As Floridians watch “Storm Porn,” as the weather channel is called, Tennessee is buzzing about this Nashville Realtor’s marketing. (Warning: Rated a solid R.) The rest of the nation is more interested in the economy, and how one of the highest rates in the world is our own overnight Fed Funds rate! Don’t forget the economist’s saying, “Either say what will happen or when something will happen, but never the two together.” Fannie Mae now forecasts full-year 2019 mortgage origination headline growth to be up slightly to 2.2 percent, despite a shortage of homes for sale and the escalating trade conflict. The Fannie Mae Economic and Strategic Research Group also expects two more quarter-point interest rate cuts by the Federal Reserve in 2019, one in September and another in December, based on strong consumer spending, a surge in government nondefense spending, slowing residential fixed investment, and a negative business investment due to increasing trade and geopolitical uncertainty. More in the capital markets section below.
Jobs & transitions
At Thrive Mortgage innovation in technology is so much more advanced than the rest. Introducing its eClosing platform in 2018, Thrive has led the charge in the industry regarding the use of Remote Online Notary services to close mortgage loans faster and easier. Thrive was recently highlighted in an industry publication by its partners at Notarize for Thrive’s commitment to leading this charge. Kelley Cooper Spencer, Closing & Funding Manager at Thrive, was a prominent feature of the eBook describing how Thrive has transformed the closing experience for all parties to the transaction. “eClosings provided unparalleled efficiencies in funding,” stated Spencer. Download the eBook to learn more. With so much technological advancement in recent months, having a lender like Thrive drive adoption only helps fuel the industry to be better. For MLOs who’d like to inquire about having leading-edge technology with a kind culture to Thrive, please visit join.thrivemortgage.com.
Pacific Residential Mortgage (PacRes), headquartered in Lake Oswego, Oregon is now approved in Montana and Illinois. PacRes will continue its expansion across the United States in the coming months, with new branch offices in the South East, Midwest, and the Mountain regions. PacRes is placing local fulfillment in every major market in the United States, so processing, underwriting and closing is placed in major market branch offices. As one of the best capitalized mortgage banks in the country, the origination model is built around no overlays (yes, really). New opportunities to run production for target markets, as a P&L or corporate branch, are available. For Regional Production Leaders, Branch Managers and Loan Officers, email Jenni Connor, National Business Development (828.238.8963) or write to JoinPacRes@pacresmortgage.com. And check out PacRes’ Ad for consumers and to learn more about how PacRes Approves Dreams Daily.
Congrats to Kat Cunningham who has joined Experian as a senior mortgage solutions strategist. Kat brings more than 30 years of mortgage industry experience, and will be responsible for articulating the needs of prospective and current clients, as well as understanding industry trends, the competitive landscape and distribution options to better inform Experian’s innovative solutions within the mortgage industry.
Lender products & services
Unsellable FHA loans. Three words that stop lenders in their tracks. Don’t give this fear any more power and take control of your FHA lending with these best practices from TMS. With Millennial homeownership demand about to skyrocket and low-down payment products being a very attractive option for them, these practical tips let you proactively manage your pipeline, so you can confidently capture the growing opportunity with FHA loans.
“Client for life: How LOs can supercharge their strategy! When thinking about how to build a client-for-life strategy, the first area you need to tackle is how to create a consistent drumbeat of content that offers insight and intelligence for your past borrowers to make smart financial decisions on their home. Give them personal, cognitive information they need to feel empowered and that has intrinsic value. If you find yourself becoming a victim of your own success, meaning when you scale up from 50 clients to 1,000, and you can’t find time to manage 1:1 relationships, your next move is to make it scale. Your marketing and technology strategy is KEY. With your cognitive value and a solid content strategy, you can grow. Homebot is purpose-built to help loan officers maintain long-term relationships with their customers by providing personalized wealth-building knowledge to your past clients. And we’re here to help ‘uplevel’ the industry, pushing past traditional marketing tactics and create intrinsic value for everyone.”
