Aug. 18: Broker product, companies expanding; appraisal news; lock process changes; HARP, CRT, & the capital markets

Brad Pitt – a wannabe architect? In 2007, Pitt founded the Make It Right Foundation to build homes for families whose original residences had been washed away in Hurricane Katrina. Here’s one – the “Tiny House” – very cool. Mr. Pitt’s accountants know a thing or two about dealing with the IRS (yes, I know, a weak segue), and for anyone in lending working with 4506-Ts know that the IRS is conducting maintenance beginning last night until 6AM ET on 8/21. During this time, 4506-T services will be unavailable. You are still able to submit orders during the maintenance period and all requests received during that time will be submitted to the IRS once their system is back up.

Products, jobs, promotions

Brokers should know that Royal Pacific Funding has announced that management has expanded their product offering through their new Choice Product line up which is designed for borrowers that just miss Agency and Jumbo guidelines. With loan amounts as high as $3,000,000, LTV’s as high has 90% and Credit Scores as low as 580, brokers are sure to find a program to help a wider variety of borrowers that cannot qualify for conventional, government or jumbo loans. The new products also allow for 1 day seasoning from major credit events such as BK, foreclosure and short sale / deed in lieu. Not all the terms above can be combined but brokers will be surprised at the liberal offering. Please contact your AE today for more information or contact Royal Pacific Funding directly at if you don’t have an AE yet.

“Here they grow again! American Pacific Mortgage is happy to announce a new branch partner: California’s Santa Cruz Home Finance, an independent mortgage bank, (many from the group have been together since 1989), has joined the growing group of DBA branches with APM. Mary Ann Kirch remarked, ‘Santa Cruz Home Finance was created with a vision of creating a company with a tightly knit group of caring professionals. We partnered with APM because we share the common value of building value-based relationships. APM’s huge, diverse platform of investors and cutting-edge technology allows our team to originate more volume, while providing great customer service.’ EVP of National Production Michael Pankow states American Pacific Mortgage is honored to have Mary Ann Kirch and the rest of the team join its growing and thriving organization! While others are still building up their infrastructure, APM’s highly-seasoned leadership team is getting after it and growing. If you would like to learn why over 300 originators so far this year have made the decision to join our established, strategic and strong company, reach out to Peter Schwartz (916-770-0053), or Dustin Block (303-378-3166), APM’s Directors of Business Development.”

The leadership hiring spree continues at Movement Mortgage as financial exec Jared Ward becomes the latest to accept a post. Ward is Movement’s new Regional Director in the Pacific Southwest, overseeing Arizona, New Mexico, and Alaska. So far, this year Movement has added 5 new Regional Directors. Ex-U.S. Bank and Caliber exec Greg Sayegh now leads Movement in Southern California, and former Guild and Wells Fargo leader Mike Ferreira now runs Northern California for Movement. Mark McGoldrick, formerly Head of Sales at Weichert Financial, was hired as Movement’s Regional Director for the Midwest this summer. And longtime Movement Market Leader Steve Barker was elevated to Regional Director in the Mid-Atlantic. Former Wells Fargo exec Quentin Hardy also joined Movement to lead business development in New York and Long Island. Cherry on top: Movement made the Inc. 5000 list for the fifth time this week.

Congrats to Stacey Goodman who will join Freddie Mac as EVP and chief information officer (CIO) in late September. “Goodman will lead the Information Technology (IT) division and provide corporatewide leadership for all the company’s technology activities. Goodman will be a member of the senior operating committee and will report directly to CEO Donald H. Layton.”

Dart Appraisal announced the promotion of Tracey Volltrauer from Director of Compliance to VP of Compliance and Process Control. Ms. Volltrauer will focus on “compliance efforts for both state and federal regulations, as well as on fulfilling Dart Appraisal’s own compliance strategy. She will also oversee the company’s document and policy management process, and serve as the liaison between state regulators and Dart Appraisal.”

