LenderNews by Rob Chrisman
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Dec. 5: LO, AE, and MI jobs; MBA’s guidance on 2017 volumes; conventional conforming changes roll on

December 5, 2016

It is probably not the case that this date is celebrated by mortgage bankers from coast to coast, and forget the jokes about it being the “Mortgage Drinkers Association.” But on this date in 1933, the 21st Amendment to the Constitution was passed and ratified, ending national Prohibition. Just think about what conferences would be like if alcohol was still banned. It would certainly save a lot of money for the MI companies that always seem to sponsor the parties! Decades from now will “edibles” be in vogue?
 
Speaking of MI, in job news Genworth Mortgage Insurance is seeking applicants for an Account Manager position in its Chicago territory. Candidates should have exceptional customer interaction skills and a proven track record of sales execution and leadership.  Key responsibilities include developing growth strategies to achieve New Insurance Written (NIW) goals. Regular use of Genworth’s sales analytics and reporting tools. Mentoring Account Executives to help drive new business and sales efficiency. The successful candidate will have 4+ years’ sales experience with a proven track record of exceeding goals, and a demonstrated ability to build and maintain strong customer relationships. Experience with Salesforce.com or similar sales system preferred.  Position requires flexible hours and travel overnight on a regular basis.  Interested candidates should send their resume to Andre Ford or click here to see the full job description and apply online. 
 
The wholesale division of Finance of America Mortgage is expanding into new markets and is seeking experienced Account Executives and Sales Managers. “The FAM wholesale division offers a dynamic sales culture, an aggressive compensation plan and benefits, excellent marketing support, a full suite of products and an NDC program. The FAM wholesale division is seeking AEs in all states and Sales Managers in the Southwest and Midwest regions. Offer your clients a better experience and join us today!” Inquiries should be sent to WScareers@financeofamerica.com
 
AnnieMac Home Mortgage is looking to expand its National Branch and LO Recruiting team “in preparation for our 2017 business plan. A National Business Development Manager will have a full marketing menu to use in recruiting, a data base of contacts, a powerful CRM, a custom design team for ad-hoc ideas, some lead support, a team environment even if remote, a coach to support reaching capabilities, one heck of a platform to promote and support in the conversations that occur in recruiting. Our team members are already very successful and ideal candidates to join the team would be high achievers, strong relationship builders, desire to be great, value accountability and have a track record in recruiting.” Interested candidates can reach out to Paul Zinn, SVP of Business Development at 856.252.1531 (referrals welcome).
 
Any lender with more than 50% of their 2016 business being refinances is fretting – how are they going to cover the rent? I have spoken to some who have already dusted off their strategic plans for scaling back personnel from a year ago when rates didn’t go up. On the plus side of things, the Mortgage Bankers Association’s renowned economist Mike Fratantoni has come out saying he and his team expect a 10% growth in the purchase market for 2017 relative to 2016.
 
Let’s take a look at a pre-election estimate. The Mortgage Bankers Association announced earlier this year that it expected to see $1.10 trillion in purchase mortgage originations during 2017, an 11 percent increase from 2016. In contrast, MBA anticipates refinance originations will decrease by 40 percent, resulting in refinance mortgage originations of $529 billion. In total, prior to the election and rates shooting up the MBA thought mortgage originations will decrease to $1.63 trillion in 2017 from $1.89 trillion in 2016. For 2018, MBA had forecast purchase originations of $1.18 trillion and refinance originations of $410 billion for a total of $1.59 trillion.
It all made sense, pre-election. Strong household formation coupled with further job growth, rising wages, and continuing home price appreciation will drive strong growth in purchase originations in the coming years. It still does. And after the HMDA data came out the MBA upwardly revised its estimate of originations for 2015 to $1.68 trillion from $1.63 trillion, to reflect the most recent data reported in the 2015 Home Mortgage Disclosure Act (HMDA) data release.
 
