LenderNews by Rob Chrisman
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May 8: LO training, recruiting, JV, capital markets products; non-QM issuance; Freddie extending credit to non-banks?

May 8, 2018

Air travel is an interesting thing, and very safe by most metrics. Did you know that there are between 440,000 and 660,000 people in the air over the U.S. at any given time? (This morning one of those will be me as it is off to Dallas for the TXAMP luncheon tomorrow.) "Not available for tracking per request from the owner" says a flight-tracking website which shows where Amazon CEO Jeff Bezos’s private jet is in an attempt to figure out where Amazon’s second HQ will be.
 
Lender products, services, and training
 
REMN is partnering with Mortgage Educators and Compliance to offer two additional webinars for anyone looking to complete their NMLS CE requirements, at a price of 50 percent off the regular rate. Space is limited, and their previous CE webinar booked up extremely fast. Register here for the May 16 or June 5 events. REMN is always striving to provide new ways for its broker and banker customers to compete in a challenging lending environment. That’s why it is also providing a discount to anyone in the industry interested in investing in themselves and attending Ron Vaimburg’s Recruiting and Mastery Leadership Program. Use code REMNRL for $200 off the intensive two-day course designed specifically to help mortgage professionals build a team and cultivate top talent.
 
Resitrader reports that data security in loan trading is becoming a bigger topic of conversation among its clients. Resitrader’s clients want to talk about data security at the upcoming MBA Secondary event with an emphasis on managing NPI data needed for loan pricing. Data encryption and employee access privileges are becoming very important in the secondary market. Contact Doug Mayers to meet up in New York to learn more.
 
What if there was finally a way to eliminate the uncertainty and generate enough referrals to achieve the mortgage success you desire? “Learn to work smarter – not harder from Cindy Ertman, one of the industry’s Top 100 Loan Originators in the U.S. for over a decade. Cindy’s 90 Day Jumpstart to Mortgage Success program will help you learn in 90 days what has taken other Mortgage Loan Originators years to accomplish on their own. You’ll get access to proven sales scripts, marketing tools, and other lead-generation programs to accelerate your income and make a greater impact in your marketplace. 90 Day JumpStart kicks off in June 2018. To take advantage of a huge one-time only discount, sign up here now and get a FREE copy of Cindy’s ‘10 Hacks to 10X Your Mortgage Results’.”
 
In today’s purchase-driven market, every detail matters to grow your business, especially who you choose to partner with. Close your loans faster, build stronger long-term relationships and gain flexibility with pricing a loan through the new TMS Emerging Banker Program (Non-Delegated Correspondent). Register today to hear from industry veteran James Hooper, SVP of TMS Wholesale, on how partnering with TMS as an Emerging Banker will not only deliver the above list, but we’ll even purchase loans off warehouse lines in average of 3 days to help grow your business. As a top-ranked mortgage employer and one of the largest correspondent lenders in the U.S, we have more than 20 years of industry experience to help your business prosper. Register by emailing EB.training@themoneysource.com today for the webinar on May 10 at 1 EST. Don’t miss out since space is limited.
 
Proven. Profitable. Industry-Leading. Stearns Lending’s Joint Venture (JV) program has seen massive success and it’s not stopping any time soon. Houston-based joint venture, Gibraltar Mortgage Services, launched its strategic alliance in January of 2015 with Better Homes and Gardens Real Estate Gary Greene. Since joining, Gibraltar has become the leading originator inside the Gary Green franchise. The JV is supported with Stearns’ capital markets execution, compliance and investor relations. The program also offers either fulfillment backup to the existing team or complete fulfillment. It’s no surprise Gibraltar quickly climbed its way as a top mortgage lender in the greater Houston area. Together, Stearns and its JVs are creating a new standard in lending. Find out how Stearns Lending can give you a competitive edge in the changing financial service environment. For more information on partnering with Stearns Lending, contact EVP of Joint Ventures Steven Stein (469-470-5152). 
 
