I try not to repeat information, but I felt that this study, which I had yesterday in the Capital Markets section of the Commentary, warranted it given that it relates to possible changes in the credit quality of potential, and existing, borrowers. Yelp tells us that as of August 31, 163,735 businesses in the United States that were open on March 1, 2020 have closed, up 23 percent since July 10. Of those businesses marked closed 60 percent will not reopen, or 97,966 permanently closed businesses with 65,769 temporarily closed ones. The most affected are restaurants (32,109 total closures), retail and shopping (30,374), and beauty and spas (16,585). It is rumored that shortages in items like canning supplies and canned pumpkin (actually mostly other squash) have replaced toilet paper, so human behavior during this pandemic continues to interesting (to say the least).

Saturday Company Spotlight

This week we highlight Assurance Financial, “an independent, full-service residential mortgage banker… created to service the loan industry a little differently.”

In 3-5 sentences, describe your company (when was it founded and why, what it does, where, recent growth and plans for near-term future growth). Founded in 2001, we have grown organically over the years with selective hiring, requiring all potential hires to demonstrate high character, job stability and a willingness to be involved in their community. Licensed in 41 states, we have 20 branch offices, two operations facilities (Baton Rouge and Charlotte) and a Consumer Direct division. Growth plans are to build new markets in the Midwest and expand our existing footprint.

  

Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why. Our operations team participates in a “jeans fund” which allows them to dress casual at work by making a small contribution from each paycheck that goes toward our company philanthropy partnership (St. Jude Children’s Hospital).  We chose St. Jude because childhood cancer touches every market where we do business.

 

What does your company do to help elevate your employees’ growth? Describe any mentoring programs, outside classes or training, in-house training. How does the company help people develop? We have a culture of helping each other and this mentality is in line with hiring high character folks who pay it forward…everyone is willing to help the next person up. We use outside companies like XINNIX for training and we have an internal training department as well.

 

Tell us how your company maintains its culture in the office, or in a work-from-home environment if applicable. Our HR team does a great job of keeping things as light and fun as possible. From talent skit competitions to celebrations for milestones, we try to have fun in the workplace. Also, we have an annual LO incentive trip and the criteria is set so as many people as possible will qualify. We have spouses attend and it has helped foster some long-time relationships between our team members in different markets.

 

Things you are most proud of that don’t have to do with sales. I am most proud of the long tenure for so many of our team members. To create a platform for our people to have a great career and be able to provide a nice life for their families is our greatest accomplishment. They make their own success because they are super at what they do but it sure is rewarding to play a role in the journey.

 

Fun fact about Assurance Financial? With our corporate headquarters in Baton Rouge, we are a proud partner of LSU athletics and reigning College Football National Champions.

                  

Is there anything else you’d like to share along these lines? In 2018 when the mortgage industry was dealing with “margin compression” and other financial hurdles, we doubled down on our technology investment. These initiatives put us in a great position from a digital perspective and has allowed our LO’s to maximize production while providing a second to none borrower user experience.

 

(For more information on having your firm and its charitable side featured, contact Chrisman LLC’s Anjelica Nixt.)

Vendorpalooza

Companies catering to the residential mortgage business do plenty of other things besides create company names that challenge spell checkers. Let’s take a random look at who is doing what, as it definitely gives us a flavor of trends in lending: follow the money! For example, Black Knight and ICE are not the only entities out there buying residential mortgage-related companies.

SitusAMC Holdings Corp. has acquired LogicEase Solutions Inc., the parent company of leading residential regulatory compliance technology provider ComplianceEaseÒ. The acquisition adds industry-leading automated compliance software ComplianceAnalyzer and TRID Monitor to SitusAMC’s growing technology portfolio. The ComplianceEase management team will be retained by SitusAMC. ComplianceEase will operate as a wholly owned subsidiary of SitusAMC with no planned changes to existing staff or operations. (Since its inception, ComplianceEase has processed audits for over 90 million loans.) With the acquisition of ComplianceEase, SitusAMC expands its rapidly growing residential technology offerings which include systems of record for the custodial and warehouse space (emBTRUST and ProMerit); product, pricing, and eligibility for loan conduits (The Rate Lock System); document classification and data extraction (Acuity); document management (DocAcuity); and loan accounting (SBO.NET).

Remember that Black Knight, Inc. acquired Compass Analytics, Optimal Blue, and DocVerify. The DocVerify acquisition “helps accelerate Black Knight’s goal of digitizing the entirety of the real estate and mortgage continuum as DocVerify’s trusted and proven digital document verification capabilities are already seamlessly integrated with Expedite Close, Black Knight’s digital closing platform.”

CoreLogic confirmed that it had received a revised unsolicited proposal from Senator Investment Group LP and Cannae Holdings Inc. on Sept. 14 to acquire all outstanding common shares of CoreLogic for $66.00 per share in cash.

Docutech has officially rebranded to First American Docutech. A new campaign kicked off titled “Accelerate Closings. Accelerate the Dream.” Check out the press release here and the broader website here.

In mortgage vendor partnership news, Top of Mind has enhanced its integration with SimpleNexus to extract consumer information from abandoned mortgage applications, enabling mortgage loan originators to follow up with borrowers who begin, but do not complete, online mortgage applications. This enhanced integration features bi-directional syncing, data flows both ways; with the push of a button, loan officers can fetch new or updated contacts from SurefireCRM and import them into SimpleNexus.

Seaway, a division of Self-Help Federal Credit Union (Self-Help), and Guaranteed Rate, Inc., have partnered to broaden the availability of mortgage loan products to the community in Chicago’s South Side. Through this partnership, Seaway’s mortgage division can now refer qualified borrowers to all of loan product options, including FHA and VA loans, which Seaway previously didn’t offer.

Recall that a joint venture of Guaranteed Rate and @properties, created Proper Rate, LLC, a new independent retail mortgage lender that offers home buyers and owners personalized lending services through a select group of some of the most highly experienced and dedicated mortgage professionals using one of the industry’s top platforms. Proper Rate delivers all of the advantages of a big lender with the hands-on feel of a “boutique” firm. Proper Rate offers home loans to home buyers throughout select regions in the country, including those represented by @properties’ 2,800 agents. Providing an integrated solution where clients can get financing in addition to finding homes and negotiating purchases; real estate agents can now work with Proper Rate mortgage originators using innovative FlashCloseSM technology to process loans.

Altisource’s Vendorly SaaS oversight platform now prevents wire fraud with Secure Insight. This alliance furthers Vendorly’s offering of a cradle-to-grave solution for the lending and banking industries that helps mitigate ongoing risks associated with vendor management.

Home Captain announced the launch of the “Home Captain Hub,” a new suite of innovative products and services tailored to dramatically increase the lifetime engagement and satisfaction of mortgage service and banking customers who are purchasing, selling or refinancing their home. This announcement follows the company’s recent acquisition announcement of Redefy and the combined companies’ rebranding.

Home Captain is also “increasing loan officer capacity” with its new Hub Conversion Optimization System. COS now includes products for portfolio retention, artificial intelligence lead engagement, loss mitigation, and customer propensity modeling.

National MI announced that it is fully integrated with Lender Price providing loan officers with instant access to National MI’s risk-based Rate GPS® through the Lender Price PPE platform.

Transformational Mortgage Solutions (TMS) assists lenders with executive leadership coaching and consulting services. SupportLink3 (SL3) provides financial services-based companies an alternative to incurring the expense of employing in-house resources that extend sales, business development, and other topline generating activities. The partnership these two firms just announced will offer mortgage entities a range of business management expertise with the ability to outsource and expand revenue-generating functions.

PRMG announced its partnership with ReadyPrice, a new service which provides brokers with an additional option to price loans, run DU and then submit loans to PRMG. Sign up for this free service.

Xome and Manor Financial announced the availability of Inspex a consumer-facing mobile application, that gives homeowners a seamless tool to appraise their property and lenders a simple, contactless option for their borrowers to reduce wait times on appraisals and other valuation products by as much as 50 percent. While the digital transformation of residential real estate has been in motion, COVID-19 has accelerated the desire for contactless appraisals. Inpex enables contactless and also addresses consumers’ desire to quickly take advantage of record low interest rates to buy, sell and refinance homes.

