Daily Mortgage News & Commentary

Apr. 7: Sales mgt., AE, MLO jobs; TPO loan products; social media, profitability products; MLOs helping financial literacy

Today is National Beer Day (beer humor below), which made last night Beer Day’s Eve. Here at the CMLA event the talk is not about all of the craft breweries in Denver, but instead a portion of the chatter in the hallways revolves around how lenders stack up on extensions and renegotiations. Compass/Black Knight has some stats for you. The talk also revolves around layoffs (including a new round from Better.com reported by the WSJ), and the stock prices of those companies that have “gone public” in the last few years. Whether it is Guild, UWM, Rocket, Finance of America, or loanDepot, some with distributed retail models, they are all near their all-time lows. Hopefully, no employees put all their retirement eggs in the one basket of their employer! The violent move higher in rates is a discussion topic, of course. Mortgage rates, usually based on a spread to Treasury securities, and with the talk of the Fed aggressively lightning its balance sheet (more in capital markets below) 30-year rates are suffering. And how ‘bout that flat yield curve? From maturities of 2-years out to 30-years, yields range from 2.48 percent to a high of 2.68 percent! (Today’s audio version of the commentary is available here and this week’s is sponsored by Optimal Blue, a division of Black Knight. Today’s has an interview with Mike Vough on how MSR valuation strategy is critical to the accuracy of the hedge model.)

Employment, personnel moves, & law firm wanted

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ClearEdge Lending, a wholesaler specializing in non-QM, continues to grow with a new role for an Executive Vice President of National Sales. “We are seeking a leader with at least 15+ years working in a Wholesale and Non-Delegated Correspondent channel. The position will report directly to the CEO and be responsible for managing our Regional Vice Presidents of Sales and 65+ External and Inside Account Executives nationwide. The main areas of focus will be on sales management, lead generation, recruiting, sales training, communications planning, tradeshow attendance and partnering with our Marketing team. As EVP you will be directly involved in the creation of annual business plans while leading the sales team to achieve its professional goals. View the full job description on our website, confidential questions should be directed to our CEO Steve Skolnik.”

AmeriSave Mortgage Corporation, one of the fastest-growing privately-held mortgage lenders in the nation, announced today the hiring of James Lyddon, Retail Regional Vice President – Central Midwest. Lyddon brings over 35 years of mortgage industry experience to his new role at AmeriSave. Previously, James worked at major financial institutions such as USA Mortgage, Bank 34, and more. “AmeriSave has a dynamic retail platform that provides massive growth opportunities for loan officers through best-in-class technology and AI. I saw this, along with the clear vision of the Traditional Retail Leadership team, as the reason I had to be a part of this amazing organization,” said Lyddon. “James is a true professional with a history of success in building retail branches” said Leif Boyd, Chief Production Officer, Retail Sales at AmeriSave. “We are excited to add a leader of James’ caliber to our team. Our organization will benefit greatly from James’ experience and we look forward to the growth he will bring to our Traditional Retail Division.” For more information, please contact Peter Schwartz 916-770-0053.

Now Hiring: Correspondent Regional Sales Executives nationwide! Reach New Heights in your Career by joining LoanStream Correspondent! We offer Delegated and Non-Delegated with a variety of unique and expansive Agency, Government and Non-QM program offerings. Work with the ONE lender that has earned a reputation for integrity and ingenuity that make us superior in the industry. Contact Eric Lenarz for more information.

A NY Title Insurance Agency who has been in business for over 16 years is looking to partner with a NY Real Estate Law Firm. Title Insurance can be a very lucrative business and the foreseeable future title insurance will be focused on purchases rather than refinance. Please reach out to Anjelica Nixt if you are interested, so we can discuss a plan.

PacRes Mortgage, formerly Pacific Residential Mortgage is excited to announce the hiring of David Boliard as Branch Manager of our new Citrus Heights, CA location. “I joined The Pac because of our shared commitment to improve our client’s lives through expert financial counsel, powerful mortgage banking, and the promise to get their client’s dreams approved daily,” said David. “Turns out that promise extends to entrepreneurs like myself that have the same dream for their family and their team.” If you want to build your entrepreneurial dream, join David and the uniqueness of a “national boutique” company that has all the resources of a large corporation without any of the corporate bureaucracy. Please contact Eric Wiley, CXO at 971-645-7087.

Huzzah to James Hedvall who is Doorway Home Loan’s Chief Capital Markets Officer.

Nick Pabarcus is the new EVP of Wholesale and Correspondent Lending at loanDepot. Congratulations!

