I need to make a dart board for the wall behind me for Zoom calls that has “rates up” and “rates down” and “rates the same” on it. Until we see actual year-over-year inflation above 2 percent, the Federal Reserve will hold short-term rates near 0 percent. Any questions? The Fed believes it will take three years before employment returns to where it was a year ago. The pandemic has put us in a deep hole, let’s not underestimate that, and all parts of the economy are impacted. In many instances people adapt, right? The pandemic forced Oasis, a cabaret and nightclub whose drag shows were often packed, to close. Its owners had to furlough the whole staff. But then its owner had an idea. “If people couldn’t come to see drag, why not bring drag to the people?” Thus was born Meals on Heels. For about $100, a drag queen or king will deliver dinner, drinks, and a curbside performance. The idea had its ups and downs. “I was definitely performing on driveways that were at a 45-degree angle,” said Amoura Teese, a drag performer whose given name is Ryan Maldonado. Can you pay $150 not to have them show up?

Jobs

Don’t you want to spend more time on an island tropical paradise? There is a unique opportunity for an experienced Correspondent Operations Manager to join a well-capitalized start-up on the ground floor. “Join our team of industry veterans for this exciting journey, as we build a best-in-class company from the ground up! Must be able to work from the USVIs at least 50% of the time; relocation & housing to be discussed.” Interested parties may send their confidential resume to Chrisman LLC’s Anjelica Nixt for forwarding.

“Caliber Home Loans is excited to let you know about its new podcast called “The Home Connection.” The topics we cover will have a strong appeal to homeowners, realtors, and mortgage professionals, and it’s right for everyone in between, too. Our first two episodes are live. In the first, Andrew Berman of American Business Media gives his insight on how COVID-19 positively impacted the trade show industry. In our second, Caliber’s Stacey Gross will share her expertise on why it’s a good time to buy a home. Our podcast promises to be enlightening and informative. Subscribe and tune in every other Monday on Apple, Google, or Spotify. Caliber Home Loans is an innovative company, and we’re hiring right now. Visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller respectively.”

 

A seasoned mortgage banking CFO with a proven track record is searching for a new home with a dynamic and growing mortgage bank. Areas of leadership and expertise include capital markets, agency and investor relationships, hedging, servicing, loan sales and delivery, warehouse financing, human resources, compliance, and operations. If you are in need of a passionate financial leader with direct experience in all aspects of mortgage banking please send confidential inquiries to Anjelica Nixt.

 

“The Citizens Bank Home Mortgage business is breaking records across the industry this year, and we’re looking for professionals who are ready to join a winning team! Here’s a snapshot of our most recent successes. Our Retail Lending channel just reached its third consecutive month of record-breaking purchase business, helping close to 3,500 families with their home purchases. Our Correspondent Lending channel climbed two spots in the IMF rankings to become a Top-10 channel nationally; volume increased 54% from Q1 to Q2, the second largest increase of any other top-25 investor. And our Wholesale Lending channel ended August with its largest funding month in history! If you’re ready to take your mortgage career to the next level, visit jobs.citizensbank.com to see all of our openings.”

Want to join the firm that is ranked the nation’s #1 VA, GNMA and FHA lender for the first half of the year according to Inside Mortgage Finance? The firm that just surpassed a $14B origination month, bolstered by a loan portfolio of over $300 billion in assets AND has some of the happiest employees in mortgage banking according to Glassdoor? The time is NOW to join Freedom Mortgage: bit.ly/SoarWithFreedom. Freedom is safely and remotely hiring thousands in several areas including: underwriting, processing, closing, sales, finance, IT and more! Come #SoarWithUs.

HUD is offering up a Program Analyst position in Washington DC.

Broker & lender services and products

Home Point Financial has announced that the Construction-to-Permanent (CTP) Modification product is now available for all Delegated Correspondents in all states. The CTP Modification is a single closing product that combines interim construction and permanent financing into one loan. Transactions will be exempt from the Adverse Market Refinance fee. Home Point continues its rapid surge as one of the fastest-growing correspondent and wholesale lenders in America. If you are a correspondent or broker that still needs to get signed up with Home Point, visit its website now.

Two million forbearance plans are set to expire at the end of this month. What comes next for borrowers and servicers? Get insight into 2021 housing prices, latest default projections, best REO/Auction strategies and more from leading economic and loan servicing experts Allan Weiss (co-founder of Case-Shiller Weiss), Sean Ryan ( CEO, Aspen Grove Solutions), Joe Chappell (EVP Covius Settlement Services), and Pete Pannes (Chief Business Officer of Covius/RealtyBid). Join us October 6 at 1pm ET. Register today!

 

ActiveComply: Did you know the FFIEC has outlined that lenders MUST have a social media risk management program? Surprise! Under this guidance, lenders are required to monitor, and control social media related to their brand as if it were traditional advertising. This also means social media must be archived to meet state advertising record retention laws. Failure to meet these requirements may result in regulatory audits, penalties, and even citations. ActiveComply helps lenders meet both responsibilities through our compliance system technology: find all company and LO accounts related to your brand, examine profiles for NMLS IDs & Equal Housing logos or verbiage,  and ensure posts are compliant (image scanning included). Too busy with the industry boom to tackle social media monitoring on your own? ActiveComply now offers a Managed Services option to partner with individual lenders to better understand their risk level tolerance and company policy. Contact Melissa today!

 

GO Mortgage and NAIBRS are sponsoring the “Housing Leadership Summit for Realtors” webinar. This educational seminar is free and will cover how realtors can become the new construction real estate specialist in their market. There’s still time to register, the webinar is September 24th at 10:00 am Central. Guest speakers from Fannie Mae, Proposed Properties, and GO Mortgage will discuss how to leverage new construction to win more listing, how to market to today’s millennial consumers, and how to have commissions paid up front for new construction builds. Please register or learn more at https://bit.ly/realtorsummit.

 

Industry leaders, Cardinal Financial and Newfi Wholesale join Stearns Wholesale, PRMG, and other top wholesale lenders on the ReadyPrice Platform allowing them to promote their best loan products to brokers in desirable territories nationwide. ReadyPrice gives brokers a simple, alternative way to deliver complete and approved loans directly to their lender of choice through its cloud-based application. Now is the best time to become a ReadyPrice Lender Sponsor! Visit www.readyprice.com/lenders to learn more or schedule a call today.

“These are real leads that result in real loans in your pipeline. In short, the last time your company saw speed and accuracy like this, you were watching Lamar Jackson smoke the Cleveland Browns on Sunday. Sorry Browns fans.” (Matthew Sell, GO Mortgage) Sales Boomerang combines customer analytics and engagement automation with borrower intelligence to give First Heritage an acquisition funnel equipped with detailed actionable data about the customer. This means that marketing is now contextual and relevant, and not random. “An unknown into a known refinance in a heartbeat.” (Phil Denfeld, First Heritage Mortgage) The numbers speak for themselves: 20X Avg ROI, $240 Avg Cost Per Acquired Loan, 10-20% Avg Lift to Loan Volume. Want to see exactly how much you lost this year? Request your report today. We will show you which competitor took your deal, what was the loan amount, and what type of loan it was.

When I was saw the teasers for an announcement from QLMS, I knew it would be big, but didn’t realize just how HUGE it would be for brokers. The lender announced a rebrand to Rocket Pro TPO. This isn’t just a name change; it’s changing the entire game. With increased access to the revolutionizing Rocket technology that brought the industry into the 21^st century, new co-branded marketing and the opportunity to leverage national ad campaigns, as well as the creation of one of the largest referral networks available – it is clear this is not just a one-time stunt. To celebrate its doubling-down on broker support, the lender is doling out 10,000 purchase leads to its partners. Rocket Pro TPO is here to push boundaries and help its partners thrive for decades to come. If you are a broker who wants to Rocket your business into the stratosphere, click HERE.

Customer communication

When high loan volumes create capacity issues, lenders are often forced to choose efficiency (i.e. get the loans pushed through quickly) over customer service excellence (personal care with each loan). But what if you could have both? “It’s not only possible – it’s already happening,” says STRATMOR MortgageSAT director Mike Seminari. In 2017, just three percent of borrowers said the primary way they received loan updates was by text, mobile app or by logging into their lender’s website. In 2020, that number has grown to 19 percent. In his just-released September MortgageSAT Tip, Seminari offers three suggestions for employing digital update tools to achieve efficiency and delight borrowers at the same time.

A sample of Agency changes at the wholesale level

United Wholesale Mortgage (UWM) has been in the news about a planned merger to lead to it going public, but earlier this month it announced 30-year fixed cash-out refinances with rates in 2.5 percent rate range are now available. “UWM introduced this program to help borrowers update, upgrade or repair their homes as the popularity of home improvements continue to surge in America. The Conquest Cash-Out Refinance product is the latest in a series of releases recently announced by UWM including 30-year fixed with rates as low as 1.999 percent, 15-year fixed mortgage with rates as low as 1.875 percent, Conquest conventional loans offering rates as low as 2.5 percent and Conquest VA offering rates as low as 2.25 percent for both purchases and refinances.

Mountain West Financial Wholesale posted COVID-19 FHA Forbearance Guidance in Bulletin 20W-112.

Orion Lending issued a reminder that all agency refinance transactions, with the exception of HomeReady, Home Possible, and loans with loan balances less than $125,000, will be subject to the 50-basis point Adverse Market Refinance Fee. Additionally, Friday, September 25^th is the last day to lock for 45 days without being assessed the 50BPS Adverse Market Fee on Conventional Refinances over $125,000.

