Equifax expects to pay out another $100 million for data breach

The Department of Justice may think it knows who hacked Equifax and exposed the sensitive personal information of 148 million U.S. consumers, but that doesn’t mean the breach is behind Equifax quite yet.

In fact, the credit reporting agency disclosed this week that it expects to pay out an additional $100 million for its role in the breach.

Last year, the company set aside then agreed to pay out nearly $700 million to settle numerous federal and state investigations.

But the company revealed this week in its fourth-quarter earnings report that it set aside another $99.6 million in the fourth quarter for “certain legal proceedings and government investigations related to the 2017 cybersecurity incident.”

According to the company, it believes this accrual will cover the remainder of its expected payouts for the breach. More specifically, the company said it “represents completed settlements and our best estimate of remaining liabilities for the U.S. matters related to the 2017 cybersecurity incident.”

All in all, the company set aside just over $800 million for breach-related payouts in 2019, which does not include the company’s legal or professional services expenses.

Beyond that, the company spent an additional $337 million in 2019 on technology and data security, legal and investigative fees, and product liability for the breach.

In total, the breach cost Equifax $1.14 billion in 2019 alone.

Overall, the breach cost Equifax more than $1.7 billion since it was first disclosed in 2017.

According to Equifax, at the time of the breach, the company had $125 million in cybersecurity insurance coverage. The company has long since received the maximum reimbursement of $125 million on that insurance policy.

The company also cautions that despite its current belief that this $100 million will cover all its “remaining liabilities,” it is possible that its financial punishment is not over yet.

“While it is reasonably possible that losses exceeding the amount accrued will be incurred, it is not possible at this time to estimate the additional possible loss in excess of the amount already accrued that might result from adverse judgments, settlements, penalties or other resolution of the proceedings and investigations related to the 2017 cybersecurity incident based on a number of factors, such as the various stages of these proceedings and investigations, that alleged damages have not been specified or are uncertain, the uncertainty as to the certification of a class or classes and the size of any certified class, as applicable, and the lack of resolution on significant factual and legal issues,” the company said in its earnings statement.

“The ultimate amount paid on these actions, claims and investigations in excess of the amount already accrued could be material to the company’s consolidated financial condition, results of operations, or cash flows in future periods,” the company added.

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Purchasing a home drives 15% of buyers to tears

Purchasing a home can be one of the most stressful financial transactions most people ever make, causing about a third of buyers to lose sleep.

That’s according to a new survey from Seattle real estate startup Flyhomes asking 1,000 people about the stress of homebuying. About 15% of respondents said they were reduced to tears during the process while 20% got in a fight with their spouse or partner because of the stress.

Almost two-thirds of the buyers said purchasing a property “was more stressful than they expected,” the Flyhomes report said.

“Stress and homebuying tend to go hand-in-hand, even more than people think,” it said.

About 40% said they spent more than they expected to when purchasing a home, the report said. Half of the people who overspent say that they paid more than $20,000 more than they expected to – and 14% went more than $50,000 over budget.

Almost a quarter of buyers said they had some regrets about their purchase. When asked about specifics, over half say their new home required unexpected repairs or maintenance, a quarter said property taxes were higher than they expected, and 20% said maintenance was more work than they expected.

There were other regrets:

  • Almost 1 in 5 said they weren’t happy with the location.
  • About a third said they wished they’d bought a larger house.
  • One in 5 said they wished they had more bathrooms.
  • Nearly a third said they wished for a larger kitchen.

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People Movers: EasyKnock, Zillow and Nextdoor

People Movers are updates about the business professionals making waves in the housing and mortgage industries.

EasyKnock announced the appointment of J. Taylor Crandall to its board of directors, effective immediately.

Prior to his appointment, Crandall was a founding member and chairman emeritus of private equity firm, Oak Hill Capital, where he has been since the company’s 1986 inception. Before joining Oak Hill, Crandall served as a vice president with the First National Bank of Boston, managing the leveraged buyout group and oversaw the bank’s Dallas energy office.

Crandall also serves on the Board of Directors of Hilltop Holdings, Berlin Packaging, Pulsant, and Omada.

“In addition to EasyKnock’s unique, solutions-oriented product offerings, I was drawn to the company’s strong and passionate team,” said Crandall. “I’m proud to officially join EasyKnock’s Board of Directors, and help the company continue its expansion to help American homeowners nationwide.”


