Apr. 30: Sales & Ops job; Merrimack Mortgage purchased; CFPB, NY, and Maryland target title companies – more regulators on the way?

I travel around a fair amount, spending time with lenders, Realtors, and TSA personnel. A major concern among the first two groups is whether or not real estate agents – especially those that only close a couple deals a year – are going to be ready for the TRID changes on August 1. NAR is indeed trying to educate through videos. And this video is a reminder about what is happening with the good ol’ HUD-1. Down a couple paragraphs is more information about TRID-mania. Are 30 day contracts a thing of the past?


On the jobs front, MB Financial Bank is currently seeking new Retail Branches and Loan Officers to fulfill opportunities in 45 states and who are interested in becoming part of a strong, nationally-chartered bank with a dedicated, customer service focus. “MB provides competitive compensation, quality benefits, internal training, marketing support, servicing portfolio leads, and generous tiered commission compensation plans to promote success and growth. Individuals who are looking to join a successful bank with a robust product offering, competitive pricing, and significant income potential” should contact Mark Mazzenga, Mortgage SVP and National Sales Manager. MB Financial Inc. is the Chicago-based holding company for MB Financial Bank, N.A., which has approximately $16 billion in assets and a 110-year history of building deep and lasting relationships with middle-market companies and individuals. Equal Housing Lender and Member FDIC. NMLS#401467


And MSA Recruiting has been retained by a national lender to assist in recruiting a VP of National TPO Operations for its wholesale/correspondent channel. The ideal candidate will have executive leadership experience in leading Operations in a multi-state environment and must have in-depth expertise in leading TPO Underwriting, Post Closing, Processing, (Account Managers) Broker Intake and Process Improvement.  The company has a strong national multi-channel footprint and an entrepreneurial culture.  This position will have from 50-75 direct and indirect reports. Headquarters is located in the Northeast, an aggressive compensation and relocation package is being offered. If you meet this criteria and want to explore this opportunity in greater detail, please forward your resume in confidence to Tami Coffey.


In other personnel news, a former senior counsel at the CFPB joining legal firm Venable in Washington. Richard Andrew Arculin, who helped implement numerous regulations at the Consumer Financial Protection Bureau, becomes counsel at Venable and a member of the firm’s financial regulatory practice. At the CFPB, Mr. Arculin helped draft regulations for the Real Estate Settlement Procedures Act, the Truth in Lending Act and the Equal Credit Opportunity Act under the Dodd-Frank’s mortgage rules.  He led a bureau-wide effort to support implementation of the TILA-RESPA Integrated Disclosures rule and regularly served as the agency’s expert on mortgage and consumer credit issues.


Speaking of TILA-RESPA and keeping abreast of changes…


Freedom Mortgage Corporation, First Funding, Arch MI and Morf Media, Inc. partner to show how TRID Training can grow partner business. On August 1 TRID rules will change the way Realtors, Lenders, Title Companies and any other Service Provider will operate.  “Learn how to train and educate your real estate industry partners on the new TILA-RESPA Integrated Disclosure rules.  Join us at one of these FREE May workshops: Carlsbad, CA Monday, 4th – Irvine, CA Tuesday, 5th _ Walnut Creek, CA Thursday, 7th and at the Silicon Valley CAMP Lenders Fair, San Jose, CA Friday, 8th.  All workshops will be led by industry educational trainer, Ginger Bell who will explain the highlights of the new rules and provide tips, tools and resources to help you understand the changes and gain valuable information to be become the expert in your field.”


And don’t forget the MBA’s “Legal Issues and Regulatory Compliance Conference” is May 3-6 in the home of the White Sox and Bears. Register now.


NAR is offering a Regulatory Issues Forum during the morning on Tuesday, May 12, Marriott Ballroom at the Marriott Wardman Park Hotel.


And if you are in the Carolinas on May 21, TRID will be the subject of another training session care of the Mortgage Bankers Association of the Carolinas.