FAMC provided an impact outline of the implementation of the Adverse Market Refinance Fee. The .50% Adverse Market Refinance Fee will be applicable for new Best-Efforts locks beginning September 14, 2020. Loan amounts less than $125,000 as well as HomeReady and Home Possible transactions are excluded. As a result, the current cash out refinance adjustment for conventional products will be eliminated. The Refinance Fee will also be applicable for loans locked prior to September 14, 2020 that are not purchased by November 6, 2020. The Refinance Fee will be applicable for mandatory commitments beginning October 15, 2020 and any mandatory loans not purchased by November 6, 2020.

Capital markets

Ever since market volatility increased earlier this year and a myriad of changing forbearance provisions were included in the CARES Act, delinquencies and advances have had a material effect on servicing portfolios. MCT’s Phil Laren, Director of MSR Services, analyzes these effects and provides recommendations for how MCT is assisting clients in his latest published piece, MSR Forbearance in 2020: Challenges and Recommendations. In this paper, he provides a first-hand look at how market volatility, forbearance, prepayment speeds and other factors have affected your MSR portfolio.

 

Do you need help managing your MSR portfolio? MCT’s MSR Services Team can help you plan for cash advances based on the impact of market volatility on your portfolio. MCT can also help lenders develop their retain-release strategy with MCT’s Enhanced Best Execution (EBX) tool. Contact MCT’s MSR Services Team today for more information.

Looking at the bond market Wednesday, Fed officials yesterday continued their pleas for more government relief. Fed Chair Powell disagreed with congressional suggestions that the Fed favored markets over people during the pandemic and said of the Main Street Lending Program that the Fed has “done basically all of the things that we can think of.” Atlanta Fed President Bostic said, “the economic recovery will get much harder, with more permanent job losses unless there’s additional fiscal support,” and Vice Chair Clarida chimed in, saying “we are still in a deep hole.” The Fed asking for another bailout (in addition to the House passing a stopgap funding bill in Washington) caused a slight pullback in Treasuries although Agency MBS prices held in well. Congress remains deadlocked over how big that package should be, what it should contain and whether there should even be another one.

As far as economic releases went, the FHFA Housing Price Index increased 1.0 percent in September after increasing a revised 1.0 percent (from 0.9 percent) in August. That comes on the heels of August Existing Home Sales posting a 14-year high earlier in the week.

Today we receive August New Home Sales, though the calendar is relatively light on data. Markets have already received initial jobless claims for the week ending September 19 (+28k to 824k) but the Thursday morning jobless claims have become so splintered and varied (seasonal, continuing, California having stopped the process due to fraud) that it is hard to make sense of them! In addition to August new home sales, which are expected to decline marginally from July, the day is again packed with seven Fed speakers. After heavy support the last couple days, the NY Fed will conduct three operations totaling up to $6.4 billion MBS with two targeting up to $2.9 billion 2 percent and 2.5 percent and one targeting up to $669 million UMBS15 2 percent. On the supply side, look for a $50 billion 7-year Treasury note auction, as yesterday’s $53 billion 5-year note auction was met with much better demand than Tuesday’s 2-year note sale. Thursday starts with Agency MBS prices better a shade and the 10-year yielding .66 after closing yesterday at 0.68 percent.

I used to be indecisive, but now I’m not so sure.

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed 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 2020 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.)

 

I know that plenty of folks at United Wholesale read this commentary, and the company is in the news about a merger that will take UWM public valuing it at $16 billion. Perhaps Bruce Springsteen reads this commentary, perhaps not, but he turns 71 today so Happy Birthday Boss! Out of curiosity, what does $500,000 buy, home-wise, in some of the cities and towns he has included in his songs, for the $1,700 monthly payment on a $400,000 loan (yes, I know a buyer doesn’t need to put 20 percent down!)? Let’s start with Lincoln, Nebraska, from “Nebraska”. (This place is nice too.) Let’s head out to California with a “bourgeois house in the Hollywood Hills from “57 Channels (and nothing on).” Across the nation, on the “Streets of Philadelphia”, this place is very stately, as is this one on Shunk Street. While you’re in that area, fix up your hair, head southeast, and meet me in “Atlantic City”: here’s a place on the water or if you don’t want to hassle with the yard, there’s this one. If you want to try your hand at mining, live in “Youngstown” in a nice house with great woodworking or one with a yard. A world away, he sang, “I know a pretty little place in Southern California down San Diego way” in “Rosalita”. (I saw them on this tour in 1980. That aside, I am glad that the real estate used a wide-angle lens.)

Jobs & promotions

“Caliber Home Loans is proud to announce that Ranjit Bhattacharjee has joined its leadership team as the EVP over Capital Markets and Treasury. In his role, Bhattacharjee is poised to take an accomplished team to the next level of growth and success. Bhattacharjee has a Ph.D. in Pure Mathematics from Boston University and a master’s in Mathematics from Technical University Aachen. He comes to Caliber from New Residential Investment Corp. where he focused on MSR Hedging, Secondary Markets, and customer data analytics and before that served in a number of senior leadership roles at CitiMortgage. Bhattacharjee has a deep and successful background in the mortgage industry. “We’re delighted to have Ranjit as a member of our team. His impressive skills will allow us to accelerate our success going forward”, remarked William Dellal, President of Caliber. Only a best-in-class mortgage lender attracts the finest talent. We’re hiring right now, so visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller respectively.

Three times the charm! Evergreen Home Loans is proud to announce that three times this quarter it was recognized locally and nationally as a best workplace. Puget Sound Business Journal named them the #1 best workplace in Washington in the Extra-Large Company category. This is their 5^thyear on the list and second time as a #1 company. Next, Evergreen was named to the Seattle Business Magazine Washington’s100 Best Companies to Work For (Large Company) list. And most recently, Fortune and Great Place to Work recognized it as the #1 Best Workplace for Women. The company is humbled by the recognition and proud of associates for bringing the WOW and FUN every day. Looking for a great place to advance your career? Check out the Careers page or contact Chuck Iverson. Great Place to Work and Best Workplaces for Women are trademarks of Great Place to Work Institute Inc.

Are you tired of feeling like you are leaving money on the table when you’re trying to build a sustainable work/life balance? Do you feel like you’re wasting your time on inefficient processes, menial tasks, and out-of-date practices? What you need is a next-generation mortgage lender to bring your work and your day-to-day into the present, with an eye on an ever-evolving and ever-improving future. Wyndham Capital Mortgage, a leading digital home lending company and Fintech Mortgage Lender, is excited to announce the launch of the new and improved JoinWyndham.com! This will be the one-stop-shop to learn about the benefits of becoming a Fintech Mortgage Lender loan officer, with in-depth information, video testimonials, relevant statistics and more. Wyndham Capital empowers our loan officers by allowing them to focus on achieving the success they crave without sacrificing the work/life balance they want. Find out more at JoinWyndham.com.

AHP Servicing announced the appointment of Tim Gillis as President of the company, bringing 25 years of lending and servicing experience to “the country’s only crowd-funded residential loan servicer.”

Sagent announced Uday Devalla is its new CTO and will “will drive Sagent’s vision to accelerate the consumer-first modernization of mortgage servicing by improving loan servicing engagement and consumer experience from the homeowner perspective.”

Lender products & services

In the next few weeks, two well-known subservicers will be opening their virtual doors to Subsequent QC, MQMR’s servicing-focused sister firm and singing, “Be our guest, be our guest, put our service to the test.” While “beef ragout, cheese souffle, pie and pudding en flambe” will not be served, SQC will be sampling favorites from the annual subservicer oversight menu, such as the review of written policies and procedures and meeting with the subservicer’s key servicing personnel, in addition to seasonal specials related to current and on-going procedures as a result of the COVID-19 pandemic. While on-site audits were postponed due to COVID, your subservicer’s compliance responsibilities were not. To learn more about subservicer audits or how you can get a seat at the table for SQC’s remaining 2020 reviews, contact [email protected].

Are your appraisals coming back on time? Many lenders have been frustrated at delays in valuations due to the high volume of refis the past few months. They’re also frequently annoyed at not being able to get ahold of the appraiser to find out what’s going on. If you’re sick and tired of poor communication and service, follow the lead of a lender in Virginia who says “Triserv is a breath of fresh air. My team and I immediately saw a change and a clear-cut winner – Triserv stood apart from the AMCs we used before. We get more than we could ever imagine from Triserv.” To find out more, go to www.triservllc.com/expect-more or contact us at [email protected]. Triserv is a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service.

How would it impact your mortgage business if you could do more loans at your current capacity? The old saying, “Time is Money” couldn’t be truer in the mortgage industry. Stop wasting time on phone calls from borrowers that you can’t help. Monster Lead Group are the experts at producing high return, high converting direct mail campaigns using Monster’s unique intelligent response marketing. Start answering more calls from borrowers that are ready to transact. Talk to us about launching a turnkey, “done for you” campaign and test us against your current marketing. Schedule a call right now.

Company-sponsored webinars and training

Carrington Mortgage Services, LLC (CMS), a leading wholesale lender and non-delegated correspondent sponsor has brought a comprehensive suite of Non-QM products to the marketplace. Carrington’s Prime Advantage, Flexible Advantage Plus, and Flexible Advantage products were developed to support borrowers that don’t fit Agency or QM standards and have FICOs as low as 550. The Carrington Investor Advantage (DCR) gives experienced and first-time investors a powerful financing tool. Guidelines and rates are on our Wholesale and Correspondent websites. Today at 11am PDT, Carrington is hosting a free webinar with Amy Marsh, “Launch Your Non-QM Business to New Heights,” that’ll show you how to originate and close more Non-QM loans. “At Carrington, we have been looking forward to the day the marketplace returned for non-agency products,” said Greg Austin, EVP, Mortgage Lending, for CMS, “and we know how important it is to ensure our product offerings are price-leading and right for both brokers and borrowers.”