Jonathan Lee has been brought on to Zillow Mortgage as its senior director of mortgage sales, and is now searching for sales trainers to bring on in Orange County.

Prior to joining Zillow Group, Lee was vice president of sales at loanDepot.

Lee was also formerly a production manager of mortgage banking at Discover Financial Services and spent some time as an executive mortgage banker and in production management at LendingTree.

Zillow has spent the last year growing its base, performing in a crowded iBuyer market as Zillow Offers, and doesn’t look like it will be slowing down anytime soon.


Neighborhood social network Nextdoor announced Maryam Banikarim has been brought on as its head of marketing.

Maryam has more than 25 years of marketing experience, managing global brands and international teams.

Prior to joining Nextdoor, Banikarim served as the Global CMO of Hyatt Hotels.

“Purpose should be the heart of a company’s brand. Nextdoor’s purpose of cultivating a kinder world where everyone has a neighborhood they can rely on immediately resonated with me,” Banikaram said in a release. “I couldn’t be more excited to join this extraordinary team that is committed to creating meaningful connections that bridge our online and offline worlds.”

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Rhode Island field services provider gets 8 years in jail for running $10 million Ponzi scheme

A Rhode Island woman who operated a property preservation and field services business will spend the next eight years in prison after admitting that she used that business to defraud dozens of individuals out of millions of dollars by operating what amounted to a Ponzi scheme.

According to the Department of Justice, Monique Brady owned and operated a property preservation company called MNB. Brady was accused last year of running the Ponzi scheme, and later pleaded guilty to the charges.

According to a release from DOJ, between 2014 and summer 2018, Brady used her business to solicit private investors to invest funds for large scale rehabilitation of properties with the promise that investors would receive half of the profits.

Brady also admitted to that she told potential investors that her company had secured contracts to perform large-scale rehabilitation projects on foreclosed properties in Rhode Island, Connecticut, Massachusetts, and New Hampshire, when in many cases, this was not true.

Of the 171 properties for which Brady ostensibly obtained investor fund for rehabilitation projects, 98 were for properties her company was never hired to preserve, and on which no work was ever performed.

To convince the potential investors that MNB had secured contracts for large rehabilitation projects, Brady provided fraudulent emails supposedly from a national property rehabilitation company, which claimed Brady had been approved to rehabilitate a property.

Brady also admitted to including fraudulent itemizations of work to be performed and used the identity of an actual employee of the national property rehabilitation company in an attempt to make the emails appear authentic.

Brady collected more than $10 million in investor funds, some of which she used for personal expenditures, according to DOJ.

As part of her guilty plea, Brady also admitted to attempting to obstruct an Internal Revenue Service criminal investigation by asking investors to delete or destroy all email correspondence, texts, and documents relating to their investments in MNB rehabilitation projects after the IRS told Brady she was under investigation.

On July 11, 2019, Brady pleaded guilty to charges of wire fraud, aggravated identity theft, and obstructing an IRS investigation.

In addition to the term of imprisonment, U.S. District Court Judge John J. McConnell Jr. ordered Brady to serve three years of supervised release and to pay $4.78 million in restitution.

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Shaquille O’Neal using Instagram to sell his L.A. mansion

Basketball legend Shaquille O’Neal is selling his $2.5 million five-bedroom home in Bell Canyon, California, about 30 miles from the Staples Center where his former team, the Los Angeles Lakers, has its home court.

Shaq, as he is known, is marketing the property on Instagram, in all-caps.

“I’M SELLING MY HOME IN BELL CANYON, CA,” he wrote on Feb. 6, in a post that has gotten more than 3 million views.

You might think he had ditched his real estate agent, but that’s not the case.

“Hey, it’s 2020,” said his listing agent, Emil Hartoonian, managing partner at The Agency. “I didn’t know he was going to be doing it, but if an owner has a high profile, and a big following, and decides to use a platform of their own to expose that listing or look for engagement, I don’t think it does any harm.”

In fact, in the week since Shaq posted about the Bell Canyon home, “several interested parties,” including some that are “good prospects,” have reached out to the brokerage, Hartoonian said in an interview with HousingWire.

“We use social media a lot to promote properties – it’s not uncommon in our world,” Hartoonian said. “But for a high-profile owner to do on their own social media – that’s different.”

