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Apr. 29, 2011: Uniform Mortgage Data news; borrowers obtaining IRS transcripts, Texas MBA; holidays overseas slow things down
Rob Chrisman
Do boom
and bust cycles in real estate only happen in the United States?
Of course not: http://www.freddiemac.com/news/blog/frank_nothaft/20110214_boom_bubble_and_bust_abroad.html?sms_ssemail&at_xt4d80bff51ecc9a4f%2C0
Here's a campaign hitting the public: Zillow
Mortgage Marketplace is giving out Lowe's gift cards to
borrowers who contact them for a quote between 4/28 and 5/4 and
the loan closes before 7/5. The cards are worth up to $1,000 for
SFH, primary residence, $250-417k, FICO greater than 720, LTV
less than 80%, in certain states. Here you go: http://www.zillow.com/blog/2011-04-28/zillow-mortgage-marketplace-testing-special-offer-program/?
Is it my imagination, or does the public's memory last only a
few weeks? Or is it just because the financial press is on to
the next shiny object? I mention this because I noticed the news
yesterday that the Japanese stock market index
(Nikkei) hits highest level since the earth quake.
Remember the earth quake in Japan, right? Heck, remember
hurricane-ravaged New Orleans, or the havoc wreaked by the
tsunami in Indonesia?
When you're hunkered down over that tall cool one this weekend
at the bocce ball tourney, ask the person standing next to you,
"In the first quarter of 2011, how many housing units are there
in the US?" The answer is 131 million. Of
those, about 86% are occupied, 57% by owners, 29% by renters,
and 14% (nearly 19 million units) are vacant. In this country
the home ownership rate is about 66%, down slightly from the
previous quarter and year. The Census Bureau reports that the
homeownership rates were highest for those householders ages 65
years and over (81%) and lowest for those under 35 years of age
(38%) - no surprise there. Lastly, the homeownership rate for
non-Hispanic Whites was highest at 74%, while “Black Alone
householders” was lowest at 45%.
http://www.census.gov/hhes/www/housing/hvs/qtr111/files/q111press.pdf
Yesterday I discussed hedging cost, and
received this from a grizzled industry vet: “Well you mention a
lot of pipeline management items in your hedge cost and
unfortunately that falls under the secondary guy. It is up to
him or her to track their pull through by broker, LO, and retail
office, establish the lock and renegotiation policies and
monitor these activities, and operational efficiencies of the
loan flow through the pipeline and upon delivery of the final
product. This part of the job is not glamorous, but extremely
important to remain profitable. Since it is under the secondary
marketing’s P&L, they have to make sure all the gears are in
sync to ensure profitability. Nice ‘pin cushion’ position!”
LO's know that borrowers can obtain their IRS Transcripts within
minutes, many times before they are available to lender.
They can just call 800-908-9946, press (1) for English (assuming
you're reading this), give their social security number when
prompted, and give the street numbers of their address on their
tax returns. The borrower should then listen to the automated
message and when it prompts to submit an order by pressing (1)
don't - the borrower should hit zero (0) until it brings them to
the operator. At that time the borrower can verbally request a
faxed copy of the years' transcripts needed, but remember that
the borrower will be asked personal questions for all people on
returns will be asked such as: what form they filed, address,
SSN’s, names, number of people on returns, whether it is a
business or personal fax, and so on - almost as much as standing
in line at the post office.
Although one conference in New York is fast approaching, there
is another one that is on many folks' radar screens: the Texas Mortgage Bankers Association Convention
(their 95th) May 22-25 in Austin. The marketing material notes,
"We have been fortunate to line up a level of speakers that
rivals any national event: David Stevens (transitioning from FHA
to the MBA), Barbara Desoer (President of Bank of America
Mortgage), Pat Sheehy (runs Chase's Correspondent and Rural
Housing groups), Vicki Bott (Deputy Assistant Secretary for
Single Family Housing at HUD), Mitch Kider (Chairman of Weiner
Brodsky Sidman Kider PC), Steve O’Connor (SVP, Government
Affairs at the MBA)," and so forth. Over 500 are expected to
attend this event in The Great State of Texas, and they promise
not to talk about seceding from the US during the conference: http://www.texasmba.org/convention/speakers.asp.
You'll be hearing a lot about this, but come September the days
of, "I'll fax you the appraisal" will be history. To illustrate,
Wells Fargo's correspondents recently received a
Newsflash with topics that included, "FHFA’s Uniform Mortgage
Data Program, GSE Required Uniform Appraisal Dataset, GSE
Uniform Collateral Data Portal, and GSE Uniform Loan Delivery
Dataset." "(Last year) FHFA announced that under its direction
Fannie Mae and Freddie Mac are working together to develop and
implement the Uniform Mortgage Data Program (UMDP)
to provide uniform appraisal and other Loan delivery data
standards, as well as a joint appraisal data delivery system for
conventional conforming Loans. UMDP is intended to drive quality
by collecting and evaluating standardized loan-level data from
lenders." Wells' goes on to address their specific updates
related to this program, but notes that the Uniform Appraisal
Dataset includes all required data points for a complete
appraisal report form and standardizes key appraisal data for a
subset of fields on the Fannie Mae and Freddie Mac uniform
residential appraisal report forms, and the GSE's will be
requiring appraisals to conform after 9/1.