You’ve got data for days, but do you have the tools or time to parse it into meaningful business insights? See for yourself how turnkey business intelligence (BI) transforms processes, productivity and profitability by witnessing a “day in the life” of AmCap Chief Analytics Officer Matt Stokes as powered by LBA Ware’s LimeGear BI platform. See how Matt utilizes LimeGear to clear roadblocks in his pipeline, manage sales force productivity and much more. Join this free webinar, hosted by The Mortgage Collaborative, at 2 pm ET tomorrow, September 24. 

 

Free webinar: Interested in finding out how implementing virtual closing and self-inspections solutions will help you prepare for the unexpected, deliver a great borrower experience (from the convenience of their homes) and help you close more loans… faster? Join ServiceLink’s upcoming webinar:  “Linking Technology and Today’s Borrowers: How You Can Provide the Closing Experience Your Consumers Expect,” being held Thursday, September 24 at 2 PM ET. See these technologies in action with product demos of our latest solutions. The webinar will demonstrate how you can contend with today’s remarkably high origination volume without sacrificing the customer experience. Learn how you can keep pace with your borrowers’ expectations and better prepare for volume fluctuations in this rapidly changing market by harnessing the power of user-friendly remote closing and borrower-inspection options. Register today.

GSE changes for lenders & investors to follow

Despite the continued decline in forbearance numbers to a five-month low (Ginnie Mae’s continues to increase, however), there is still forbearance risk, leading to potential warehouse risk. Lenders, already delivering directly to Freddie and Fannie rather than correspondent investors, will continue selling directly to the Agencies if the correspondent investors out there make a wrong move in terms of forbearance policy.

Brian Levy, author of the mortgage blog Levy’s Mortgage Musings, wrote in response to Monday’s note about the Agencies using indemnification/recourse to demand repurchase of loans that are 120 days past due as a result of forbearance. “Rob, The COVID related forbearance program was mandated by federal legislation and created a moral hazard as noted in some of my previous Mortgage Musings. For the GSEs to now demand repurchase for a forbearance delinquency is an unjustified transfer of the risk of forbearance back to the originator. As an attorney who negotiated and defended numerous repurchase claims coming from meltdown era, I would be inclined to strongly resist any effort to put forbearance induced delinquency risks back on an originator as contractually unwarranted and grossly unfair. I think the whole origination industry should want to vigorously push back against any effort by the GSEs to send forbearance induced risks back downstream.” (Levy also recently posted a new Musings on the CFPB’s QM proposal to use price in lieu of DTI with some observations about mask wearing and hearing loss. Attorney Levy can be reached here.)

The Federal Housing Finance Agency (FHFA) is requesting input on its Strategic Plan: Fiscal Years 2021-2024 (the Plan), which establishes new goals that are necessary for FHFA to fulfill its statutory duties, including responsibly ending the conservatorships of Fannie Mae and Freddie Mac (the Enterprises). Input on the Plan is due by October 5.

Earlier this month PIMCO (Pacific Investment Management Co) wrote to the Federal Housing Finance Agency, warning that plans to end government control of Fannie Mae and Freddie Mac could undermine US housing finance. Per PIMCO, the move could signal a weakening of federal guarantees of the firms’ securities, prompting some investors to shy away from holding them and encourage others to sell, leading to higher borrowing costs.

Fannie Mae’s DU validation service will discontinue validation of employment and income using manual verification reports. Lenders may continue to use third-party employment verification vendors to obtain income and employment information, in accordance with the requirements outlined in Section B3-3.1-02 of the Selling Guide. Lenders are encouraged to review information on underwriting and quality control best practices for identifying income and employment discrepancies.

Fannie Mae Selling Guide SEL 2020-05 update includes changes related to accessory dwelling units, the removal of references to refinanced or modified balloon loan policies, and clarifications regarding non-occupant borrowers.

Capital markets

Mortgage rates have been unusually stable for several weeks now. Sure there’s a little up and down movement, but nothing major. This is a good thing as no lender, or lock desk, or MLO, wants volatility. The latest U.S. economic data from August continues to be broadly positive, but the rate of improvement from the summer is clearly slowing. This raises the possibility that demand will level out causing both manufacturing and non-manufacturing industries to reduce capacity and turning furloughed employees into permanent layoffs. Not a good thing for your clients.

August’s retail sales increased 0.6 percent vs. 0.9 percent in July and were up 2.6 percent over the last twelve months. Given that consumer spending is the largest component of GDP, the market widely expects at least a partial rebound from the second quarter’s historic decline.

Housing starts fell 5.1 percent in August due to a plummet of 22.74 percent in multifamily starts. Meanwhile single family starts increased 4.1 percent to an annual rate near February’s as people look to leave crowded apartment living for more space. The Federal Reserve made no significant changes to monetary policy at its meeting last week and projected the Fed Funds rate would remain near zero until 2023. The Fed also reiterated its recent change in inflation targeting with a goal to see their broad measure of inflation rise above two percent so that it averages near two percent for a sustained period prior to raising rates.

Looking at bond markets yesterday, U.S. Treasuries rallied 1 bp across the curve and the UMBS30 basis closed mostly tighter due to a large amount of Fed support across three operations and a general rebound in risk tolerance after the equity selloff to open the week. Fed Chairman Powell and Treasury Secretary Mnuchin testified before the House Financial Services Committee. Chairman Powell told the Committee that the economy is improving but has a long way to go before fully recovering. Secretary Mnuchin said that the Treasury can’t offer additional assistance without action from Congress as employment and overall activity remain well below pre-virus levels.

Existing home sales increased 2.4 percent month-over-month in August to a seasonally adjusted annual rate of 6.00 million, the third consecutive month of positive sales gains. Total sales in August were up 10.5 percent from a year ago and the strongest since 2006 as demand for existing homes is very strong and certainly a bright spot for the economy. Unlike other parts of the economy, the housing market continues to experience a V-shaped recovery. The downside to that is that supply is constrained, 18 percent lower than 2019, and will push home prices higher the longer it remains that way.

Turning to today’s economic calendar, we have seen that mortgage applications increased 6.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 18. On tap are FHFA house prices for July and preliminary September Markit manufacturing and services PMIs. Markets will have to digest remarks from six Fed speakers: Cleveland’s Mester, Chair Powell, Chicago’s Evans, Boston’s Rosengren, Atlanta Bostic, and Fed Vice Chair Quarles. The Desk of the New York Fed will conduct three MBS FedTrade operations that will total up to $5.5 billion, starting with $1 billion UMBS15 1.5 percent and 2 percent followed by $2.9 billion UMBS30 2 percent and 2.5 percent and $1.7 billion GNII 2 percent and 2.5 percent. We begin the day with Agency MBS prices unchanged and the 10-year yielding .68 after closing yesterday at 0.66 percent: another snoozer of a day, rate-wise.

To be sure of hitting the target, shoot first and call whatever you hit the target. (Read that again; Chillingly reminiscent of investment bank residential loan-level underwriting guidelines thirteen years ago.)

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed 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 2020 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.)

I know that plenty of folks at United Wholesale read this commentary, and the company is in the news about a merger that will take UWM public valuing it at $16 billion. Perhaps Bruce Springsteen reads this commentary, perhaps not, but he turns 71 today so Happy Birthday Boss! Out of curiosity, what does $500,000 buy, home-wise, in some of the cities and towns he has included in his songs, for the $1,700 monthly payment on a $400,000 loan (yes, I know a buyer doesn’t need to put 20 percent down!)? Let’s start with Lincoln, Nebraska, from “Nebraska”. (This place is nice too.) Let’s head out to California with a “bourgeois house in the Hollywood Hills from “57 Channels (and nothing on).” Across the nation, on the “Streets of Philadelphia”, this place is very stately, as is this one on Shunk Street. While you’re in that area, fix up your hair, head southeast, and meet me in “Atlantic City”: here’s a place on the water or if you don’t want to hassle with the yard, there’s this one. If you want to try your hand at mining, live in “Youngstown” in a nice house with great woodworking or one with a yard. A world away, he sang, “I know a pretty little place in Southern California down San Diego way” in “Rosalita”. (I saw them on this tour in 1980. That aside, I am glad that the real estate used a wide-angle lens.)

Jobs & promotions

“Caliber Home Loans is proud to announce that Ranjit Bhattacharjee has joined its leadership team as the EVP over Capital Markets and Treasury. In his role, Bhattacharjee is poised to take an accomplished team to the next level of growth and success. Bhattacharjee has a Ph.D. in Pure Mathematics from Boston University and a master’s in Mathematics from Technical University Aachen. He comes to Caliber from New Residential Investment Corp. where he focused on MSR Hedging, Secondary Markets, and customer data analytics and before that served in a number of senior leadership roles at CitiMortgage. Bhattacharjee has a deep and successful background in the mortgage industry. “We’re delighted to have Ranjit as a member of our team. His impressive skills will allow us to accelerate our success going forward”, remarked William Dellal, President of Caliber. Only a best-in-class mortgage lender attracts the finest talent. We’re hiring right now, so visit our website today to view open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller respectively.

Three times the charm! Evergreen Home Loans is proud to announce that three times this quarter it was recognized locally and nationally as a best workplace. Puget Sound Business Journal named them the #1 best workplace in Washington in the Extra-Large Company category. This is their 5^thyear on the list and second time as a #1 company. Next, Evergreen was named to the Seattle Business Magazine Washington’s100 Best Companies to Work For (Large Company) list. And most recently, Fortune and Great Place to Work recognized it as the #1 Best Workplace for Women. The company is humbled by the recognition and proud of associates for bringing the WOW and FUN every day. Looking for a great place to advance your career? Check out the Careers page or contact Chuck Iverson. Great Place to Work and Best Workplaces for Women are trademarks of Great Place to Work Institute Inc.