Shaq’s post has gotten more than 16,700 comments, including, “Y’all do layaway?” and “I’ll play you 1 on 1 for it.”

Shaq’s five-bedroom home has a free-form pool.

Here’s how Shaq described his property:

“It’s in a premier cul-de-sac offering privacy. It’s an open floor plan with a two-story foyer leading to a formal living room with vaulted beam ceilings off a formal living room with porcelain flooring and chef’s kitchen. The kitchen has marble countertops, custom cabinetry and stainless steel appliances. The first floor has a family room, dining room, wine closet, wet bar, media room, laundry room, office and a bedroom. Upstairs has the master bedroom and three additional bedrooms.”

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How fear of new things is crushing real estate agents’ growth potential

Unfortunately, not a day goes by without an overwhelming amount of complaining and pessimism from fellow real estate agents on social media.

The highest concentrations of whining can be found in industry Facebook groups… especially the public ones for some odd reason! 

Dustin-Brohm
Dustin Brohm, Columnist

Most of the complaining and bad-mouthing I see is rooted in fear and scarcity thinking. Fear of a new way of doing things. Fear of the unknown. Fear of new competition. Fear of new technology. Fear of new business models. 

From some of the most evergreen topics that agents latch on to, (Zillow, flat-fee listings, iBuyers… etc.), it would be reasonable for an outsider to assume that we’re all going to be out of business by next weekend.

While I truly do understand some of the criticisms and complaints, it’s really getting out of hand. In many cases, it’s flat out embarrassing. Embarrassing to real estate agents as a profession.

When hundreds, if not thousands, of real estate agents are seen bad-mouthing a new competitor or a business model in a public Facebook group that is completely and totally open for all to see, we look like a bunch of whiners and losers. To consumers, agents bad-mouthing Zillow is no different than Blockbuster bad-mouthing Netflix. 

It’s unfortunate because when we resort to fear when new technology or new business models emerge that create new competition, we also fail to see the new opportunities that emerge as a result.

A hot topic these days is iBuyers. So many agents freak out when a new iBuyer opens up shop in their market. Chicken Little comes out swinging, screaming from the rooftop that Opendoor is about to put us all out of business.

While at the same time, agents with open minds and a smidge of creativity find ways to partner with, and/or leverage iBuyers to complement their businesses, and end up selling even more homes. I see it often – from many agents – and I’ve even used iBuyers in my listing presentations to win even more listings.

While embracing and partnering with iBuyers is a topic for another article, it is the most glaring example of how way too many agents choose to complain, belittle or criticize, while a small minority embraces the new business models and find ways to leverage them. There are countless examples out there of agents who are now selling many more homes as a direct result of iBuyers in their markets.

I’ll end with this: We can choose to fight for the status quo, for how things have always been and what we’ve become used to.

Or we can evolve, roll with the punches, keep an open mind and look for the new opportunities that are always created as change happens. After all, we can only control is how we react to the inevitable changes (and improvements) coming at us fast and furious.

Connect with Dustin on LinkedIn

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Seattle nonprofits and Zillow launch affordable housing search tool

Seattle has an affordable housing problem, one that both local leaders and the tech companies that call Seattle home are trying to address.

Now, the city’s leadership and one of city’s biggest real estate tech companies are partnering up to try to get more people into affordable housing.

Seattle Mayor Jenny Durkan and King County Executive Dow Constantine this week announced a partnership with Zillow.

As part of the partnership, Zillow developed and is powering a search tool that will help match local nonprofit service providers and their clients experiencing homelessness with owners of affordable vacant rental units.

This tool was developed in coordination with the Seattle Office of Housing, local nonprofit organization Housing Connector and its network of service providers and property owners, and Zillow.

According to the parties involved, the project came from Durkan’s Innovation Advisory Council, which includes the corporate, academic, and nonprofit sectors. The council works with the city to use data and technology to address the city’s homelessness, affordability, mobility, and other issues.

“We are fortunate to live in one of the most innovative, talent-rich ecosystems anywhere on the planet – and for too long, our government has existed as if we have no relationship to it. I created the Innovation Advisory Council because we know that the challenges facing our region cannot be addressed by government alone,” Durkan said in a statement.

By using the Zillow-created tool, case managers are able to more efficiently search for affordable housing, making it easier for them to help their clients avoid homelessness.

Via this tool, Housing Connector partner landlords upload housing inventory, allowing local nonprofits to find affordable housing in real-time for their clients.

