. August 7 is Sea Serpent Day. August 8 is Sneak Zucchini Onto Your Neighbor’s Porch Night. August 10 is Lazy Day. August 12 is Middle Child’s Day. August 15 is National Relaxation Day & National Failures Day. August 18 is Bad Poetry Day. August 25 is Kiss-And-Make-Up Day. August 28 is World Sauntering Day. August 30 is National Toasted Marshmallow Day. August 31 is National Trail Mix Day.

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

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 31: Recruiting, MD & DDS, non-QM, digital products; legal news and lawsuits; layoffs & promotions continue

When I was in my 20s and into my 30s, I think I had about $3,000 in my retirement account – hardly enough now to even pay for the line-caught salmon for my cat Myrtle for a year. But in down payment news CNBC is telling us that people in that age group are tapping into their retirement money to buy homes. The survey size is only 600, which by my capital markets background math is about 12 people per state – is that really representative? Regardless, it is worth a skim for originators working with first-time home buyers.

Lender products & services

As the MBA’s recent letter to HUD indicates, Ginnie Mae’s orphaning of loans that were in underwriting or closed prior to the rule change prohibiting lenders from pooling unseasoned VA-guaranteed refinances remains an issue for the industry. Mid America Mortgage stands ready to help lenders stranded with these now-ineligible loans by purchasing them through its Whole Loan Trading Group. To be eligible for purchase, loans must be performing and have received a VA guaranty. For more information, please contact Michael Lima, Managing Director.

Are you an independent mortgage lender looking for a digital mortgage solution partner? Check out Maxwell, they could your perfect solution. Maxwell may be has been making waves in the industry with their innovative product and company approach to create partnerships (not client relationships) with their lenders. Click here to learn more.

New Penn Financial’s lineup of proprietary non-QM products now includes the SMART Series – four distinct product offerings designed to meet the varied needs of specific borrowers. SmartEdge is a product for borrowers qualifying full doc with shorter significant credit event seasoning and permits asset-amortization income calculations with a FICO 620+. Fixed 30, ARM 5/1, 7/1, 10/1, all optional interest-only, available with down payments as little as 10%. With loan amounts up to $3 million, there’s room in this product to find a great loan for a variety of borrowers. Call your rep for more information or go to www.gonewpenn.com.

Today, Total Expert and Mortgage Coach announced their new partnership, empowering lenders to create customers for life and build their personal brand within the enterprise. The Total Expert and Mortgage Coach integration is a unique offering to loan officers, pairing the Total Expert Marketing Operating SystemTM (MOS) with Mortgage Coach’s loan comparison, Total Cost Analysis. The partnership further expands the ability for lenders to centralize all marketing assets created and deployed into the Total Expert MOS for full oversight and on-demand reporting. “Mortgage loan officers are working every day to stay front and center with their clients – and our integration with Mortgage Coach makes this a seamless, automated process with beautiful, user-friendly client deliverables. Mortgage Coach is a best-of-breed partner, and together, we can provide lenders with solutions for long-term success,” said Joe Welu, founder and CEO of Total Expert.

“Next time you’re getting your annual check-up or squirming in the dental chair, let your doctor or dentist know that we can help them, too! Stearns Wholesale makes it easier for Docs and Dentists just out of their residency or fellowship to qualify for a loan by excluding certain student debt when calculating monthly debt-to-income ratios! We are one of the few lenders to offer Doctor Loans that offer borrowers a higher loan limit and lower down payment options.  No problem if your borrower is still in their residency or fellowship, they are still eligible to qualify. It’s not brain surgery…Stearns Wholesale will get these highly skilled individuals into the home of their dreams with the least pain points possible! Contact us to learn more about our Doctor Loan Program.”

The attrition rate in the mortgage industry is at an all-time high and we know a few popular reasons for it. One big thing, Baby Boomers are going into retirement daily, -10,000 people a day to be exact. In addition, the FREE Agent mindset of loan officers. With this high turnover in the sales force, Jim McGrath, veteran headhunter and recruitment trainer decided to open the attrition flood gates this month and dive into who and why mortgage professionals are jumping ship in the height of the season. With the high attrition rates (aka: Talent Run-Off), Jim addresses the top reasons why talent runs off to a competitor and how sales managers can leverage their leadership style to recruit, retain and train talent. Learn how to stop bleeding

red ink and increase your net worth as a sales leader and retain the loyal top performing loan officers on the Mortgage Recruiting Coach – Talent Run-Off | Stop the Madness.

Personnel moves

Yes, there are plenty of cutbacks around the industry, the latest batch said to be at National MI. Middle management particularly seems to be at risk. And Providential Financial’s CEO Craig Blunden announced that “…the continued weakness in mortgage banking fundamentals has resulted in necessary adjustments to our mortgage banking business model. During the 2018 fiscal year, we have reduced our retail production offices by 25%, from 12 to nine and we have reduced our mortgage banking staffing levels by approximately 32%.” But there are also plenty of promotions as well.

Altisource Portfolio Solutions S.A. announced the appointment of Justin Vedder as Chief Operating Officer, Origination Solutions, where he will be “responsible for the growth of Altisource’s Origination Solutions business which brings together the integrated and consultative products, services and solutions needed by mortgage market participants of all sizes throughout the loan origination and secondary market execution process.”

From Wisconsin comes news that Eric Egenhoefer, the CEO of Waterstone Mortgage Corp. who founded the company in 2000, has resigned effective 9/15. Waterstone Mortgage is a subsidiary of Wauwatosa-based WaterStone Bank SSB, which is part of Waterstone Financial Inc. A.W. Pickel III, who was recently hired as president of Waterstone Mortgage, will take on Egenhoefer’s duties.

Primary Residential Mortgage, Inc. (PRMI), which funded over $5.4 billion in home loans in 2017, announced the promotion of four of its executives: Tom George as EVP and chief production officer, Ruth Green as EVP and chief operations officer, A.J. Swope as EVP of secondary marketing, and Mathew Whitebrook as SVP of capital markets.

Conference

MBA’s Annual Convention and Expo is in Washington, DC this October. “Your participation and engagement with MBA has never been more important as so many issues stand before us as we head into the mid-term elections. The early registration deadline for the convention is tomorrow, Wednesday, August 1. This is always an impressive event and this year is no exception. Featuring some of the brightest minds in the mortgage banking and finance industries – including Dr. Janet L. Yellen, Geoff Colvin, The Honorable Benjamin Carson, M.D. and The Honorable Mel Watt – the program is sure to live up to expectations. Register today to save big, and make sure you bring members of your staff.”

Legal news

“Amrock, Inc., owned by Rock Holdings, Inc., claims it has evidence that HouseCanary, an analytics firm for property and real estate valuation, committed fraud during a $706.2 million jury verdict trial earlier this year.” For those playing along at home, Rock Holdings Dan Gilbert’s parent company of Quicken Loans Inc.

A few months ago, the Board of Governors of the Federal Reserve System issued a proposal to amend the rules implementing Section 13 of the Bank Holding Company Act of 1956 (the “Volcker Rule”). Shortly thereafter, the other federal agencies responsible for implementing the Volcker Rule followed suit. In general, the Proposed Rule would provide regulatory relief to banking entities subject to the Volcker Rule by tailoring its application, simplifying certain standards and requirements, and reducing compliance burden. Comments on the Proposed Rule are due 60 days after its publication in the Federal Register. Read the Morrison & Foerster Client Alert for details.

Congrats to Wells Fargo whom the OCC has released from its consent order. Mostly dealing with auto loan practices, but it touched on home lending.

In FHFA news, the headlines blared “FHFA Ruled Unconstitutional” but in reality, two judges ruled president couldn’t remove the head of the FHFA but did rule that government could sweep earnings. The ruling is sure to make no one happy. The FHFA & Congress are not happy (no ability to remove the director), and shareholders are not happy since profits will continue to be swept. Stay tuned.

On July 27, Politico reported that a FHFA employee brought an Equal Employment Opportunity (EEO) claim against FHFA Director Mel Watt after he purportedly made inappropriate sexual advances. In response, FHFA Director Watt said that he is “confident” that the investigation will conclude that he has “not done anything contrary to law.” Analysts believe this increases the likelihood of Director Watt departing before the end of his term in January 2019, which in turn could expedite anticipated FHFA policy shifts intended to modestly shrink the role of the GSEs.

Isaac Boltansky with Compass Point Research and Trading writes, in part, “At this juncture, there are five key questions. Will FHFA Director Watt leave before the end of his term? At a minimum, we believe this investigation makes it difficult to envision Director Watt staying beyond his term. Will the White House try to push Director Watt out before his term ends? The White House could either directly or indirectly challenge Director Watt. The White House is likely to expedite its timeline for nominating a FHFA Director replacement and could become more vocal on the matter. When will there be clarity on the investigation? Under federal guidelines, EEO investigations must be completed within 180 days and the documents cited by Politico suggest that the investigation has been ongoing for over a month…the investigation is being handled by the Postal Service Inspector General rather than the FHFA’s Inspector General.