Are you tired of feeling like you are leaving money on the table when you’re trying to build a sustainable work/life balance? Do you feel like you’re wasting your time on inefficient processes, menial tasks, and out-of-date practices? What you need is a next-generation mortgage lender to bring your work and your day-to-day into the present, with an eye on an ever-evolving and ever-improving future. Wyndham Capital Mortgage, a leading digital home lending company and Fintech Mortgage Lender, is excited to announce the launch of the new and improved JoinWyndham.com! This will be the one-stop-shop to learn about the benefits of becoming a Fintech Mortgage Lender loan officer, with in-depth information, video testimonials, relevant statistics and more. Wyndham Capital empowers our loan officers by allowing them to focus on achieving the success they crave without sacrificing the work/life balance they want. Find out more at JoinWyndham.com.

AHP Servicing announced the appointment of Tim Gillis as President of the company, bringing 25 years of lending and servicing experience to “the country’s only crowd-funded residential loan servicer.”

Sagent announced Uday Devalla is its new CTO and will “will drive Sagent’s vision to accelerate the consumer-first modernization of mortgage servicing by improving loan servicing engagement and consumer experience from the homeowner perspective.”

Lender products & services

In the next few weeks, two well-known subservicers will be opening their virtual doors to Subsequent QC, MQMR’s servicing-focused sister firm and singing, “Be our guest, be our guest, put our service to the test.” While “beef ragout, cheese souffle, pie and pudding en flambe” will not be served, SQC will be sampling favorites from the annual subservicer oversight menu, such as the review of written policies and procedures and meeting with the subservicer’s key servicing personnel, in addition to seasonal specials related to current and on-going procedures as a result of the COVID-19 pandemic. While on-site audits were postponed due to COVID, your subservicer’s compliance responsibilities were not. To learn more about subservicer audits or how you can get a seat at the table for SQC’s remaining 2020 reviews, contact [email protected].

Are your appraisals coming back on time? Many lenders have been frustrated at delays in valuations due to the high volume of refis the past few months. They’re also frequently annoyed at not being able to get ahold of the appraiser to find out what’s going on. If you’re sick and tired of poor communication and service, follow the lead of a lender in Virginia who says “Triserv is a breath of fresh air. My team and I immediately saw a change and a clear-cut winner – Triserv stood apart from the AMCs we used before. We get more than we could ever imagine from Triserv.” To find out more, go to www.triservllc.com/expect-more or contact us at [email protected]. Triserv is a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service.

How would it impact your mortgage business if you could do more loans at your current capacity? The old saying, “Time is Money” couldn’t be truer in the mortgage industry. Stop wasting time on phone calls from borrowers that you can’t help. Monster Lead Group are the experts at producing high return, high converting direct mail campaigns using Monster’s unique intelligent response marketing. Start answering more calls from borrowers that are ready to transact. Talk to us about launching a turnkey, “done for you” campaign and test us against your current marketing. Schedule a call right now.

Company-sponsored webinars and training

Carrington Mortgage Services, LLC (CMS), a leading wholesale lender and non-delegated correspondent sponsor has brought a comprehensive suite of Non-QM products to the marketplace. Carrington’s Prime Advantage, Flexible Advantage Plus, and Flexible Advantage products were developed to support borrowers that don’t fit Agency or QM standards and have FICOs as low as 550. The Carrington Investor Advantage (DCR) gives experienced and first-time investors a powerful financing tool. Guidelines and rates are on our Wholesale and Correspondent websites. Today at 11am PDT, Carrington is hosting a free webinar with Amy Marsh, “Launch Your Non-QM Business to New Heights,” that’ll show you how to originate and close more Non-QM loans. “At Carrington, we have been looking forward to the day the marketplace returned for non-agency products,” said Greg Austin, EVP, Mortgage Lending, for CMS, “and we know how important it is to ensure our product offerings are price-leading and right for both brokers and borrowers.”

You’ve got data for days, but do you have the tools or time to parse it into meaningful business insights? See for yourself how turnkey business intelligence (BI) transforms processes, productivity and profitability by witnessing a “day in the life” of AmCap Chief Analytics Officer Matt Stokes as powered by LBA Ware’s LimeGear BI platform. See how Matt utilizes LimeGear to clear roadblocks in his pipeline, manage sales force productivity and much more. Join this free webinar, hosted by The Mortgage Collaborative, at 2 pm ET tomorrow, September 24. 

 

Free webinar: Interested in finding out how implementing virtual closing and self-inspections solutions will help you prepare for the unexpected, deliver a great borrower experience (from the convenience of their homes) and help you close more loans… faster? Join ServiceLink’s upcoming webinar:  “Linking Technology and Today’s Borrowers: How You Can Provide the Closing Experience Your Consumers Expect,” being held Thursday, September 24 at 2 PM ET. See these technologies in action with product demos of our latest solutions. The webinar will demonstrate how you can contend with today’s remarkably high origination volume without sacrificing the customer experience. Learn how you can keep pace with your borrowers’ expectations and better prepare for volume fluctuations in this rapidly changing market by harnessing the power of user-friendly remote closing and borrower-inspection options. Register today.

GSE changes for lenders & investors to follow

Despite the continued decline in forbearance numbers to a five-month low (Ginnie Mae’s continues to increase, however), there is still forbearance risk, leading to potential warehouse risk. Lenders, already delivering directly to Freddie and Fannie rather than correspondent investors, will continue selling directly to the Agencies if the correspondent investors out there make a wrong move in terms of forbearance policy.

Brian Levy, author of the mortgage blog Levy’s Mortgage Musings, wrote in response to Monday’s note about the Agencies using indemnification/recourse to demand repurchase of loans that are 120 days past due as a result of forbearance. “Rob, The COVID related forbearance program was mandated by federal legislation and created a moral hazard as noted in some of my previous Mortgage Musings. For the GSEs to now demand repurchase for a forbearance delinquency is an unjustified transfer of the risk of forbearance back to the originator. As an attorney who negotiated and defended numerous repurchase claims coming from meltdown era, I would be inclined to strongly resist any effort to put forbearance induced delinquency risks back on an originator as contractually unwarranted and grossly unfair. I think the whole origination industry should want to vigorously push back against any effort by the GSEs to send forbearance induced risks back downstream.” (Levy also recently posted a new Musings on the CFPB’s QM proposal to use price in lieu of DTI with some observations about mask wearing and hearing loss. Attorney Levy can be reached here.)

The Federal Housing Finance Agency (FHFA) is requesting input on its Strategic Plan: Fiscal Years 2021-2024 (the Plan), which establishes new goals that are necessary for FHFA to fulfill its statutory duties, including responsibly ending the conservatorships of Fannie Mae and Freddie Mac (the Enterprises). Input on the Plan is due by October 5.

Earlier this month PIMCO (Pacific Investment Management Co) wrote to the Federal Housing Finance Agency, warning that plans to end government control of Fannie Mae and Freddie Mac could undermine US housing finance. Per PIMCO, the move could signal a weakening of federal guarantees of the firms’ securities, prompting some investors to shy away from holding them and encourage others to sell, leading to higher borrowing costs.

Fannie Mae’s DU validation service will discontinue validation of employment and income using manual verification reports. Lenders may continue to use third-party employment verification vendors to obtain income and employment information, in accordance with the requirements outlined in Section B3-3.1-02 of the Selling Guide. Lenders are encouraged to review information on underwriting and quality control best practices for identifying income and employment discrepancies.

Fannie Mae Selling Guide SEL 2020-05 update includes changes related to accessory dwelling units, the removal of references to refinanced or modified balloon loan policies, and clarifications regarding non-occupant borrowers.

Capital markets

Mortgage rates have been unusually stable for several weeks now. Sure there’s a little up and down movement, but nothing major. This is a good thing as no lender, or lock desk, or MLO, wants volatility. The latest U.S. economic data from August continues to be broadly positive, but the rate of improvement from the summer is clearly slowing. This raises the possibility that demand will level out causing both manufacturing and non-manufacturing industries to reduce capacity and turning furloughed employees into permanent layoffs. Not a good thing for your clients.

August’s retail sales increased 0.6 percent vs. 0.9 percent in July and were up 2.6 percent over the last twelve months. Given that consumer spending is the largest component of GDP, the market widely expects at least a partial rebound from the second quarter’s historic decline.

Housing starts fell 5.1 percent in August due to a plummet of 22.74 percent in multifamily starts. Meanwhile single family starts increased 4.1 percent to an annual rate near February’s as people look to leave crowded apartment living for more space. The Federal Reserve made no significant changes to monetary policy at its meeting last week and projected the Fed Funds rate would remain near zero until 2023. The Fed also reiterated its recent change in inflation targeting with a goal to see their broad measure of inflation rise above two percent so that it averages near two percent for a sustained period prior to raising rates.

Looking at bond markets yesterday, U.S. Treasuries rallied 1 bp across the curve and the UMBS30 basis closed mostly tighter due to a large amount of Fed support across three operations and a general rebound in risk tolerance after the equity selloff to open the week. Fed Chairman Powell and Treasury Secretary Mnuchin testified before the House Financial Services Committee. Chairman Powell told the Committee that the economy is improving but has a long way to go before fully recovering. Secretary Mnuchin said that the Treasury can’t offer additional assistance without action from Congress as employment and overall activity remain well below pre-virus levels.

Existing home sales increased 2.4 percent month-over-month in August to a seasonally adjusted annual rate of 6.00 million, the third consecutive month of positive sales gains. Total sales in August were up 10.5 percent from a year ago and the strongest since 2006 as demand for existing homes is very strong and certainly a bright spot for the economy. Unlike other parts of the economy, the housing market continues to experience a V-shaped recovery. The downside to that is that supply is constrained, 18 percent lower than 2019, and will push home prices higher the longer it remains that way.