Let’s take a look at the MBA’s current estimates, since plenty of lenders use those as a benchmark – although lenders never think declining volumes will impact them – it is always “the other guy” who is going to be hit. Keep in mind that 2003 was the high water mark for residential originations: $3.8 trillion. 2015 clocked in with $1.67 trillion, 2016 is shaping up to be $1.89 trillion, and the MBA predicts 2017 to be $1.58 trillion – down about 16%.
 
Purchase biz in 2015 was $903 billion, 2016 estimated at $990 billion, and forecast at $1.1 trillion in 2017. On the refi category, 2015 was $776 billion, 2016 expected at $901 billion and then 2017 forecast at $484 billion – a drop of 46%.
 
What are people financing, or refinancing? Attom Data Solutions reports the value of the housing market has reached $26 trillion, supported by $14 trillion in mortgage debt ($10 trillion is single family residences). In order, the largest lenders as of Q2 2016 are: Wells Fargo (26,262 originations in the quarter), Quicken (18,753), Caliber (13,580), Bank of America (11,111), Fairway Independent (11,020), JPMorgan (9,862), Movement (9,796), Prime Lending (9,064), Guaranteed Rate (8,581), and Guild (8,315). Of note, 63% of the total was originated by nonbank originators.
 
The lion’s share of loans are still destined for the agencies, and let’s see what is happening to lenders & investors in their conventional conforming lineups.
 
Join the webinar courtesy of Ellie Mae and representatives from Fannie Mae and Freddie Mac on December 7th to gain vital intel into upcoming Uniform Closing Dataset (UCD) closing disclosure changes.
 
Spanish-speaking borrowers represent one of the largest growing segments of the mortgage market. To help servicers work with such borrowers, Fannie Mae has consolidated Spanish/English loan servicing documents. Available documents include Spanish translations of routine servicing documents as well as borrower notices related to delinquencies, modifications, and foreclosure alternatives. Access the documents on the Spanish Language Resources for Servicers page.
 
First Community Mortgage posted its guidelines for the 2017 Conventional, FHA and VA loan limits.
 
United Guaranty will support the increased Fannie Mae and Freddie Mac loan limits announced by the Federal Housing Finance Agency (FHFA) effective January 1, 2017.
 
Fannie Mae will no longer charge a fee to exercise a Property Inspection Waiver (PIW), effective January 1, 2017. The process for exercising a PIW offer will not change – lenders must provide special feature code (SFC) 801 at the time of loan delivery – but the fee will no longer apply. As a reminder, PIWs will be enhanced in Desktop Underwriter (DU) during the weekend of December 10, 2016, providing Day 1 Certainty™ with freedom from representations and warranties on eligible refinance transactions. Learn more about enhanced PIWs.
 
During the weekend of December 10, Collateral Underwriter (CU) Version 4.0 will introduce a new, intuitive, and easy-to-use design and layout of the web application enhanced and simplifying the appraisal review process. Review the updated CU Version 4.0 Release Notes and CU FAQs to learn more about the CU redesign, and visit the CU web page to see all the CU news and resources.
 
United Wholesale Mortgage removed the 25 basis point charge on conventional conforming loans where the borrower opts to manage their own real estate taxes and homeowners insurance. Those payment chores are usually handled by the servicer. In a press statement, the privately held company – the largest table funder in the nation, according to Inside Mortgage Finance – said that by waiving the fee mortgage borrowers can “potentially save thousands of dollars at closing on fees and an initial escrow deposit.”
 
At ditech you can pick your loan term – anywhere from 10 to 30 years for conforming and VA Fixed Rate as well as 5 to 30 years for FHA. Consider using this great option for refinances and purchases to help your borrowers reach their exit strategy of being mortgage-free upon retirement.
 
This year, Fannie Mae and Freddie Mac published a redesigned Uniform Residential Loan Application (URLA) along with a corresponding Uniform Loan Application Dataset (ULAD). These documents support changes in mortgage industry credit, underwriting, eligibility policies, and regulatory requirements. A new self-paced presentation can now to help you understand the changes to the URLA (i.e., Fannie Mae Form 1003), summarizing the differences between the new and old forms, what you should be doing now to get started, a high-level timeline, and more. Reference additional resources including the interactive/dynamic forms and ULAD mapping on the URLA page.
 