“Who will the White House tap to head the FHFA? The White House will ultimately make a FHFA Director nomination, but the politics and timeline suggest that a transitional figure may be necessary. Our sense is that the White House’s decision will be driven by Director Watt’s next step. If Director Watt leaves prior to the conclusion of his term in January 2019, then the governing statute suggests that the White House will need to tap one of three specific deputies to serve in an acting capacity. If Director Watt leaves at the end of his term or thereafter, the White House could either tap one of the designated deputies or conceivably use the Vacancy Act to designate a Senate-confirmed individual as the acting head of the FHFA.

“What are the practical policy implications? Our sense is that the investigation into Director Watt increases the odds of an early departure, which in turn could expedite the transition to a new FHFA aimed at narrowing the footprints of Fannie Mae and Freddie Mac. Ultimately, we believe the next FHFA Director will work to modestly narrow the GSE footprint in the market, which is likely to include a reduction in multifamily lending activity, a broader consideration of the ‘charter creep’ conversation, and a curtailment of certain residential product offerings (e.g., cash-out refis, investment property).”

From Pennsylvania comes news that five mortgage foreclosure companies and two company owners are facing a lawsuit over allegations that they deceived homeowners and consumers into mortgage loan modifications. The lawsuit is seeking injunctive relief and restitution of more than $280,000 for all consumers who are currently or have ever been in a transaction with any of the companies or their affiliates. The Pennsylvania attorney general filed the suit in the Philadelphia County Common Pleas Court. The complainants entered into mortgage modification agreements with companies including GMK Solutions, the Foreclosure Law Center, Century Legal Group, Alia Law Group, and the Law Offices of Drew Alia. These entities were owned by Mark Goldstein and Drew Alia.

Capital markets

A quiet start to the week saw the American 10-year close +2bps to 2.98% as headlines revolved around Japan’s 10-yr yield edging above 0.10%, spurring the Bank of Japan to conduct its third unlimited purchasing operation of the past week. While the BoJ is not expected to alter its policy rate (-0.10%), some of its policy tools could be modified, and a downgrade to the inflation outlook is expected. The only other newsworthy items of note were Pending Home Sales increasing well above 0.2% expectations after decreasing 0.5% in May and the U.S. Treasury announcement it plans to issue $329 billion in net marketable debt during Q3 while issuance in the Q4 is expected to reach $440 billion.

This morning we have a lot of news in the U.S. We’ve had June’s personal income and spending (both +.4%, as expected), as well as the Q2 Employment Cost Index (+.6% versus the expected +.7%). For retail news we have Redbook same-store sales for the week ending July 28. The S&P/Case-Shiller Home Price Index for May will be released at 9AM ET and is expected to increase 0.2% MoM and 6.5% YoY, essentially the same figures as April. Chicago PMI for July will be released at 9:45AM followed by July consumer confidence at 10AM. Finally, day one of the two-way FOMC meeting will kick off in Washington, D.C. – don’t look for any change tomorrow. Tuesday starts with the 10-year yielding 2.95% and agency MBS prices better a tad versus Monday’s close.

(From a friend in Central Texas.)

To help you understand the meaning of grammar, please repeat the following three times.

Ice

Bank

Mice

Elf

After you have repeated these words, then perform the action while videoing yourself, then send to ten closest friends for critique.

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 30: LO jobs; leads, subservicer, bank statement programs; upcoming events; a look at the economy

“Buy land – they’re not making any more of it.” Don’t tell that to Hawai’i. While California continues to burn, 2,400 miles to the southwest Hawai’i has a different heat. In less than three months the state’s volcanic activity has created more land than in the last 35 years. Since 1983, the volcano Kilauea’s vent Puu Oo has added 443 acres of land by dumping lava into the sea. In the three months the fissures in Leilani Estates added at least 760 acres of new land: an estimated 50 to 150 cubic meters of lava flow per second compared to the sustained 3 to 4 cubic meters of lava flow from the 35-year-old vent. Of course, most lenders don’t lend in a lava region. But this is much more interesting than dumping garbage off the coast until land forms, like some nations do.

Jobs & promotions

Guardian Mortgage, a division of Sunflower Bank, N.A., has announced that Todd Boeding has joined the organization as the Regional Manager for Texas. Boeding will oversee origination operations in Texas and will focus on recruiting, growth and market development for the entire state. Boeding has an established background in mortgage sales management with leading companies in the industry and will channel his efforts toward expanding the Guardian Mortgage profile in Texas. Todd is a past President of the Dallas Mortgage Bankers Association and a board member for Carry The Load, a non-profit dedicated to honoring and celebrating our nation’s heroes – our military and first responders and their families. “Todd’s addition is a huge boost to achieve our growth strategy and production goals in Texas” said Guardian Mortgage president Mischelle Weaver. Guardian Mortgage is enjoying rapid growth across the country and is always looking for top performers. Please visit its website.

Lender products & services

Impac Mortgage Corp. is Introducing Bank Statement Premier – a new program for borrowers who have shown exceptional money management skills and deserve to be rewarded for it with enhanced pricing and a floor rate of just 4.99%. With loan amounts to $3M and unparalleled pricing, Bank Statement Premier uses flexible underwriting guidelines making it easier to qualify than your traditional full doc loan program and is available for all occupancy types. “Since our launch, Bank Statement Premier has quickly proven to be the program our clients need and want to grow their NQM business platform with tremendous feedback and exponential growth in both wholesale and correspondent channels. Click here for more on this innovative program.”

It’s time for a mid-year check: Are your numbers where they should be? It isn’t too late to have a record-breaking year! Ramp up revenue and close the year out strong. Join Wednesday’s webinar to learn, in 30 minutes, how Insellerate gives top lenders the boost they need to not only achieve but EXCEED revenue goals. Learn how to: Convert more leads with smart lead distribution and better lead management; Accelerate sales and reduce missed opportunities with workflow management and team collaboration; Improve LO performance by tracking activity effort and effectiveness; Generate repeat business with automated marketing and a robust content library; Turn more leads into live inbound calls with artificial intelligence and big data. Register for the 8/1 webinar: Sign Up Here!

Is your auditor just “checking the box” on their subservicer reviews? Demand more! A review that goes deeper than “just the facts” can uncover tremendous opportunities for improvement in the service your subservicer provides to both your organization and your borrowers. Subsequent QCsister company to mortgage risk management and compliance services provider MQMR, conducts multiple on-site reviews of all the major subservicers throughout the year to assess multiple facets of subservicers’ operations, including process control effectivenessvendor oversightregulatory/investor compliance AND alignment with operational best practices. By doing more than simply “checking the box,” Subsequent QC delivers a more comprehensive assessment of the risk a subservicer’s operations pose to the master servicer. Our team has uncovered numerous servicing exceptions during our subservicer audits, which have translated into direct value for our clients. For more information on Subsequent QC’s subservicer audit program, contact sales@mqmresearch.com.

FinLocker, a financial data and analytics company, has issued a press release announcing the approval of its third patent, further innovating their proprietary analytics engine and digital vault functionality. This most recent patent complements the FinLocker’s patent strategy, locking in its distinct capabilities and substantiating the uniqueness of the technology. The FinLocker platform generates high-quality leads, and dramatically reduces lender costs, data errors and processing timelines. The patent framework protects their advanced technology and validates the uniqueness of the FinLocker lending solution. This third patent protects the complex methods developed to enable complete interactive control over workflows, hierarchy, access, and rules-based analytics of sensitive financial information. This patent adds to the analytics foundation with machine learning, natural language processing, and heuristic analysis. FinLocker advancements in secure financial data management and analytics enable lenders to create a true “customer for life/lender for life” relationship.

Webinars and Trainings

As July wraps up (already?!), let’s see what events, conferences, and learning opportunities are ahead.

As mentioned above, Insellerate is offering a session for LOs to, “Ramp up revenue and close the year out strong. Join Wednesday’s webinar to learn, in 30 minutes, how Insellerate gives top lenders the boost they need to not only achieve but EXCEED revenue goals.”

Join the California MBA in San Diego for the 23rd Annual Western States Mortgage Technology and Loan Servicing Conference, August 5-7. There’s a keynote Q&A featuring Rocket Mortgage’s Shawn Krause, as well as a panel of the nation’s top servicers, a look at the latest in mortgage tech, and more! Registration discounts include a 50% discount for California MBA members, and the 3Under35 program (members can send up to 3 young employees for free!).

Join Indecomm on Tuesday, August 7th for its complimentary “Ask Me Anything” webinar with Krista K. Sabol and Joy K. Gilpin taking on the topic of social media and mortgage compliance. You can send your questions in advance.