Turning to today’s economic calendar, we have seen that mortgage applications increased 6.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 18. On tap are FHFA house prices for July and preliminary September Markit manufacturing and services PMIs. Markets will have to digest remarks from six Fed speakers: Cleveland’s Mester, Chair Powell, Chicago’s Evans, Boston’s Rosengren, Atlanta Bostic, and Fed Vice Chair Quarles. The Desk of the New York Fed will conduct three MBS FedTrade operations that will total up to $5.5 billion, starting with $1 billion UMBS15 1.5 percent and 2 percent followed by $2.9 billion UMBS30 2 percent and 2.5 percent and $1.7 billion GNII 2 percent and 2.5 percent. We begin the day with Agency MBS prices unchanged and the 10-year yielding .68 after closing yesterday at 0.66 percent: another snoozer of a day, rate-wise.

To be sure of hitting the target, shoot first and call whatever you hit the target. (Read that again; Chillingly reminiscent of investment bank residential loan-level underwriting guidelines thirteen years ago.)

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed 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 2020 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.)

 

Today (Tuesday), while Washington DC “sucks the air out of the room,” welcome to the Autumn Solstice (Equinox) in the U.S., the day when the Sun appears to cross the celestial equator, heading southward. Others know it as halfway between the day with the most sunlight in June and the day with the least (December 22), or when night and day are the same length. What isn’t the “same” are lock volumes. According to Informa Financial Intelligence, August 2020 mortgage rate-lock volume was up 39% YoY but down -6% MoM across all channels, while funded volume increased 39% YoY and 2% MoM. It reports retail lock volume increased 36% YoY and funded volume was up 57% YoY. If yours didn’t, well, catch up! The industry talk continues to revolve around lock volumes (“ops staff can’t take vacations, so we’re breaking policy and rolling vacay into next year”) and about Bloomberg’s story on a potential initial public offering by loanDepot. Not that it necessarily needs the billions… But some argue to strike while the proverbial “iron is hot.”

Employment

Home Point Financial had 96% of its Associates working from home since mid-March and still increased its loan volume by nearly 60% from Q1 to Q2. While growing volume and building capacity are focal points, the company’s top priority is the care and well-being of its Associates and their families. With many people pulling double-duty, working remotely while supporting young virtual learners, Home Point committed to providing laptops, tablets, or Chromebooks to all Associates with kids (kindergarten through age 22) that are attending school virtually from home. If you want to be part of a team that makes your career, and your family, a priority, apply for one of Home Point’s hundreds of open positions or email your resume directly to John Eite.

On Q Financial is seeking an experienced VP of Consumer Direct, a qualified candidate that has a proven track record in consumer direct lending. The ideal candidate is an energetic, transformational leader with an exceptional sales mind capable of cultivating effective relationships in order to collaborate cross-functionally to innovatively scale the call center, convert organic leads, and support portfolio retention. This is an exciting opportunity to join a highly entrepreneurial company with a $2 billion and growing servicing portfolio committed to $100 million and more in funded monthly volume. The VP of Consumer Direct will help lead and bring this vision to life! Relocation not required. Interested candidates please email your resume to Shane Miller.

 

PrimeLending’s empowering culture wins again! For the sixth straight year, Great Place to Work and FORTUNE have honored the powerhouse national lender as one of the 2020 Best Workplaces for Women, this year ranking 16. Awarded based on survey results from 4.9 million employees nationwide, PrimeLending ranked highly in trustworthy leaders, treating people with respect, fair workplace decision making and team camaraderie. We’re proud to be home to so many talented women, who represent 56% of all our company officers and 65% of our total workforce. This recognition comes on the heels of earning a spot on this year’s Best Workplaces for Millennials in August. Earning rave reviews for our culture comes as no surprise, 94% of our employees say PrimeLending is a great place to work compared to 59% of employees at a typical U.S.-based company. If you’re ready to join an award-winning team, contact Nic Hartke.

Operations and Sales… are you managing your career, or just managing your day? “Joining Thrive is absolutely the best career move I have ever made.” This is the most common sentiment expressed by new hires after their first months with the company. After laying an incredible foundation of best-of-breed technology solutions, perfecting their Quality & Efficiency workflow, and building one of the best leadership teams in the industry; Thrive Mortgage is crushing production numbers and is positioned to maintain this growth for years to come.  “Our Operations Staff is unmatched.  It’s not just that we have great tools, but we have the best people,” stated Kindra Miller, Business Development Manager for Thrive.  “When you have great leadership like Selene Kellam and her team, it simply breeds a culture of excellence from the top down.” To inquire about open positions within Thrive, contact Kindra to begin a confidential conversation.

Broker and lender products & services

Maxwell continues to expand on one of the most impactful features of its digital mortgage platform, its technology-powered outsourced fulfillment services. Maxwell now offers both underwriting and closing services to its already successful processing offering. Designed to provide economic scale for small to midsize lenders, the Maxwell Fulfillment Platform plugs in like the operational unit of any mortgage originator, enabling you to adjust fulfillment capacity to meet market needs. By being a Maxwell customer, we can simplify the handoff, communication, accuracy, and transparency of loans. What’s more, all of this efficiency saves costs that we pass on to you, the lender, saving thousands in fulfillment costs monthly. To learn more about Maxwell’s digital platform and tech-powered outsourced capabilities click here or schedule a demo.

 

Lenders, speed up turn-times by assessing true borrower credit risk & resiliency up-front with the predictive & prescriptive Mortgage Risk & Fairness Score. MRS identifies which loans should be “fast-laned”, and which need a closer look than even DU suggests. It also enables lenders to open the credit box safely, helping the underserved while expanding margins. For FHA this is a must! Lenders, investors, traders, servicers, and insurers can sleep well at night knowing that MRS is helping avoid costly forbearance, delinquency, and default events, while promoting financial inclusion. Bottom line: The Mortgage Risk Score is an easy and inexpensive tool that leverages state-of-the-art AI and ML algorithms, and years of experience, to supercharge risk management, sales, operations, secondary, and servicing. It’s plug-n-play, validated (top 10 bank) and vetted (CFPB, OCC, Fed). Click for more information.

 

Is your servicing operation held captive by aging systems and point solutions that create fragmented processes? In today’s world of evolving technology, the power of workflow automation is real. Data is advancing business process automation quickly and effectively by leveraging expanded access to resources, machine learning capabilities and bulk processing optimization. Understanding the value of data since its inception, Clarifire uses notable industry resources to enhance its proven CLARIFIRE automated workflow application. CLARIFIRE helps mortgage servicers remove the chaos of process fragmentation, circumvent antiquated system issues, and gain access to a fluid, seamless application that offers fast and easy displays of critical data. Click here to read about the benefits that can be realized when you leverage data in your automated business processes, rules administration and decisioning. If your organization is interested in achieving a new level of innovation with a proven industry provider, turn to CLARIFIRE, Truly BRIGHTER AUTOMATION.

Can your current POS provider quantify the ROI it delivers? Do you suspect that if it did, the results would be rather disappointing? SimpleNexus is so confident in its ability to deliver above the rest it has launched a self-service ROI calculator that compares its performance to other major POS providers. Just plug in a few numbers, like annual units and volume, and it’ll tell you how SimpleNexus lines up. Try the calculator out now and request an in-depth ROI analysis. It only takes 30 seconds!

Events & training from your La-Z-Boy

Today’s the day. Blend’s virtual summit kicks off at 9 a.m. PDT and if you’ve been wondering how your organization can become digitally agile, you won’t want to miss this. Find out what it takes to be able to respond to market conditions, regulatory changes, and rising consumer expectations swiftly and efficiently. Join the summit for keynote addresses, industry and customer panels, and product roadmaps to hear how Blend executives and leaders across mortgage and consumer banking are tackling today’s challenges. Join the summit.

Just in time for 2021 business planning: XINNIX is presenting a free live executive roundtable event on Wednesday, October 7 at 1 PM ET for all mortgage industry leaders. “Building the Next Generation of Mortgage Professionals” is part of XINNIX’s quarterly Leadership Lessons series and will feature leaders from three of the nation’s top mortgage companies: Regions Bank EVP of Lending, Bob Cabrera; HomeBridge Financial Services EVP & Partner, Rick Floyd; and Caliber Home Loans AVP Program Director and Head of Caliber University, Lauren Havins. Moderated by XINNIX Founder & CEO Casey Cunningham, these leaders will discuss how their organizations are developing new talent to meet the industry’s short-term capacity challenges and ensure long-term organizational success. Registrants will have an opportunity to submit questions in advance or can ask the panelists during the live session. Reserve your seat today!

The California MBA’s Western Secondary Market Conference is this week, virtually, September 23 and 24. To thank you for being a loyal subscriber, I am offering you a complimentary conference registration! Use this link and enter the promo code Chrisman to get your free registration. Hear from the star of Undercover Billionaire and CEO of Kind Lending, Glenn Stearns, as well as the CEO Panel, mPower Leadership Panel, Capital Markets Update, and a discussion about the latest trends in Mergers and Acquisitions.

As a reminder, the Mortgage Banker Association offers scores of training events and webinars. And the grand national convention is October 19-21.

MGIC’s upcoming webinar calendar includes, “Up Your Game to Score Approvals Sooner!”, offered Oct. 6. “During this 30-minute session, we’ll review several scenarios to avoid documentation delays at the closing table. MGIC offers complimentary webinars every month to help customers succeed in today’s mortgage insurance industry.” View the full MGIC training calendar at mgic.com/training.