Housing Connector landlords also have an adjusted or waived criteria that would normally prevent those in need from qualifying for the home.

“I am incredibly proud of the work that Zillow and the Housing Connector have done to make it easier for people experiencing homelessness to find affordable housing and for affordable housing providers to connect with those in need,” Durkan said. “Zillow, Housing Connector, and the Seattle Office of Housing have shown that by working together, we can find truly innovative solutions to some of our region’s most pressing challenges.”

Housing Connector provides free referrals to ready-to-rent residents and financial support to cover a variety of costs, including ensuring access to benefits that include rent guarantee, security deposits, damage mitigation funds, and unit hold fees, to name a few.

In exchange, property owners will adjust criteria or lower barriers for potential tenants, opening up units that previously were out of reach for individuals experiencing homelessness.

According to the group, there are currently 35 landlords in Seattle and King County and 42 nonprofit service providers active on the platform, with more partners expected to be added soon.

“As a company headquartered in Seattle, Zillow is committed to doing what we can to help address one of the greatest challenges facing our region today: housing affordability and homelessness,” said Racquel Russell, vice president of government relations and public affairs for Zillow.

“When asked by the mayor to serve on her Innovation Advisory Council and work with Housing Connector — which needed a better way to find and surface available housing inventory — we saw an opportunity to use our unique skillset to build a tool that will help Housing Connector fulfill its mission to help families find a home.”

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Forbes names most innovative fintech companies in housing

Forbes this week announced the winners of its 5th annual Fintech 50, which it describes as the world’s most innovative financial technology companies, and several heavy hitters in housing made the list.

The companies selected were recognized for their industry-changing innovation. This was measured by how often they released new products and made strategic improvements to their technology.

“Our 2020 Fintech 50 includes one of the most diverse sets of disruptors since the list’s inception, and it’s indicative of the innovations we’re seeing throughout every aspect of the financial landscape,” said Forbes’ Washington Bureau Chief and Personal Finance Editor Janet Novack.

Here are the companies with housing ties that made Forbes’ list (For more on each company, click on their name. Financial details courtesy of Forbes):

Better.com
Better.com’s latest valuation comes in at $610 million. In 2019, the company’s revenue increased to $115 million. According to Forbes, Better.com received $254 million in funding from American Express Ventures, Goldman Sachs, Ally Financial and more.

Cadre
Cadre’s latest valuation comes in at $800 million. The company has financed purchases of $3.1 billion worth of property in 36 deals, including $1 billion in the last year. According to Forbes, Cadre has received $133 million in funding from Andreessen Horowitz, Ford Foundation, Goldman Sachs and more.

Credit Karma
Credit Karma’s latest valuation comes in at $4 billion. The company boasts more than 100 million users in the U.S., Canada, and the U.K. According to Forbes, the company received $869 million in funding from Silver Lake, CapitalG, Tiger Global Management and more.

Divvy Homes
Divvy Homes’ latest valuation comes in at $163 million. The company purchased 900 homes in 2019 and now receives 10,000 applications a month. According to Forbes, Divvy Homes has received $66 million in funding from GIC, Andreessen Horowitz, Caffeinated Capital and more.

Hippo Insurance
Hippo Insurance’s latest valuation comes in at $1 billion. The company has a retention rate over 90% and its premiums increased fivefold in 2019. According to Forbes, the company received $209 million in funding from Bond, Felicis Ventures and Lennar and more.

Lemonade
Lemonade’s latest valuation comes in at $2.1 billion. The company is active in 26 states, and Washington D.C. and Germany. According to Forbes, the company received $480 million in funding from SoftBank, Allianz, Sequoia and Aleph.

Opendoor
Opendoor’s latest valuation comes in at $3.8 billion. The company purchased more than 19,000 homes in 2019. According to Forbes, the company received $1.3 billion in funding from Khosla Ventures, SoftBank, General Atlantic and more.

Plaid
Plaid’s latest valuation comes in at $5.3 billion. In 2019, the company doubled its customers to 2,600, while expanding to Europe. According to Forbes, the company received $310 million in funding from Andreessen Horowitz, Kleiner Perkins, NEA and more.

Roofstock
Roofstock’s latest valuation comes in at $550 million. The company operates in 25 states. According to Forbes, the company received $133 million in funding from Bain Capital Ventures, Lightspeed Venture Partners, SVB Capital and more.