There is an upcoming Collateral Risk Network meeting in Reston, VA on August 8th. In addition to a Valuation Compliance Workshop on August 7th to benefit chief appraisers, vendor managers and compliance, Steve Cannon, counsel for the Louisiana Real Estate Appraisers Board in the FTC action, will bring folks up-to-date with this pivotal legal case. Jim Park, ASC Director, will discuss the AMC Registry and many of the issues around AMC enforcement.

Join AzAMP Central Chapter Luncheon on August 8th with luncheon speaker, Congressman David Schweikert. Reservations and prepayment are required. Online Registration and payment accepted through Wednesday at 10AM before the luncheon.

The Lenders One 2018 Summer Conference will be in Salt Lake City, Utah, August 5-8, at The Grand America. Attendees will be able to select from 16 curated education sessions led by industry experts.

On Thursday, August 9th, get Your TRID Questions Answered by Richard Horn, Partner with Garris Horn PLLC, during an upcoming webinar hosted by October Research, LLC. The October 1st deadline is right around the corner, register to learn what you need to comply and what you can expect from the CFPB heading into 2019.

From Hawai’i, MBAH’s Connecting to Close Workshop on August 9th is an interactive session. Gain a deeper understanding of EI and the critical role it plays in creating the right connections with your customers and referral sources.

Join Buckley Sandler on August 9th to discuss what’s in the new California Consumer Privacy Act and what it means for businesses. The webcast will focus on the scope of the act and the compliance and operational requirements businesses will face, as well as enforcement and litigation implications.

Register now for the NMMLA August 13thLuncheon and Gubernatorial Round Table.

Join the California MBA on August 14th in San Francisco at the offices of Blend from 5-7pm for a free networking event for residential industry pros.

The Mortgage Collaborative will be holding its 2018 Summer Conference at the fabulous Four Seasons Hotel in Chicago, IL from Sunday, August 19th through Tuesday, August 21st. For more details, visit TMC or contact TMC COO Rich Swerbinsky.

FHA underwriter training? August 21, 8:30 AM to 4:00 PM, FHA is hosting a free instructor led, on-site training in Salt Lake City. And then the next day, in SL UT, Register for FHA Underwriting the Appraisal Training.

With so much at stake and few opportunities to advance the legislative priorities of the local housing finance community, register for the first ever NALHFA Legislative Conference to be held in Washington D.C. from October 2nd-4th, hosted by the District of Columbia Housing Finance Agency. NALHFA will bring members of the United States Congress, HUD, the Treasury Department, Congressional offices, and industry leaders will discuss the driving issues HFAs need to know.

Capital markets

Housing and jobs drive the economy, but, despite higher prices not being an issue in decades, recall that earlier in July we had an inflation measure. The headline Consumer Price Index increased by 0.1 percent in June, which paled in comparison to the 0.3 percent gain in the headline Producer Price Index for June. Stronger producer prices are not yet pushing hard on consumer prices despite increasing import tariffs, energy, and tight labor market conditions contributing to inflationary pressures. Deflationary forces are still in effect too, and expectations are for more pressure on both upstream and downstream prices through year end. These pressures should motivate the Federal Reserve to increase the fed funds rate 25 basis points two more times this year, once in September and once in December, for a total of four rate hikes in 2018. The implied odds of a fourth fed funds rate hike on December 19 have increased to about 55 percent.

Both existing and new home sales sagged in June, pointing to a cooler residential real estate market as higher land prices, lumber prices, labor costs and mortgage rates are all working to reduce housing affordability. Added to that, tax reform may be working against some markets, as the regional component of tax reform may be influencing both buyer and seller behavior on the West Coast. New home sales fell by the most since October 2017, and despite the Northeast seeing big gains at 36.8 percent for the month, the Midwest lost 13.4 percent, the South was down 7.7 percent, and the West saw its third consecutive monthly decline at -5.2 percent. The months’ supply of new homes ticked up to 5.7 months’ worth, which should help new home sales for the rest of the summer. Existing home sales decreased in June for the third consecutive month. The inventory of existing homes for sale notched up to a still-tight 4.3 months’ worth in June, and the median sales price of an existing home was up by 5.2 percent over the previous 12 months.

Friday, we learned that GDP registered as-expected (+4.1%) for Q2, the strongest since Q3 2014 with the strong annualized rate of growth underscoring the path of the Federal Reserve’s policy at a time when central bank decisions are highly scrutinized by investors. The Q2 reading was strong enough to support the belief that the Federal Reserve will remain undeterred from steady tightening, which will eventually weigh on growth. The market will receive the latest FOMC Statement this week, but a rate hike is not expected due to the lack of a press conference after the policy meeting. The only concerns surrounding the report are that the rate of growth may not be sustainable given that export growth was based off pre-tariff activity.

In Japan, reports suggested BOJ officials are debating ways to reduce the side-effects of their yield-curve control policy. The European Central Bank said Thursday that it will stick to its plan to end bond purchases and pledged to keep interest rates unchanged “at least through the summer of 2019.” Next week will also be unusually busy on the central banking front, considering the market will receive the latest policy statements from the Bank of Japan (Tuesday), Reserve Bank of India (Wednesday), Federal Reserve (Wednesday), Central Bank of Brazil (Wednesday), and Bank of England (Thursday).

Aside from a lot of Central Bank news, there is other scheduled news in the U.S. this week. Today’s only release is June Pending Home Sales (prior -0.5%) at 10AM ET. Things swing back into gear tomorrow with the Q2 Employment Cost Index, June PCE Prices, PCE Prices – Core, Personal Income, and Personal Spending, May S&P Case-Shiller Home Price Index, June Chicago PMI, and July Consumer Confidence. Wednesday sees the usual Weekly MBA Mortgage Index but will also feature July ADP Employment Change, June Construction Spending, July ISM Index, and the August FOMC Rate Decision (look for unchanged). Thursday, we receive Weekly Initial Claims and Continuing Claims, and June Factory Orders. The week closes with July Nonfarm Payrolls, the July Unemployment Rate (prior 4.0%), Average Hourly Earnings, and July ISM Services. Monday starts with rates higher versus Friday’s close with the 10-year yielding 2.98% and agency MBS prices worse .125.

On his deathbed, a lifelong Republican supporter suddenly announced that he was switching to the Democrats.

“I can’t believe you’re doing this.” said his friend. “For your entire life you’re been a staunch Republican. Why would you want to become a Democrat now?”

“Because I’d rather it was one of them that dies than one of us.”

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 28: Weed & lending; lending law changes from the Heartland; the investigation of FHFA’s Mel Watt

Yes, seems like the summer doldrums out there, and relatively quiet as lenders and originators focus on helping their borrowers one loan at a time. It was pretty quiet until Politico broke the story of the FHFA Director Mel Watt being investigated by the US Postal Service for sexual harassment, apparently with taped conversations about kissing an employee’s ankle tattoo. If the inappropriate behavior is true, would this impact borrowers? Not really, because lenders should focus on helping home buyers and home owners at the loan level. If true, would it impact our industry that continues to try to improve our public relations? Yes, because if true, it is shameful and should not be condoned. Obviously we will see where the investigation goes.

Full disclosure

Earlier this week I posted a note asking, “Rob, are you hearing that residential lenders are nervous about releasing their 2nd quarter results to warehouse banks, correspondent investors, and other counter-parties since they aren’t as good as hoped? Or even delaying them?”

The question prompted Jerry Davis, Managing Director in the Warehouse Division of LegacyTexas, to send, “The last thing any mortgage company should do is hide or delay financials as required by their warehouse banks. We, and reputable warehouse banks, work on fostering relationships where ALL clients inform us as soon as they know of issues including poor financial performance. With this knowledge and relationship, we can help companies going forward. Whereas finding out information either indirectly or after the fact makes the relationship on rocky foundation. Anyone with grey hair knows the mortgage industry has ups and downs in ALL aspects. But delaying or hiding information is truly not an acceptable process to take on the industry challenges.”

Weed

There’s no substantive change to the policy that many lenders face. Namely, loans sold or guaranteed by a U.S. Government Agency can’t be backed by income from illegal activities – in this case the marijuana business. Fed Chair Powell clarified that until federal guidance comes out, the Fed will not allow federally chartered banks to take money from marijuana businesses. He said the issue is difficult because while “many state laws permit the use of marijuana”, the issue remains that “federal law still doesn’t”. The current marijuana situation “puts the supervisors in a very difficult position”, so he wants to see it clarified. And the House Appropriations Committee has voted down a measure that would have defended banks that opened accounts for cannabis businesses from any punishment by federal financial regulators.