And congratulations to FormFree’s latest hire, Joseph Stunzi, Head of Marketing, where he will be leading FormFree’s marketing strategy and building the marketing team in 2022.

Lender & broker products and services

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On this day in 2001, NASA launched the Mars Odyssey spacecraft. To this day, it maintains the record for the longest active spacecraft orbit around a planet other than Earth. Unlike launching the Odyssey, turning customer relationships into long-lasting financial friendships isn’t rocket science. However, it does require a shift in approach that prioritizes building trust and long-term borrower retention. With the average American taking up to 11 mortgage loans in their lifetime, there is a great opportunity for mortgage advisors and borrowers to build enduring relationships that benefit them both. Sales Boomerang shares the five best tactics that mortgage professionals can use to earn borrowers’ loyalty in its new eBook: “Be Your Borrowers’ Best Financial Friend.” Download the free eBook for borrower retention strategies that are out of this world!

Many credit unions fail to take the right steps to protect their margins from rate movement. As the industry endures a rising rate environment, it’s an especially important time for credit unions to examine their hedging approaches and implement risk management strategies. Optimal Blue Director of Solutions Specialists Mark Teteris, CMB, recently participated in a webinar with the American Credit Union Mortgage Association to discuss the financial risk credit unions face when issuing interest rate lock commitments. View the complimentary recording to learn about protecting rate sheets from the volatility of the secondary mortgage market.

Created for the financial industry, by the financial industry, ActiveComply is a cloud-based solution that collates social media for IMBs, banks, credit unions, & more. ActiveComply monitors profiles and post content 24/7 to ensure regulatory compliance and protect brand reputation, and is constantly adding new features like our new Translations Collections FolderWe could tell you all about how we save marketing and compliance departments time and money, but luckily for you, you don’t have to take our word for it – check out our episode of The Mortgage Collaborative’s “TMC Success Stories” with FirstBank Mortgage for more information. If you’re heading to MBA Tech 2022 next week, make sure to schedule a time to meet or stop by booth 714 to chat with the ActiveComply team.

The global bond rout has accelerated in recent weeks on concerns the Fed unwind may drain liquidity from the system, triggering higher borrowing costs and spikes in volatility. Sound concerning? Join MCT for an Industry Webinar on April 19th at 11AM PT titled Taper Tantrum Two? Comparing 2013 to 2022 & What Lenders Can Do. In this webinar, MCT’s Phil Rasori, Justin Grant, and Andrew Rhodes will compare 2013 to 2022 in terms of the deteriorating market, market liquidity in specific coupons, loan sale execution liquidity, and investor pricing performance. They will also provide actionable recommendations to protect your business and pipeline. Additionally, download the MCT whitepaper, The Links Between MBS Markets and Loan Prices that explores the relationship between consumer loan pricing and capital market conditions, addresses common misconceptions, and illustrates the processes involved in generating consumer loan offerings and intermediate loan prices.

TPO loan products

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Orion Lending is proud to announce the release of COIN – Cash-Flow Only Investor Loan! This business purpose investor loan offers DSCR DOWN TO ZERO, no disclosures or required wait periods, and state licensing not required in many states!! Orion offers industry leading STAR Portal technology for easy submissions! Oh and COIN is underwritten entirely in house with a 24-hour UW Purchase Commitment too! What’s not to love? To learn more about this out of this world investor program, please click here.

Lakeview Correspondent is announcing the addition of a Bank Statement Mortgage product, both 12 & 24 months, to our already robust Non-Agency suite of products, more commonly known as the SAIL Series. Deliver any of the loan products within the SAIL Series via Delegated or Non-Delegated underwriting. Contact your Sales Contact today for more information on how to get set up the way that best fits you and your Company’s needs. We are back at The Blue Fin in New York City, for the MBA Secondary conference, contact us to get on our schedule.

Would you like to drive more volume with your Correspondent channel? You have two upcoming opportunities to talk to Planet Home Lending about what we can do for your bottom line. Discuss our award-winning servicing, great pricing, and intelligently curated loan product options at the Great River MBA Conference, April 20-22, with Regional Sales Manager Jim Shaler (813-784-6237). Then join us at MBA’s Secondary and Capital Markets Conference and Expo, May 15-18, where SVP Jim Loving (414-270-0027) and more members of our team will be on hand to talk about putting Planet to work for you. We’ll be at the Intercontinental New York Times Square in the Union Square Park Meeting Room, ready for a 30-minute conversation that can boost your bottom line all year long.

MLOs: the frontline of financial literacy

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Huh? Your son or daughter doesn’t know how to write a check? Your spouse doesn’t know the difference between interest and dividends? Or those around you are barely saving enough? Loan officers can help their clients help themselves by providing advice and knowledge, and what better way to compete with internet lenders?