States Title
States Tittle’s total revenue comes in at $185 million. Last year, the company gained a part of Lennar’s title business. According to Forbes, the company received $107 million in funding from Fifth Wall, Foundation Capital and more.

Unison
Unison’s latest valuation comes in at $550 million. The company has invested in $4.4 billion worth of housing. According to Forbes, the company received $40 million in funding from Citi Ventures, F-Prime Capital Partners, The Royal Bank of Canada and more.

In March, HousingWire will announce its 2020 Tech100 award winners, naming 100 of the housing industry’s most influential and innovative tech companies. Make sure to check back in to see who makes the cut, but until then, you can read this list of last year’s winners.

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Feb. 14: AE & LO jobs; servicing, 203(k) products; conventional conforming underwriting shifts

Does anyone out there care that credit-card debt rose to a record $930 billion in Q4 2019? (Total mortgage debt hit $9.56 trillion.) How about that the origination cost of over $8,000 per loan hits low balance loan borrowers more than high balance borrowers? Do you break out your “tech spend” per loan? Has it gone from hundreds to thousands of dollars? Residential lending is truly a numbers game. According to Informa Financial Intelligence January 2020 Mortgage Originations Data, rate-lock volume has increased 71% YoY and 42% MoM across all channels, while funded volume has increased 70% YoY and fallen 10% MoM. In the Retail channel, lock volume has increased 78% YoY and 48% MoM, while funded volume has increased 94% YoY and fallen 17% MoM. Average 30-year Conforming FRM funded loan note rates have fallen 101bps from January 2018, with refinance rates lower by 116bps and purchase rates lower by 97bps. Informa sources a statistically significant data set directly from lenders to produce these benchmark figures.

Jobs & transitions

National MI is excited to share a few new members to our winning sales teamKyle Sachs, joined us as a new Account Representative covering northern NJ and Westchester/Rockland counties in NY.  Kyle earned his bachelor’s degree in Marketing and has 3 years previous experience in the Title Insurance industry. He has already made such a positive impact and we are so happy to have him as an integral part of the team!! Jen GibsonAccount Representative joins Tony Scoma (Regional Team Lead) to round out this combo team in the Northern California and the Reno, Nevada markets. Jen has spent most of her career in the Mortgage Industry. Julie Waldron is the new Wisconsin Account Representative in the North Region and will be working alongside Jan Brezina. Julie has over 25 years of mortgage industry experience, much of it as an accomplished loan originator.”

NewRez, a rapidly growing nationwide lender, is expanding its already robust Correspondent Division, and is looking for experienced Non-Delegated Account Executives in several markets across the country. At NewRez, it is our mission to exceed the expectations of our lender partners through superior service, simple processes, and effective communication. Matched with a robust line of industry-leading Non-QM, Jumbo and Agency products, the future is bright with NewRez! Interested parties should contact the SVP National Sales, John Davis.

“Great people are coming BACK to Movement Mortgage! Here at Movement, we exist to love and value people, that’s why we’ve had over 20 originators return to the South Atlantic Region in the last year doing over $200M in volume! If you’re an experienced originator who wants more for yourself, professionally and personally, we can provide you the tools and first-class coaching to help you develop habits that can lead to your future success. To learn how we can make 2020 your best year ever, contact one of our experienced mortgage recruiting consultants in the South Atlantic: Shay Crow (720-315-2195) or Elisha Manning (252-714-8240). Visit Movement South Atlantic to learn more.”

Assurance Financial, a nearly 20-year-old profitable full-service mortgage banker licensed in 45 states is pleased to announce that Paul Peters, CMB has returned to his role with the company as National Business Development manager.  Peters has over 30 years of mortgage banking experience and during his tenure with Assurance Financial, has been instrumental in expanding the company’s production office footprint across the United States.  Peters said, “I am very pleased to return to this business development role where I can help the company achieve our aggressive growth initiatives.  We have a total commitment to branch origination success, going all-out to support higher levels of branch and MLO production.  Our technology stack is second to none and as always, we expect our loans to close on time, every time, regardless of volume levels.” Producing Branch Managers and top MLO’s looking to join a proven team should visit www.assurancemortgagelo.com or email myfinalmove@assurancemortgage.com

 

