Apr. 9: Three big cyber risks and protective measures; vendor updates; Lock volume stats; Saturday Spotlight: Lender Price
Let’s say your daughter or son graduates from high school, doesn’t want to spend hundreds of thousands on college, and is deciding between becoming a carpenter, with a starting wage of about $53k per year, or a truck driver. How much can a Walmart trucker make in a year? Up to $110,000. Don’t worry about Walmart as that cost will be passed on to anyone who buys anything shipped by that trucker. Inflation is already everywhere, and portions either go up in price or become smaller. The Fed is reacting, and is set to sell off its portfolio of fixed-income securities, driving down prices of fixed-income securities and thus drive-up yields. When yields/rates go up, people and companies are less inclined to spend money. A house that makes sense at 3% may not make sense at 6%, building a new distribution center by borrowing money at 3% may not make sense at 6%. Borrowers are already reacting to higher rates. According to Curinos, March 2022 mortgage rate-lock volume was down 32% YoY and up 16% MoM across all channels, while funded volume decreased 48% YoY and increased 17% MoM. The average 30-year conforming retail funded rate in March was 3.96%, 33bps higher than February and 98bps higher than the same month last year. In general rates were 32bps higher MoM and 100bps higher YoY. Curinos sources a statistically significant data set directly from lenders to produce these benchmark figures, and drills into this data further here.
Saturday Spotlight: Lender Price
“Modernizing & Democratizing Pricing and Underwriting”
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)
Lender Price was founded in 2015 to tackle the labor-intensive activities and inefficiencies in the mortgage loan origination process. Since our inception, we have become the most accurate, robust, and dynamic mortgage product & pricing engine (PPE) in lending. With advanced business intelligence & analytics, Lender Price’s versatility allows over 200 correspondent lenders, banks, and credit unions to market and manage product pricing for all mortgage types (conforming, non-conforming, non-QM, and specialty loans). Built on a modern technology stack, Lender Price provides powerful performance and innovative features such as built-in compliance checks, capital market tools, margin management, lock desk and customized workflows with full mobile functionality. We have a number of exciting new product features that are rolling out in the coming months that we believe will further accelerate the digitization of the industry, improve the customer experience, and drive cost savings as lenders operate in this challenging environment.
Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why
Our employees are encouraged to seek out organizations that match their individual interests and make an impact on their local communities. Lender Price also supports many national organizations, but our main focus is doing what we can to give back to our local communities.
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?
Continuous learning is a key theme at Lender Price. Over the years, we’ve sent many employees to tradeshows, sales seminars, and national events to help enhance their personal, product, and industry knowledge. We continue to provide access to these options and encourage team members to get involved with various industry groups and local chapters.
Additionally, the Lender Price product team holds weekly training classes to help keep employees updated on product and feature enhancements. It provides a collective space to improve overall product knowledge across the company.
Most importantly, as Lender Price continues to scale, we understand the importance of building a culture around employee recognition. Recently, we implemented a new employee recognition program called “Kudos,” giving every team member at Lender Price a chance to express gratitude and motivate one another. Employees have a direct channel to be rewarded and recognized by their peers for going above and beyond.
Tell us how your company maintains its culture in a work-from-home environment, or how you plan on bringing employees back into the office, if applicable
Prior to the pandemic, our approach has always been finding the best talent regardless of physical location. Transitioning to a work-from-home environment was hard for many organizations, but it was really quite commonplace for us before the pandemic.
Things you are most proud of that don’t have to do with sales
We are extremely proud of equipping the lending community with innovative technology that is driving a much better experience for users and borrowers.
Our platform is helping lenders of all sizes compete and provide quality products that are priced accurately. Lender Price is the first modern pricing engine using natural language processing (NLP) and proprietary algorithms to automate the management of loan programs, margins, loan adjustments, and loan eligibility. We touch the entire loan manufacturing process including origination, underwriting, and capital markets. By analyzing a lender’s loan programs and adjusting prices automatically, Lender Price is empowering lenders to become leaner, more effective, and more profitable in this market.
Fun fact about Lender Price
In conjunction with our private equity partner Argentum, some of our investors include legendary movie star Kevin Costner, Rod Lake (Kevin’s business partner and founder of various enterprises that have achieved successful exits), mortgage pioneer Glenn Stearns, Regions Bank, and Mr. Cooper.
(For more information on having your firm’s extracurricular activities, employee growth, and your charitable side featured, contact Chrisman LLC’s Anjelica Nixt.)