As one would expect, federal authorities are not applying consumer protections to the marijuana industry. A new study from the University of Northern Colorado (imagine that senior project!) bought several samples of 30 different labeled strains of legal cannabis from dispensaries to check to see if that Ghost OG they thought they were buying was in fact the bona fide breed. Perhaps someone in the supply chain is hitting the employee discount a little too hard, because out of the 30 strains, only 4 strains proved to be genetically consistent. Same with Purple Kush.

Heartland state-level lending changes

The states are “united” but that doesn’t mean they don’t all have different economic conditions, rules, regulations, disasters, and the like. Arch MI’s release of its quarterly Housing and Mortgage Market Review (HaMMR) report and proprietary risk index had some key findings and data from the report, including the top five states most at risk for home price declines and details regarding increased shortage in entry-level homes.

Let’s look at changes in America’s “Heartland” – defined as states that don’t touch an ocean.

Mortgage Solutions Financial posted updated information regarding the Indiana Severe Storms and Flooding.

The Oklahoma Department of Consumer Credit has published its annual changes in dollar amounts for 2018. The revised dollar amounts were effective on July 1, 2018, unless otherwise noted in the chart. Various dollar amounts set forth in the Uniform Consumer Credit Code change effective July 1 of each “qualifying year.” The calculations for dollar amount changes use figures from the Consumer Price Index Indicators, Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), issued each December by the Bureau of Labor Statistics. The annual changes in dollar amounts for 2018 may be viewed on the chart.

Wisconsin has recently passed Assembly Bill 607, relating to non-probate transfers of real estate, the transfer by affidavit procedure for small estates, and payoff amounts in mortgage payoff statements. The new bill first creates more flexibility for the transferring of real property upon death. Second, the bill modifies Wisconsin’s transfer by affidavit procedure, so that it may be used when the gross value of the decedent’s estate is less than $50,000. The bill notes that purchasers and lenders who acquire improperly transferred property will be held harmless if acting in good faith. Lastly, the new bill creates more flexibility for creditors, by allowing them to qualify the payment amount, state that the payoff amount cannot be determined, or state that the payoff amount is subject to change under certain conditions.

And Wisconsin has passed Assembly Bill 691, effective October 1, 2018, in response to a longstanding problem with nuisance landlords that routinely purchase property at foreclosure auctions, but habitually fail to pay delinquent property taxes and court fines for building code violations. There are two requirements placed on successful bidders at foreclosure auctions. First, the successful bidder must submit an affidavit to the court affirming that the bidder does not own property in the state that is more than 120 days tax delinquent.  And second, the affidavit must also affirm that the successful bidder does not have an outstanding judgement regarding noncompliance with state or local building codes. These affirmations must also be true for an entity that the bidder owns, manages, or controls, or for any entity that owns manages, or controls the bidder.

The news of Tennessee legislation update allowing every notary in Tennessee to conduct online notarizations, valid for citizens of all 50 states. Digital notary start-up Notarize was instrumental in helping to pass bill HB 1794/SB 1758, now headed to Governor Bill Haslam to be signed into law. Notarize co-founders Pat Kinsel and Adam Pase have been working with the Tennessee Land Title Association, the Tennessee Bankers Association, Realtors, Credit Unions, and others to adopt the remote notarization operating model originally enacted by Virginia in 2011. Tennessee joins Indiana, Ohio, Nevada, Texas, and Virginia as states enabling notaries to conduct secure, verifiable and convenient online notarizations. Benefits of the law to consumers and businesses include: eliminating robo-signing, encourages local business, and streamlines payment process.

Arizona Governor Doug Ducey signed HB 2154 into law, amending and strengthening the state’s data breach notification law. Notably, the amended law significantly expands the definition of “personal information” to include several new data elements, including online account credentials, certain health information, and biometric data used to authenticate an individual when the individual accesses an online account.

The amended law also requires that notice be provided within 45 days after a determination that a “security system breach” has occurred and adds an obligation to notify the Arizona Attorney General and nationwide consumer reporting agencies if the security system breach involves more than 1,000 individuals.

Iowa has made amendments to its Power of Attorney Act regarding an agent’s termination or suspension of authority effective as of July 1, 2018. The current section of the Act provides that an agent’s authority as power of attorney can be terminated under various circumstances, including when the principal revokes authority and when the agent dies, becomes incapacitated, or resigns. Under the amendment to this section, an agent’s powers can now be terminated if the agent is named as the abuser in an abuse report regarding the principal’s financial resources, or if the agent is convicted of dependent adult abuse related to the principal’s financial resources.

The Act has also been amended to allow any person who becomes aware of pending criminal charges of dependent adult abuse against a principal to petition the court to construe a power of attorney or to review an agent’s conduct. Finally, the amended Act provides that the court, upon receiving such a petition, may suspend the agent’s power of attorney and may appoint a guardian ad litem to represent the principal. Under this bill, the guardian ad litem must be a practicing attorney.

Effective as of August 28, 2018, Missouri has enacted provisions regarding its Fiduciary Access to Digital Assets Act. The Act allows fiduciaries to access electronic records of an account holder. The account holder may allow or prohibit the disclosure or his or her digital assets to a fiduciary in a will, trust, or other record.

The bill also specifies that a health savings account may be created if the trustee of a trust consisting of trust property less than $250,000 concludes that the trust property is insufficient to justify the cost of administration. The trustee must also provide notice to qualified beneficiaries upon this determination. Under the previous provision, the amount of the trust property must have been less than $100,000.

The term “directed trust” has been defined in the new provision and the term “trust protector” is further defined within this section. The bill also adds a no-contest clause in a trust instrument in certain circumstances.

The Tennessee Department of Commerce and Insurance, Division of Regulatory Boards, Collection Service Board has adopted provisions regarding the standards of practice for debt collectors. The new provisions address, among other things, the acquisition of location information from 3rd parties, communications in connection with debt collection, harassment or abuse, and unfair practices.

The standards define a debt collector, requirement of identification and state that he or she is attempting to confirm or correct location information and may only identify his/her employer if expressly requested. The debt collector cannot state that the consumer owes a debt, may not communicate with the 3rd party more than once unless requested to do so. If the consumer is represented by an attorney, may only communicate with that attorney unless the attorney consents to direct communication with the consumer. Further, a debt collector may not communicate with the consumer at his or her place of employment if the debt collector has reason to know that the employer prohibits the consumer from receiving such communication.

The standard also specifies what is considered harassment, abuse and unfair practices.

Through House Bill 1320, Indiana modified its provisions relating to recording requirements as they relate to the disposition of tax sale surplus.

For purposes of the tax sale statutes, has been amended to specify that: the term “means title to or interest in a tract that is within the tract’s chain of record title and: possessed by a person; and either recorded in the office of a the county recorder for the county in which the tract is located; or available for public inspection and properly indexed in the office of a the circuit court clerk in the county in which the tract is located; no not later than the hour and date a sale is scheduled to commence under IC 6-1.1-24.”

Furthermore, Section 2. Indiana Code 6-1.1-23.9-3(b) is amended to specifyfor purposes of IC 6-1.1-24 and IC 6-1.1-25 only, chain of record title includes instruments executed by the owner and recorded within the five (5) day period before the date the owner acquires title to the tract.”

Oklahoma has recently passed House Bill 1151, regarding convenience fees on consumer loan payments effective on November 1, 2018. In addition to the typical loan finance charges permitted by statute, a lender may also charge a “convenience fee” if a borrower makes his or her loan payment by debit card, electronic funds transfer, electronic check, or other electronic means. The purpose of the fee is to offset the lender’s costs for processing electronic payments with limits set not exceed the lesser of either the actual cost to the lender of electronic processing or 4% of the transaction amount.

If a lender charges a convenience fee, the lender must notify the customer of the fee amount prior to completing the electronic payment transaction. The lender must allow the customer to then cancel the transaction if he or she wishes without incurring a fee.  If a lender charges a convenience fee for electronic transactions, the lender must also allow the borrower to make loan payments by check, cash, or money order, without a convenience fee. The bill adds that if a borrower elects to make payments by debit card, electronic funds transfer, electronic check, or other electronic means, and a convenience fee is properly imposed, then the fee will be nonrefundable.

Plenty of folks use movies to escape reality, and everyone in residential lending knows we have enough of that. And people like lists for some reason. So let’s finish the week with the 50 best special effects of all time, per the people who wrote the article. (The cool thing about this site is that one can click on the links and see the effect. And yes, that godawful Alien movie stuff is in there.)