With loan volumes at an all-time high, Nations Lending and SWBC Mortgage rely on Advantage Systems’ AMBfx Module for better financial reporting, building custom reports and delivering enhanced financial reporting all while working remotely during the pandemic. With hundreds of easy-to-use reports already embedded into the AMB system, AMBfx allows users to build custom reports specific to their needs. Data is accessed directly from the AMB database into spreadsheets created by the user, meaning that changes made in AMB are immediately reflected in the customized spreadsheet.

Real Estate Profinder launched a Free App to Consumer and Real Estate Professionals. This search system finds reputable real estate agents, lenders, home inspectors, and title agents free of cost to the consumer. This system is a win-win for the consumer and the professional. The consumer gets in exchange for their feedback, a professional that follows the Real Estate Profinder Customer Service Policy, and the professional get a free introduction. Real Estate Profinder Customer Policy causes consumer’s referral and loyalty to the real estate professional that assisted the consumer in a satisfactory outcome. Check out this Profinder video for more information.

Home Point Financial selected Docutech’s Solex eClosing software to enable a hybrid eClosing experience. Borrowers can review their closing package digitally prior to the day of closing, taking the time they need to familiarize themselves with the document prior to signing. On the day of closing, borrowers can eSign most documents in advance of meeting at the closing table, reducing the closing time to mere minutes. Once the closing is complete, all documents are digitized and stored in the Solex eVault.

This summer National MI integrated with Cloudvirga’s digital mortgage origination platform for retail and wholesale lenders. Mutual customers now have direct access to National MI’s  Rate GPS^SM through Cloudvirga’s technology platform.

UWM announced an “industry-first” Insights Tool for brokers. Insights is a new instantaneous tool built into UWM loan origination system, EASE that allows clients to generate up-to-the-minute, customizable reports specific to their businesses. Brokers have the control over their data and capability to research, make data-based decisions and run reports instantaneously to help them more efficiently manage their business and pipeline. Reports take seconds to generate and give clients the ability to search, sort, filter and organize their data. These reports can even be exported to update your own systems for easy compliance and audits.

HomeLight launched Move Safe Certification, a program to identify agents who are using the best tools, technology, and practices to help keep buyers and sellers safe in a COVID-19 environment. HomeLight’s Top Agents Insights report, surveyed over 1,000 top agents across the United States since before COVID-19 hit and subsequently after, agents are mostly still open for business, with: 97% of agents surveyed are still accepting new clients. 67% of agents describe their business as slower than normal, but still doing deals. Over 64% of agents report that they are optimistic about the housing market this year.

One of the two underwriters brought back into the office lifted her head. “They’ve been working us like dogs for six months. I know how to get some time off work,” the woman whispered.

“How?” asked the second underwriter.

Instead of answering, the woman quickly looked around. No sign of her manager. She jumped up on her desk, kicked out a couple of ceiling tiles and hoisted herself up. “Look!” she whispered, then swinging her legs over a metal pipe, hung upside down.

Within seconds, the manager emerged from the lunchroom at the far end of the floor. He saw the worker hanging from the ceiling, and asked her what on earth she thought she was doing.

“I’m a light bulb,” answered the underwriter.

“I think you need some time off,” barked the manager. “Get out of here – that’s an order – and I don’t want to see you back here for at least another two days! You understand me?”

“Yes, sir”, the underwriter answered meekly, then jumped down, logged off her computer and left.

The second underwriter was hot on her heels.

“Where do you think you’re going?” the boss asked.

“Home,” he said lightly. “I can’t work in the dark.”

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. 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 & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

TGIF! Do Fridays mean as much as they did up until mid-March? Yes! Well, maybe. How about some non-mortgage stuff? There is, after all, life outside of RESPA. It’s crazy at the nursery via webcam at the Warrior Canine Puppy Live (although sometimes they let them roam outside). How about the oldest recording of a U.S. President? (It’s short.) Here’s the first film of a U.S. President: Teddy Roosevelt in San Francisco. I don’t need more politics in the daily news, or to hear jawboning about the half dozen Congressional & Administration election permutations, but I sure need water every day. Did you know it takes 90 days for a drop of water to travel the entire length of the Mississippi River. (By the way, the Mississippi River is not the longest river in the United States. The Missouri owns that title.) One mountain, Triple Divide Peak in the Rockies, is the only place in the United States where rain and snowmelt flow into three different oceans: the Atlantic, the Artic, and the Pacific! Lastly, for you fans of George Orwell, here is a “security” drone that constantly flies around the inside of your house, and Alexa can bark at intruders from your Echo for $49 per year. Hard pass, no thanks.

Employment

“August was a great month for Caliber Home Loans! We continue to help more families achieve their dreams of buying a home as rates remain at historic lows. Our ongoing success is driven by our remarkable team members. Caliber customers get exceptional service through all stages of home ownership. Are you looking for a place to work that is rewarding, has an awesome opportunity for upward mobility and is committed to supporting the communities where you live and work? We have open positions in Operations and Sales. If you have a passion for helping customers, we’d like to talk to you. Visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley  or Brian Miller respectively.”

4506-Transcripts.com is now Powered by Private Eyes Screening Group. We are growing fast and if you have relationships in the lending industry, and would like to join a team that has easy to use technology combined with great customer service, apply today for a sales or customer support role! Send a confidential resume to Martin Serrano, VP of Supply Chain Strategy at 925-927-3333.

“A top national mortgage lender, headquartered in Houston, Texas, is expanding and seeking to fill production and underwriting positions across four expansive regions. With over 20 years in the business, Envoy Mortgage is continually setting new records, investing in game-changing marketing technology and has a rock-solid operational and financial position to fuel repeated growth. We even broke our own personal production record three times this year! Shall we say it louder for those in the back? A strong balance sheet, extensive warehouse bank capacity and licensing status in 46 states, including DC, is just the beginning. Contact Envoy’s Recruiting Director, Hal Sims to learn more about these positions or register for our live webinar to see what it is like to work at Envoy!”

Lender services and products

In personnel news, Credit Plus is excited to announce the addition of Ashley Lockaby as a Regional Account Manager. Ashley will manage existing and potential customers helping them navigate the tumultuous waters of our industry. Her hard work and dedication are only exceeded by her enthusiasm. With more than 17 years in the mortgage industry, Ashley brings well-rounded experience to the table. Most recently she was the VP of Warehouse Lending at Northpointe bank and before that spent time in the mortgage technology space as a Director at Black Knight. In the beginning of her career, Ashley ran secondary for a national mortgage lender.  “We’ve built a top performing company fueled by a team of high-achieving and customer-centric individuals who have a real desire to help mortgage lenders and we think Ashley is a perfect fit,” said Greg Holmes, Managing Partner at Credit Plus. “We’re excited she is joining Credit Plus and look forward to her contributions as she helps lenders mitigate risk and make more confident credit decisions.” Reach out to Ashley (404-481-3733) to say congrats!

Free Infographic: Your client’s FICO Score. There are 5 weighted factors that go into a FICO Score. Do you know what they are? Here are some quick tips you can share with your borrowers on what they can do to improve their score for each factor. For more helpful ways to elevate your lending game, subscribe to Data Facts’ weekly blog, or follow us on LinkedIn.

Want to supercharge your outbound marketing? Top of Mind and special guest Barry Habib will show you how to combine Surefire CRM’s Power Calls with market insights from MBS Highway to work smarter, not harder. The show starts at 1 pm ET on October 1. Register here. Stay tuned at 2 pm ET for another Top of Mind session, this one featuring Zac Scalzi of Floify. Learn to integrate your website, your POS, and your CRM to turn drive-by traffic into inbound leads that convert. Register here. See you there!

Security and cybercrime

My daughter teaches 7^th grade and got quite a chuckle out of this. Is your kid’s teacher trying to steal their identity? I don’t think so.