“DPA – Where do we go from here? Part 9 in Series: Of all the barriers keeping people from becoming homeowners, one seems most daunting of all: the down payment. A report by The Urban Institute notes that 2/3rds of renters cite “down payment” as a key obstacle. We must decide if supporting DPA is in the best interests of our industry and nation. Will DPA lead to riskier lending, as critics warn? Can it be provided responsibly? Can assistance be used to lift minorities out of intergenerational poverty, providing them the best chance possible of creating a better future? CBC Mortgage Agency is aware of concerns surrounding DPA. We take extraordinary steps – from underwriting restrictions to pre/post-purchase borrower education and loan performance monitoring – to ensure sound lending practices and acceptable performance. DPA, done responsibly, helps families escape the financial trap of perpetual renting and build stable, prosperous futures. That’s an outcome we should get behind.”
Thrive Mortgage recently announced an enhancement to their already impressive Construction Lending product line. Last week, Thrive launched a 95% LTV One-Time Close construction product, allowing those who are seeking to build their dream home the opportunity to get in for less money up front. “This is a game-changer for clients, Builders, and Realtors!” stated Mitzi Hutchens, Director of Interim Construction Operations. “Consumers have virtually the same opportunities now for building their dream home as the do for purchasing an existing home.”
Michael Jones, CFO for Thrive, also added, “Finding the best ways to serve our clients and give them as many convenient options as possible is what motivates us. We continually seek improve our operations and loan program offerings so that the consumer wins.” To learn more about this program, reach out to Thrive mortgage at email@example.com.
What is, by far, a broker’s biggest expense? It’s not marketing, payroll or leases. It’s fallout. Add up the lost revenue from the loans that don’t close every year, and the result is staggering. QLMS offers the exclusive “Fresh Start” program to its Pinnacle partners, to help more their clients qualify. Fresh Start consultants take credit scores that don’t qualify, and help improve them to a point where they do. On average, a successful Fresh Start client improves their credit score by 38 points! QLMS partners love the program. Alberto Vernacchio of Union Plus Mortgage said, “The Fresh Start program has allowed our clients to save via lower rates/payments, putting them in a better financial position and achieving the ultimate of American Dreams – home ownership.” This incredible service is free to QLMS Pinnacle partners. Click here to learn and earn.
When the BOOM of 2019 ends you are in danger of losing your top teams to someone promising them sustained volume. YOU need to be the one promising your team you will keep the river of deals flowing and you need to make sure those deals can actually convert. Protect your greatest asset (your database of current customers& your team of producers) with the #1 borrower retention system in the industry. The highest converting deals, the most profitable deals, and the most valuable deals are those deals that come from your database. You are 12X more likely to convert an existing customer than a new lead. If your competitors steal your deals today then they will steal your team tomorrow. Schedule a demo and protect what’s yours.
Tech and vendor news
Real estate tech startup Opendoor is announcing Opendoor Home Loans: “a new service that empowers home buyers with convenience, speed, and certainty throughout the entire financing process. Now, home buyers in Arizona and Texas can request financing directly from Opendoor Home Loans with just a few taps of a button in our mobile app. Over the past five years, Opendoor has been reimagining the home transaction and eliminating pain points for home buyers and sellers. Home financing has always been a natural next step in our vision of building an end-to-end experience that makes the entire moving process simple and hassle-free. That’s why we want to make financing just as simple and frictionless as we’ve made finding and selling a home.”
“It typically takes 45 days for buyers to finance and close on a new home. That’s 45 days of uncertainty, anxiety and stress that we can cut in half with Opendoor Home Loans. In the last 10 months, we’ve built a mortgage business from the ground up that combines savings, convenience and certainty into a simpler, more transparent process for buyers. It takes us one step closer to providing an end-to-end experience where you can buy, sell or trade-in a home in just a few clicks…We offer competitive interest rates, no lender fees, and for a limited time, up to $1,000 towards buyer closing costs… We close loans on the scheduled closing date, or we’ll credit the buyer $100 per day for every day delayed… Borrowers will be paired with a dedicated mortgage consultant who will provide guidance, updates and support at every step.”