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

 

July 27: FHA, LO, Ops jobs, AI product; price, fee, lock changes from around the biz; Libor update

I received a note yesterday from the CEO of a well-known lender. “Rob, I love it when our competitors, who are losing money, wait weeks or months, after making the decision, to actually have a RIF or cutback. Now is the time for managers to actually manage, not just ride the gravy train, and the longer they wait in lowering overhead the worse their financials will look. We’ll outlast them by being more efficient and making the same revenue on every loan funded, but having lower costs.” Hundreds of companies are indeed cutting back, but don’t make the press. The latest to actually publicize cut backs is HomeStreet Bank as CEO Mark Mason announced the cuts in a second-quarter earnings call. “…we took additional steps in the quarter to streamline our mortgage banking operations by closing, consolidating or reducing space in 20 single family offices. These steps also include a reduction in headcount of approximately 127 full time equivalent employees” mostly in Arizona and coastal California.

Employment & personnel moves

“Mr. Cooper is looking for a Rockstar! Do you know of someone who’s passionate about their work and a great people leader? Mr. Cooper Correspondent is seeking the right person to help lead our team as AVP, Customer Relationship Management. The ideal candidate should be a motivator and leader for client-facing personnel, an innovator and solutions-driven, and have deep experience in Correspondent Lending Operations/Pipeline Management. We’re aggressively growing our Correspondent channel and want to fill this position with someone who will complement our leadership team and enjoy working in our exciting and energetic culture. We attribute much of our success in 2018 to the recent accomplishments including the addition of Non-Traditional Credit, Modified Construction to Perm Loan Notes and Manufactured Housing products. And in development are E-Notes, FHLMC HomeOne and Temporary Buydowns. Mr. Cooper is a premier Correspondent and Co-Issue investor and the largest non-bank servicer with a servicing portfolio exceeding $500B. For information, please contact Bryan Budd.”

“DEAL Junkies wanted! CALCAP Lending, LLC a direct lender in the high demand private money lending marketplace is expanding and seeking motivated loan producers and experienced processors in Irvine and Pasadena, California. While 2018 mainstream consumer lending volumes are dropping, and margins are compressing, we’re continuing to grow in a very active market where the effective decisioning and fast funding are the overriding priorities of our clients. We are seeking career-minded, mortgage professionals who are open to change and would like to increase their earnings potential via the origination of private money transactions. CALCAP offers competitive rental, fix-and-flip loan (financing 100% of rehab), foreign national (no FICO or income verification), and construction lending (80% of total cost) and a full range of employee benefits. To learn more, you are invited to email CALCAP at careers@calcapfinancial.com, call us at 623-337-4504, or contact our HR Manager, Josie Fowler.”

The Federal Housing Administration (FHA), the world’s largest mortgage insurer, has open positions within many of its program offices, including its Single Family, Multifamily, and Healthcare program offices. Positions include underwriters, analysts, housing program policy specialists, and others. To find FHA job postings, visit www.usajobs.gov and search on “HUD” and then sort by “Agency.”

Recently a customer of Caliber Home Loans, Inc. was killed in action while serving our country overseas. To help his widow and children stay in their family home, Caliber presented them with a check for $33,000 on Tuesday, July 24th, to pay off the mortgage in full. The non-profit organization, Tunnel to Towers, initiated a nationwide fundraising campaign to collect the remainder of the family’s mortgage balance. “To be able to stay in our home forever, and where our memories were made… I won’t have to work multiple jobs and I can be there for my kids. I’m forever grateful,” Briggs’ widow, Rebecca, said. The employees of Caliber strive to be ambassadors of goodwill and financial education in our military communities. Branch Manager Joseph Ferraro, RVP Peter Carney and Director of Military Community Engagement, Brittany Boccher were in attendance to represent Caliber.

MortgageHippo, Inc. announced the addition of several executive team members: Deborah Hill as VP Customer Success and Operations, Linda Verardi as VP Business Development, Russ Alton as Director of Technical Operations, and Brooke Mulder as Marketing & Communications Manager. Based in Chicago, MortgageHippo is a fintech company offering a comprehensive suite of customizable web and mobile-ready products white-labeled for banks, credit unions and mortgage lenders.

Lender products & services

National Mortgage Professional Magazine is compiling their 2018 “Who’s Who in Wholesale” list of wholesale lenders in the September 2018 edition. The deadline for this feature is Wednesday, August 22. Be sure to get your submission in by the deadline to ensure your company is included. Please follow this link to include your company in this list of wholesale lenders. There is no cost for the listing, however we’ll give you an opportunity to add your logo. Your listing will appear in the September print and electronic issue of National Mortgage Professional Magazine and on NationalMortgageProfessional.com. You have until Wednesday, August 22 to complete this form.

Marketing and CRM company Usherpa is proud to announce a partnership with borrower intelligence service Sales Boomerang. “We are so excited about our partnership with Usherpa,” said Alex Kutsishin, CEO of Sales Boomerang. “It is a perfect marriage of services, and the Usherpa team is dedicated to making the experience for their lender clients the best experience possible. Plus, the interface they created for Sales Boomerang notifications is awesome!” “Learn how customer intelligence can be the key to developing an effective customer relationship strategy in our latest blog post, and sign up for Usherpa and Sales Boomerang’s upcoming free webinar to learn about how artificial intelligence can help build authentic relationships.”

LendingQB‘s Vice President of Strategy David Colwell will be participating in a panel session at CMBA’s Western Technology conference on August 6th titled, “The Life Cycle of the Loan – Technology for Every Aspect.” LendingQB will also be participating in the conference’s Technology Marketplace on August 7th to demonstrate LendingQB’s powerful integration capabilities through their flexible OpenAPI’s that allows for an extensive list of over 300 integrations that assist in propelling lenders into the digital mortgage fold. If you’re interested in seeing a full demonstration of LendingQB, click here.

Price, fee, and lock policy changes from around the biz

United Wholesale Mortgage introduced a new Lock & Shop feature that gives mortgage brokers the ability to lock their borrowers’ interest rate while the borrower shops for a new home. Even without a formal offer on a property, Lock & Shop gives rate security with 60 or 90-day rate locks. If the rates improve as borrowers’ shop, brokers have the option to float down to the better rate.

Earlier this month Quicken Loans Mortgage Services spread the word that, “Now through July 31st we’re giving you the ultimate bps offer: 40 bps on top of Rock Solid pricing. Redeem the ultimate bps offer on unlimited locks on agency loans above $200K and government loans above $125K for July only!”

Starting Friday June 22, “All ditech approved correspondent clients should note…ditech changed the LLPA on its 5/1 ARM 5/2/5 CAP from +0.250 to +0.050.

PRMG has eliminated the escrow waiver fee for all states.

Wells Fargo Funding has changed its tax service fee to a flat $80 per Loan fee and retired the state-by-state Tax Service Fee Schedule (Schedule B).

Effective June 4, pending state approvals, Arch MI reduced BPMI rate card premiums for most credit scores and updating adjusters for loans with more than one borrower and loans with a Debt-To-Income (DTI) ratio greater than 45%. Please see the BPMI Monthly rate card and Underwriting Guidelines for more details.

Back in May ditech updated appraisal fees on appraisals ordered through Mercury. The complete fee schedule will be posted on its website in the Forms Library.

Capital markets

Originators should know what MBS traders and economists have been looking at recently. A majority of fund managers expect a recession in the US by early 2020, according to a Bank of America survey. A separate survey of bond-market experts reveals widespread expectations of a yield-curve inversion, a recession signal, within two years. Surely these people realize the long end of the yield curve is being held down artificially by the Fed, right?

The financial-services sector appears at risk of operational, financial and market-stability impact as replacement of Libor approaches. Regulators have voiced concerns Libor’s disappearance after 2021 could catch the sector off guard. Off guard? We had 4 years notice!

Stepping back and looking at economic trends, BJ Necel writes, “Talk surrounding inflation has been widespread over the last few months as higher tariffs and tight labor markets points to increased pressure on businesses to begin the pass through at least some of those costs onto consumers. While we haven’t seen it come through in the broad data yet, many expect that price increases may begin to gather momentum. The Producer Price Index was up 0.3 percent in June and 3.4 percent in the last year; however non-energy materials used in manufacturing and construction are up 6.5 percent year-over-year. While consumer inflation was not as strong in Jun – only up 0.1 percent – prices have risen 2.9 percent over the last year as food, shelter, and gasoline have experiences steady gains. With the lack of slack in the economy and uncertainties around trade and the potential for consumer products to be directly affected, consumer prices are expected to face increasing upward pressure.

“Given that core consumer inflation is above the Fed’s 2 percent target, there is a good case to be made for the Fed to raise rates twice more this year. Currently, market expectations are around 85% for the next increase to be at the September FOMC meeting with the final rate increase expected in December.”

Most of the recent headlines have more political than economic as uncertainty surrounding international trade increased. There hasn’t been any hard evidence, however, in the economic indicators that have shown the trade concerns have had a meaningful negative impact on the US economy as we move into the third quarter. The Producer Price Index increased 0.3 percent and is up 3.4 percent over the previous twelve months while the core index was also up 0.3 percent in June and 2.7 percent year-over-year. Consumer prices were more subdued in June; only increasing 0.1 percent for the month though they are up 2.9 percent over the last twelve months. Small business optimism eased last month but remains near historic highs. Despite higher tariffs, import prices declined 0.4 percent in June and excluding energy, import prices fell 0.3 percent.