Along those lines, Kristin Messerli has some thoughts. “It may come as no surprise that Americans today are in poor financial health. By the end of last year, over one in five adult renters with children are still not caught up on rent. Pre-pandemic, half of Americans couldn’t cover a $400 emergency.

“Money problems are complex, but financial literacy is a deeply neglected topic in our country. While knowledge will not solve everything, it can have enormous impact. For example, one report found that almost half of the credit card costs paid in the US were “due to ignorance” of fee structures and compound interest.

“Young people, women, and diverse segments, experience the largest gaps in financial literacy, further compounding challenges in wealth-building and equality. In the most basic financial literacy quiz, only a quarter of Millennials could answer four out of five questions correctly. For nearly all homebuyers, education is a barrier. In our 2021 NextGen Homebuyer Report, we found that one in four homebuyers said their biggest challenge while buying a home was a lack of understanding. Unfortunately, two-thirds of them also said lenders were not trustworthy or reliable, so they said they went to Google, friends and family, and social media (in that order) for financial information.

“As an industry we can do more. To date, most consumers have relied on their parents to provide education and guidance on financial matters, but we know that parents are just as undereducated, and our financial situations are increasingly more complex. In addition, money is often ridden with taboo and trauma, making it just as uncomfortable for parents to talk about money as it is for them to educate their children about sex. And both are really poorly educated in our school systems.

A 2017 study found that only 23 percent of kids reported talking about money regularly with their parents. This lack of education translates directly to poor financial outcomes. For example, in our 2020 study of NextGen homebuyers, women reported lower confidence in financial decisions and were three times less likely to be investing. While we controlled for income, children, and socioeconomic status, the only statistically significant factor was childhood education.

“Last month, Florida became the latest state to mandate financial literacy education in high schools. Building on this momentum for change, I’ll be joining Dave Savage and Joe Puthur on an industry call-to-action next Tuesday, April 12th, to discuss strategies to educate our communities today and support mandated financial literacy education.

“Universal and accessible financial education may seem like a lofty goal and a long-term play, but our participation builds trust and growth opportunities with a meaningful segment in a growing purchase market.

Please share with me your financial education stories and experiences as we share examples to inspire every mortgage professional to be the best advisor they can be.”

Capital markets

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The release of the FOMC Minutes for March were always going to be the highlight of the day yesterday, and possibly the week. The Minutes were hawkish-minded, but without big surprises that would dictate even sharper selling in the Treasury market. The Fed signaled general agreement that it will reduce its massive bond holdings at a maximum pace of $95 billion a month ($60 billion for Treasury securities and about $35 billion for Agency MBS) with the caps phased in relatively quickly over a three-month period, or slightly longer if needed. There was also some agreement that “after balance sheet runoff was well under way, it will be appropriate to consider sales of agency MBS to enable suitable progress toward a longer-run SOMA portfolio composed primarily of Treasury securities.”

The balance sheet reduction will further tighten credit across the economy as the central bank raises interest rates to cool inflation. The Minutes also showed that “many” officials held the view that one or more 50-basis point rate hikes could be warranted. Money market traders are betting on a further 225-basis points of increases this year. With the Fed focused on tamping down inflation, likely inflicting more losses on stock and bond investors, Treasuries continued their selloff and mortgage rates continued to rise. The MBS basis ended the day wider with treasuries bear-steepening, amid fresh yield highs across the curve, with 2s/10s accounting for most of the curve steepening.

Weekly jobless claims led off today’s calendar (166k, -5k from a revised number; expected -5k). Later today brings remarks from Fed speakers (St. Louis Fed President Bullard, Chicago Fed President Evans, and New York Fed President Williams), Freddie Mac’s Primary Mortgage Market Survey, and February consumer credit. The Treasury will announce the details of the mini-Refunding consisting of 3s and reopened 10s and 30s for $46 billion, $34 billion and $20 billion to be auctioned this upcoming Monday through Wednesday. The Desk will conduct just one purchase operation which will target up to $1.5 billion UMBS30 3 percent through 4 percent. We begin Thursday with Agency MBS prices unchanged and the 10-year yielding 2.62 after closing yesterday at 2.61 percent.

From Michigan, Don C. writes about a recent text exchange with a buddy.

Me: “Joe, want to meet for 2-3 beers this afternoon?”

Joe: “Hell yeah dude, but there’s no hyphen in 23.”

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, “Lenders Continue to Pivot” about how lenders and MLOs continue to shift to a purchase-centric focus. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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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 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 2022 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.)