Congratulations to Marcello Mastioni whom Altisource has appointed to the newly created position of President, Real Estate Marketplace responsible for driving growth by focusing on digital experience and strategy across Altisource’s consumer- and investor-focused marketplaces including, an innovative real estate brokerage, and Hubzu, a leading real estate auction platform. Mr. Mastioni will join Altisource’s executive team in the company’s Luxembourg headquarters.

Lock desk news and trends?

A while back I heard someone joke about, “The lock desk monster,” and no, they weren’t in Scotland. Good lock desk employees are some of the most valued staff of any lender. They often serve as a liaison between the primary markets (loan officers) and secondary markets. They must be familiar with pricing, programs, personnel, policies and procedures. Many absorb LO tirades, and do their best to help. Unsung heroes.

Effective Monday, August 28, 2017, the following updates will be made to Flagstar’s rate sheets: The Price Indication Sheets page will be updated so that the user can select to view the current rate sheet or a previous rate sheet. This updated page will allow Flagstar to start archiving each rate sheet as of August 28, 2017. Rate sheets from August 28, 2017 and going forward will start being available from the Previous Rate Sheet section.

Mortgage Solutions Financial changed its Lock Desk hours for the last five business days of the month. The lock desk will be open between 9:00 am and 7:00 pm MT Monday through Friday, excluding federal holidays. These extended hours will only apply for the last five business days of the month. Normal hours will resume on the first of the month.

Pacific Union Financial added a new 75-day lock term on Monday, July 24. The cost for this new 75-day lock term will be the same as the 30-day price – .50.

Things get complicated with the big banks that have correspondent divisions. For example, Chase offers a variety of programs, and lock desk employees must be familiar with them.

Over at SunTrust, the same thing: here’s an 11-page document on lock policy. Memorize it as there’ll be a test in the morning…

Lender related appraisal changes? Yup.

Fifth Third Correspondent no longer requires the appraisal for a subject property with space heaters to have at least 2 comparables with space heaters to support marketability for all Agency and Jumbo products. Space heaters must still be permanently attached, properly vented, adequate to heat dwelling and typical for the area. Also noted, grandfathered flood insurance or flood insurance transferred from the seller to the buyer is acceptable provided flood insurance requirements are met for all Products.

Appraisals? Home equity lenders are using AVMs on lower risk home equity loans to control costs.  Many are promoting no fee loan programs, so inexpensive property valuation solutions are attractive.  Lenders have a healthy skepticism of automated valuation solutions and they want a valuation product that includes the same elements of an appraisal report, including supporting comparable sales data and neighborhood maps. In walks The Value Report thanks to Independent Settlement Services and HouseCanary. The Value Report lists recent and historical similar sales, active listings and other drivers of home value complete with informative graphs and maps. Read the full story fresh off the wire.

Wells Fargo Funding’s systems have been updated to no longer charge the automated collateral evaluation (ACE) fee, effective for Loans purchased on and after August 14, 2017. For these Loans, post-fund adjustments to refund the ACE fee will no longer be required.

Effective for all appraisal orders created on or after August 15, 2017, NewLeaf revised its Appraisal Fee Sheet. The new fee sheet published under the Job Aids link in the Resources section on the NewLeaf Wholesale Website.

Mortgage Works AMC will be adding an additional $200 onto the base appraisal fees for properties located in the counties below. This will ensure that Mortgage Works is able to offer a more competitive turn time and service level in these areas. Please its updated Appraisal Fees posted on its website under the “Fees” Section. All fee services have been updated to reflect this change in BOLT.

Mortgage Works AMC is now adding an additional $100 onto the base appraisal fees for properties located in the following counties: Alameda, Calaveras, Contra Costa, Kern, Lake, Marin, Napa, San Francisco, Santa Clara, San Mateo, Solano and Sonoma. View MWF’s updated Appraisal Fees, link, also posted on its website under the “Fees” Section.