When the pandemic hit and companies who had outsourced work overseas scrambled to equip their foreign staffs to work from home, but it raised issues. The shut down in India and other countries has played havoc with work, lack of computers, cyber security (could someone, accustomed to turning their phone in at the door, now take a photo of their screens?), and unwanted eyes seeing personal information from U.S. borrowers. It is still an area of cybersecurity focus.

Borrowers are continually reminded to beware of cyber-fraud. Before wiring any funds, borrowers are told to call the intended recipient at a number they know is valid to confirm the instructions and to be very wary of any request to change wire instructions already received. Lender’s employees are warned to never provide nor confirm wire instructions.

In a paragraph of non-mortgage chatter, how much does the director of the FBI make? About a $185k bones. The Central Intelligence Agency (CIA) is having serious difficulty recruiting tech savvy geek types with no social conscience about spying on people because they are usually hired by Facebook or Google. But the CIA’s officers can now publicly file patents on intellectual property IP they work on and collect a piece of the profits. Officers who make new tech at CIA Labs will be able to make 15 percent of the income from a new invention with a cap of $150,000 per year, functionally doubling agency salaries.

This summer a FinCEN Advisory (FIN-2020-A005) came out on cybercrime and cyber-enabled crime exploiting the COVID-19 Pandemic alerts financial institutions to indicators of potential fraudulent schemes, malicious cyber activity and scams, and other suspicious activity.

A Cybercrime Report provides detailed insight into how fraudsters have responded to the COVID-era and modified their cyber activities to take advantage of governments and certain industries. There was evidence of specific attacks targeting government-backed loan schemes, as well as a number of e-commerce merchants. The former is reflective of the number of schemes that governments put in place globally to get credit and grants to individuals and businesses impacted by the global pandemic.

Educating employees and clients is critical. Man against machine. Global, automated bots remain a key attack vector for fraudsters. Financial services organizations experienced a surge in automated bot attacks, up 38% year over year, and continue to experience more bot attacks than any other industry. Financial services companies include mobile and online banking, online money transfer, lending, brokerage, alternative payments, and credit card issuance.

 

Naturally, all industries have felt the impact of COVID-19, and there are clear peaks and troughs in transaction volumes coinciding with global lockdown periods. During this period, financial services organizations saw growth in new-to-digital banking users, a changing geographical footprint from previously well-traveled consumers and a reduction in the number of devices used per customer. There have also been several attacks targeting banks offering COVID-19-related loans.

Capital markets

What rebound? Yelp tells us that as of August 31, 163,735 businesses in the United States that were open on March 1, 2020 have closed, up 23 percent since July 10. Of those businesses marked closed 60 percent will not reopen, or 97,966 permanently closed businesses with 65,769 temporarily closed ones. The most affected are restaurants (32,109 total closures), retail and shopping (30,374), and beauty and spas (16,585).

As you’ll see below, today’s Capital Markets section is largely about the prospect of a new stimulus bill. Speaker Pelosi and Secretary Mnuchin both raised the prospect of resuming negotiations as House Democrats yesterday drafted a $2.4 trillion proposal that they can take into possible negotiations with the White House and Senate Republicans. For the American’s across the nation who truly need further stimulus, they will be disappointed to hear the latest offer from Democrats deviates only slightly from previous offers and is unlikely to find any Republican backing. The Senate passed a stopgap funding bill, as expected. Elsewhere in Washington, day three of Fed Chair Powell on Capitol Hill saw him once again suggesting that aid to small businesses and the unemployed should be a priority. Treasuries ended the day pulling back slightly but the entire week has been a snoozer, rate-wise.

With both Fed Chair Powell and Treasury Secretary Mnuchin appearing before a House panel earlier this week, markets were looking for indications on which direction talks between the White House and Congress are heading over another aid package. A compromise (mortgage rates likely up) or lack thereof (mortgage rates likely unchanged/down) will have implications for our industry, so it is worth paying attention.

White House officials and leaders of both parties of Congress have struggled for months to agree upon another economic relief package since the passing of the $2.2 trillion CARES Act at the end of March. Any future bill before November will have to pass the Democrat-led House and the Republican-controlled Senate, which appears increasingly unlikely before the election. Negotiations between the two sides were on and off throughout the summer, with Democrats in the house proposing a $3 trillion relief bill and Republicans in the Senate countering with their own $650 billion relief bill. The sense of urgency that propelled the CARES Act into law is likely gone, as many say the country is no longer facing a historic collapse of economic activity. U.S. equity markets have all but recovered their early-pandemic losses, and the unemployment rate has fallen over six percentage points from its high of 14.7 percent in April. The result is that Democrats and Republicans disagree over both how much additional support is needed and how best to structure that support. Sticking points are support for state and local governments, the bump to weekly unemployment benefits and liability-protections from COVID-related lawsuits for businesses, schools, and health care providers. Currently, most baseline U.S. economic forecasts have refrained from including any new stimulus in its projections.

Did I mention time for compromise is running out? The legislative calendar sees the House of Representatives leave Washington on October 2, with the Senate scheduled to leave a week later on October 9. Unless there is an emergency that necessitates Representatives and Senators to be called back (stimulus talks do not qualify), neither chamber will return to action until after the election. Unfortunately, for the average American, the current position of the two parties appears too far apart for any deal. Both sides have dug in and appear willing to wait until after the election, when election results may change the balance of power. With each passing day, the prospects of an economic relief bill being passed into law before the election decline. If further stimulus is passed, it would be a boost to real GDP growth, payroll growth, inflation, Treasury yields, the budget deficit, etc. I wouldn’t hold your breath, unless you can make it until 2021, which means mortgage rates don’t appear likely to increase anytime soon.

It was a relatively busy day for economic releases yesterday. Jobless claims for the week ending September 19 increased when they were expected to decline, which still would have been nearly four times pre-pandemic levels and twice as high as the peak of the last recession. It’s going to be a long road back for U.S. businesses. On a brighter note, new home sales in August exceeded a seasonally adjusted annual rate of 1.0 million for the first time since November 2006, rising 4.8 percent month-over-month to 1.011 million when the figure was expected to be 875k. That marks a 43.2 percent year-over-year increase (!), reflecting strong demand for new homes at more affordable price points. The South region, which is the largest homebuilding region and features lower average prices, saw a sales increase of 13.4 percent month-over-month. Finally, the FHFA announced the extension for buying loans in forbearance, and certain loan origination flexibilities, due to Covid-19 from September 30 to October 31.

Well, we’ve already received both economic releases that were scheduled for today. August durable goods orders were only +.4 percent (ex-transportation only +.4% as well). We’ve also seen, per Black Knight, the number of mortgage plans in active forbearance fell 95K over the last week (-2.6 percent). This marks five consecutive weeks of improvement and is 24 percent lower than the peak in late May, a decline of 1.17M plans since then. As of September 22, 3.6 million homeowners remain in COVID-19-related forbearance plans, or 6.8 percent of all active mortgages, representing $751 billion in unpaid principal. Separately, a busy week of Fed speak concludes with remarks from New York Fed President Williams. The Desk will conduct a near repeat of Wednesday’s operations when they purchase up to $5.5 billion MBS starting with $954 million UMBS15 1.5 percent and 2 percent followed by $2.9 billion UMBS30 2 percent and 2.5 percent and $1.7 billion GNII 2 percent and 2.5 percent. We begin the day with Agency MBS prices are better/up a few ticks and the 10-year yielding .66 after closing yesterday at 0.67 percent, shaping up to be another day of no rate volatility!

I’m a simple capital markets guy. I, like everyone reading this, have done and said some dumb things in my life. To end the business week and head into your work weekend, here is “29 Of The Most Mind-Meltingly Dumb Posts People Have Actually Made On Twitter.” For example:

“I walked into a sliding glass door and think I may have a Caucasian.”

“If you don’t know the difference between ‘there,’ ‘they’re,’ and ‘their,’ your an idiot.”

“Every second someone dies, and every second someone is born, so why isn’t the population 0?”