Are you using digital to empower your borrowers? In his August MortgageSAT Tip, MortgageSAT Director Mike Seminari draws on data from the Digital Innovations section of STRATMOR’s 2019 Technology Insight Study to show how borrower-centric digital offerings, like online disclosures, can pay off for lenders. “One of our MortgageSAT customers implemented an online application in late 2018 and saw a 14-point jump in their Net Promoter Score (NPS).” Seminari says that while providing time and cost savings to lenders, digital capabilities benefit the borrower, too, by putting greater control of the loan process into the borrower’s hands. Mike suggests three steps lenders can take to put digital capabilities to work for themselves and the borrower in the August MortgageSAT Tip.
Most M&A talk centers on IMBs buying other IMBs, but the entire ecosystem is increasingly in play as current fintech, real estate, and broader economic cycles all mature this fall/winter. The lines between financial services, software, and media will all blur in the race to make consumers actually enjoy banking and real estate. Julian Hebron expects fintech companies, large and small, to make M&A moves, and whether merging beats fundraising. Here’s a preview of the fintech/real estate M&A tsunami rising into Fall 2019.
Recall that Churchill Mortgage announced a joint venture with American Home Title to create Churchill Title Solutions, a title company intended to streamline the origination process and create a secure mortgage experience for borrowers, real estate agents and lenders. Available to all lenders in every U.S. state, Churchill Title Solutions will provide borrowers the option of pursuing a digital mortgage, streamlining (or eliminating) some tedious processes associated with traditional title management, while expediting lenders’ time to close.
If you are interested in learning about Compliance and Risk Management Considerations in the Bid-Tape Process for whole loan trading, MCT is recommending a recent article with a comprehensive review from Regina Lowrie of RML Advisors.
Fannie’s research group believes that while consumer demand for housing remains strong, limited inventory, particularly on the affordable end, continues to hold back the single-family market. Despite strong homebuyer interest with mortgage rates nearing new lows, the limited availability of homes for sale continues to hamper growth. Consumers who are eligible to refinance are the biggest beneficiaries of the lower mortgage rate environment and that group is driving the improved projection for single-family origination volume in 2019.
Turning to the Treasury market, Beijing on Thursday indicated it wouldn’t immediately retaliate against the latest tariff increase announced by President Trump last week, who responded by saying the two nations are scheduled to have a conversation about trade, rallying U.S. stocks on the news. As a result of the news, U.S. Treasuries retreated, including the 10-year closing +5 bps to 1.52 percent. As far as economic releases went, the downward revision to 2.0 percent on the second estimate for Q2 GDP still contained the silver lining that consumer spending growth displayed the strongest growth since the Q4 2014. But markets still remain fully priced for a 25-bps rate cut at the Fed’s September 17-18 meeting. Finally, in Europe, soon-to-be ECB President Lagarde said the ECB had room to cut rates if needed, while Prime Minister Johnson steered the UK closer to an exit from the EU at the end of October.
With the bond market closing early many market participants are eyeing vacations or early exits today ahead of the long Labor Day weekend. But August closes with several important economic releases. We’ve just had personal income (+.1%, low) and consumption for July (+.6%, strong). Additionally, the core PCE price (1.6% y-o-y, as expected). Later this morning brings both Chicago PMI for August, and final University of Michigan consumer sentiment for August. We begin the day with agency MBS prices worse a few ticks and the 10-year yielding 1.53%.
The mortgage industry is consumed, for better or worse, with technology. Here is something really cool technology can do besides draw docs (Warning: you may want a tissue.)
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, “Mortgage Rates: Thinking the Unthinkable.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.
(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of 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 www.robchrisman.com. Copyright 2019 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.)