Continuing the look at recent weeks for economic trends, the labor market continued its hot streak in June as employers added 213,000 new jobs and May’s gain was revised up from 223,000 to 224,000. The unemployment rate increased to 4.0 percent, but this was mainly driven by a 0.2 percentage increase in the labor force participation rate. Hourly earnings also saw a small increase. The ISM manufacturing index increased to 60.2 in June, adding fuel to an expected strong Q2 GDP reading. New orders remained strong despite the tariffs, though manufacturers continue to report upward pressure on prices. Non-manufacturing activity also expanded in June as the ISM non-manufacturing index increased to 59.1. Construction spending in May was slightly below analysts’ expectations, however it did increase 0.4 percent and is up 4.3 percent for the year. Most of the monthly gain was in the residential sector as multifamily, single-family, and home improvement spending all increased. Finally, the trade balance narrowed to $43.1 billion in May as exports increased 1.9 percent. This marks the third straight month of declines for the trade gap and as a result should be a substantial lift to GDP.

Looking at the actual bond market yesterday, headline news revolved around the 20% drop in Facebook’s market value, but earnings reports generally have little impact on rates, and the European Central Bank holding interest rates was a much bigger player in the 10-year closing 4bps higher at 2.98% yesterday than anything occurring in the equity marketplace. The ECB said it will stick to its plan to end bond purchases and pledged to keep interest rates unchanged “at least through the summer of 2019.” The market, however, ignored the fact that while Mr. Juncker is one of the executives within the European Union, he does not speak for the entire union or any of the individual member states.

The weeks continue to sail by, and today brought the first look at Q2 GDP. Expected to register at 4.0% (that would be the most since Q3 2015’s +5.2%), it was +4.1%. The only other economic release is the final University of Michigan Sentiment Index for July. The summer non-volatile rate environment continues: Friday starts with rates versus Thursday’s close: the 10-year is yielding 2.96% and agency MBS prices are actually better a couple ticks despite the strong GDP number.

(Warning: the first link is unrated, but if you get the willies easily, this video is not for you.) Amazing things happen all the time in Kansas. Including unwanted visitors triggering video cameras outside of houses. But wait… there’s more, and this time cute and cuddly! Check out the photos a woman took of a mountain lion snoozing on her couch! Really? Stand there and take photos and communicate telepathically? Is weed legal in Oregon? Nature always bats last.

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 26: LO & Ops jobs, construction process risk product; blockchain primer; lender tech rollouts

The United States is a fine country, and the residential lending industry is filled with fine individuals working to help borrowers, or help others help borrowers, with owning a home. Periodically I am asked about a list of organizations around the nation who support the financing of home ownership and related activities. From the MBA, here you go – just scroll down. (Speaking of the Mortgage Bankers Association, its president Dave Stevens sat down in his waning administrative days to discuss his view of the future of mortgage lending with XINNIX CEO Casey Cunningham on a very special episode of Inside the Mortgage Mind, a XINNIX podcast.)

Employment

Military Direct Mortgage, a growing VA direct to consumer lender, licensed in 39 states around the nation is looking for remote Loan Officers. Join a growing team while helping our veterans utilize their benefits. Military Direct offers the VA Rehab loan along with a complete suite of loan products. For more information please contact Military Direct President, Patti White.

 

“Looking for more control in your career? Maybe it’s time to investigate Motto Franchising, LLC. As the first national franchised mortgage brokerage model, we offer something totally unique. Own your own business and take advantage of an out-of-the-box mortgage company solution. With franchisee setup support for compliance, LOS training, licensing, wholesale lender mix, brand and marketing, we streamline the process of starting your own business and controlling your own future. To find out more about this disruptive new model, contact our team at www.mottomortgage.com/franchises (866.668.8649).”

Wrapping up a record Q2, Angel Oak Mortgage Solutions, a leader in non-QM lending, announced the addition of 6 more AEs to help brokers and correspondents grow their business. Adding additional coverage across the country, Mark Dombrowski came on-board in Arizona, Tim Saucier in Maine, Gil Moran in Chicago, Shawn Hartman in Indianapolis, Robyn Smith-Manchas in Eugene, Oregon and Jennifer Hernandez in Southern California. “To support this record volume growth, the AOMS Operations team is also hiring underwriters and other positions in both Atlanta and our newest center in Dallas. As more companies realize the benefits of offering responsible non-QM products, it only makes sense to work with the market leader. If you are interested in learning more, please visit www.angeloakms.com/careers.”

 

Fortune Magazine recognized Houston-based Cornerstone Home Lending, Inc. in two of its Top 100 PLACES TO WORK lists this year, FORTUNE’S BEST WORKPLACES IN FINANCIAL SERVICES, and FORTUNE’S 100 BEST WORKPLACES FOR DIVERSITY. Cornerstone also earned national recognition in the GREAT PLACE TO WORK Best Workplaces national employee survey for achieving ratings of 98% and higher on: Workplace Atmosphere, Company Pride, Communication, Rewards, and best Bosses. Founder and CEO Marc Laird sites Cornerstone’s servant-leadership management style and its meaningful Mission Statement as the driving factors for the company’s success over the past 30 years. For more information about Cornerstone Home Lending employment opportunities throughout the U.S. contact Tom Lott.

How many more residential loans could you and your branch team close with better back office support? You work too hard to experience the same chokepoints over and over again. Assurance Financial offers you a committed team of experts who have spent the last 17 years with only one objective: Help you close loans on time, every time. If you even THINK you may be losing origination opportunities to build your business in your current situation due to poor support, contact Paul Peters, CMB (225.239.7948). Assurance Financial is a growing full-service independent mortgage banker seeking dynamic producing branch managers and MLO teams throughout the South, Southeast, Southwest, East, and Midwest, U.S. Watch this 2-minute video now.

Lender products & services

Flagstar Bank has been working with Ellie Mae to integrate with Encompass Investor Connect, which establishes a secure system-to-system workflow to the loan delivery process. This integration will allow correspondents using Encompass to deliver required data and documents directly to Flagstar with just one click, thus reducing time and errors. The result is lower costs and more efficiencies for both Flagstar and its correspondent customers. Full rollout is set for mid-August. This is among several exciting technology enhancements that Flagstar has planned for the coming months. Stay tuned to see what’s coming next.

With 2018 shaping up for lower volumes, compressed margins and a purchase driven marketplace, lenders across the U.S. are struggling to find ways to produce revenue and are searching for innovative products to support their origination platforms. CFSI Loan Management is a full-service construction risk mitigation company, helping lenders manage the construction process from beginning to end. “We help our lending partners to ensure that the contractor and project feasibility phase is set prior to loan approval and after loan funding we provide full service fund control (including lien releases) and a national inspection platform that allows our clients to ensure that the project is progressing on time and the percent complete is accurate for funding each draw. Lenders manage credit risk, CFSI manages construction risk. Let CFSI Loan Management help you lead your market with real estate agents, borrowers and builders with a construction loan program.” Please contact President Brian Mingham for information.

We all want to be just like Google and Amazon, web-enabled companies that created real disruption in consumer buying. Is Blockchain the technology to create this kind of disruption in the mortgage industry? In the July issue of STRATMOR Group’s Insights report, Principal Andrew Weiss outlines Blockchain technology and its possible impacts in his article, “Connecting the Blocks: Practical Applications of Blockchain for the Mortgage Industry.” Weiss explains Blockchain through mortgage-related examples, including one that proposes what the industry could see in the year 2026 if Blockchain is widely adopted. Blockchain is one of the hottest technology discussions going today, and lenders, if you’re wondering how it might help you get a leg up in the current market environment, be sure to read this article. The July issue of Insights also offers an article on diversity in the borrower’s experience that includes data analysis from the STRATMOR MortgageSAT Borrower Satisfaction Program that may surprise you. It appears the mortgage industry isn’t doing as well as we think serving some ethnicities. STRATMOR Insights report.

Lenders & investors rolling out new tech plays

Many small and mid-sized lenders don’t have the time, money, or dedicated vendor manager to vet products and roll one out. (These lenders certainly couldn’t afford a complete re-do of TRID.) With limited personnel, sometimes the task falls to the CEO, the owner, the head of IT…

Ruoff Home Mortgage recently rolled out their proprietary digital mortgage solution, Loan Butler. This exclusive online loan technology gives homebuyers access to apply for home financing with a few simple clicks and keeps them apprised of the progress along the way. Loan Butler is cutting-edge online loan technology that gives potential homebuyers the ability to digitally provide required documentation at the touch of a finger. Applicants can initiate a credit check and review their scores, digitally verify their employment information, and seamlessly transfer asset documentation all from the convenience of their digital device.