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. 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 & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

I need to make a dart board for the wall behind me for Zoom calls that has “rates up” and “rates down” and “rates the same” on it. Until we see actual year-over-year inflation above 2 percent, the Federal Reserve will hold short-term rates near 0 percent. Any questions? The Fed believes it will take three years before employment returns to where it was a year ago. The pandemic has put us in a deep hole, let’s not underestimate that, and all parts of the economy are impacted. In many instances people adapt, right? The pandemic forced Oasis, a cabaret and nightclub whose drag shows were often packed, to close. Its owners had to furlough the whole staff. But then its owner had an idea. “If people couldn’t come to see drag, why not bring drag to the people?” Thus was born Meals on Heels. For about $100, a drag queen or king will deliver dinner, drinks, and a curbside performance. The idea had its ups and downs. “I was definitely performing on driveways that were at a 45-degree angle,” said Amoura Teese, a drag performer whose given name is Ryan Maldonado. Can you pay $150 not to have them show up?

Jobs

Don’t you want to spend more time on an island tropical paradise? There is a unique opportunity for an experienced Correspondent Operations Manager to join a well-capitalized start-up on the ground floor. “Join our team of industry veterans for this exciting journey, as we build a best-in-class company from the ground up! Must be able to work from the USVIs at least 50% of the time; relocation & housing to be discussed.” Interested parties may send their confidential resume to Chrisman LLC’s Anjelica Nixt for forwarding.

“Caliber Home Loans is excited to let you know about its new podcast called “The Home Connection.” The topics we cover will have a strong appeal to homeowners, realtors, and mortgage professionals, and it’s right for everyone in between, too. Our first two episodes are live. In the first, Andrew Berman of American Business Media gives his insight on how COVID-19 positively impacted the trade show industry. In our second, Caliber’s Stacey Gross will share her expertise on why it’s a good time to buy a home. Our podcast promises to be enlightening and informative. Subscribe and tune in every other Monday on Apple, Google, or Spotify. Caliber Home Loans is an innovative company, and we’re hiring right now. Visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller respectively.”

 

A seasoned mortgage banking CFO with a proven track record is searching for a new home with a dynamic and growing mortgage bank. Areas of leadership and expertise include capital markets, agency and investor relationships, hedging, servicing, loan sales and delivery, warehouse financing, human resources, compliance, and operations. If you are in need of a passionate financial leader with direct experience in all aspects of mortgage banking please send confidential inquiries to Anjelica Nixt.

 

“The Citizens Bank Home Mortgage business is breaking records across the industry this year, and we’re looking for professionals who are ready to join a winning team! Here’s a snapshot of our most recent successes. Our Retail Lending channel just reached its third consecutive month of record-breaking purchase business, helping close to 3,500 families with their home purchases. Our Correspondent Lending channel climbed two spots in the IMF rankings to become a Top-10 channel nationally; volume increased 54% from Q1 to Q2, the second largest increase of any other top-25 investor. And our Wholesale Lending channel ended August with its largest funding month in history! If you’re ready to take your mortgage career to the next level, visit jobs.citizensbank.com to see all of our openings.”

Want to join the firm that is ranked the nation’s #1 VA, GNMA and FHA lender for the first half of the year according to Inside Mortgage Finance? The firm that just surpassed a $14B origination month, bolstered by a loan portfolio of over $300 billion in assets AND has some of the happiest employees in mortgage banking according to Glassdoor? The time is NOW to join Freedom Mortgage: bit.ly/SoarWithFreedom. Freedom is safely and remotely hiring thousands in several areas including: underwriting, processing, closing, sales, finance, IT and more! Come #SoarWithUs.

HUD is offering up a Program Analyst position in Washington DC.

Broker & lender services and products

Home Point Financial has announced that the Construction-to-Permanent (CTP) Modification product is now available for all Delegated Correspondents in all states. The CTP Modification is a single closing product that combines interim construction and permanent financing into one loan. Transactions will be exempt from the Adverse Market Refinance fee. Home Point continues its rapid surge as one of the fastest-growing correspondent and wholesale lenders in America. If you are a correspondent or broker that still needs to get signed up with Home Point, visit its website now.

Two million forbearance plans are set to expire at the end of this month. What comes next for borrowers and servicers? Get insight into 2021 housing prices, latest default projections, best REO/Auction strategies and more from leading economic and loan servicing experts Allan Weiss (co-founder of Case-Shiller Weiss), Sean Ryan ( CEO, Aspen Grove Solutions), Joe Chappell (EVP Covius Settlement Services), and Pete Pannes (Chief Business Officer of Covius/RealtyBid). Join us October 6 at 1pm ET. Register today!

 

ActiveComply: Did you know the FFIEC has outlined that lenders MUST have a social media risk management program? Surprise! Under this guidance, lenders are required to monitor, and control social media related to their brand as if it were traditional advertising. This also means social media must be archived to meet state advertising record retention laws. Failure to meet these requirements may result in regulatory audits, penalties, and even citations. ActiveComply helps lenders meet both responsibilities through our compliance system technology: find all company and LO accounts related to your brand, examine profiles for NMLS IDs & Equal Housing logos or verbiage,  and ensure posts are compliant (image scanning included). Too busy with the industry boom to tackle social media monitoring on your own? ActiveComply now offers a Managed Services option to partner with individual lenders to better understand their risk level tolerance and company policy. Contact Melissa today!

 

GO Mortgage and NAIBRS are sponsoring the “Housing Leadership Summit for Realtors” webinar. This educational seminar is free and will cover how realtors can become the new construction real estate specialist in their market. There’s still time to register, the webinar is September 24th at 10:00 am Central. Guest speakers from Fannie Mae, Proposed Properties, and GO Mortgage will discuss how to leverage new construction to win more listing, how to market to today’s millennial consumers, and how to have commissions paid up front for new construction builds. Please register or learn more at https://bit.ly/realtorsummit.

 

Industry leaders, Cardinal Financial and Newfi Wholesale join Stearns Wholesale, PRMG, and other top wholesale lenders on the ReadyPrice Platform allowing them to promote their best loan products to brokers in desirable territories nationwide. ReadyPrice gives brokers a simple, alternative way to deliver complete and approved loans directly to their lender of choice through its cloud-based application. Now is the best time to become a ReadyPrice Lender Sponsor! Visit www.readyprice.com/lenders to learn more or schedule a call today.

“These are real leads that result in real loans in your pipeline. In short, the last time your company saw speed and accuracy like this, you were watching Lamar Jackson smoke the Cleveland Browns on Sunday. Sorry Browns fans.” (Matthew Sell, GO Mortgage) Sales Boomerang combines customer analytics and engagement automation with borrower intelligence to give First Heritage an acquisition funnel equipped with detailed actionable data about the customer. This means that marketing is now contextual and relevant, and not random. “An unknown into a known refinance in a heartbeat.” (Phil Denfeld, First Heritage Mortgage) The numbers speak for themselves: 20X Avg ROI, $240 Avg Cost Per Acquired Loan, 10-20% Avg Lift to Loan Volume. Want to see exactly how much you lost this year? Request your report today. We will show you which competitor took your deal, what was the loan amount, and what type of loan it was.

When I was saw the teasers for an announcement from QLMS, I knew it would be big, but didn’t realize just how HUGE it would be for brokers. The lender announced a rebrand to Rocket Pro TPO. This isn’t just a name change; it’s changing the entire game. With increased access to the revolutionizing Rocket technology that brought the industry into the 21^st century, new co-branded marketing and the opportunity to leverage national ad campaigns, as well as the creation of one of the largest referral networks available – it is clear this is not just a one-time stunt. To celebrate its doubling-down on broker support, the lender is doling out 10,000 purchase leads to its partners. Rocket Pro TPO is here to push boundaries and help its partners thrive for decades to come. If you are a broker who wants to Rocket your business into the stratosphere, click HERE.

