Daily Mortgage Commentary
Feb. 20: Sales jobs, large and small, new products, expansion; legal & political updates – gfee chatter
February 20, 2018
Welcome to Day 1 of the longest period in the United States without a federal holiday: President’s Day to Memorial Day. Some will think, “That’s a drag,” while others will think, “That’s more days to fund loans!” Speaking of fundings, the precise HMDA information for 2017 won’t be out until September. But if you want a solid estimates for single family originations in 2017, Marina Walsh, VP of Industry Analysis with the MBA, points out that its website is a good place for information on units and dollar volume, and thoughts about 2018.
Employment, products, expansion, and ownership changes
Short and sweet: Citi is looking for someone to run its U.S. mortgage group. The Head of U.S. Mortgage will be an integral part of the U.S Retail Bank and Mortgage leadership team and will be responsible for growing the CitiMortgage business in the United States and meet the on-going needs of current and potential clients for Citibank.
XINNIX introduces new Strategic Partnerships to empower every office, branch, regional, and divisional manager with the ability to elevate their team’s production. After countless conversations with managers around the country, the nation’s premier provider of mortgage sales and leadership development has found yet another way to move the needle for the mortgage industry. Strategic Partnerships will allow managers to bring XINNIX’s transformative sales and leadership development to branches and divisions who are ready to explode their production. By engaging in XINNIX Performance Programs, individuals and teams typically see a 50% increase in production. To learn more about how you can elevate your entire team, call your XINNIX Account Executive or CLICK HERE.
Business has not taken off in 2018 the way many were hoping for. The lack of inventory has buyers in a holding pattern, and rising rates have caused a significant drop in the refi segment. But there are solutions! To help brokers and bankers jumpstart their 2018, REMN Wholesale is hosting a free webinar with Frank Garay of National Real Estate Post. Frank will reveal his proven strategies for success, share his personal scripts and tips for identifying the best targets and closing the deal. The webinar takes place on February 22 at 2PM ET, but space is limited, so interested participants should register ASAP here. While business is slow for some, REMN is still on a hiring spree and looking for entrepreneurial account executives in all territories. If you know someone looking to join a thriving wholesale lender, have them email REMN’s recruiting team.
PHH Mortgage, a leading provider of subservicing and portfolio retention services, has promoted Marc Field to Senior Vice President, Originations. Marc will be responsible for all aspects of fulfillment operations and growing originations in PHH’s portfolio retention business. Marc joined PHH in early 2016 as Vice President, Business Development for Portfolio Retention, responsible for leading the company’s marketing and business strategy as well as various analytics and technology programs to support the portfolio business segment. Prior to PHH, he was a senior leader involved in Sales, Retail, Call Center and Information Technology.
Welcome Texas Tech Credit Union Mortgage to the Dallas/Fort Worth area! Chartered by Texas Tech University Alumni in 1953, the Texas Tech Credit Union (TTCU) has proudly provided exceptional products and service to thousands of alumni, teachers, medical professionals, service providers, and charitable foundation employees across the great state of Texas and beyond. This dynamic organization is home to a successful and growing mortgage operation, and a unique, high-performance corporate culture. The expansion provides an attractive career opportunity for a Mortgage Lending professional who is established in the local mortgage and real estate market, and eager to help us grow in the greater Dallas area. To learn more about this exciting opportunity, please contact Jay Herrin, TTCU Mortgage Team Manager.
“Commitment is strengthened through action. Stearns Wholesale has supported the mortgage Broker community for more than 25 years. Through the depths of the financial crisis and the industry’s technology revolution, Stearns has been unwavering in our support of the Mortgage Broker. With millions invested in technology over the last two years, Stearns continues to leverage tools like bSNAP, SNAP 2.0, SNAP 2.0 Mobile and Instant VOI that give our Brokers an edge in a highly competitive marketplace. We do not have a Consumer Direct group dedicated to portfolio retention, but we do distribute leads back to our Broker partners through a program called “Stearns Returns.” It is more than just business at Stearns; it is about our partnerships, our people and finding a better way. To learn more about how you can partner with a Wholesale lender that has your back, please visit StearnsWholesale.com. Work with Stearns and you experience the power of more than 25 years of mortgage lending experience.”