Sun West Mortgage Company, Inc. announced a technology update to its SeeMyLoanStatus. Enhancements include a new option “Price the Loan” has been added to “Originator Access” to check out the Sun West’s excellent pricing on any scenario without creating a loan number.

Pacific Union Financial has chosen Total Expert to deploy its new proprietary marketing operating system (MOS), EXPmarketing. Pacific Union Financials’ Retail loan officers will be able to manage and communicate with prospects and customers while maintaining company brand standards and regulatory requirements.

AmeriHome’s Correspondent Connect has a new landing page where you will find: AmeriHome and industry news, product and program highlights, Information about upcoming sponsored events and more. The new landing page also provides centralized access for logging into Correspondent Connect and SellerWeb.

Fannie Mae recently launched “Ask Poli”, a new tool that uses natural language processing to better understand your policy questions and quickly find the answers you’re seeking. Available to Fannie Mae sellers and servicers, Ask Poli not only provides answers, but it tells you where to find relevant details in the Selling and Servicing Guides, and allows you to share or print the answers to keep for your files. Give Ask Poli a spin at AskPoli.fanniemae.com or on the Selling and Servicing Guide pages.

Franklin American Mortgage announced a new and improved customer experience powered by Blend’s digital platform. Homebuyers can submit, including on nights and weekends, all required documentation when applying for a loan from their mobile device or desktop computer. Recent studies have shown that the streamlined process allows up to 80% of borrowers to complete their applications in just one sitting. Additionally, borrowers can directly link their financial accounts to the portal, giving loan officers and processors access they need to quickly verify income information.

Wells Fargo Retail now uses Blend in its mortgage application process. “Blend…the venture-backed company has “tens of millions of dollars” in annual revenues and 300 employees. It plans to expand soon into software connecting car-loan lenders with consumers.”

Recall that Freddie Mac launched its “Borrower of the Future Campaign” to take a look at how the industry will have to address the younger homebuyer. “The increase in self-employed and the rise of the sharing economy and digitally-driven lifestyles are having a tremendous impact and leading to shifts in behavioral, economic and societal factors,” said Chris Boyle, Chief Client Officer at Freddie Mac. “Collectively, the industry must now consider these dynamics as we think about how to effectively help the next generation find the home of their dreams. We’re excited to serve in this important role to help the industry better understand the Borrower of the Future, and then drive the conversation on how to apply these insights to make the mortgage process more efficient and affordable.”

Earlier this year Guild Mortgage launched Guild 360, a sales, marketing and CRM platform powered by Salesforce Sales Cloud and Pardot with Guild’s proprietary internal systems. The platform gives the company’s loan officers a single reliable source for maintaining current homebuyer information, aiding them throughout the lending process and specific to each customer lifecycle.

Caliber Home Loans joined forces with FirstFunding, Inc. to bring “Caliber Express Connect” for non-delegated correspondent lenders. Caliber is the first wholesale lender
to offer this service and the only lender who’s integrated their services with FirstFunding.
Tune Watch its Vimeo channel for a 5-minute introduction to Caliber Express Connect.

Earlier this year, to foster communication between regulators and industry regarding financial technology, regulators from all 50 states and the District of Columbia designated an Innovation Staff Contact within their offices, the Conference of State Bank Supervisors (CSBS). The Innovation Contact will be the primary contact for fintech officials, streamlining communication on money transmission, payments and lending. The full list can be found here. John Ryan, CSBS president and CEO, said: “State regulators see how fintech is reshaping the financial services industry. And an Innovation Contact is but the latest step that states are taking to engage with industry and modernize nonbank regulation.”

Capital markets

For actual rate moves on Wednesday, they barely did anything despite Donald Trump reaching some kind of an agreement with European Commission President Jean-Claude Juncker, supposedly averting a trade war. (The two sides agreed to expand European imports of U.S. liquefied natural gas and soybeans and lower industrial tariffs on both sides. Does Congress do anything anymore?) The Bank of Japan refrained from scaling back its bond purchases at a regular operation yesterday, and European government bonds rose ahead of Thursday’s European Central Bank meeting. There was also some domestic news indicating the Senate will present a bill aimed at delaying the imposition of tariffs on imports. And as far as economic releases went, New home sales decreased 5.3% MoM in June to a seasonally adjusted annual rate of 631k, falling well short of 670k expectations after a downwardly revised 666k in May. The decline in June represented the largest monthly drop since December, and it took place despite a decline in median (-4.2% to $302k) and average selling price (-2.0% to $363k).

Headlines today will revolve around the myriad of central bank decisions, starting with the ECB leaving rates unchanged. ECB President Draghi’s press conference offered little new – a good thing as markets don’t like surprises. Not that economic releases tend to move rates much anymore, but in the U.S., we’ve had durable goods orders (+1% in June), weekly jobless claims (at 217k, as expected), and advanced indicators (deficit of $68.3 billion, whatever that means). If anyone cares the Kansas City Fed Manufacturing Survey for July will be released at 11AM ET, and later, at 2PM ET, the NY Fed will report MBS purchases for the week ending July 25 which are expected to total just $1.406 billion net, compared with $2.9 billion in the previous week. Thursday starts, like a broken record, with the 10-year yielding 2.96% and agency MBS prices little changed versus Wednesday’s close.

Here is something interesting, at least from a technology perspective. Website monitoring is partly art and lots of science. The belief that a user will stop looking after three clicks on a website appears to be incorrect. So for anyone re-designing their website, the goal is to make a clear path to the information rather than focus on a maximum number of clicks on tabs.

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, “With Regulations, Be Careful What You Wish For.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

July 25: LO, AE jobs, non-QM and e-recording products; Fannie/Freddie/conforming/conventional news

“Rob, are you hearing that residential lenders are nervous about releasing their 2nd quarter results to warehouse banks, correspondent investors, and other counter-parties since they aren’t as good as hoped? Or even delaying them?” Yes, I am hearing rumblings of that, but hopefully plenty are anxious to release them to show how well they did. No one is immune to cutbacks and changes in business models, the latest example being Pacific Union’s shift in El Paso. (Applications were down again last week.) As an industry we’re coming up on the 10-year anniversary of a heckuva lot, and with it various write ups. For example, RPM Mortgage’s Dick Lepre produced, “Lessons from Lehman Brothers 10 Years Later: Watch for these signs to guard against a repeat of the financial crisis.”

Employment & retirements & promotions

“A new Augusta, Georgia branch hit a hole-in-one when they joined perennial powerhouse and top 10 national lender, PrimeLending. And the timing is perfect, as more and more homebuyers look to call The Masters hometown (and a Newsweek Top 100 Best Place to Live) their own home. Branch Manager Bob Lacey and the entire Augusta team are already climbing the leaderboard by offering 400-plus loan programs, faster processing and better service than the competition. For instance, the company’s no lender fee VA loan program — Your Home Our Mission — is a real draw for area’s veterans and active Fort Gordon military members. Are you tired of feeling trapped at a company who makes your life rough? Join PrimeLending to score the best situation for your career. Contact Sherri White (469.737.5743) to tee up your transition.”

Carrington Mortgage Services Wholesale is seeing great success with its new Non-QM programs. As a result, Carrington is expanding and hiring in the following markets:  For Wholesale Account Executives – Houston Tx, Austin, TX; San Antonio TX, Philadelphia, PA; and Minneapolis, MN. If interested, please email John Cervantes.”

How many more residential loans could you and your branch team close with better back office support? You work too hard to experience the same chokepoints over and over again. Assurance Financial offers you a committed team of experts who have spent the last 17 years with only one objective: Help you close loans on time, every time. If you even THINK you may be losing origination opportunities to build your business in your current situation due to poor support, contact Paul Peters, CMB (225.239.7948). Assurance Financial is a growing full-service independent mortgage banker seeking dynamic producing branch managers and MLO teams throughout the South, Southeast, Southwest, East, and Midwest, U.S. Watch this 2-minute video now.

Executive moves from Home Point? Yup. Paul Wyner has been named Senior Managing Director responsible for the national Third-Party Originations team having previously served as Managing Director for the Third-Party Originations East team. He’ll report directly to Chief Production Office Lisa Patterson.

Lender products & services

The old saying that, “It’s cheaper to keep an existing customer than it is to replace one,” couldn’t be more meaningful in today’s real estate lending industry. Statistics show that it costs five times as much to acquire a new customer as it does to retain an existing customer. HomeScout® offers lenders cost saving solutions when it comes to customer retention by engaging buyers with real estate search where they are advertised; and its buyer reporting interface helps nurture them throughout the entire home buying process. With dwindling purchase numbers and shrinking margins, operating cost containment is critical to originators big and small. HomeScout can offset the costs associated with lost leads and preapproved buyers. To help mitigate these financial challenges, HomeScout-HBM is offering Chrisman subscribers $1,200 of incremental services free. Find out more by contacting them HERE  and scheduling a demo or give them a call at 952-831-0623.