Valuation Management is co-hosting a webinar with Fannie Mae on August 23 at 11 AM EST. This webinar will be presented in efforts for appraisers to gain a better understanding of Fannie Mae’s mission, to dispel common appraisal myths, and to improve communication.

Get the latest updates with Arch MI’s convenient webinars, online sessions on key topics like appraisals, processing, underwriting fundamentals, mortgage fraud and more. Register for any of the complimentary September sessions which include Analyzing Appraisals: Identifying the Key Areas of the Uniform Residential Appraisal Report.

Capital markets

Remember good ol’ HARP? It has been through three iterations, and now, via the FHFA, Fannie Mae and Freddie Mac will extend more credit to underwater borrowers next year by refinancing higher-risk home loans through a new program. The Federal Housing Finance Agency (FHFA) announced that they modified Freddie Mac and Fannie Mae’s streamlined refinance program for borrowers with high loan-to-value ratios by setting eligibility for loans originated on or after October 1, 2017. The agency says the goal of this modification is to, “help preserve credit loss protection on the loans without unwinding the protection paid for through CRT transactions.”

The second announcement was that the agency has extended the deadline for the Home Affordable Refinance Program (HARP) to December 31, 2018. This is the fourth time HARP has been extended. FHFA estimates that HARP could still help more than 143,000 homeowners refinance their home.

The “high” loan-to-value option, not expected to be available until late in 2018, will allow borrowers to refinance loans above the agencies’ prior 95% standard LTV limit. Loans inked under the program can be rolled into future credit risk transfer (CRT) bond deals. For borrowers to be eligible for the new program they must be current on their mortgage payments, use their homes as a primary residence, the refinancings also must reduce a borrower’s monthly payments, lower their interest rate, shorten an amortization term or put a borrower into a more stable product. To qualify for the new program, the loan also must be made on or after October 1, 2017. Thereafter, the loans can be bundled into CRT bond deals which help reduce taxpayer exposure to the large book of mortgages guaranteed by the two housing giants.

Most investors want higher rates of return. Unlike standard mortgage bonds issued either by Freddie and Fannie, CRT bonds do not come with government guarantees and thus have relatively high yields. But they’re liquid: Fannie has sold $27.3 billion of such notes since its Connecticut Avenue Securities CRT program began in 2013; Freddie’s Structured Agency Credit Risk program has issued $28.7 billion over the same period.

In terms of rates, no one is complaining about them. Is someone hoping they head lower due to our economy slowing, or because of an incident with North Korea? U.S. Treasuries ended Thursday with their yields just a couple basis points above last week’s lows. Back in November investors, expecting lots of growth and thus higher rates, are growing impatient with an administration that made lofty promises but has not made much headway on highly-anticipated items like tax or health insurance reform. Too many distractions.

Yesterday, after the early morning numbers, we had Industrial Production (+.2% in July, near expectations), capacity utilization (76.7%, unchanged), and the Conference Board’s Leading Economic Index increased 0.3% in July, as expected. We are reminded that the economy in the United States continues to motor along.

We start the last day of the week with rates versus last night’s close. Coming up is some minor preliminary Michigan Sentiment Index for August – hardly a big market mover. In the meantime, after a 2.19% close on the 10-year yield last night, it is currently hovering at 2.19% with MBS prices unchanged – hardly noticeable for borrowers.

An old cowboy walks into a barbershop in Kalispell, Montana for a shave and a haircut.

He tells the barber he can’t get all his whiskers off because his cheeks are wrinkled from age.

The barber gets a little wooden ball from a cup on the shelf and tells the old cowboy to put it inside his cheek to spread out the skin.

When he’s finished, the old cowboy tells the barber that was the cleanest shave he’d had in years, but he wanted to know what would have happened if he had accidentally swallowed the little ball.

The barber replied, “Just bring it back in a couple of days like everyone else does”.

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(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 Copyright 2017 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