LenderNews by Rob Chrisman
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Aug. 16: Ops, LO, & MI jobs; lender price changes; upcoming events inc. a couple today; implications of UG & Arch deal

August 16, 2016

Only two weeks until Labor Day? How did that happen? Will AIG and Arch MI figure out which reps have which territories after the purchase of UG goes through by then? (Doubtful – but the spoils generally go to the victor although I am sure area market share is a factor.) Celebrating Labor Day goes back to a “workingmen’s holiday” in the 1800s and the first Monday in September was designated “Labor Day” in 1894. Leave it to our Census Bureau to tell us that there are 159 million people aged 16 and over working in the U.S., of which about 10% belong to a union. Unfortunately, on average men earn $50,383, while women only earn $39,621. Want a growth field? Don’t be scared of heights: the projected percentage growth from 2014 to 2024 in the number of wind turbine service technicians is 108% (the projected fastest growing occupation).
 
Speaking of labor, “an exciting, well-known, and rapidly growing, mid-size independent mortgage banker located in the Houston, TX area is looking to add a talented professional person to fulfill a SVP/EVP of Operations position. ‘We are willing to relocate someone that would be a good fit to add to our team that has an entrepreneurial spirit to help continue to build and lead a high-performing operations team.’ The 10-year old nationwide residential lender is seeking an experienced SVP/EVP of Operations. The company is a Fannie approved lender, issuer, and servicer and is funding well over $1 billion a year just in their retail channel. The Candidate should have experience with all aspects of loan origination. If you are interested, please forward your resume to me and specify the opportunity.
 
Assurance Financial is expanding its footprint throughout the Southeast and Southwest and looking to hire branch managers and MLOs in Arizona, Colorado, New Mexico, Texas, Arkansas, Louisiana, Mississippi, Tennessee, Alabama, Ohio, Virginia, North Carolina, South Carolina, Georgia, and Florida. “The company has a solid reputation for closing loans on time. It’s what we do. Our back office supports its mortgage loan originators and branch managers so they can focus on originating more new loans rather than worrying about closing their pipeline. For more information, contact Paul Peters, CMB at 225-239-7948 or visit www.LendTheWay.com/Careers.
 
Private Mortgage Insurance company Genworth Financial is seeking an Account Executive for our Seattle WA territory. The ideal candidate will be based in the Seattle area, and will also cover Spokane. Candidates should have exceptional customer interaction, sales execution, and leadership skills. The person hired will be expected to provide the highest level of internal and external customer service, manage customer relationships, and develop growth strategies for assigned accounts. The successful candidate will be responsible for developing calling plans to cover all assigned accounts, monitor branch volume and calling activity, take necessary actions to achieve account volume goals, execute and lead implementation of Genworth products and initiatives, and identify and communicate new opportunities to provide solutions to customer needs. The ideal candidate will have 2+ years of experience in a sales role, have a college degree or equivalent industry/sales experience, have strong presentation and communication skills, and have the ability to work flexible hours with occasional overnight travel. Interested Candidates should send their resume to Amy Haynes.
 
Congrats to Suzzette Bosch. CoesterVMS, a national Appraisal Management Company, has promoted Ms. Bosch to National Market Leader responsible for developing the company’s sales plan as well as selecting and managing a team of Regional Market Leaders.
 
And the Dallas-based CPA firm BKM Sowan Horan, a firm specializing in independent mortgage banks and financial services, has hired Dustin Pfluger as the Director of Assurance Services.  Dustin brings additional specialization in providing assurance, tax and consulting services to independent mortgage banks and real estate focused financial entities.  For more information or questions please contact Dustin (512-739-5406).
 
Yes, changes to lending are occurring to the lending biz. Freedom Mortgage has completed its acquisition of the residential mortgage origination operations of Sterling National Bank the principal subsidiary of Sterling Bancorp (NYSE: STL).  Sterling Bancorp operates mainly in the greater New York and Hudson Valley markets through its principal subsidiary, Sterling National Bank. Freedom Mortgage officially transitioned the residential business and its team of approximately 70 professionals to its banner last week. “Freedom will handle new mortgage requests from Sterling National Bank customers through the newly acquired team, as well as leveraging the unit’s capabilities to expand Freedom Mortgage’s presence throughout the New York metro area.” Don’t forget that last month Freedom Mortgage acquired the origination assets of JPMorgan Chase’s rural housing business.
 