And many are watching the Quicken set of lawsuits with great interest. “Hey, Rob.  Eileen O’Grady here.  I’m betting that lenders, especially Direct Endorsement lenders, who are watching the DOJ v. Quicken/Quicken v. DOJ lawsuits need some basic information regarding their own DE privileges and responsibilities, to know where they stand. So I have produced a free brief, 30 minute solo webinar – short and sweet – to help lenders understand some of the very important details behind this and the other DE lawsuits that have been filed by the DOJ.  I am not an attorney, nor do I play one on TV, but my company and I have experience in, and knowledge about, this FHA/HUD/DOJ issue.  We are experienced in FHA and DE lending, have had many FHA DE clients and projects, and have done a great deal of research on the basis of the DOJ claims. The free webinar, hosted by LoanScoreCard, will be next Thursday, May 7, from 10:30 – 11:00 AM EDT.  Lenders can register here.  Lending Operations Managers and Executives, DE Underwriters, FHA Insurance Managers and FHA Servicers are encouraged to register.


For various reasons including cost, efficiencies, geographic opportunities, and cultural fit, banks continue to speed date. Just in the last week we learned that United Community Bank ($7.5B, GA) will acquire The Palmetto Bank ($1.2B, SC) for $240.5mm in cash (30%) and stock (70%). Union First Market Bank ($7.3B, VA) said it plans to close 7 branches (about 5% of its network) following an in depth analysis of profitability and market opportunity. South State Bank ($7.8B, SC) said it will buy 12 branches in SC and 1 in GA from Bank of America. Yadkin Bank ($4.3B, NC) will close 6 branches as it seeks to optimize resources. In the land of fruits and nuts, Heritage Bank of Commerce ($1.6B, CA) will acquire Focus Business Bank ($391mm, CA) for $54.8mm in stock or roughly 1.7x tangible book.


And the same thing is happening, and will continue to happen, with non-depository lenders. HarborOne Bank announced that it will acquire Merrimack Mortgage Company, Inc. of Manchester, N.H. – a privately held home loan originator that averages more than $1 billion in annual business throughout New England.


For you legal eagles out there, today the New York Court of Appeals will hear arguments in the case, ACE Securities Corp et al. v. DB Structured Products Inc. At stake is whether the six-year statute of limitations will continue to preclude more credit crisis litigation, or whether New York law will be construed to permit fresh “putback” cases to be filed against the major banks for years to come. The Appeals Court will decide whether or not a lower court correctly ruled in a case involving a Deutsche Bank AG unit that the statute of limitations for putback cases begins to run on claims when the representation to repurchase was made, not when the alleged breach of the repurchase agreement occurred.  If the Appeals Court overturns the lower court’s December 2013 decision, banks and other financial firms could face more litigation over mortgage-backed securities. The result of these proceedings will set a precedent in RMBS lawsuits and heavily influence the development of a standardized rep & warrant framework.  The ruling will also dictate RMBS investor strategies for years to come.


Speaking of New York, Governor Andrew M. Cuomo announced new regulations to crack down on kickbacks and other improper expenditures (such as excessive meal and entertainment expenses) in the title insurance industry, which a Department of Financial Services investigation uncovered are “significantly inflating title insurance premiums for consumers.” These new regulations, together with broader reform measures, are expected to reduce title insurance closing costs by up to 20 percent for new home purchases and up to 60 percent for refinancing transactions. “New Yorkers should not have to foot the bill for outrageous or improper expenses made by title companies just to refinance or close on their home,” Governor Cuomo said.


Benjamin M. Lawsky, Superintendent of Financial Services, said, “Our investigation uncovered that title insurance companies paid for lavish meals and entertainment on the dime of consumers, which inflated premiums. These new reforms will help significantly reduce costs for homeowners by trimming the fat and making sure that New Yorkers get what they pay for in the title insurance industry.”


The regulation outlines categories of expenditures which, when provided as an inducement for title insurance business, are improper and violative of the New York Insurance Law. These expenditures include meals, entertainment, vacations and gifts that are provided to attorneys, real estate professionals, and others, who represent consumers and order title insurance on their behalf.


And we learned that the CFPB & Maryland AG brought an Enforcement Action against Genuine Title, LLC. The CFPB and the Maryland Attorney General brought an enforcement action against the Maryland-based title company and its executives, alleging they participated in a mortgage kickback scheme, trading cash and marketing services in exchange for referrals.