4506-Transcripts.com has become an approved vendor for Ellie Mae’s Encompass® Digital Mortgage Solution. “Encompass is an all-in-one mortgage management solution that offers a digital mortgage experience covering the entire loan lifecycle, so lenders can originate more loans, lower origination costs, and reduce time to close. With this integration, 4506-Transcripts.com makes it possible for lenders to use their favorite LOS platform accompanied with our outstanding customer service and unbeatable turnaround times.” And 4506-Transcripts.com has become a Fannie Mae approved vendor for Desktop Underwriter® (DU®) Validation Service. “Fannie Mae’s Day 1 Certainty™ gives lenders freedom from representations and warranties plus greater speed and simplicity and enables an improved borrower experience. With this integration, 4506-Transcripts.com makes it possible for lenders to request tax transcripts and protects lenders from related buyback risk through Day 1 Certainty. If you are using any of these platforms, please contact us today (925.927.3333)!
©  Ellie Mae, Inc. Ellie Mae®, Encompass®, AllRegs®, DataTrac®, Ellie Mae Network™, Mavent®, Mortgage Returns®, Prospect Manager®, Total Quality Loan®, True CRM®, TQL® and the Ellie Mae logo are trademarks of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.
USA Mortgage transferred the ownership of the company to its employees, forming an ESOP.
New Penn Financial, a mortgage lender that is owned by Shellpoint Partners, is expanding into Nevada by launching Synergy Home Mortgage. Synergy Home Mortgage is licensed to operate thought the state of Nevada but based in Reno. The lender is also a joint venture between New Penn and local real estate firms Dickson Realty and Ferrari-Lund Real Estate.
EverBank was acquired by TIAA and the integration process is expected to be complete by this summer. When its name changes, very little will change for clients who have an existing loan. The accounts and account numbers remain the same. If you have clients who are in the process of getting a mortgage, the name change will not change their loan terms or delay closing. To learn more about TIAA and the transition, click here.
Legal & political updates
There have been developments in repurchase/make-whole litigation. Although the number of repurchase suits appears to have been slowing down, James Brody, Chair of the Mortgage Banking Group at Johnston Thomas, PC, is an attorney who has kept his finger on the pulse of such matters.
According to Brody, whose firm has experienced a large influx of demands that were triggered by EPDs caused by Hurricanes Harvey and Irma, “[a] good practice for any correspondent lenders that may have received EPD related repurchase demands, for collateral that is situated within those areas that were hardest hit by Hurricanes Harvey and Irma, is to promptly request copies of the servicing notes and copies of any insurance claims that may have been made in connection with these natural disasters. Through an examination of these documents, as well as the underlying agreements, lenders can discover invaluable information about whether appropriate loss mitigation steps were taken, identify what the true cause of the EPDs were, and improve their overall chances of negotiating favorable resolutions.”
In addition, Brody advises that there is big news to report regarding developing case law, specifically as it relates to demands made by CitiMortgage (“CMI”). First, Brody reports that “There is good news for correspondent lenders who have received such demands from CMI, in that CMI recently lost its motion for reconsideration in CitiMortgage, Inc. v. Equity Bank (Case No. 4:15-CV-230-SPM), providing lenders with the possibility of raising an argument that CMI cannot enforce repurchase demands for loans that were foreclosed on prior to related repurchase demands being issued.” Second, CMI recently filed an appeal with the 8th Circuit, concerning a loss it suffered in the case of CitiMortgage, Inc. v. Platinum Home Mortgage Corp. (Case No. 17-3158). Although the Platinum case had been the subject of speculation, given the fact that the pleadings in the Platinum case have been under seal in the district court, CMI’s appeal has brought much of the pertinent information to light. Per Brody, “. . .the district court had found that, under the Form 200 Agreement, CMI was required to notify Platinum of the prescribed time to “correct or cure” the alleged defects and, because CMI’s demands did not prescribe a time to correct or cure the loan defects, the district court held that the duty to repurchase never arose.”
If interested in learning more about the latest developments in the repurchase landscape, you may contact James Brody directly at (415) 246-3995.
Regarding lender-specific government news, things are haltingly move along. The House passed a bill that included a TRID fix and SAFE Act amendment. Encompassing five measures and garnering support from the financial services industry, the House passed H.R. 3978, also known as the “TRID Improvement Act.” The package is named after a formerly free-standing measure to amend the Real Estate Settlement Procedures Act, and includes a provision pertaining to loan officers who relocate or go to work for different types of entities.
The White House released its fiscal 2019 budget request, Efficient, Effective, Accountable, an American Budget (2019 budget proposal), along with Major Savings and Reforms (MSR – as if we need another acronym) and an Appendix.