Ready to take on the Big Banks? A recent Mortgage Collaborative survey found that the most important overall issue for its members in 2018 is to find ways to compete with the largest lenders. HomeScout-HBM lead generation and conversion technologies helps create efficiencies for branch managers and loan officers to be competitive, by creating a single place where lenders, agents and buyers can come together to do business. HomeScout, a National MLS for lenders, provides a digital real estate marketplace featuring 100% MLS listing data, where lenders are exclusively branded to home buyers, alongside cooperative agents, prior to their point of sale. Do what the big guys can’t. Generate more production out of the talent you have without adding overhead and become a valuable lead source for your agents. For more information or to schedule a demo contact us HERE or give us a call at 952-831-0623.
 
“At Mr. Cooper Correspondent, we are making significant progress towards our 2018 goals, specifically our Product Roadmap. We are pleased to announce the expansion of our No FICO option to include Freddie Mac and FHA (FNMA No FICO was released earlier this year!). As a full-service investor, our intention is to give our clients the full spectrum of solutions to meet their origination needs. The No FICO option is an effective option for consumers, and especially first-time homebuyers. Those attending the MBA’s National Secondary Market Conference & Expo can contact your Mr. Cooper Account Executive and schedule a meeting to learn about the benefits of doing business with Mr. Cooper, our impressive service levels, and about upcoming developments including Manufactured Home Loans, Modified Construction-to-Perm Loan Notes, FHLMC HomeOne and Renovation Lending. Mr. Cooper is a premier Correspondent and Co-Issue investor and the largest non-bank servicer with a servicing portfolio exceeding $500B.”
 
If you’re considering non-agency lending, meet with correspondent investor Verus Mortgage Capital (VMC) in New York during the MBA National Secondary Conference May 20-23. This growing market is a tremendous opportunity for lenders but requires a committed partner who knows how to create programs that serve the non-agency market and apply common-sense lending guidelines. To schedule a meeting, email Jeff Schaefer, EVP – Correspondent Sales.
 
From Missouri comes news that Lead Bank has brought on Chris Bornheimer as its CFO. Lead Bank continues to grow and expand its platform working to become a leader in Fintech and the local Kansas City community.
 
And Better Mortgage announced that it has hired Howard Katzenberg as CFO. “He joins Better during a period of rapid growth, leveraging his experience to help Better meet increasing customer demand, which has grown 3x year over year as of Q1 2018, and building up its West Coast offices. (Better Mortgage is backed by Kleiner Perkins, Goldman Sachs, and Pinebrook.)
 
Freddie & Fannie news
 
Freddie Mac has quietly started extending credit to nonbanks that issue mortgages, a move it says will help the companies maintain access to a crucial stockpile of cash if their home loans go sour. But critics say the financing could create an unfair market advantage that allows preferred lenders to muscle out competitors. The new Freddie credit lines, which haven’t been publicly announced, are meant to support nonbanks’ mortgage-servicing operations. That’s the lucrative business of managing a home loan after it’s been issued.” This story in Bloomberg is sure to turn some heads. To extend credit to some non-bank servicers helps these servicers maintain access to credit cashflow from operations are challenged such as in the case of default. Names include Quicken, Caliber, AmeriHome, Matrix, UWM, and LoanDepot.
 
Fannie Mae Issued Selling Guide #2018-03 clarifying lender-sourced contributions to fund closing costs and prepaid fees. Lenders may take advantage of the change immediately. The key points of the announcement: A lender-sourced contribution may not be: Used to fund any portion of the down payment; Subject to repayment requirements or require financial obligation apart from the subject mortgage; or Passed to the lender from a third party. There is no limit to the amount the lender can provide, if the contribution does not exceed the amount of borrower-paid closing costs and prepaid fees. If the lender is an interested party to a purchase transaction as defined in the Fannie Mae Seller/Service Guide, Section B3-4.1-02, Interested Party Contributions, the interested party contribution (IPC) policy applies. The money must be in the form of a gift and cannot be subject to any sort of repayment requirement.
 