Customer communication

When high loan volumes create capacity issues, lenders are often forced to choose efficiency (i.e. get the loans pushed through quickly) over customer service excellence (personal care with each loan). But what if you could have both? “It’s not only possible – it’s already happening,” says STRATMOR MortgageSAT director Mike Seminari. In 2017, just three percent of borrowers said the primary way they received loan updates was by text, mobile app or by logging into their lender’s website. In 2020, that number has grown to 19 percent. In his just-released September MortgageSAT Tip, Seminari offers three suggestions for employing digital update tools to achieve efficiency and delight borrowers at the same time.

A sample of Agency changes at the wholesale level

United Wholesale Mortgage (UWM) has been in the news about a planned merger to lead to it going public, but earlier this month it announced 30-year fixed cash-out refinances with rates in 2.5 percent rate range are now available. “UWM introduced this program to help borrowers update, upgrade or repair their homes as the popularity of home improvements continue to surge in America. The Conquest Cash-Out Refinance product is the latest in a series of releases recently announced by UWM including 30-year fixed with rates as low as 1.999 percent, 15-year fixed mortgage with rates as low as 1.875 percent, Conquest conventional loans offering rates as low as 2.5 percent and Conquest VA offering rates as low as 2.25 percent for both purchases and refinances.

Mountain West Financial Wholesale posted COVID-19 FHA Forbearance Guidance in Bulletin 20W-112.

Orion Lending issued a reminder that all agency refinance transactions, with the exception of HomeReady, Home Possible, and loans with loan balances less than $125,000, will be subject to the 50-basis point Adverse Market Refinance Fee. Additionally, Friday, September 25^th is the last day to lock for 45 days without being assessed the 50BPS Adverse Market Fee on Conventional Refinances over $125,000.

FAMC provided an impact outline of the implementation of the Adverse Market Refinance Fee. The .50% Adverse Market Refinance Fee will be applicable for new Best-Efforts locks beginning September 14, 2020. Loan amounts less than $125,000 as well as HomeReady and Home Possible transactions are excluded. As a result, the current cash out refinance adjustment for conventional products will be eliminated. The Refinance Fee will also be applicable for loans locked prior to September 14, 2020 that are not purchased by November 6, 2020. The Refinance Fee will be applicable for mandatory commitments beginning October 15, 2020 and any mandatory loans not purchased by November 6, 2020.

Capital markets

Ever since market volatility increased earlier this year and a myriad of changing forbearance provisions were included in the CARES Act, delinquencies and advances have had a material effect on servicing portfolios. MCT’s Phil Laren, Director of MSR Services, analyzes these effects and provides recommendations for how MCT is assisting clients in his latest published piece, MSR Forbearance in 2020: Challenges and Recommendations. In this paper, he provides a first-hand look at how market volatility, forbearance, prepayment speeds and other factors have affected your MSR portfolio.

 

Do you need help managing your MSR portfolio? MCT’s MSR Services Team can help you plan for cash advances based on the impact of market volatility on your portfolio. MCT can also help lenders develop their retain-release strategy with MCT’s Enhanced Best Execution (EBX) tool. Contact MCT’s MSR Services Team today for more information.

Looking at the bond market Wednesday, Fed officials yesterday continued their pleas for more government relief. Fed Chair Powell disagreed with congressional suggestions that the Fed favored markets over people during the pandemic and said of the Main Street Lending Program that the Fed has “done basically all of the things that we can think of.” Atlanta Fed President Bostic said, “the economic recovery will get much harder, with more permanent job losses unless there’s additional fiscal support,” and Vice Chair Clarida chimed in, saying “we are still in a deep hole.” The Fed asking for another bailout (in addition to the House passing a stopgap funding bill in Washington) caused a slight pullback in Treasuries although Agency MBS prices held in well. Congress remains deadlocked over how big that package should be, what it should contain and whether there should even be another one.

As far as economic releases went, the FHFA Housing Price Index increased 1.0 percent in September after increasing a revised 1.0 percent (from 0.9 percent) in August. That comes on the heels of August Existing Home Sales posting a 14-year high earlier in the week.

Today we receive August New Home Sales, though the calendar is relatively light on data. Markets have already received initial jobless claims for the week ending September 19 (+28k to 824k) but the Thursday morning jobless claims have become so splintered and varied (seasonal, continuing, California having stopped the process due to fraud) that it is hard to make sense of them! In addition to August new home sales, which are expected to decline marginally from July, the day is again packed with seven Fed speakers. After heavy support the last couple days, the NY Fed will conduct three operations totaling up to $6.4 billion MBS with two targeting up to $2.9 billion 2 percent and 2.5 percent and one targeting up to $669 million UMBS15 2 percent. On the supply side, look for a $50 billion 7-year Treasury note auction, as yesterday’s $53 billion 5-year note auction was met with much better demand than Tuesday’s 2-year note sale. Thursday starts with Agency MBS prices better a shade and the 10-year yielding .66 after closing yesterday at 0.68 percent.

I used to be indecisive, but now I’m not so sure.

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. 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 & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

 

I know that plenty of folks at United Wholesale read this commentary, and the company is in the news about a merger that will take UWM public valuing it at $16 billion. Perhaps Bruce Springsteen reads this commentary, perhaps not, but he turns 71 today so Happy Birthday Boss! Out of curiosity, what does $500,000 buy, home-wise, in some of the cities and towns he has included in his songs, for the $1,700 monthly payment on a $400,000 loan (yes, I know a buyer doesn’t need to put 20 percent down!)? Let’s start with Lincoln, Nebraska, from “Nebraska”. (This place is nice too.) Let’s head out to California with a “bourgeois house in the Hollywood Hills from “57 Channels (and nothing on).” Across the nation, on the “Streets of Philadelphia”, this place is very stately, as is this one on Shunk Street. While you’re in that area, fix up your hair, head southeast, and meet me in “Atlantic City”: here’s a place on the water or if you don’t want to hassle with the yard, there’s this one. If you want to try your hand at mining, live in “Youngstown” in a nice house with great woodworking or one with a yard. A world away, he sang, “I know a pretty little place in Southern California down San Diego way” in “Rosalita”. (I saw them on this tour in 1980. That aside, I am glad that the real estate used a wide-angle lens.)

Jobs & promotions

“Caliber Home Loans is proud to announce that Ranjit Bhattacharjee has joined its leadership team as the EVP over Capital Markets and Treasury. In his role, Bhattacharjee is poised to take an accomplished team to the next level of growth and success. Bhattacharjee has a Ph.D. in Pure Mathematics from Boston University and a master’s in Mathematics from Technical University Aachen. He comes to Caliber from New Residential Investment Corp. where he focused on MSR Hedging, Secondary Markets, and customer data analytics and before that served in a number of senior leadership roles at CitiMortgage. Bhattacharjee has a deep and successful background in the mortgage industry. “We’re delighted to have Ranjit as a member of our team. His impressive skills will allow us to accelerate our success going forward”, remarked William Dellal, President of Caliber. Only a best-in-class mortgage lender attracts the finest talent. We’re hiring right now, so visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller respectively.

Three times the charm! Evergreen Home Loans is proud to announce that three times this quarter it was recognized locally and nationally as a best workplace. Puget Sound Business Journal named them the #1 best workplace in Washington in the Extra-Large Company category. This is their 5^thyear on the list and second time as a #1 company. Next, Evergreen was named to the Seattle Business Magazine Washington’s100 Best Companies to Work For (Large Company) list. And most recently, Fortune and Great Place to Work recognized it as the #1 Best Workplace for Women. The company is humbled by the recognition and proud of associates for bringing the WOW and FUN every day. Looking for a great place to advance your career? Check out the Careers page or contact Chuck Iverson. Great Place to Work and Best Workplaces for Women are trademarks of Great Place to Work Institute Inc.

Are you tired of feeling like you are leaving money on the table when you’re trying to build a sustainable work/life balance? Do you feel like you’re wasting your time on inefficient processes, menial tasks, and out-of-date practices? What you need is a next-generation mortgage lender to bring your work and your day-to-day into the present, with an eye on an ever-evolving and ever-improving future. Wyndham Capital Mortgage, a leading digital home lending company and Fintech Mortgage Lender, is excited to announce the launch of the new and improved JoinWyndham.com! This will be the one-stop-shop to learn about the benefits of becoming a Fintech Mortgage Lender loan officer, with in-depth information, video testimonials, relevant statistics and more. Wyndham Capital empowers our loan officers by allowing them to focus on achieving the success they crave without sacrificing the work/life balance they want. Find out more at JoinWyndham.com.