Recently named among Top 5 Best Mortgage Companies to work for by National Mortgage News, Geneva Financial, Home Loans Powered By Humans®, is filling 500 Branch Manager and Loan officer positions in 43 states. Geneva strives to humanize every aspect of their business from the inside-out. With a culture-forward mindset, they focus on loan originators and support staff to ensure an unbeatable experience for their customers. Their Geneva Gives, BE A GOOD HUMAN and Hero of The Year initiatives deemed them a recipient of this year’s AZ Business Magazine’s Excellence in Banking Award for Community Impact. In 2019 Geneva was ranked a nationally fastest growing company in the financial sector, mortgage industry and all industries categories. They consistently hit record-breaking months, doubling volume in most. Geneva Financial is excited for another historic year, with no plans on slowing down. Explore Branch and Originator opportunities here.

Mortgage Unlimited, The Home of Sustainable Lending, has been named as one of the 2020 Best Mortgage Companies to Work for by the National Mortgage News for the second year in a row! This annual survey and awards program is designed to identify, recognize, and honor the best employers in the U.S. mortgage industry. ‘It is a distinct honor to be selected number 17 on this special list of Mortgage companies,’ said Justin Tagliareni, CEO of Mortgage Unlimited. ‘It really shows our unique culture that our employees are empowered by.’ Mortgage Unlimited, L.L.C. is a family owned mortgage lender in existence for over 30 years and headquartered out of Garfield, NJ. Our company proudly recognizes our moral and ethical responsibility to protect the financial well-being of the families and communities we serve. To find out more about our culture email Justin or visit our website.”

In the private MI world, Radian added two new Directors, Lisa Mumford and Brad Conner, and the announced the retirement from the Board of David Carney.

Lender products and services

As the top lender for 203(k) sponsored originations, AFR is proud to participate in the expanded program specifications of the FHA Limited 203(k) Rehabilitation Mortgage: total renovation and repair costs can go up to $50K for properties located in Qualified Opportunity Zones (QOZs). The expansion of this program provides eligible borrowers with additional financing options in these Zones (the $35K limit still applies for properties outside a QOZ). Intended for smaller scale projects not structural in nature, the FHA Limited 203(k) Rehabilitation Loan can help a buyer or homeowner remodel a kitchen, change the flooring, or install an outdoor deck, adding to their own enjoyment of the home and adding to its value at the same time. AFR also continues to offer the FHA Standard 203(k), with a minimum renovation cost of $5K. Visit afrwholesale.com for complete guidelines. For more information on becoming an AFR partner, email sales@afrwholesale.com (800-375-6071).

Altisource®, your one source for real estate and mortgage solutions, has released its 2020 The State of the Default Servicing Industry report. The report reveals exclusive survey results and feedback from 200 mortgage default servicing professionals. One of the key findings is that 80% of those surveyed expect FHA loan volume to increase in the next one to two years. Almost half of those servicers anticipate a volume increase of more than 50%. While that surge means greater opportunities, it also means more challenges. This report gives you a look into those and other challenges facing servicers today and reveals input on valuable services and features critical to managing the default lifecycle in order to mitigate loss and streamline efficiency.

Sourcepoint, a leading provider of products and services to the US mortgage industry, recently announced the launch of its Servicing Solutions suite, designed to deliver servicers tangible results including reduced operating expense, enhanced borrower experience and retention rates and the ability to drive digital transformation across the servicing lifecycle. Equipped with the most comprehensive set of servicing and collection licenses in the mortgage BPM industry and backed by a 3,500+ global workforce, Sourcepoint’s solution suite encompasses Loan Boarding and Administration through Lien Release and Omnichannel Contact Centers for customer service support. Schedule time to meet with Sourcepoint at the MBA Servicing Solutions Conference. Not attending the conference? Contact them directly.

Conventional conforming moves

Have you heard about the FHFA’s proposed changes to pooling practices? Do you know how they could affect pricing and liquidity in the secondary market?  After responding to the FHFA’s Request For Input (RFI) in January, MCT’s Bill Berliner has prepared a handy overview of the proposed changes, including their objectives and implications. Read the whitepaper and stay informed about regulatory developments that may impact your business.

Freddie Mac recently extended the effective date for the variable income updates announced in Bulletin 2019-20. As a result of the extension, PennyMac is extending the required implementation date to loans delivered on or after May 15, 2020 to align with Freddie Mac’s update.