And after a lengthy rumor period, news broke yesterday that AIG agreed to sell United Guaranty, its mortgage insurance subsidiary, to ACGL (Arch) for $3.4 billion. The unit had $3.5 billion of equity capital, so this transaction appears to be taking place at a price/book multiple of roughly 1x. So now the industry will have one less player – which will certainly impact price competition. (National MI introduced a new price structure and Arch followed with a new pricing methodology.) Both UG’s and Arch’s pricing is generally viewed as more aggressive than most of its peers, and if this pricing is now extended to a broader share of the market it will help borrowers & lenders but certainly not its competitors.
 
Despite losing market share for a couple years, in the 2nd quarter UG was the largest mortgage insurer with new insurance written (NIW) of 18.3% in 2Q16, this was down from a peak of 28% in early 2013. Arch’s market share is much less at about 9% by this measure. (Radian was #2 at 18.2%, MGIC 17.8%, Genworth 16.1%, Essent 12.3%, Arch, and then National MI at 8.2% per a report by KBW.) If one uses Insurance in Force (IIF) as a metric the rankings remain the same but UG had over 21% at the end of the 2nd quarter. As it does now, business going forward will depend on transaction-based versus the central allocation (divvying up) by lender management.
 
Arch MI’s take on the deal? “We are pleased that the transaction is moving forward and would like to assure our customers that the transaction will not impact Arch MI’s existing customers and that there will be no interruption of our service to you during this time. Arch MI and UGC will continue to operate as completely separate entities until the transaction closes.”
 
August is sailing by, and the upcoming events that are of interest to various portions of the lending community continue to come at us.
 
Live on Mortgage News Network on Thursday, August 18 at 2PM EDT. Sponsored by REMN Wholesale and National Mortgage Professional Magazine, they’re going to dissect the minds of three leading loan officers to learn how they develop their business strategies, who they market to and how they market differently than the competitors in their area, and why their lender partners help them take their business to the next level. This complimentary live video broadcast (this is not a webinar) is titled Masters of the Mortgage Industry: Tips of the Trade from Industry Leaders and you can join them live by reserving your space here
 
SF-based software company Snapdocs has found that 2 in 5 loan closings are compliance risks. Dig into the data on hundreds of thousands of loan closings to identify a new breed of compliance and operational risks. The full findings and recommended solutions will be discussed during their complimentary webinar today, Tuesday, August 16th titled “Navigating Loan Closing Pitfalls.” Sign up here to learn more.
 
Also today, join Richey May & Co for its Deferred Compensation Plans: Strategies and Implications for Independent Lenders Register now for this August 16th webinar. CPE credit is offered for this webinar.
 
The Midwest Financial Services Conference on August 19th is coming up quickly. Bricker & Eckler and INCompliance are presenting this one-day conference in Columbus Ohio. Representatives from the Mortgage Bankers Association and other industry leaders are invited to discuss current regulatory and compliance issues pertaining to mortgage lending and other consumer loan products.
 
Register for Tuesday, August 23rd with Ellie Mae compliance experts to hear about the updated HMDA regulation. Discover Ellie Mae’s plans to support the regulation and when, and what your management and staff need to be doing to get ready.
 
K&L Gates in conjunction with four of its partners will host a webinar regarding the Telephone Consumer Protection Act (TCPA).
 
Mark your calendars for September 28-30 in Los Angeles: MBA Risk Management, QA and Fraud Prevention Forum is coming to town.
 
Are you ready for this years’ Valuation Expo in Las Vegas? The event is being from Wednesday, November 9th through Saturday, November 12th. Be a part of the biggest and best trade show and loads of networking opportunities. Click this link for numerous options, videos and registration information.
 
There are lender & investor price changes to note.
 