AHP Servicing announced the appointment of Tim Gillis as President of the company, bringing 25 years of lending and servicing experience to “the country’s only crowd-funded residential loan servicer.”

Sagent announced Uday Devalla is its new CTO and will “will drive Sagent’s vision to accelerate the consumer-first modernization of mortgage servicing by improving loan servicing engagement and consumer experience from the homeowner perspective.”

Lender products & services

In the next few weeks, two well-known subservicers will be opening their virtual doors to Subsequent QC, MQMR’s servicing-focused sister firm and singing, “Be our guest, be our guest, put our service to the test.” While “beef ragout, cheese souffle, pie and pudding en flambe” will not be served, SQC will be sampling favorites from the annual subservicer oversight menu, such as the review of written policies and procedures and meeting with the subservicer’s key servicing personnel, in addition to seasonal specials related to current and on-going procedures as a result of the COVID-19 pandemic. While on-site audits were postponed due to COVID, your subservicer’s compliance responsibilities were not. To learn more about subservicer audits or how you can get a seat at the table for SQC’s remaining 2020 reviews, contact [email protected].

Are your appraisals coming back on time? Many lenders have been frustrated at delays in valuations due to the high volume of refis the past few months. They’re also frequently annoyed at not being able to get ahold of the appraiser to find out what’s going on. If you’re sick and tired of poor communication and service, follow the lead of a lender in Virginia who says “Triserv is a breath of fresh air. My team and I immediately saw a change and a clear-cut winner – Triserv stood apart from the AMCs we used before. We get more than we could ever imagine from Triserv.” To find out more, go to www.triservllc.com/expect-more or contact us at [email protected]. Triserv is a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service.

How would it impact your mortgage business if you could do more loans at your current capacity? The old saying, “Time is Money” couldn’t be truer in the mortgage industry. Stop wasting time on phone calls from borrowers that you can’t help. Monster Lead Group are the experts at producing high return, high converting direct mail campaigns using Monster’s unique intelligent response marketing. Start answering more calls from borrowers that are ready to transact. Talk to us about launching a turnkey, “done for you” campaign and test us against your current marketing. Schedule a call right now.

Company-sponsored webinars and training

Carrington Mortgage Services, LLC (CMS), a leading wholesale lender and non-delegated correspondent sponsor has brought a comprehensive suite of Non-QM products to the marketplace. Carrington’s Prime Advantage, Flexible Advantage Plus, and Flexible Advantage products were developed to support borrowers that don’t fit Agency or QM standards and have FICOs as low as 550. The Carrington Investor Advantage (DCR) gives experienced and first-time investors a powerful financing tool. Guidelines and rates are on our Wholesale and Correspondent websites. Today at 11am PDT, Carrington is hosting a free webinar with Amy Marsh, “Launch Your Non-QM Business to New Heights,” that’ll show you how to originate and close more Non-QM loans. “At Carrington, we have been looking forward to the day the marketplace returned for non-agency products,” said Greg Austin, EVP, Mortgage Lending, for CMS, “and we know how important it is to ensure our product offerings are price-leading and right for both brokers and borrowers.”

You’ve got data for days, but do you have the tools or time to parse it into meaningful business insights? See for yourself how turnkey business intelligence (BI) transforms processes, productivity and profitability by witnessing a “day in the life” of AmCap Chief Analytics Officer Matt Stokes as powered by LBA Ware’s LimeGear BI platform. See how Matt utilizes LimeGear to clear roadblocks in his pipeline, manage sales force productivity and much more. Join this free webinar, hosted by The Mortgage Collaborative, at 2 pm ET tomorrow, September 24. 

 

Free webinar: Interested in finding out how implementing virtual closing and self-inspections solutions will help you prepare for the unexpected, deliver a great borrower experience (from the convenience of their homes) and help you close more loans… faster? Join ServiceLink’s upcoming webinar:  “Linking Technology and Today’s Borrowers: How You Can Provide the Closing Experience Your Consumers Expect,” being held Thursday, September 24 at 2 PM ET. See these technologies in action with product demos of our latest solutions. The webinar will demonstrate how you can contend with today’s remarkably high origination volume without sacrificing the customer experience. Learn how you can keep pace with your borrowers’ expectations and better prepare for volume fluctuations in this rapidly changing market by harnessing the power of user-friendly remote closing and borrower-inspection options. Register today.

GSE changes for lenders & investors to follow

Despite the continued decline in forbearance numbers to a five-month low (Ginnie Mae’s continues to increase, however), there is still forbearance risk, leading to potential warehouse risk. Lenders, already delivering directly to Freddie and Fannie rather than correspondent investors, will continue selling directly to the Agencies if the correspondent investors out there make a wrong move in terms of forbearance policy.

Brian Levy, author of the mortgage blog Levy’s Mortgage Musings, wrote in response to Monday’s note about the Agencies using indemnification/recourse to demand repurchase of loans that are 120 days past due as a result of forbearance. “Rob, The COVID related forbearance program was mandated by federal legislation and created a moral hazard as noted in some of my previous Mortgage Musings. For the GSEs to now demand repurchase for a forbearance delinquency is an unjustified transfer of the risk of forbearance back to the originator. As an attorney who negotiated and defended numerous repurchase claims coming from meltdown era, I would be inclined to strongly resist any effort to put forbearance induced delinquency risks back on an originator as contractually unwarranted and grossly unfair. I think the whole origination industry should want to vigorously push back against any effort by the GSEs to send forbearance induced risks back downstream.” (Levy also recently posted a new Musings on the CFPB’s QM proposal to use price in lieu of DTI with some observations about mask wearing and hearing loss. Attorney Levy can be reached here.)

The Federal Housing Finance Agency (FHFA) is requesting input on its Strategic Plan: Fiscal Years 2021-2024 (the Plan), which establishes new goals that are necessary for FHFA to fulfill its statutory duties, including responsibly ending the conservatorships of Fannie Mae and Freddie Mac (the Enterprises). Input on the Plan is due by October 5.

Earlier this month PIMCO (Pacific Investment Management Co) wrote to the Federal Housing Finance Agency, warning that plans to end government control of Fannie Mae and Freddie Mac could undermine US housing finance. Per PIMCO, the move could signal a weakening of federal guarantees of the firms’ securities, prompting some investors to shy away from holding them and encourage others to sell, leading to higher borrowing costs.

Fannie Mae’s DU validation service will discontinue validation of employment and income using manual verification reports. Lenders may continue to use third-party employment verification vendors to obtain income and employment information, in accordance with the requirements outlined in Section B3-3.1-02 of the Selling Guide. Lenders are encouraged to review information on underwriting and quality control best practices for identifying income and employment discrepancies.

Fannie Mae Selling Guide SEL 2020-05 update includes changes related to accessory dwelling units, the removal of references to refinanced or modified balloon loan policies, and clarifications regarding non-occupant borrowers.

Capital markets

Mortgage rates have been unusually stable for several weeks now. Sure there’s a little up and down movement, but nothing major. This is a good thing as no lender, or lock desk, or MLO, wants volatility. The latest U.S. economic data from August continues to be broadly positive, but the rate of improvement from the summer is clearly slowing. This raises the possibility that demand will level out causing both manufacturing and non-manufacturing industries to reduce capacity and turning furloughed employees into permanent layoffs. Not a good thing for your clients.

August’s retail sales increased 0.6 percent vs. 0.9 percent in July and were up 2.6 percent over the last twelve months. Given that consumer spending is the largest component of GDP, the market widely expects at least a partial rebound from the second quarter’s historic decline.

