July 13: Women and banking; latest deals; Saturday Spotlight: Optifunder’s new software

Some of you here in the mortgage industry are probably old enough to remember that until 1974 in the USA women were unable to open a bank account or acquire a line of credit without a man co-signing. The financial services industry was led by (usually white) men. So, eight women came together to turn everything around by opening their own Women’s Bank. Carol Green, Judi Wagner, LaRae Orullian, Gail Schoettler, Wendy Davis, Joy Burns, Beverly Martinez, and Edna Mosely founded the bank’s board by each pitching in $1,000. On July 14, 1978 The Women’s Bank opened for business. People stood in line down the street in downtown Denver to deposit their money. The first day’s deposits exceeded $1 million. Speaking of banks, the biggest U.S. bank stocks have been beating the broader market this year. But their rally got a brake-check yesterday from earnings results that underwhelmed investors. Wells Fargo sank 6 percent for its worst earnings-day drop in more than three years after a net interest income miss, Citigroup slumped nearly 2 percent on expenses even though its markets revenue beat expectations, and JPMorgan fell 1.2 percent after its results and steady guidance failed to impress.

Saturday Spotlight: OptiFunder Launches New Software for Warehouse Lenders

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Describe your company (when was it founded and why, what it does, recent growth and plans for near-term future growth).

 

OptiFunder, the pioneer of the Warehouse Management System (WMS), was founded in 2018 to bring optimization and automation to warehouse lending. An award-winning mortgage software company, OptiFunder has announced a revolutionary new software for warehouse lenders, called Greyhound by OptiFunder, featuring the same scalability, security, and automation from its flagship solution.

 

Over the last five years, OptiFunder has developed the most comprehensive warehouse management system for mortgage originators. With 40% of top IMB’s on OptiFunder’s roster, 1 in every 7 loans funded across IMBs go through the OptiFunder system. Built by a team of mortgage professionals, the OptiFunder software not only reduces risk, but the user-friendly system condenses hours of manual work into automated tasks. From funding through loan sale, OptiFunder has automated the entire process for many originators.

OptiFunder’s innovative solutions and remarkable growth earned it a top 100 spot on Inc5000’s Fasting Growing Private Companies in 2023. From 2020 – 2024, HousingWire has named OptiFunder a Tech100 Mortgage Winner, and in 2023 and 2024 OptiFunder was recognized as a Progress in Lending Innovations Winner.

 

Describe any new products or solutions and how they will bring positive change to the industry.

 

“We wanted to create a platform for warehouse lenders that would run independent of OptiFunder but leverage the same technology and incredible team,” said CEO Michael McFadden. “While Greyhound represents a new brand, the underlying software, configurability, and proven rules engine have already routed and funded nearly a million loans with over 70 warehouse lenders.”

 

Greyhound provides new options for warehouse lenders looking for alternatives to legacy solutions. With its security-first design, highly configurable workflow, seamless integrations, and unparalleled efficiency, Greyhound is an ideal fit for warehouse lenders looking to grow market share in today’s challenging environment. With effortless client onboarding, robust reporting, and simple loan ingestion from originators, warehouse lenders of all sizes can easily scale their business with minimal cost and complexity.

 

Tell us about your team (what types of volunteer work are employees encouraged to engage in, how does your company help elevate growth, how does your company maintain culture in a work-from-home environment?)

 

OptiFunder appreciates its highly experienced team of professionals with over 125 years of mortgage banking experience, offering generous flexibility for work/life balance and volunteer work. Being part of OptiFunder means being first to market with breakthrough solutions.

 

Things you are most proud of that don’t have to do with sales.

 

OptiFunder is most proud of its customers’ experiences and positive feedback with not only the software, but with the whole team. “We’re a technology company,” said McFadden, “but it’s the direct feedback I get around our people at OptiFunder that means the most to me.”

 

Is there anything else you’d like to share along these lines?

 

OptiFunder released a monthly newsletter reporting on warehouse lending trends, available the second Tuesday of every month. Sign up here for next release.

 

(For more information on having your firm’s extracurricular activities, employee growth, and your charitable side featured, contact Chrisman LLC’s Anjelica Nixt.)

Deals are always happening

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Fannie Mae announced that it has executed a new Credit Insurance Risk Transfer transaction (CIRT 2024-L3) transferring $337.2 million of mortgage credit risk to private insurers and reinsurers. The covered loan pool for CIRT 2024-L3 consists of approximately 24,000 single-family mortgage loans with an outstanding unpaid principal balance of approximately $8.2 billion. Additionally, the covered pool collateral has loan-to-value (LTV) ratios of 60.01 percent to 80.00 percent and was acquired between July 2023 and September 2023. The loans included in this transaction are fixed-rate, generally 30-year term, fully amortizing mortgages and were underwritten using rigorous credit standards and enhanced risk controls. With CIRT 2024-L3, which became effective May 1, 2024, Fannie Mae will retain risk for the first 170 basis points of loss on the $8.2 billion covered loan pool. If the $139.8 million retention layer is exhausted, 27 insurers and reinsurers will cover the next 410 basis points of loss on the pool, up to a maximum coverage of $337.2 million. Coverage for this deal is provided based upon actual losses for a term of 18 years. Since inception to date, Fannie Mae has acquired approximately $27.6 billion of insurance coverage on $921.6 billion of single-family loans through the CIRT program, measured at the time of issuance for both post-acquisition (bulk) and front-end transactions. As of March 30, 2024, approximately $1.33 trillion in outstanding UPB of loans in Fannie’s single-family conventional guaranty book of business were included in a reference pool for a credit risk transfer transaction.