The Mortgage Girlfriends is hosting a Women’s Retreat Mastermind on October 22 and 23^rd virtually. Women can register at www.mortgagegirlfriends.com and we have amazing content planned, as well as, special gifts. The theme is Maximizing Your Business and planning for next year, as well as Maximize You and not to forget to take care of yourself with some tricks on how to fit it all in. A TexX Speaking Coach is going to share how to improve your public speaking skills for video, a top producer is sharing how she manages her calendar and works less than 40 hours a week, along with a master of delegation and how to delegate effectively. We have teamed up with The Marketing Firm who is going to teach them how to utilize social media in all ways to leverage for next year.

Capital markets

Ginnie Mae announced restrictions on the pooling of adjustable-rate mortgages with rates indexed to the London Interbank Offered Rate (LIBOR), which are effective with security issuances dated on or after January 21, 2021. This guidance follows Ginnie Mae’s adoption of the recommendations of the Alternative Rates Reference Committee (ARRC) relating to fallback language for new issuances of LIBOR floating rate securities.

Economic data over the last week mostly failed to meet analysts’ expectations but one could argue that it’s exponentially more difficult to forecast during this time. Despite the “misses” at the headline levels, the details of the data were generally positive. Industrial production increased just 0.4 percent in August, however July was revised nearly a half point higher meaning the overall level of production was more or less in line with market expectations. Retail sales also fell short of expectations but the total level of retail sales hit a record high. Despite the record high, spending has shifted so not every component of retail sales has recovered to their pre-pandemic levels. Receipts at bars and restaurants remain 16 percent below their pre-crisis peak and in many places, bars remain completely closed. Grocery stores continue to see a surge in sales as consumers shifted spending away from restaurants. Gas station sales remain 14.8 percent below their pre-crisis peak as many people continue to work from home and gas prices remain low. Builder confidence remains high as single family housing starts have risen for the past four months and the trend is expected to continue in September with low mortgage rates driving sales and prices higher.

Bond markets yesterday traded sharply “risk-off.” There was pressure from falling equities, heightened coronavirus shutdown concerns from Europe, and talk out of Washington that investors should prepare for the likelihood Congress won’t pass a second bailout. The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 8 basis points to 6.93 percent of servicers’ portfolio volume as of September 13, 2020. According to MBA’s estimate, 3.5 million homeowners are in forbearance plans.

Today’s economic calendar is already underway with the Philadelphia Fed’s nonmanufacturing indices. Later are existing home sales in August and the Richmond Fed Manufacturing and Services, Revenues Indices for September. Markets will also receive a heavy slate of Fed speakers: Chicago’s Evans, Chair Powell (along with Treasury Secretary Mnuchin) before the House Financial Services Committee, Richmond’s Barkin, and Atlanta’s Bostic. The Desk will provide its largest support for the week, $6.7 billion across three operations with targets including up to $2.9 billion UMBS30 2 percent and 2.5 percent as well as another for $1 billion GNII 2.5 percent. We begin the day with Agency MBS prices a tad better and the 10-year’s yield unchanged at 0.67 percent.

Everyone values some semblance of privacy in their lives. Here’s some instructions on how to blur your house in Google’s street views.

1. Go to Google Maps and enter your home address.

2. Enter into Street View mode by dragging the small yellow human-shaped icon, usually found in the bottom-right corner of the screen, onto the map in front of your house.

3. With your house in view, click “Report a problem” in the bottom-right corner of the screen or from the small drop-down menu (often indicated by three dots).

4. Center the red box on your home, and select “My home” in the “Request blurring” field.

5. There are a couple minor questions. Then you should be set.

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed 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 2020 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.)

If you watch the news long enough, you see all kinds of interesting things. Cracker Barrel is adding alcohol to its menu? Yup! And you must watch this clip with Stephen Colbert working out with, and interviewing, the Notorious RBG (“Is a hot dog a sandwich?”) a few years back. We watched Lee Farkas be released from prison after only 9 years. What are small independent mortgage bankers, and every other lender for that matter, watching? How about concerns and questions about loans with Agencies’ indemnification/recourse, that are now in forbearance, hitting the 120-day delinquency repurchase trigger? My guess is that details are under review and you should ask your Agency rep for details, but if your net worth is $4 million, and in the next month you receive buyback requests for five loans at $400,000 each, it doesn’t take an HP-12C to calculate what does that does to your net worth. Oh, there’s help: Miller High Life is giving away a backyard dive bar. Let the good times roll!

Jobs

“In the midst of a turbulent year, NRL Mortgage has not skipped a beat. While shattering previous companywide production volume records for six consecutive months and soon September, NRL has maintained operational excellence in underwriting turn times, upheld service level agreements, and placed a heavy emphasis on agility allowing NRL to avoid an operational slow down. Our turn times from application to clear to close are hovering just over 21 calendar days! Our proven record of high-quality and efficient service has driven rapid company expansion: 10 new branches across nine differed states in two months! Director of Acquisitions, Jeff Mason, attributes the growth to NRL’s committed operations team. “They are incredible,” he said. “When people see that they can get their files underwritten in 48 hours and closed in 21 calendar days during these incredibly busy times, it gets their attention. Pair that with our industry-leading compensation plan and NRL Mortgage is the perfect combination.” We are always looking to grow our team with professionals that share our entrepreneurial spirit and value for customer service. If you are interested in being a part of NRL Mortgage, please contact Jeff Mason.”

“Caliber Home Loans is thrilled to announce the launch of our new H2O ClearChoice Automated Underwriting System (AUS). Caliber ClearChoice empowers loan officers and wholesale business partners to make quicker decisions by providing side-by-side comparisons of multiple AUS types. Our AUS is a powerful and intuitive tool that provides the best option every time, drives a better experience and builds confidence with your customer. ClearChoice also offers an intelligent recommendation, and its recommendations have been accepted by 99% of users. Smart, efficient, and clear, just what you need to prepare your sales presentation to customers! If you’re ready to work for an innovative company, Caliber Home Loans is hiring. Connect with Jonathan Stanley or Brian Miller for positions in Operations or Sales respectively. To join as an approved Caliber business partner, email us.”

 

Recently named among Top 5 Best Mortgage Companies to work for by National Mortgage News, Geneva Financial, Home Loans Powered By Humans has experienced explosive growth and is seeking Operations Professionals nationwide. Competitive pay and benefits. Underwriters, Processors, Closers, and multiple other positions available. Most positions can be remote/home-based. across the United States. Geneva strives to humanize every aspect of its business from the inside-out. With a culture-forward mindset, management focuses on employees to ensure an unbeatable experience for customers. Its Geneva Gives, BE A GOOD HUMAN and Hero of The Year initiatives deemed them a recipient of this year’s AZ Business Magazine’s Excellence in Banking Award for Community Impact. In 2019 Geneva was ranked a nationally fastest growing company in the financial sector, mortgage industry and all industries categories. Apply today!

Churchill Mortgage, who was recently named a “Fast 50” company by Nashville Business Journal, announced two new hires: Randy Starkweather & Martin Ford. “Starkweather joins as Churchill’s CFO. With more than 35 years of executive management experience, his career includes a broad spectrum of industries and company sizes. Bringing more than 30 years of experience in operations, underwriting and credit policies in the financial services industry, Martin Ford, joins as our Vice President of Credit Risk. We’re continuing to quickly grow! We are not only focused on profits, but also on our people, which is one reason why we’ve been voted a Top Workplace for 8 consecutive years! If you would like to join us in our success, we would love to speak with you about opportunities in your area. Learn more about us here.”

Broker & lender services & products

For all of you sports fanatics out there, give me a virtual high five that football is back!  We all know that a fundamental principal in any successful sport’s team is roster depth. Computershare Loan Services (CLS) is embracing this fundamental by adding two more seasoned industry professionals to its team. Tracey Dace brings 30 years of experience to CLS’ Fulfillment team and joins as the VP of National Sales. Contact Tracey to learn how CLS can help originators increase capacity and drive down costs. Lining up as the VP of Capital Markets Cooperative’s Vendor Management is Mark Litzel. Launched in 2003, CMC is a highly diversified cooperative with solutions for lenders of all sizes. Mark is focused on adding vendors and investors that round out CMC’s robust Preferred Partner network. Reach out to Mark and learn about the benefits of becoming a CMC partner.

 

Corey Shelton at Atlantic Coast Mortgage shared how one of his team’s highest-performing LOs nailed down a WHOPPING $2 Million in revenue in 110 seconds. All coming from just 4 alerts he received from Sales Boomerang. Check it out.  Sales Boomerang notifies mortgage lenders when someone in their database is ready for a loan. “Look at the opportunity cost you have by not having Sales Boomerang. Last year we closed over $72M in loans that we would have lost from not having Sale Boomerang.” (Stephen Barton, EVP, Eustis Mortgage) The numbers speak for themselves: 20x Avg. ROI, $240 Avg Cost Per Acquired Loan, 10-20% Avg Lift to Loan Volume. Want to see exactly how much you lost this year? Request your report today. We will show you which competitor took your deal, what was the loan amount, what type of loan it was, and much more.

HomeBinder, one of the fastest growing tools in the lending market for post-closing retention, will be starting a capital raise on October 1st to support its expansion. In June, HomeBinder finalized its partnership with Ellie Mae and their integration with Encompass resulting in accelerated adoption of HomeBinder across mortgage companies nationwide as a value-added platform to help increase client retention. Interested parties can contact Pete Paglia (978.618.0835). To learn more about HomeBinder visit https://pages.homebinder.com/ or to receive a demo click here.

USDA, All the Way!