Housing starts fell 5.1 percent in August due to a plummet of 22.74 percent in multifamily starts. Meanwhile single family starts increased 4.1 percent to an annual rate near February’s as people look to leave crowded apartment living for more space. The Federal Reserve made no significant changes to monetary policy at its meeting last week and projected the Fed Funds rate would remain near zero until 2023. The Fed also reiterated its recent change in inflation targeting with a goal to see their broad measure of inflation rise above two percent so that it averages near two percent for a sustained period prior to raising rates.

Looking at bond markets yesterday, U.S. Treasuries rallied 1 bp across the curve and the UMBS30 basis closed mostly tighter due to a large amount of Fed support across three operations and a general rebound in risk tolerance after the equity selloff to open the week. Fed Chairman Powell and Treasury Secretary Mnuchin testified before the House Financial Services Committee. Chairman Powell told the Committee that the economy is improving but has a long way to go before fully recovering. Secretary Mnuchin said that the Treasury can’t offer additional assistance without action from Congress as employment and overall activity remain well below pre-virus levels.

Existing home sales increased 2.4 percent month-over-month in August to a seasonally adjusted annual rate of 6.00 million, the third consecutive month of positive sales gains. Total sales in August were up 10.5 percent from a year ago and the strongest since 2006 as demand for existing homes is very strong and certainly a bright spot for the economy. Unlike other parts of the economy, the housing market continues to experience a V-shaped recovery. The downside to that is that supply is constrained, 18 percent lower than 2019, and will push home prices higher the longer it remains that way.

Turning to today’s economic calendar, we have seen that mortgage applications increased 6.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 18. On tap are FHFA house prices for July and preliminary September Markit manufacturing and services PMIs. Markets will have to digest remarks from six Fed speakers: Cleveland’s Mester, Chair Powell, Chicago’s Evans, Boston’s Rosengren, Atlanta Bostic, and Fed Vice Chair Quarles. The Desk of the New York Fed will conduct three MBS FedTrade operations that will total up to $5.5 billion, starting with $1 billion UMBS15 1.5 percent and 2 percent followed by $2.9 billion UMBS30 2 percent and 2.5 percent and $1.7 billion GNII 2 percent and 2.5 percent. We begin the day with Agency MBS prices unchanged and the 10-year yielding .68 after closing yesterday at 0.66 percent: another snoozer of a day, rate-wise.

To be sure of hitting the target, shoot first and call whatever you hit the target. (Read that again; Chillingly reminiscent of investment bank residential loan-level underwriting guidelines thirteen years ago.)

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. 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 & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)

I know that plenty of folks at United Wholesale read this commentary, and the company is in the news about a merger that will take UWM public valuing it at $16 billion. Perhaps Bruce Springsteen reads this commentary, perhaps not, but he turns 71 today so Happy Birthday Boss! Out of curiosity, what does $500,000 buy, home-wise, in some of the cities and towns he has included in his songs, for the $1,700 monthly payment on a $400,000 loan (yes, I know a buyer doesn’t need to put 20 percent down!)? Let’s start with Lincoln, Nebraska, from “Nebraska”. (This place is nice too.) Let’s head out to California with a “bourgeois house in the Hollywood Hills from “57 Channels (and nothing on).” Across the nation, on the “Streets of Philadelphia”, this place is very stately, as is this one on Shunk Street. While you’re in that area, fix up your hair, head southeast, and meet me in “Atlantic City”: here’s a place on the water or if you don’t want to hassle with the yard, there’s this one. If you want to try your hand at mining, live in “Youngstown” in a nice house with great woodworking or one with a yard. A world away, he sang, “I know a pretty little place in Southern California down San Diego way” in “Rosalita”. (I saw them on this tour in 1980. That aside, I am glad that the real estate used a wide-angle lens.)

Jobs & promotions

“Caliber Home Loans is proud to announce that Ranjit Bhattacharjee has joined its leadership team as the EVP over Capital Markets and Treasury. In his role, Bhattacharjee is poised to take an accomplished team to the next level of growth and success. Bhattacharjee has a Ph.D. in Pure Mathematics from Boston University and a master’s in Mathematics from Technical University Aachen. He comes to Caliber from New Residential Investment Corp. where he focused on MSR Hedging, Secondary Markets, and customer data analytics and before that served in a number of senior leadership roles at CitiMortgage. Bhattacharjee has a deep and successful background in the mortgage industry. “We’re delighted to have Ranjit as a member of our team. His impressive skills will allow us to accelerate our success going forward”, remarked William Dellal, President of Caliber. Only a best-in-class mortgage lender attracts the finest talent. We’re hiring right now, so visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller respectively.

Three times the charm! Evergreen Home Loans is proud to announce that three times this quarter it was recognized locally and nationally as a best workplace. Puget Sound Business Journal named them the #1 best workplace in Washington in the Extra-Large Company category. This is their 5^thyear on the list and second time as a #1 company. Next, Evergreen was named to the Seattle Business Magazine Washington’s100 Best Companies to Work For (Large Company) list. And most recently, Fortune and Great Place to Work recognized it as the #1 Best Workplace for Women. The company is humbled by the recognition and proud of associates for bringing the WOW and FUN every day. Looking for a great place to advance your career? Check out the Careers page or contact Chuck Iverson. Great Place to Work and Best Workplaces for Women are trademarks of Great Place to Work Institute Inc.

Are you tired of feeling like you are leaving money on the table when you’re trying to build a sustainable work/life balance? Do you feel like you’re wasting your time on inefficient processes, menial tasks, and out-of-date practices? What you need is a next-generation mortgage lender to bring your work and your day-to-day into the present, with an eye on an ever-evolving and ever-improving future. Wyndham Capital Mortgage, a leading digital home lending company and Fintech Mortgage Lender, is excited to announce the launch of the new and improved JoinWyndham.com! This will be the one-stop-shop to learn about the benefits of becoming a Fintech Mortgage Lender loan officer, with in-depth information, video testimonials, relevant statistics and more. Wyndham Capital empowers our loan officers by allowing them to focus on achieving the success they crave without sacrificing the work/life balance they want. Find out more at JoinWyndham.com.

AHP Servicing announced the appointment of Tim Gillis as President of the company, bringing 25 years of lending and servicing experience to “the country’s only crowd-funded residential loan servicer.”

Sagent announced Uday Devalla is its new CTO and will “will drive Sagent’s vision to accelerate the consumer-first modernization of mortgage servicing by improving loan servicing engagement and consumer experience from the homeowner perspective.”

Lender products & services

In the next few weeks, two well-known subservicers will be opening their virtual doors to Subsequent QC, MQMR’s servicing-focused sister firm and singing, “Be our guest, be our guest, put our service to the test.” While “beef ragout, cheese souffle, pie and pudding en flambe” will not be served, SQC will be sampling favorites from the annual subservicer oversight menu, such as the review of written policies and procedures and meeting with the subservicer’s key servicing personnel, in addition to seasonal specials related to current and on-going procedures as a result of the COVID-19 pandemic. While on-site audits were postponed due to COVID, your subservicer’s compliance responsibilities were not. To learn more about subservicer audits or how you can get a seat at the table for SQC’s remaining 2020 reviews, contact [email protected].

Are your appraisals coming back on time? Many lenders have been frustrated at delays in valuations due to the high volume of refis the past few months. They’re also frequently annoyed at not being able to get ahold of the appraiser to find out what’s going on. If you’re sick and tired of poor communication and service, follow the lead of a lender in Virginia who says “Triserv is a breath of fresh air. My team and I immediately saw a change and a clear-cut winner – Triserv stood apart from the AMCs we used before. We get more than we could ever imagine from Triserv.” To find out more, go to www.triservllc.com/expect-more or contact us at [email protected]. Triserv is a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service.

How would it impact your mortgage business if you could do more loans at your current capacity? The old saying, “Time is Money” couldn’t be truer in the mortgage industry. Stop wasting time on phone calls from borrowers that you can’t help. Monster Lead Group are the experts at producing high return, high converting direct mail campaigns using Monster’s unique intelligent response marketing. Start answering more calls from borrowers that are ready to transact. Talk to us about launching a turnkey, “done for you” campaign and test us against your current marketing. Schedule a call right now.