E-recording is one of the most overlooked digital mortgage processes – and one of the easiest to implement. Now that the GSEs will accept e-recorded security instruments, there’s really nothing stopping lenders from adopting this process today. The latest white paper from Simplifile, “What Lenders Don’t Know About E-recording,” outlines why lenders need to make e-recording the next step in their path to a completely electronic mortgage transaction. For example, did you know that 83 percent of the U.S. population is covered by e-recording? Learn more about the benefits of e-recording by downloading this FREE white paper here.

Floify, the leading end-to-end mortgage point-of-sale solution, is rolling out an impressive set of integrations to boost efficiencies for enterprise lenders next week. Following a recent partnership with Fannie Mae, Floify’s newest integration with Desktop Underwriter® (DU®) will instantly help LOs slash loan processing times by enabling automatic pre-qualification, delivering branded letters to prospects upon the submission of a loan application, and seamlessly updating DU® findings throughout the lifetime of the loan – all that’s needed is an active LOS and credit reporting integration to automate this tedious process. Additionally, Floify’s integration with Day1 Certainty provider AccountChek™ by FormFree can now be leveraged within their interview-style 1003, effectively eliminating the need for LOs to collect paper statements from borrowers. To see the power and efficiency of Floify’s newest integrations and how they can boost productivity for your enterprise operation, request a live demo.

Non-QM volume continues to grow at a robust pace. Now that we are past the halfway point of 2018, the velocity of growth, interest in the product and capital investment are at all-time highs. Deephaven Mortgage, founded in 2012, was one of the first entrants into the market. It continues to lead the way by providing capital, liquidity, technology, and process to this growing segment. Deephaven is solely focused on the Non-QM marketplace. It invests in new products, new processes, and most recently, new technology to help the originator. Deephaven is proud to announce the Identifi™ Scenario Calculator which is available to both Wholesale and Correspondent partners. The Identifi Scenario Calculator makes the pre-screening exercise simple, easy and fast. Give it a try today by visiting Deephaven and click on the applicable channel. Find out more about how Non-QM can help you grow your business by contacting us at brokerinfo@deephavenmortgage.com (Wholesale) or sales@deephavenmortgage.com (Correspondent). Providing solutions to clients nationwide that don’t fit the government box.

Most lenders I meet are always looking for ways to grow their business. The great ones, though, stand out because they refuse to accept the status quo. They hunger for new tactics and thrive on experimenting with new methods to drive leads, all while searching for new ways to enhance the borrower experience. As consumer expectations continue to shift, it is incumbent on every lending team to meet prospects where they are to scale your business in a predictable way. A recent eBook from Maxwell, “Six Ways to Master Mortgage Leads,” provides ample strategic insight to help you increase inbound lead volume and grow your business. From website optimization and digital campaigns to creating an “ideal borrower profile,” the eBook provides tips and links to free resources to help lenders outpace their competition every step of the way. Download it free here.

Freddie and Fannie – always up to something

From Fannie Mae comes news that Tim Mayopoulos will step down as CEO by year end. Dave Benson was appointed President of Fannie Mae and Celeste Brown was promoted to EVP and CFO. Congrats to both! “In this role, Benson will report to the Chief Executive Officer (CEO) and manage the day-to-day business and operations of the company, including the ongoing execution of the company’s strategy. Mayopoulos will remain CEO until his departure at the end of the year, and he will work closely with the Board of Directors to ensure a smooth transition and succession. The Board of Directors announced that it will conduct a search for a successor to Mayopoulos.”

In an internal memo Tim wrote, “Our team has achieved more in my years here than I or anyone else would have thought possible. We returned to profitably and paid taxpayers nearly $50 billion more in dividends than we received in support. We have improved our business model, making the company’s revenues more reliable and predictable, and reducing risk to taxpayers. We worked hard to keep families in their homes during the crisis, and we have helped millions of Americans buy, rent and refinance homes in the years of recovery. I have pride in all that we have achieved together, and confidence that Fannie Mae will keep delivering innovative solutions that make housing finance stronger.”

Fannie Mae has added a “Vacancy Posting” line item to LoanSphere Invoicing under “Category 19: Property Services” and “Subcategory 8089: Vacancy Posting.” And, coming soon, it will add a new “Referral Date” field to further simplify expense reimbursement. Beginning Sept. 1, servicers must populate the new field in the “Title Cost – Foreclosure” expense line item with the foreclosure referral date, which is required for reimbursement of foreclosure title cost expenses. Visit the Servicer Expense Reimbursement page for more information and view the full list of LoanSphere Invoicing servicer expense categories and subcategories for conventional loans.

Consumers who buy a condo, or refinance an existing condo mortgage, may now be eligible for the Freddie Mac automated appraisal waiver. In some instances, borrowers could save approximately $500 on appraisal fees, and potentially close 7-10 days faster. To find out if a condominium property is eligible for an ACE waiver, lenders must submit loan data through Loan Product Advisor®, Freddie Mac’s automated underwriting system. ACE for condominium purchases and refinances will be available beginning July 16, 2018.

The PennyMac Correspondent Group has posted a new announcement on updates to Freddie Mac Condos and Multiple Financed Properties. Also posted is PennyMac announcement regarding various topics including HomeOne, FHA Gift Donor Statements, and Underwriting Help.

AmeriHome Mortgage overlays for Fannie Mae and Freddie Mac purchase transactions where the property transferred within 91-180 days prior to the subject transaction resale date are removed. Additionally, the Conventional Agency Overlay Matrix and impacted Fannie Mae and Freddie Mac program guides have been updated to clarify existing requirements that apply to resale transactions within 90 days of prior sale date (as measured from closing date of the previous transaction to purchase contract date for the new transaction). Generally, Fannie Mae and Freddie Mac purchase transactions with resale within 90 days are not eligible.

FAMC will no longer require the transfer or assignment of the UCD file on loans submitted successfully to both Fannie Mae and Freddie Mac. The UCD submission certificate from both agencies must be delivered in the closed loan file. The transfer or assignment of the UCD file will continue to be required prior to purchase on those loans where the UCD file is submitted to only one agency.

Freddie Mac’s HomeOne Mortgage Loans are not currently eligible for purchase by Wells Fargo Funding. It is currently assessing the new low-down-payment option change and building necessary system enhancements to support HomeOne Mortgage Loans. Watch for future Wells Fargo Funding communications announcing system support and updates to the requirements.

PennyMac Correspondent Group has posted a new announcement regarding Freddie Mac updates.

Mountain West Financial Wholesale has implemented new flexibilities for the Fannie Mae HomeStyle Energy program. The program now allows borrowers to use this product to make resiliency upgrades that will improve the home’s ability to withstand environmental hazards, in addition to making their home more energy efficient. The max LTV has been increased to 97%.

Property assessed clean energy (PACE) loans are now eligible to be paid off with no dollar restrictions (previously restricted to 15% of the appraised value). Radon remediation is now eligible. And, an energy report is no longer needed for certain energy-related improvements or refinances of existing consumer debt incurred to purchase and/or install energy-related improvements.

Capital markets

Rates go up, rates go down. After jumping up 7bps on Monday, the 10-year dropped back down 2bps to close at 2.95% as markets digested strong earnings reports from technology and health-care companies, while China State Council pledged to make fiscal policy more proactive. This will include a larger allowance for companies to deduct R&D expenses from tax, speeding up of disbursement of tax rebates, and accelerated issuance and disbursement of local government bonds to support infrastructure development. Worries over international trade disputes were dwarfed by Google parent Alphabet, Exxon Mobil, and Chevron all beating analyst’s expectations. As far as economic releases went, the FHFA Housing Price Index increased 0.2% in May, failing to meet 0.4% expectations after a revised 0.2% increase in April. Prices are still rising at an unsustainable pace in the West and Mountain regions, while the Middle Atlantic, including NY and NJ, is bringing up the rear.

Mortgage applications from the MBA for the week ending June 20 kicked off today’s calendar: -1%. Next up, we have June new home sales at 10AM ET, where expectations are for 675k annualized versus 689k previously. The Treasury conducts two auctions with $18 billion of new 2-year FRNs followed by $36 billion of 5-year notes. European Commission President Juncker is scheduled to meet with President Trump at the White House where they will discuss, among other things, trade issues amongst the two counterparts. We start Wednesday with the 10-year yielding 2.94% and agency MBS prices basically unchanged versus Tuesday’s close.

Under communism you buy everything from a single state outlet whereas under fully mature capitalism you buy everything from Amazon.

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Rob

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