In fact, Wells Fargo Funding will expect all conventional
conforming loans submitted for purchase to comply with the
effective Agency UAD requirements. Get used to it - sellers
across the nation will be expected to review and
update their internal processes and procedures to accommodate
the implementation of new GSE electronic appraisal data
requirements.
Speaking of which, business is springing up regarding the
Uniform Collateral Data Portal (UCDP) and Uniform Mortgage
Delivery Program (UMDP). For example, the Mercury
Network's support of MISMO formats provides Mortgage
Lenders, AMC's and your appraisers the ability to stay pace with
these GSE's requirements. a la mode is the company behind the
Mercury Network, the nation's premier vendor management platform
for Mortgage Lenders and AMC's to manage appraisals. The
Mercury Network allows your appraiser's to deliver you
appraisal's today in both a PDF and MISMO XML data format. And
no, this is not a paid announcement, but apparently they have
over 10,000 appraisals going through the Mercury Network daily.
For more information contact Marty
Richardson at martyrichardson@sbcglobal.net.
Who has been buying securities backed by mortgages?
Over the three week period ending on April 13, domestic bank
holdings of agency MBS have increased by $26 billion (from
$1,093bn to $1,119bn). This sharp rise occurred after bank
holdings of agency MBS remained nearly flat for about 3-4
months. In addition, a major portion of the recent spike in bank
holdings of agency MBS can be attributed to the purchases of
large banks instead of small banks (large bank holdings are up
$21.5bn over the three week period ending on 4/13). This is
unlike with the prior 3-4 months when agency MBS holdings of
small banks continued to increase while those of large banks
remained flat or even declined. It is also apparent that
domestic banks that were aggressively growing their Treasury
holdings (and agency debt) instead of agency MBS holdings in
2009 and 1H’10 are preferring agency MBS over Treasuries over
the past several months.
Things seem pretty slow out there, with a light day in Asia,
Europe wrapped up with the wedding holiday today and Bank Day
coming up on Monday, and the devastation in the South from the
tornadoes. 170 tornadoes through 6 states! (Japan’s markets were
closed today, and next Tuesday through Thursday as the Golden
Week holidays begin.)
Yesterday rates
improved as Initial Jobless Claims jumped 25K last week with
continuing claims posting a decrease. Pending Home Sales for
March came in much stronger than expected, possibly due to
buying ahead of the FHA MIP change. The 1st quarter
GDP printed worse than expectations at +1.8% (is the economy
slowing back down, or did it pick up in the first place?), and a
weak 7-yr auction. The 10-year note closed higher by 14+/32s
(3.314%) and rate-sheet MBS prices were better by about
.250-.375.
Today we have/had had
the Employment Cost Index, Personal Income & Spending, the
Chicago PMI, and a Michigan Sentiment number. Personal
income and spending both posted larger-than-expected gains in
March. After Exxon produced a 1Q profit of $10.7B earlier
this week, Chevron announced net income of $6.21B (last year's
first quarter: $4.55B) due to higher oil prices. Remember that
we have more news ahead of us, MBS prices are better by
about .125.
Special Terror Announcement:
The English are feeling the pinch in relation to recent
terrorist threats and have therefore raised their security level
from "Miffed" to "Peeved."
Soon, though, security levels may be raised yet again to
"Irritated" or even "A Bit Cross." The English have not been "A
Bit Cross" since the blitz in 1940 when tea supplies nearly ran
out. Terrorists have been re-categorized from "Tiresome" to "A
Bloody Nuisance." The last time the British issued a "Bloody
Nuisance" warning level was in 1588, when threatened by the
Spanish Armada.
The Scots have raised their threat level from "Pissed Off" to
"Let's get the B--stards." They don't have any other levels.
This is the reason they have been used on the front line of the
British army for the last 300 years.
The French government announced yesterday that it has raised its
terror alert level from "Run" to "Hide." The only two higher
levels in France are “Collaborate" and "Surrender." The rise was
precipitated by a recent fire that destroyed France’s white flag
factory, effectively paralyzing the country's military
capability.
Italy has increased the alert level from "Shout loudly and
excitedly" to "Elaborate Military Posturing." Two more levels
remain: "Ineffective Combat Operations" and "Change Sides."
The Germans have increased their alert state from "Disdainful
Arrogance" to "Dress in Uniform and Sing Marching Songs." They
also have two higher levels: "Invade a Neighbor" and "Lose."
Belgians, on the other hand, are all on holiday as usual; the
only threat they are worried about is NATO pulling out of
Brussels.
The Spanish are all excited to see their new submarines ready to
deploy. These beautifully designed subs have glass bottoms so
the new Spanish navy can get a really good look at the old
Spanish navy.
Australia, meanwhile, has raised its security level from “No
worries” to “She’ll be alright, Mate.” Three more escalation
levels remain: “Crikey!”; “I think we’ll need to cancel the
Barbie this weekend”; and “The Barbie is canceled."
“The Barbie is canceled” has never been reached.
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