Fannie Mae’s Lender Letter LL-2020-01 provides details on updated ARM instruments, retirement of LIBOR ARMs, SOFR ARMs, and the future retirement of CMT ARMs.

Fannie Mae’s Announcement SEL 2020-01 revises policies on liabilities related to rental housing payment and calculating monthly qualifying rental income; delays a previously announced policy change related to calculating monthly real estate tax payments; streamlines the section on Contractual Representations and Warranties; and clarifies use of income limits for loans with resale restrictions.

Fannie Mae’s improved Single-Family website has launched. Enhancements include a new search functionality, a redesigned technology hub and Learning Center, access to Ask Poli® from every page, and optimization for use on all devices.

Plaza issued a reminder, all conforming loans with applications dated March 1 and later requiring Mortgage Insurance must be submitted using one of the new approved forms per agency requirements. Loans delivered without the use of the updated forms will not be eligible. for purchase.

Regarding Fannie Mae’s Appraiser Independence Requirements (“AIR”), is it compliant for a mortgage lender to permit a mortgage broker to select the appraisal management company (“AMC”) from which to order an appraisal if the lender provides the broker with a list of authorized AMCs? No. This process provides the broker with an element of responsibility for selecting and/or retaining the appraiser, and is, therefore, not compliant with the Appraiser Independence Requirements (“AIR”). Fannie Mae has cited Seller/Servicers in relation to this issue. It does not matter if the lender is responsible for the relationship with the AMC, including compensation. Notably, a lender may direct a mortgage broker to one specifically authorized AMC if the lender has previously arranged for its appraisal process to be managed by that particular AMC. This process is compliant with AIR because the lender, and not the mortgage broker, is responsible for selecting and/or retaining the appraiser.

Asurity Technologies successfully integrated of FFIEC Census 2019 and National Snapshot 2018 Peer HMDA files into RiskExec, its comprehensive web-based compliance reporting and analysis platform that automates HMDA, CRA, redlining, and fair lending processes. The 2019 Census file release includes 1,308 updates, approximately 1,200 of which are Census Tract Low- and Moderate- Income (LMI) changes, that affect HMDA and CRA analysis. The HMDA Peer data also includes a new derived field that indicates whether a loan is considered Conforming.”

Capital markets

Loan officers should know that a Treasury yield-curve inversion that is developing appears to indicate headwinds for the global economy, rather than the US economy. Federal Reserve Vice Chairman Richard Clarida says the inversion is “really driven not so much by an outlook for the US economy, but globally.” Job openings in the US fell by 364,000 in December to 6.4 million, the smallest total in two years, according to the Labor Department. The figures suggest a recent surge in job growth might not be sustained.

Let’s face it, rates haven’t been doing much over the last few days, so I won’t waste your time. There are the usual news items: the spread of the coronavirus, corporate earnings, Huawei sanctions, the U.S. proposed federal budget, etc., but all in all the bond market, and therefore mortgage rates, haven’t been doing much.

In the MBS world, the NY Fed announced yesterday it plans to buy a maximum of $2 billion in agency MBS, as expected, over the February 14 through March 13 period, based on January paydowns (that exceeded $20 billion). They also released a new FedTrade schedule covering the February 14 to 28 period targeting up to $1.1 billion MBS over three operations with the first next Wednesday purchasing up to $89 billion UMBS15 2.5 percent.

Ahead of Monday’s bond market holiday today’s economic calendar is already underway with January Retail Sales (+.3%, as expected) and January Import Prices ex-oil (flat). We do have one Fed speaker today, Cleveland Fed President Mester. Later this morning brings January Industrial Production and Capacity Utilization, December Business Inventories, and the Preliminary February Michigan Consumer Sentiment Survey. We begin today with Agency MBS prices better nearly .125 and the 10-year yielding 1.59 percent after closing yesterday at 1.62.

Guys – struggling with something to jot down in that Valentine’s Day card?

Are you a banana? Because I find you a peeling.

I know this is going to sound cheesy, but I think you’re the gratest.

My feet are getting cold… because you’ve knocked my socks off.

Is your name Wi-fi? Because I’m really feeling a connection.

If I were a cat, I’d spend all 9 lives with you.

Are you a camera? Because every time I look at you, I smile.

Do you have a bandage? Because I just scraped my knee falling for you.

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, “How Epidemics Impact Lending” If you have the inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2020 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.)