Steve Brown with PCBB writes, “More than 30% of SMBs (small medium business) are at risk of cyberattacks, according to the cybersecurity firm, CyberCatch. Its January report found that hackers specifically target SMBs, due to the fact that their security measures tend to be less effective than those of larger organizations. Not only that, but with the current Russian cyber threats, experts say that larger targeted companies could affect smaller businesses that are connected to their platforms.
“Spoofing, sniffing, and clickjacking are the three biggest cyber risks for SMBs right now. While having anti-malware software in place is a good start, it isn’t necessarily enough. Given this reality, it is important for SMBs to know the differences between each of these tactics to be on the lookout for these cyber malfeasances.
“Spoofing is when cybercriminals mask their identities using phony IP addresses designed to appear like those of legitimate (usually well-known and recognizable) organizations in order to get the trust of an individual to click on a link or attachment. Once they click on the link or attachment, malware is installed on their device. According to CyberCatch, roughly a third of SMBs have fallen prey to spoofing attacks.
“Sniffing is the real-time interception of packets of data that pass through a network in order to capture sensitive information, such as passwords, credit card information, etc. Cyberthieves use programs and devices, known as sniffers, which can monitor everything from an organization or an individual’s email and web traffic to router configurations, FTP passwords, and DNS traffic. While there are legal uses for sniffers, such as FBI wiretaps and monitoring, criminals are looking for any unprotected and unencrypted information that they can exploit. The most common way that people fall victim to sniffing attacks is by using Wi-Fi networks that are unsecured.
“Clickjacking is when someone compromises the user interface (UI) on a legitimate website so that someone is clicking on something other than what appears on the screen. By hiding a different UI within or on top of a legitimate site’s normal UI, criminals are able to do things, such as install malware on an individual’s computer or steal credentials. In some cases, criminals will hide clickjacking so well by mimicking the expected result that an individual has no idea nothing is out of the ordinary. Clickjacking is possible on websites that use HTML frames that enable content to be displayed independently within a separate window.
“Small and mid-sized businesses can take protective measures. Identify your organization’s most valuable data and information and ensure that it is backed up somewhere separately, should a malware attack occur. Encrypt both outgoing and incoming communication using a virtual private network (VPN). Conduct internal IT network audits using device auditing or bandwidth monitoring. Regularly test all systems, from software to web applications and websites, and look for any anomalies.
“Patch any security weaknesses identified immediately. Limit administrator privileges. Require remote workers to use only secured Wi-Fi networks, particularly when working with sensitive customer data. Cybercriminals sometimes create phony public Wi-Fi connections that are unsecured, hoping that unsuspecting people will utilize them. Employ ethical hackers to help identify any weaknesses within your security measures. Maintain a recovery plan, if and when a cyber threat happens. This would include firming up entry points, changing system passwords, and accessing data from another location, among others.
“Cyber risks are ongoing, yet now there are new threats arising. So keep your SMBs safe by communicating the largest threats, along with ways they can protect themselves. This will help mitigate these rising threats.” Thank you, Steve!
Vendors do much more than capitalize letters in the middle of their names. Let’s take a random look at who’s doing what.
MISMO® announced the release of the updated Industry Loan Application Dataset (iLAD) for a 30-day public comment period. iLAD is a compendium of data points that are included in the Uniform Residential Loan Application (URLA), the Government Sponsored Enterprises’ (GSEs) Automated Underwriting System (AUS) interfaces, as well as the retired Fannie Mae 3.2 flat file. The 30-day public comment period for this dataset runs through April 29, 2022. The comment period is intended to afford workgroup participants who worked on the proposed iLAD 2.1.0 at least 30 days’ notice prior to final release to provide feedback and disclose any applicable Patent Rights (as defined by MISMO’s 2018 Intellectual Property Rights Policy). Disclosures and comments should be directed to firstname.lastname@example.org. MISMO also requests that organizations disclose in writing any patents and patent applications that might be infringed by an organization that uses or is compliant with iLAD.
AnnieMac Home Mortgage plans to rapidly expand its wholesale lending business over the next three years using Tavant’s VΞLOX FinXperience, an intuitive platform of point-of-sale experiences. Implementable across all lending channels, FinXperience will empower AnnieMac’s brokers with seamless digital lending experiences and the tools they need to be self-sufficient. VΞLOX is an AI-powered suite of digital lending products that uses automation and straight-through processing to configure immersive lending experiences that accelerate loan manufacturing and improve loan quality.