Freddie Mac announced the Home Possible RISE Awards– an annual program that recognizes top loan originators of the company’s affordable lending solutions to low- to moderate- income home buyers. The program recognizes customers, correspondent lenders and brokers, as well as the top originators within each organization who produce Home Possible® loans across various categories. The Home Possible RISE Awards program combines volume from Home Possible and Home Possible Advantage mortgage options. Lenders must be active Freddie Mac Seller/Servicers, and correspondent lenders and brokers must originate through those Seller/Servicers. For the inaugural awards, Freddie Mac reviews data from the prior year (2017), and awards the top organizations among several categories including, total volume, fastest growth, correspondent volume, broker volume, and education. Within each winning organization, the top individual originators will also be recognized. Winners will be announced next month.
 
Freddie Mac announced its “Targeted Affordable Housing Express” (TAH Express), a new offering designed to provide faster, simpler and cheaper financing for the preservation of smaller, affordable rental properties. TAH Express financing is now available in all markets, and is an extension of Freddie Mac Multifamily’s Targeted Affordable Housing platform, which generally finances properties that have units with rent restrictions. Through TAH Express, Borrowers benefit from a condensed prescreen process, simplified non-negotiable legal documents and a standardized underwriting process, resulting in lower transaction costs. TAH Express also offers a “step-down” prepayment option, which provides more flexibility in the prepayment of these smaller loans.
 
Capital markets
 
As the industry continues to move toward digital loan trading, it is important to recognize the demand for improved efficiency in loan sales. In a recent interview, Timothy Leyoub of Eustis Mortgage explains the before and after experience of working with the new Bid Auction Manager (BAM). Using automated bidding, commitment, and data writeback via a secure platform the case study shows a reduction in the loan sale process from 2-4 hours to 5-10 minutes. After implementing the new technology, they now solicit bids from their full investor set instead of just their top tier, because of the increased speed and convenience. Timothy explains how before BAM, collecting and analyzing the prices of all their investors would have taken all day long. Read his loan sales process case study to learn more about his time savings and improved pickup.
 
The $1.16bn ARRW 2018-1 (WAMCO) transaction priced, bringing issuance of non-QM RMBS YTD to $4 billion. The class A-1, A-2, and A-3 bonds were rated AAA (sf), AA (sf), and A (sf), and priced at IS+85bps, IS+110bps, and IS+130bps. Click here to view the full presale. Originators and servicers include AmWest Funding Corp., BofI Federal Bank, East West Bank, JMAC, Metro City Bank, and Sterling Bank and Trust.
 
Looking at the bond market, there isn’t much going on, so I won’t waste your time. (Rates were pretty much unchanged on Monday from Friday’s close.) The only schedules news was Consumer Credit. It expanded by $11.62 billion in March due to a decline in outstanding revolving credit for the second straight month, which reflects a propensity by consumers to pay down debt in a rising interest rate environment. That inclination helps explain why consumer spending growth was lackluster in the first quarter.
 
We have some second-tier numbers out: April NFIB Small Business Activity Index (very strong – record-setting optimism), Redbook Same-Store Sales Index for last week, job openings from JOLTS for March, and a $31 billion 3-year note auction. Tuesday starts with rates little changed from Monday’s close, and therefore little changed from Friday afternoon, and the 10-year is currently yielding 2.95%.
 
 
(Part 2 of 4 of whatever these are. And please, no PC-related comments – some of these aren’t.)

Relationships are a lot like algebra. Have you ever looked at your X and wondered Y?

America is a country which produces citizens who will cross the ocean to fight for democracy but won’t cross the street to vote.
You know that tingly little feeling you get when you like someone? That’s your common sense leaving your body.
Did you know that dolphins are so smart that within a few weeks of captivity, they can train people to stand on the very edge of the pool and throw fish to them?
I think my neighbor is stalking me as she’s been Googling my name on her computer. I saw it through my telescope last night.
Money talks …but all mine ever says is good-bye.
You’re not fat, you’re just… easier to see.
If you think nobody cares whether you’re alive, try missing a couple of payments.
 
 
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, “Amazon in the Mortgage Jungle.” 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 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)