 

Freddie Mac Multifamily announced that it will soon go to market with the issuance of $186 million in Social Bonds supporting 641 rental homes for individuals with intellectual and developmental disabilities across 26 states. The proceeds from these Social Bonds help address the significant shortage of community-based homes critical to the deinstitutionalization of care for individuals with disabilities. Under the company’s Social Bonds Framework, the proceeds of Freddie Mac’s Social Bonds are used to provide liquidity to social impact financial institutions for financing affordable housing or to finance multifamily properties originated by the Freddie Mac Multifamily Optigo® network that are affordable to an underserved population. This Social Bond structured transaction is a PC-REMIC, Series 2024-P016, issuance backed by a pool of six Multifamily Participation Certificates. Freddie Mac Multifamily has issued more than $7.2 billion in Social Bonds since 2020.

Vendor tidbits

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Lenders One Members can now make it easier for their borrowers to secure the homeowners insurance coverage they need with L1 Insurance. This new solution helps borrowers quickly get multiple competitive quotes for homeowners insurance in all 50 states, enabling your team to close loans faster and with less friction. L1 Insurance integrates seamlessly with your loan origination software to share borrower and property information with a team of licensed agents, who can quickly prepare an application for insurance. Plus, L1 Insurance works with over 40 carriers across 50 states to get your borrower access to competitively priced coverage no matter where they live. To learn more, reach out to Tricia Migliazzo or request a demo today.

 

 

Optimal Blue announced the release of Competitive Data License, a collection of key national mortgage pricing data that enables lenders to price products competitively, operate more profitably, and react swiftly to changing market conditions. Competitive Data License draws upon direct-source loan data from the Optimal Blue PPE, which is used to price and lock over 35% of loans in the United States. The data solution provides lenders with extensive insight into markups, loan-level price adjustments (LLPAs), servicing-released premiums (SRP), concessions, loan officer compensation, base price, and PAR rate. The offering’s data set allows for granular benchmarking at various levels – from organization-wide to individual loan officers – enabling lenders to identify areas for improvement, replicate successful strategies, and maintain a competitive edge.

 

Asurity® Announces Integration of Propel™ and RegCheck® with Wilqo™’s Production Optimization Platform, Charlie

 

Do consent orders need to be reported to HUD?

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Yes. HUD requires the timely notification of state sanctions. HUD’s Mortgagee Review Board took numerous administrative actions against mortgagees in recent years for a failure to notify HUD of state sanctions. Note, reporting is required even if the state sanction is publicly set forth on the NMLS Consumer Access website. The current version of the HUD’s Handbook 4000.1 indicates: A Mortgagee must submit a Notice of Material Event to FHA and provide relevant documentation if it or any officer, partner, director, principal, manager, supervisor, loan processor, loan underwriter, or loan originator employed or retained by the Mortgagee is subject to any Unresolved Findings or Sanctions. A Mortgagee must submit a Notice of Material Event to FHA of a change of status in any Unresolved Finding or Sanction previously reported. 4000.1.I.A.7.u.

Recent updates to the Handbook 4000.1, effective August 19, 2024, define Unresolved Findings and Sanctions as follows: Unresolved Finding = a material, adverse written finding, to include fair lending violations of the Fair Housing Act or Equal Credit Opportunity Act, contained in a lawsuit or report produced in connection with an investigation, audit, or review conducted by HUD, another federal, state, or local governmental agency, or by any other regulatory or oversight entity with jurisdiction over the Mortgagee or its officers, partners, directors, principals, managers, supervisors, loan processors, loan underwriters, or loan originators, that has not yet been resolved through final agency or judicial action. Sanction = any penalty, punitive, or restrictive measure taken either for a failure to comply with or an alleged failure to comply with a court order, federal, state, or local government law, rule, or regulation.

Ginnie Mae MBS portfolio growing

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Ginnie Mae’s mortgage-backed securities (MBS) portfolio outstanding grew to $2.60 trillion in June, including $36.7 billion of total MBS issuance, leading to $16.0 billion of net growth. June’s new MBS issuance supports the financing of more than 113,000 households, including more than 57,000 first-time homebuyers. Approximately 74 percent of the June MBS issuance reflects new mortgages that sup​​​port home purchases because refinance activity remained low due to higher interest rates. The June issuance includes $35.6 billion of Ginnie Mae II MBS and $1.1 billion of Ginnie Mae I MBS, including $944 million in loans for multifamily housing. For the 2024 calendar year to date, Ginnie Mae has supported the pooling and securitization of more than 306,000 first-time homebuyer loans. For more information on monthly MBS issuance, Unpaid Principal Balance (UPB), real estate mortgage investment conduit (REMIC) monthly issuance and global market analysis, visit Ginnie Mae Disclosure​.

Watch out for those hotel movies on the bill when checking out!

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 titled, “Catastrophe and Climate Risk Is Only Increasing”. 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 2024 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.)

 

Rob Chrisman