Total Expert has announced the launch of a new tool, Customer Intelligence, is fully integrated into the company’s all-in-one CRM and customer experience platform, alerts loan officers when a customer or contact completes an action that triggers personalized outreach. With this tool, loan officers have access to key insights about their contacts such as Mortgage Credit Inquiry Alert, Rate Alert, Equity Alert and Listing Insights. With refinance originations expected to drop 62% and total origination volume by 33%, through intelligent automation, loan officers and advisors can now receive recommended actions and pre-built workflows based on key customer insights, allowing them to easily engage and advise borrowers on the best loan product for their financial situation, such as using home equity to pay off higher interest rate debt or to pay for a college education.
Househappy just closed its B round of financing. Black Knight (BKI) and Fidelity (FNF) each took half. “Black Knight is integrating HouseHappy in its Servicing Digital platform and rolling out to its clients. The BKI relationship has resulted in PenFed, the 2nd largest credit union in the US, launching Househappy to its members. The FNF investment will secure Househappy’s place within their “In Here” transaction management system, resulting in closings through the FNF brands to come with the Househappy app and benefits. Our enterprise partners now have the ability to organically deliver insurance, security, cable, internet, appliance discounts and more through our platform and earn revenue from those purchases throughout the entire ownership cycle. The products/services offered can either be with their existing relationships or with ours.”
Clear Capital launched two products, Desktop Appraisal, a GSE-compliant 1004 Desktop/70D residential appraisal and Desktop Data Collection a certified, data collector-enabled property data gathering service designed to capture information, photos, and generate high-fidelity floor plans with interior walls and ANSI-aligned digital gross living area (GLA). In the last year, Clear Capital announced the innovation of ClearPhoto™, AI-driven rules built into ClearCollateral® Review, automating the review of property photos and ensuring they are aligned with the appraisal data and sketch. The company also announced ClearInsight™, an easy-to-use mobile app that enables real estate professionals, homeowners, and appraisers to quickly generate a complete digital picture of a home. Additionally, Clear Capital completed the acquisition of CubiCasa, a Finnish proptech startup that automates floor plan sketch creation and digitizes property data collection. For more on Clear Capital and its products and solutions, visit ClearCapital.com.
Guaranteed Rate Companies, announced that it has closed on its acquisition of Attorneys’ Title Guaranty Fund Inc. (ATG), a Chicago-based title insurance underwriter.
LoanLogics, a recognized leader in loan quality technology for mortgage manufacturing and loan acquisition, announced that the company’s LoanBeam® Transcripts product provides Freddie Mac with IRS tax transcript data that can be compared to the borrower’s tax return(s) data through Loan Product Advisor® Asset and Income Modeler (AIM) for self-employed, providing rep and warranty relief related to the accuracy and integrity of the tax return data used to calculate borrower qualifying income.
Clearview Federal Credit Union selected Sagent to power its mortgage servicing in a 7-year deal. Sagent, a fintech company modernizing mortgage and consumer loan servicing for America’s top banks and lenders, today announced a new, seven-year partnership with Clearview Federal Credit Union to power its member and enterprise experience as Clearview brings its mortgage servicing in-house.
An old Doberman starts chasing rabbits and before long, discovers that he’s lost. Wandering about, he notices a young lion heading rapidly in his direction with the intention of having lunch.
The old Doberman thinks, “Uh oh! I’m in deep trouble now!” Noticing some bones on the ground close by, he immediately settles down to chew on the bones with his back to the approaching cat.
Just as the lion is about to leap, the old Doberman exclaims loudly, “Boy, that was one delicious lion! I wonder if there are any more around here?”
Hearing this, the young lion halts his attack in mid-stride, a look of terror comes over him and he slinks away into the trees.
“Whew!” says the lion, “That was close! That old Doberman nearly had me!
Meanwhile, a squirrel who had been watching the whole scene from a nearby tree, figures he can put this knowledge to good use and trade it for protection from the lion. So, off he goes.
The squirrel soon catches up with the lion, spills the beans, and strikes a deal for himself with the lion. The young lion is furious at being made a fool of and says, “Here, squirrel, hop on my back and see what’s going to happen to that conniving canine!”
Now, the old Doberman sees the lion coming with the squirrel on his back and thinks, “What am I going to do now?” but instead of running, the dog sits down with his back to his attackers, pretending he hasn’t seen them yet.
Just when they get close enough to hear, the old Doberman says, “Where’s that squirrel? I sent him off an hour ago to bring me another lion!”
Moral of This Story
Don’t mess with the old dogs. Age and skill will always overcome youth and treachery! BS and brilliance only come with age and experience.
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).
(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.)