Supposedly officers Zukerberg and Glickstein developed and operated schemes to give loan officers marketing services and cash payments in exchange for referrals of title work.


Most LOs, and hopefully Realtors, know that kickback schemes violate the Real Estate Settlement Procedures Act, which prohibits giving a “fee, kickback, or thing of value” in exchange for a referral of business related to a real estate settlement service. In this case the bureau and Maryland allege that the defendants exchanged valuable marketing services for referrals: Genuine Title offered services, including purchasing, analyzing, and providing data on consumers, and creating letters with the loan officers’ contact information that the company printed, folded, stuffed into envelopes, and mailed, the CFPB said. In return, the loan officers would refer homebuyers to the company for closing services.


A modern aircraft carrier has 6,000 people on board in order to handle the +/- 100 pilots? It seems that the lending industry, by the time you add up the regulators, auditors and examiners, support staff, and management, is fast approaching that ratio with LOs as the pilots. And this article in the Wall Street Journal suggests that even more regulators are needed to police the non-bank lenders – like Stearns, Nationstar, Quicken, Stonegate…


“Is The Government Suing Banks Out Of The Mortgage Market?” Here’s another story in the WSJ by Joe Light worth a gander.


For economic news yesterday we had NAR’s Pending Home Sales Index – it increased 1.1% in March which was 11.1 percent above March 2014. NAR chief economist’s noted that “While contract activity being up convincingly compared to a year ago is certainly good news, the increased number of traditional buyers who appear to be replacing investors paying in cash is even better news. It indicates this year’s activity is being driven by more long-term homeowners.”


But we also had the Fed statement which came out pretty much “spot on” with what was expected. The most important message from the policy statement is that the FOMC continues to meander down the path toward normalization and expects to be in position to raise rates at some point in 2015. The Fed is in no rush. At the current juncture, the timing of the liftoff is still indeterminate and will depend upon continued improvement in the labor market and the inflation data.


Of great, but expected, interest was the news that the Fed will continue to reinvest principal payments and Treasuries as they mature. Merrill Lynch wrote, “We find a statistically significant effect of the Fed’s daily purchases in the conventional 30-year sector this year, especially on days US Treasuries rally and basis is under pressure. We believe these observations primarily reflect weaker market liquidity conditions and relative trading volumes. Year-to-date, the Fed’s influence has likely contributed at least half a point of value to MBS performance. Following the Fed should lead to a half tick outperformance per trade if investors buy on non-Fed and sell on Fed purchase days.”


The economic menu for today has a couple “Daily Specials.” Weekly Jobless Claims (-34k to 262k), Personal Income for March (expected lower on headline, it was unchanged), Personal Consumption (+.4%), while 9:45am Chicago PMI for April is also expected higher. We closed the 10-year around 2.03% and this morning after the initial news we’re at 2.05% with agency MBS prices worse nearly .125.



For those hoping for the usual humor or trivia this morning, there is none. Last night I flew from Southern to Northern California on the plane that had flown in from Las Vegas. On it was the flag-draped casket of an unmarried Serviceman who died overseas. (The U.S. military brings fallen service members back to the States and then rely on commercial airlines to take them home.) Everyone watched from the boarding area windows as the casket came down the conveyor. An honor guard of pall bearers was waiting on the tarmac, as was a detail of airport security standing at attention. As was the family – a mother and father the approximate age of many of the passengers.


It didn’t matter that we were late in boarding. Nothing else mattered. One could have heard a pin drop in the terminal aside from the sniffles and weeping heard from strangers as the pall bearers moved the casket to the gurney and the parents hugged the casket for several minutes before it was placed in the waiting hearse. Religious beliefs aside, it was such a sense of loss, and so tragic. One young man that won’t be married and raise a family, that won’t go jogging in the morning again, that won’t go on a picnic, that won’t roll his eyes at another corny knock-knock joke. I realize that this drama plays out many times around the country, but it was a reminder of those who serve, of what a family can lose, and of our priorities. It was the quietest plane ride I’d ever been on.





(Copyright 2015 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.)


Rob Chrisman