We go through this every darned year, and are reminded of it as Fiscal Year 2021 begins October 1. Pretty much the same note goes out every year. Lenders should review the Single-Family Housing Guaranteed Loan Program (SFHGLP) Conditional Commitment process. “Fee Structures: An upfront guarantee fee of 1.00 percent and an annual fee of .35 percent will apply to both purchase and refinance transactions for FY 2021. Issuance of Conditional Commitments: At the beginning of each fiscal year, funding for the guaranteed loan program is not available for a short period of time –approximately two weeks. USDA anticipates this brief lapse in funding to continue for FY 2021. During the temporary lapse in funding, Rural Development-Rural Housing Service (RHS) will issue Conditional Commitments (Form RD 3555-18/18E) ‘subject to the availability of commitment authority’ for purchase and refinance transactions.”

The U.S. Department of Agriculture (USDA) extended the foreclosure and eviction moratorium for Single Family Housing Direct Loan Borrowers through December 31, 2020.

The moratorium applies to: Initiation of foreclosures or completion of foreclosures in process, excluding vacant and abandoned properties and Evictions of borrowers from properties bought with a USDA direct home loan.

Additional FAQs related to the origination of USDA Single Family Housing Guaranteed loans have been added to the previously posted FAQs. The revised document has been posted to the USDA LINC Training and Resource Library. (Questions regarding program policy and this announcement may be emailed to the National Office Division or (202) 720-1452.)

Yes, the USDA Rural Development SFHG Program is providing additional guidance to support borrowers impacted by the Presidentially declared COVID-19 National Emergency. Guidance includes Moratorium Extension, Forbearance Requirements and Post Forbearance Options. Also announced, temporary exceptions in relation to COVID-19 Pandemic have been extended for the Single-Family Housing Guaranteed Loan Program. The temporary exceptions originally issued on March 27, 2020, pertaining to appraisals, repair inspections and income verifications for the Single-Family Housing Guaranteed Loan Program (SFHGLP) due to the COVID-19 pandemic have been extended until November 30, 2020.

There will be no change to the Submission or Underwriting process for Mountain West Financial, Inc. during the 2-week USDA unavailability of Funding for Fiscal Year 2021.

During the interim period, which starts 10/1/2020, while USDA awaits Fiscal Year 2021 funding, AmeriHome will require that the unexpired Conditional Commitment be in the Loan file prior to Loan Purchase by AmeriHome. The Conditional Commitment may be “subject to the availability of commitment authority.” By the way, During recent months, AmeriHome and each of the Agencies, Fannie Mae, Freddie Mac, FHA, VA, and USDA, have published announcements providing temporary measures to address the impacts of COVID-19 (coronavirus). The Agency guides and handbooks, AUS messaging (except as otherwise noted by the respective Agency), and AmeriHome Seller Guide and program guides will not be updated to reflect these temporary policies.

Flagstar Bank will continue to process, underwrite, and fund loans during the USDA lapse in funding submitted under the Guaranteed Rural Housing program, Doc. #5830 and GRH StreamlinedAssist program, Doc. #5831. Read Memo 20093 for details.

As per FHA Mortgagee Letter 2020-28 and the USDA-RD Single-Family Guaranteed Originations Notice, FAMC is announced updated temporary guidance for FHA Products:

Appraisal, VVOE – Wage Earner and USDA-RD Product Appraisal and VVOE.

The PennyMac Correspondent Group posted new announcements: Fannie Mae SEL 2020-05, Freddie Mac Bulletin 2020-36 and FHA Mortgagee Letter 2020-28 and 20-57: Funding for USDA Rural Housing 2021 Fiscal Year (FY).

Trainings and Events:

Blend Forward kicks off tomorrow. Learn what it takes to be able to respond to market conditions, regulatory changes, and rising consumer expectations with swift action. Forward, Blend’s virtual summit, brings together industry leaders and Blend executives and partners to unpack tactics lenders can use to master digital agility. Reserve your spot at the September 22-23 summit.

The Zelman and Associates 2020 Virtual Housing Summit begins today at 8:15AM.

Join Insellerate on Tuesday, September 22^nd for a free dynamic webinar “Managing The Borrower Journey”. Key Take-A-Ways include The Evolution of CRM & Marketing Automation in the mortgage industry, Data and key borrower touchpoints, Importance of telephony integration to intelligently engage borrowers, Mobile Innovation, and its impact on borrower engagement.

FHA has posted a new pre-recorded webinar on the Single Family Housing Archived Webinars page, providing a detailed overview of the loss mitigation policies for disaster-affected borrowers with FHA-insured mortgages whose property and/or place of employment is in a PDMDA.

Redwood Trust will be participation in Morgan Stanley’s State Of The Housing Market Webcast on September 24^th.

Join snapdocs on September 30^th for its Leading Lender Forum Webinar. Mike Lyons, EVP of Nexsys, Jaime Kosofsky, Partner at B&K Law, and Thomas Knapp, CIO of Waterstone Mortgage will discuss What RON and investor acceptance has looked like this year, How changes this year will affect lenders in 2021 and What to expect in the mortgage industry in 2021 and beyond.

Capital markets

Last week rate sheets didn’t change much, and Friday ended with UMBS30 basis roughly unchanged and the Treasury yield curve steepening slightly during a pullback amid the stalemate on more fiscal stimulus (the two sides are currently about $700 billion apart). Stocks hit a six-week low due to tech shares as that move heaped more pressure on risk tolerance across all asset classes.

In terms of news, the Federal Reserve announced it will release the results of its latest stress test by the end of 2020. The Conference Board’s Leading Economic Index (LEI) increased 1.2 percent in August, falling slightly short of expectations though the increase for August represents the fourth straight month the index has been positive after declining 7.4 percent in March and 6.3 percent in April. The index is still 4.7 percent below the level seen in February. The preliminary University of Michigan Index of Consumer Sentiment for September beat expectations and bettered the August reading, though the index is still 15.3 percent below the level registered in the same period a year ago.

This week opens with a very light economic calendar. We’ve had the Chicago Fed National Activity Index for August (down to .79 from last month’s 2.54), and later today, markets will have a chance to digest a couple shorter-duration Fed auctions and remarks from Governor Brainard, New York Fed President Williams and Dallas Fed President Kaplan. The Desk will conduct three MBS purchase operations totaling up to $5.5 billion. That starts with nearly $1 billion UMBS15 1.5 percent and 2 percent, which will be followed by $2.9 billion UMBS30 2 percent and 2.5 percent and $1.7 billion GNII 2 percent and 2.5 percent. With no other economic releases of note today, things pick back up tomorrow with August Existing Home Sales. Wednesday brings the September FHFA Housing Price Index and Thursday sees August New Home Sales before the week closes with August Durable Orders. Monday starts with Agency MBS prices better/up nearly .125 and the 10-year yielding .65 after closing Friday at 0.69 percent.

(I receive a lot of emails and a lot of questions & comments. These came from an industry vet in Richmond, Virginia.)

The fact that Kansas and Arkansas are pronounced differently bothers me way more than it should.

Pronouncing words that end in ‘ough’. Cough, bough, rough, dough, through, though, trough….

Is the “S” or “C” in “scent” silent?

Why does fridge have a “D” in it, but refrigerator doesn’t?

Why are Zoey and Zoe pronounced the same but Joey and Joe aren’t?

You can drink a drink by you can’t food a food?

The word “queue” is just a “Q” followed by four silent letters.

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed 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 2020 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.)

This week the lack of volatility in the bond market, and thus Agency mortgage rates, was made up for in other news. Lee Farkas was released from prison. As a reminder for anyone who has been in the business less than nine years, Farkas was sentenced to 30 years in prison in 2011 and ordered to pay $38.5 million for his role in a $2.9 billion scam that led to the collapse of both Taylor Bean & Whitaker and Alabama’s Colonial bank. TBW was one of the largest privately held mortgage lenders in the U.S., and Colonial was one of the 25 largest banks in the country. Virginia’s U.S. District Court Judge Leonie Brinkema, who tried him in 2011, cited Farkas’ age, health, and an outbreak of COVID-19 at the prison where he was confined as reasons for his release. I want his lawyer if something ever happens to me! And we have the death of Supreme Court Justice Ruth Bader Ginsberg. She indeed had a life “well lived” as they say. What happens now will occupy the press and the nation. After the death of Justice Antonin Scalia in February 2016, 9 months before the election, Senator Mitch McConnell famously refused to hold confirmation proceedings for then-President Barack Obama’s Supreme Court nominee Merrick Garland. “The American people should have a voice in the selection of their next Supreme Court Justice. Therefore, this vacancy should not be filled until we have a new president,” McConnell said at the time. Meanwhile, lenders keep on doing what they’re doing: helping millions of borrowers!

Saturday Company Spotlight

This week we highlight Truework, which “Gives employees control over employment, income, and other identity data.”

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). Truework was founded in 2017 in San Francisco with the idea that there needed to be a faster and more way for lenders to verify income and employment. More than 40,000 lenders, background check companies, landlords and other verifiers, as well as 150 enterprise companies and 20,000 small businesses, trust Truework as their employee and income verification platform of choice. By the end of 2020, Truework’s employer network will include over 26 million employees ranging from small and medium businesses to enterprise companies.
 

Tell us how your company maintains its culture in the office, or in a work-from-home environment if applicable. At Truework, our people are the cornerstone of our company.  We believe that only by prioritizing our team members and company culture can we truly create a great product.  Since shelter-in-place orders took effect in March, we’ve maintained our incredible culture through virtual off-sites such as wine tastings and woodworking where teams can get together and bond. We’ve also been hosting company-wide lunch-and-learns that range from anything from virtual tours of a local farm, to magic shows.