Company-sponsored webinars and training

Carrington Mortgage Services, LLC (CMS), a leading wholesale lender and non-delegated correspondent sponsor has brought a comprehensive suite of Non-QM products to the marketplace. Carrington’s Prime Advantage, Flexible Advantage Plus, and Flexible Advantage products were developed to support borrowers that don’t fit Agency or QM standards and have FICOs as low as 550. The Carrington Investor Advantage (DCR) gives experienced and first-time investors a powerful financing tool. Guidelines and rates are on our Wholesale and Correspondent websites. Today at 11am PDT, Carrington is hosting a free webinar with Amy Marsh, “Launch Your Non-QM Business to New Heights,” that’ll show you how to originate and close more Non-QM loans. “At Carrington, we have been looking forward to the day the marketplace returned for non-agency products,” said Greg Austin, EVP, Mortgage Lending, for CMS, “and we know how important it is to ensure our product offerings are price-leading and right for both brokers and borrowers.”

You’ve got data for days, but do you have the tools or time to parse it into meaningful business insights? See for yourself how turnkey business intelligence (BI) transforms processes, productivity and profitability by witnessing a “day in the life” of AmCap Chief Analytics Officer Matt Stokes as powered by LBA Ware’s LimeGear BI platform. See how Matt utilizes LimeGear to clear roadblocks in his pipeline, manage sales force productivity and much more. Join this free webinar, hosted by The Mortgage Collaborative, at 2 pm ET tomorrow, September 24. 

 

Free webinar: Interested in finding out how implementing virtual closing and self-inspections solutions will help you prepare for the unexpected, deliver a great borrower experience (from the convenience of their homes) and help you close more loans… faster? Join ServiceLink’s upcoming webinar:  “Linking Technology and Today’s Borrowers: How You Can Provide the Closing Experience Your Consumers Expect,” being held Thursday, September 24 at 2 PM ET. See these technologies in action with product demos of our latest solutions. The webinar will demonstrate how you can contend with today’s remarkably high origination volume without sacrificing the customer experience. Learn how you can keep pace with your borrowers’ expectations and better prepare for volume fluctuations in this rapidly changing market by harnessing the power of user-friendly remote closing and borrower-inspection options. Register today.

GSE changes for lenders & investors to follow

Despite the continued decline in forbearance numbers to a five-month low (Ginnie Mae’s continues to increase, however), there is still forbearance risk, leading to potential warehouse risk. Lenders, already delivering directly to Freddie and Fannie rather than correspondent investors, will continue selling directly to the Agencies if the correspondent investors out there make a wrong move in terms of forbearance policy.

Brian Levy, author of the mortgage blog Levy’s Mortgage Musings, wrote in response to Monday’s note about the Agencies using indemnification/recourse to demand repurchase of loans that are 120 days past due as a result of forbearance. “Rob, The COVID related forbearance program was mandated by federal legislation and created a moral hazard as noted in some of my previous Mortgage Musings. For the GSEs to now demand repurchase for a forbearance delinquency is an unjustified transfer of the risk of forbearance back to the originator. As an attorney who negotiated and defended numerous repurchase claims coming from meltdown era, I would be inclined to strongly resist any effort to put forbearance induced delinquency risks back on an originator as contractually unwarranted and grossly unfair. I think the whole origination industry should want to vigorously push back against any effort by the GSEs to send forbearance induced risks back downstream.” (Levy also recently posted a new Musings on the CFPB’s QM proposal to use price in lieu of DTI with some observations about mask wearing and hearing loss. Attorney Levy can be reached here.)

The Federal Housing Finance Agency (FHFA) is requesting input on its Strategic Plan: Fiscal Years 2021-2024 (the Plan), which establishes new goals that are necessary for FHFA to fulfill its statutory duties, including responsibly ending the conservatorships of Fannie Mae and Freddie Mac (the Enterprises). Input on the Plan is due by October 5.

Earlier this month PIMCO (Pacific Investment Management Co) wrote to the Federal Housing Finance Agency, warning that plans to end government control of Fannie Mae and Freddie Mac could undermine US housing finance. Per PIMCO, the move could signal a weakening of federal guarantees of the firms’ securities, prompting some investors to shy away from holding them and encourage others to sell, leading to higher borrowing costs.

Fannie Mae’s DU validation service will discontinue validation of employment and income using manual verification reports. Lenders may continue to use third-party employment verification vendors to obtain income and employment information, in accordance with the requirements outlined in Section B3-3.1-02 of the Selling Guide. Lenders are encouraged to review information on underwriting and quality control best practices for identifying income and employment discrepancies.

Fannie Mae Selling Guide SEL 2020-05 update includes changes related to accessory dwelling units, the removal of references to refinanced or modified balloon loan policies, and clarifications regarding non-occupant borrowers.

Capital markets

Mortgage rates have been unusually stable for several weeks now. Sure there’s a little up and down movement, but nothing major. This is a good thing as no lender, or lock desk, or MLO, wants volatility. The latest U.S. economic data from August continues to be broadly positive, but the rate of improvement from the summer is clearly slowing. This raises the possibility that demand will level out causing both manufacturing and non-manufacturing industries to reduce capacity and turning furloughed employees into permanent layoffs. Not a good thing for your clients.

August’s retail sales increased 0.6 percent vs. 0.9 percent in July and were up 2.6 percent over the last twelve months. Given that consumer spending is the largest component of GDP, the market widely expects at least a partial rebound from the second quarter’s historic decline.

Housing starts fell 5.1 percent in August due to a plummet of 22.74 percent in multifamily starts. Meanwhile single family starts increased 4.1 percent to an annual rate near February’s as people look to leave crowded apartment living for more space. The Federal Reserve made no significant changes to monetary policy at its meeting last week and projected the Fed Funds rate would remain near zero until 2023. The Fed also reiterated its recent change in inflation targeting with a goal to see their broad measure of inflation rise above two percent so that it averages near two percent for a sustained period prior to raising rates.

Looking at bond markets yesterday, U.S. Treasuries rallied 1 bp across the curve and the UMBS30 basis closed mostly tighter due to a large amount of Fed support across three operations and a general rebound in risk tolerance after the equity selloff to open the week. Fed Chairman Powell and Treasury Secretary Mnuchin testified before the House Financial Services Committee. Chairman Powell told the Committee that the economy is improving but has a long way to go before fully recovering. Secretary Mnuchin said that the Treasury can’t offer additional assistance without action from Congress as employment and overall activity remain well below pre-virus levels.

Existing home sales increased 2.4 percent month-over-month in August to a seasonally adjusted annual rate of 6.00 million, the third consecutive month of positive sales gains. Total sales in August were up 10.5 percent from a year ago and the strongest since 2006 as demand for existing homes is very strong and certainly a bright spot for the economy. Unlike other parts of the economy, the housing market continues to experience a V-shaped recovery. The downside to that is that supply is constrained, 18 percent lower than 2019, and will push home prices higher the longer it remains that way.

Turning to today’s economic calendar, we have seen that mortgage applications increased 6.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 18. On tap are FHFA house prices for July and preliminary September Markit manufacturing and services PMIs. Markets will have to digest remarks from six Fed speakers: Cleveland’s Mester, Chair Powell, Chicago’s Evans, Boston’s Rosengren, Atlanta Bostic, and Fed Vice Chair Quarles. The Desk of the New York Fed will conduct three MBS FedTrade operations that will total up to $5.5 billion, starting with $1 billion UMBS15 1.5 percent and 2 percent followed by $2.9 billion UMBS30 2 percent and 2.5 percent and $1.7 billion GNII 2 percent and 2.5 percent. We begin the day with Agency MBS prices unchanged and the 10-year yielding .68 after closing yesterday at 0.66 percent: another snoozer of a day, rate-wise.

To be sure of hitting the target, shoot first and call whatever you hit the target. (Read that again; Chillingly reminiscent of investment bank residential loan-level underwriting guidelines thirteen years ago.)

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, “The Agency Finance Fee: Delayed but not Forgotten.”

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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed for sophisticated mortgage professionals only. There are no paid endorsements by me. 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 & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)