Freddie Mac released a series of disclosure specifications relating to the upcoming single agency security (UMBS). From the release: As a reminder, Freddie Mac will implement the Single Security aligned disclosure format for our current single class PC securities in the Summer of 2017. Vendors should begin to review the specification, sample files and the updated 2017 Disclosure Guide and make plans to update their systems in the first half of 2017. In the first quarter of 2017 Freddie will provide system-generated L1/L2 test files for the early Freddie Mac implementation.
 
Effective with commitments issued on or after December 5, PennyMac is aligning with the conforming loan limit increases for standard and high balance loans.
 
MWF posted the following information: New 2017 Conforming High Balance County loan limits. The new FNMA/FHLMC limits apply to all loans sold beginning January 1, 2017.  LendingQB will implement changes as part of the December 16th release that will accommodate the new loan limits. The new FHA limits apply to loans with case numbers assigned on or after January 1, 2017. 
 
In an effort to expedite and streamline the mortgage process by encouraging the use of digital documents, Freddie Mac announced that it has published a list of companies that meet its requirements for creating, signing and storing electronic promissory notes. Commonly called eNotes, it details the repayment obligation of the borrower to the lender. Freddie Mac began actively purchasing eMortgages from seller/servicers in 2005. Today, it regularly purchases eMortgages and accepts many electronic documents used in initial disclosures and electronic closings, such as loan applications and IRS forms. For more information on electronic loan documents, click here.
 
Rates? The Trump victory initially sent interest rates on a dizzying ride in the days following the election. They plunged for a few hours, then roared upward. They’ve certainly moved higher since. Markets never like uncertainty, and the market had a Clinton win baked into its forecasts. The benchmark 30-year fixed-rate mortgage rose election week to 3.73 percent from 3.69 percent, according to Bankrate’s weekly survey of large lenders. A year ago, it was 4.11 percent. Four weeks prior the rate was 3.62 percent. The last time the 30-year fixed was higher was June 8, at 3.74 percent. Over the past 52 weeks, the 30-year fixed has averaged 3.78 percent.
 
Anyone who claims that the economy in the United States is not doing better than it was a few years ago is wrong. And an improving economy often leads to higher rates as the demand for capital to expand increases. We received more evidence of a solid economy at the end of last week with the employment data. Average hourly earnings growth in the U.S. fell short of expectations for November but the rest of it was solid, and yet MBS prices improved Friday, along with Treasuries:  the 10-year rallied .5 to close yielding 2.39% and MBSs improved about .250.
 
The Italian referendum – which is not the name of a movie – took place yesterday as did the Austrian presidential elections. The Italian referendum outcome, while “bad” as far as risk sentiment is concerned, was also very consistent with market expectations (the magnitude of the loss may have been a bit larger than anticipated but regardless, “No” was expected to emerge victorious). Italian Prime Minister Matteo Renzi announced his resignation after voters in a national referendum soundly rejected his proposed constitutional reforms. The world will also follow some other central bank meetings in other countries. This morning we’ll have some forgettable Markit Services PMI number along with November ISM Non-manufacturing PMI and some other random numbers.
 
Tomorrow we’ll have Q3 Productivity and Unit Labor Costs, the October Trade Balance, and October Factory Orders/Durable Goods. Wednesday includes the MBA’s Mortgage Application figures and JOLTS Job Openings. Thursday is the usual Jobless Claims, and then Friday are December’s Michigan Sentiment numbers, sliced and diced every which way, and October Wholesale Inventories. Out of the block this morning we find the 10-year yielding 2.43% and agency MBS prices worse .125 versus Friday’s close.
 
 
THE FOUR STAGES OF LIFE:
1) You believe in Santa Claus.
2) You don’t believe in Santa Claus.
3) You are Santa Claus.
4) You look like Santa Claus.
 
 
If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Election Day 2016 is Over – Now What?” 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.)