 

We’ve also begun virtual “donut” meetups, where a generator randomly pairs two team members together from different parts of the organization to meet up virtually that week. This is done with the purpose that even as our entire company works from home, getting to know other members of the team is still high priority. Furthermore, as we rapidly scale—we want to ensure that all new employees at the company are able to experience camaraderie and the Truework culture.

 

Things you are most proud of that don’t have to do with sales. In the midst of truly unprecedented times, we’ve been able to see the impact that our technology has had in ensuring that healthcare workers are quickly staffed and deployed to the frontlines of battling COVID-19.

 

Earlier this year we partnered with Trusted, a nurse staffing platform to help them verify important information about each nurse, such as verified employment history, work credentials, and criminal history. We saw that with Truework’s technology, tens of thousands of nurses were able to be verified in an average time of 22 hours and subsequently staffed, providing a critical need in the hardest-hit areas throughout the US.

Trusted’s head of marketplace, Amanda Maxedon, had this to say: “Nurses are the backbone of our healthcare system and have played a key role in the fight against COVID-19. Being able to ensure the privacy of their data while also helping to speed up the hiring process is not only a win for the nurses involved, but also ensures that everyone is able to get the care they deserve.”

 

Fun fact about Truework. Our team has grown rapidly and continues to grow. Since May of 2020, we have nearly doubled our team from 50 employees to 91 as of September.

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

Down payment help

Many MLOs and organizations know about, and understand, state-level housing finance agencies (HFAs). And there’s the National Council of State Housing Agencies (NCSHA), which advocates on behalf of all HFAs. But I continue to receive questions about resources and programs. So I turned to Stockton Williams, NCSHA’s executive director.

 

“Even in the midst of COVID-19, state housing finance agencies’ homeownership programs are running strong. Many HFAs have told us that their production is up substantially over last year, and some have seen record levels of volume in recent months. A large majority of this business isn’t refinancings, but home purchase loans to help low- and moderate-income borrowers realize the dream of homeownership.

 

“HFAs’ competitive products, including down payment assistance that can be paired with FHA, USDA, Fannie, and Freddie loans, offer affordable and sustainable paths to homeownership for responsible borrowers who may not otherwise be able to afford a mortgage. They have traditionally outperformed the market in shares of loans that go to minority borrowers and are constantly exploring new ways to address the specific housing needs of other underserved populations and communities.

“In addition, those lenders and servicers who have borrowers struggling to keep up with their mortgage payments due to a COVID-19-related hardship should be advised that many HFAs have established mortgage assistance programs to help struggling homeowners avoid foreclosure during these trying times. Some HFAs have received state and/or federal funding to support these efforts. Other HFAs quickly reopened dormant mortgage assistance programs from a federal program, the Hardest Hit Fund, that they administered in response to the financial crisis. Your readers can learn more about these initiatives with NCSHA’s matrix of state HFA emergency rental and housing assistance programs. The matrix includes links with more detailed information on each program.”

“If lenders want to know more about the HFAs in their states, you can visit NCSHA’s HFA Directory, or they can reach out to NCSHA’s Rosemarie Sabatino with any general inquiries about HFAs.”

Secondary market tidbits

The vast majority of mortgage deals in the secondary market involve either hedging with TBA (to be announced, generic, unspecified) securities, Agency mortgage backed securities filled with loans with defined characteristics, or CRTs (credit risk transfers). Let’s take a look at some other, less generic securities that may be of interest, as they too help determine demand and therefore supply.

In late July Fannie Mae announced that it issued a Single-Family Green Mortgage-Backed Security (MBS) transactions under its Green Bond Program as part of the company’s ongoing commitment to be a leader in green finance. Fannie Mae’s Single-Family Green MBS program recently received a Light Green Second Opinion from CICERO Shades of Green, an independent leading global provider of green ratings for bonds. Fannie Mae has issued over $40 million in Single-Family Green MBS since the first bond was issued on April 22, 2020 to commemorate the 50th anniversary of Earth Day. Fannie Mae Single-Family Green MBS transactions include only mortgage loans backed by newly constructed single-family residential homes with ENERGY STAR certifications that meet or exceed the national program requirements for ENERGY STAR Certified Homes. On average, these homes are 20% more efficient than single-family homes built to code. In addition to these transactions, Fannie Mae has issued $75 billion of Multifamily Green MBS since 2010 backed by either green-certified properties or properties targeting a reduction in energy or water consumption. For details regarding the Single-Family Green MBS program, visit www.fanniemae.com/GreenMBS.

 

That Green Bond Program announcement came after Fannie Mae published its second annual Multifamily Green Bond Impact Report at the end of June to provide metrics on the projected financial, social, and environmental benefits from Fannie Mae Green Bonds for U.S. housing. As the largest green bond issuer in the world, Fannie Mae issued $22.8 billion in multifamily green mortgage-backed securities in 2019, comprising 32 percent of the company’s total multifamily issuances. Fannie Mae’s Multifamily Green Bond Impact Report shows that in the first 10 years of the program, 770,000 units have been retrofitted or green-building certified. Each dollar invested is projected to generate $2.99 in economic output. Newly constructed or retrofitted green multifamily buildings are estimated to have contributed $7.6 billion in workers’ income and $15.6 billion to U.S. GDP and supported 180,000 jobs. As a result of Fannie Mae Green Bond-financing, properties are projected to reduce water use by 7.7 billion gallons, greenhouse gas emissions by 528,000 metric tons, and source energy by 7.8 billion kBTU. The Green Financing Business supports the multifamily housing market by incentivizing property owners to make energy- and water-saving improvements and by supporting properties with a Green Building Certification. Selling green bonds into the broader capital markets helps accelerate the transition to a low-carbon economy and a greener housing supply.

New York-based Hunt Real Estate Capital provided three Fannie Mae conventional loans totaling $24.2 million for manufactured housing communities (MHCs) in the greater Phoenix area. The three properties contain 519 units and are four-star parks made for single- and double-wide homes and RV rental spaces restricted to tenants 55 and older. The three loans were limited to Tier 4 underwriting standards (1.55 debt service coverage and 55 percent loan-to-value) and all carry 15-year, interest-only terms. This refinance lowered the rate significantly and provided cash out to the borrower while retaining reliable, long-term cash flow.

On September 8, Freddie Mac announced a $534 Million non-performing loan (NPL) sale, comprised of seasoned non-performing residential first lien loans held in Freddie Mac’s mortgage-related investments portfolio. The NPLs are being marketed via five pools: four Standard Pool Offerings (SPO) and one Extended Timeline Pool Offering (EXPO), which targets participation by smaller investors, including non-profits and Minority, Women, Disabled, LGBT, Veteran or Service-Disabled Veteran-Owned Businesses. Bids are due from qualified bidders by October 1, 2020 for the SPO pools, and October 15, 2020 for the EXPO pool. The SPO and EXPO pools are expected to settle in December 2020. All eligible bidders, including private investors, MWDOBs, nonprofits and neighborhood advocacy organizations are encouraged to bid. To participate, all potential bidders must be approved by Freddie Mac and successfully complete a qualification package to access the secure data room containing information about the NPLs and to bid on the NPL pool(s). The bids are to be made on an all-or-none basis for any pool separately or for any combination of SPO pools together. The winning bidder will be determined on the basis of the economics of the bids, subject to meeting Freddie Mac’s internal reserve levels, at Freddie Mac’s sole discretion. The NPLs are currently serviced by Specialized Loan Servicing LLC.

Earlier this year Freddie Mac announced pricing on the $376 million multifamily mortgage-backed SB74 offering, a securitization backed by small balance loans underwritten by Freddie Mac and issued by a third-party trust. The SB74 Certificates are expected to settle on or about May 29. Freddie Mac Small Balance Loans generally range from $1 million to $7.5 million and are generally backed by properties with five or more units. This is the fifth SB Certificate transaction in 2020. Pricing for the deal is as follows. Class A-5F has principal of $71.417 million, a weighted average life of 4.05 years, a 1.00 percent coupon, a 0.8668 percent yield, and a $100.4682 price. Class A-5H has principal of $116.777 million, a weighted average life of 4.15 years, a 1.17 percent coupon, a 1.0334 percent yield, and a $100.4850 price. Class A-7H has principal of $75.277 million, a weighted average life of 5.47 years, a 1.32 percent coupon, a 1.2162 percent yield, and a $100.4752 price. Class A-10F has principal of $113.436 million, a weighted average life of 7.26 years, a 1.38 percent coupon, a 1.2995 percent yield, and a $100.4845 price. This securitization is intended to aid Freddie Mac in continuing to provide liquidity to smaller apartment properties.

(Instead of the usual joke, trivia, or animal video, here is a test that KW sent along.)

Both the office and, more broadly, life entail lots of interactions with people you’re not quite sure about. Maybe they’re fun in some settings but not in others; maybe they have moments of brilliant talent mixed with astounding incompetence.

If you want to really evaluate how you feel about someone, give them the “Two Beers and a Puppy” test. The test is: In order to find out how you actually feel about someone, ask yourself, “Would I have two beers with this person?” And “Would I allow this person to look after my puppy over a weekend?”

There’s the “no and no” people. Those are to be avoided at all costs.

Some people are “yes and no,” or “no and yes.” These people are to cautiously trusted, or time spent. These people are no fun but they make the word a better place – for puppies, especially. Yes-beer, no-puppy people “are to be cautiously trusted. No-beer, yes-puppy people “are no fun but they make the world a better place. For puppies, especially.”

Some people are yes and yes, and those are the best people in your life. Hopefully, you were raised by people like that, or are your friends. Your life and work are better for having them in your life. Seek them out. Collaborate with them. Enjoy their company.

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, “The Agency Finance Fee: Delayed but not Forgotten.”

uɐɯsᴉɹɥɔ qoɹ

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is designed 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 2020 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.)