Why should every loan officer in America care? Contained in the details, and thus open for negotiation, is a provision to increase FNMA and FHLMC guarantee fees by 10 bps through 2023. This provision also would extend the expiration of the 10 bps in guarantee fee that was implemented as part of Temporary Tax Cut Continuation Act from 2021 to 2023. These proposals are likely to meet stiff resistance from housing advocates concerned about housing affordability, especially in a rising rate environment and on top of the recently approved tax changes that limit the deductibility of mortgage interest and real estate taxes. Since Congress ultimately controls spending, it’s uncertain which elements of the President’s budget might eventually be enacted.
What are the “experts” saying about rates? Bond fund manager PIMCO forecasts that the 10-year Treasury yield is unlikely to surpass its recent rise to just below 3%. Goldman Sachs analysts expect the cost of servicing US debt will surge due to climbing bond yields and the expansion in borrowing amid a growing economy. "In the past, as the economy strengthens and the debt burden increases, Congress has responded by raising taxes and cutting spending," the analysts wrote, noting the opposite is now true.
Markets are open again after the holiday and a flat Friday for treasuries. The biggest news for investors at the end of last week was an announcement by the Commerce Department that some viewed as a catalyst for a trade war should the recommendations be enacted. The announcement was highlighted by a recommended global tariff of 24.0% on all steel imports (an additional tariff of up to 53.0% on steel imports from 12 countries, including China), quota on imports from elsewhere, or a quota on all steel imports. The Department made similar recommendations regarding aluminum, and President Trump has until April 11 to accept or reject the recommendations on steel, and April 19 to accept or reject the recommendations on aluminum.
Economic releases at the end of last week showed continued strength & expansion, and provided a positive input for Q1 GDP. The University of Michigan’s preliminary Index of Consumer Sentiment for February jumped to 99.9, the highest print since April 2004. Fortunately, consumer sentiment doesn’t seem to have been hampered by the recent stock market volatility, and showed optimism over government policies, improved financial conditions, and expectations for larger income gains in the year ahead.
Turning to this week, we have zip for concrete news although today sees $28 billion of 2-yr auction results at 1pm ET, while tomorrow we have $15bn 2-year FRNs and $35bn 5-year notes, the release of the minutes from the January 30-31 FOMC meeting, and January Existing Home Sales. Thursday, we have weekly Initial Claims and Continuing Claims, January Leading Indicators, and weekly natural gas inventories and weekly crude inventories. We start the business week with the 10-year up to 2.90% and agency MBS prices worse .125-.250 versus Friday’s close on the continued thinking that the economy is doing well.
Okay, I admit it. As a kid I was mesmerized by the “drinking bird” toy that continually bends over to drink, and then falls back, incessantly. How? It turns out that you may want to have your high school physics and chemistry student explain it.
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(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.)
Feb. 17: Notes on AIME, cybersecurity site, free phishing test, site for tracking breaches; some HELOCs still tax deductible
February 17, 2018
Yes, it is a holiday weekend, but there are notes from readers that may be of interest to many. AIME From New Jersey Anthony Casa sent, “Your readers should know about The Association of Independent Mortgage Experts (AIME). It is an organization committed to empowering independent mortgage professionals and strengthening the wholesale mortgage channel to levels that haven’t been seen in the last decade. The association will centralize its mission on providing ‘independent’ mortgage experts – brokers, loan originators, processors and the like, who own or work for or in support of a company or entity that does not underwrite its own loans – with real tangible and financial value. “AIME is 100% committed to independent mortgage experts, and it’s a solidified, organized solution to what mortgage brokers have been calling for, especially since the BRAWL movement
Feb. 16: LO & secondary jobs, subservicing product; tax changes’ impact on the business; LOs & attending closings
February 16, 2018
Mortgage rates are greatly influenced by supply and demand. And if both the U.S. government and individuals need to borrow money, the government usually wins. Total U.S. household debt hit an all-time high of $13.15 trillion at the end of 2017. That’s up $193 billion from the previous quarter. Mortgage debt is at $8.88 trillion, up $139 billion. The Fed Funds futures are now predicting an 83% chance of a hike at the March meeting. By the end of 2018 the odds are good we’ll have seen 3 hikes this year taking overnight Fed Funds rate to 2.0% – 2.25%. And if the slope of the yield curve remains constant, we can expect the 10-year note to yield in the mid-high 3% area, and IF mortgages tag along, 30-year rates will be in the low 5% area. Ready for all that?