Caliber Home Loans, Inc. announced significant rate reductions for its Portfolio Products resulting from the success of the first rated non-prime RMBS issued since the financial crisis. Rates have improved by anywhere from .25% – .875% for Caliber’s Jumbo Alternative, Homeowner’s Access, and Fresh Start Programs. “These substantial rate improvements are now coupled with major guideline enhancements,” all going into effect August 15th and “further expanding home ownership opportunities to thousands of qualified borrowers who do not qualify under traditional guidelines.”
 
Mortgage Solutions Financial has made changes to its loan level price adjusters.
 
Beginning with locks after July 29, Flagstar Bank made the following price adjustment changes to the applicable Doctor and Jumbo products: Doctor Loan, Doc. #5425 and Jumbo 5/1 & 7/1 ARMs, Doc. #5415. Non CA LLPA adjustment will be +0.250. The existing Non CA LLPA for the Jumbo 30 Year Fixed will remain at +0.500.
 
AmeriHome changed its lock renegotiation policies on Best Effort offerings. A couple of changes include the removal of its requirement that a lock must be within 15 calendar days prior to Delivery Due Date (Lock expiration).  “Renegotiation pricing indications must be accepted by an email, written change request submitted to the Commitment Desk Lock Desk at on the same day the quote was received” this requirement has also been removed. 
 
Effective for all commitments taken on or after Monday, August 22nd, 2016, PennyMac is implementing updates to values in the ‘Conv LLPAs’ and ‘Govt LLPAs’ tabs on all rate sheets. No changes will be made to the structure of any rate sheet tab or grid.
 
Plaza has increased the appraisal fees in Texas, Oregon and the following 5 counties in California; Marin, Napa, San Francisco, Santa Clara and Santa Cruz. The fees went into effect for appraisal orders placed on or after Monday, August 15th.
 
Enough about the primary markets – how about the secondary markets? We were once again reminded that long-term rates are set by supply and demand. In this case, a story from Bloomberg points out that investors in fixed income securities are buying as much corporate debt as the can find. “Treasuries are falling behind corporate bonds in a reversal from last year…Investors are willing to accept as little as 216 basis points of extra yield to buy company debt instead of Treasuries, the smallest spread in more than a year. Benchmark government yields are within about 22 basis points of a record low in the U.S. – investors will have to look to other assets other than government bonds.”
 
But U.S. Treasuries and other fixed-income securities worsened Monday as the S&P 500 made yet another record high and the NAHB reported that home-builder sentiment improved in August. The New York Fed’s Empire Manufacturing survey showed modest deterioration this month, but the internals of the report remained encouraging.
 
It’s a brand-spankin’ new day, however, and we’ve already had July Housing Starts and Building Permits (+2.1%, prior month revised higher; permits -.1%) and July’s Consumer Price Index and Core CPI (unchanged as expected) – inflation hasn’t been an issue in decades yet people still worry about it. Still ahead is July’s Industrial Production and Capacity Utilization (09:15).
 
Rates were pretty darned flat last week with the yield on the 10-year closing in the 1.50%s for several days. Yesterday it worsened nearly .375, closing at 1.55%; the 5-year T-note and agency MBS prices closed .125 worse than Friday. After the first round of numbers this morning we’re at 1.52% on the 10-year and +.250 in price on current-coupon agency MBS prices.
 
 
(The NFL season commences in three weeks. This is part 2 of 6 of football quotes & jokes guaranteed to insult practically every team. Please, no complaints – you can change the team to whoever you like.)
"A school without football is in danger of deteriorating into a medieval study hall."  –  Frank Leahy / Notre Dame
"There’s nothing that cleanses your soul like getting the ‘hell’ kicked out of you."  –  Woody Hayes / Ohio State
"I don’t expect to win enough games to be put on NCAA probation. I just want to win enough to warrant an investigation."  –  Bob Devaney / Nebraska 
"In Alabama, an atheist is someone who doesn’t believe in Bear Bryant." –  Wally Butts / Georgia
"I never graduated from Iowa. But I was only there for two terms – Truman’s and Eisenhower’s."    Alex Karras / Iowa
"My advice to defensive players is to take the shortest route to the ball and arrive in a bad humor."  Bowden Wyatt / Tennessee
 
 
If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “The Fed’s QE: Help or Hindrance to Lending?” 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 2016 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.)