Who predicted that we’d be at 1.22 percent on the 10-year yield to start August? And 30-year fixed-rate mortgages still chopping around in the high 2 percent area? Or that the FHA would announce another extension of its moratorium on evictions for foreclosed borrowers and their occupants? Predictions are rough, and often forgotten, but numbers are interesting things. Whatever you do, always give 100%, unless you’re donating blood. We’re in an industry determined by numbers. Interesting times in the debt markets. Apple just issued 40-year debt at .92 percent above comparable U.S. risk-free Treasury yields. Mortgage rates, of course, are determined in part by the risk of prepayment and the risk of default. (They also include profit margins, competitive positioning, covering overhead.) (The audio version of today’s commentary, available here, is sponsored by Origence and features an interview with Ken Burns, EVP of Sales and Business Development, and Sarah Ledbetter, Senior Sales Executive on the benefits CRMs and automated marketing strategies can deliver to lenders.)

Employment & transitions

Westerra Credit Union Credit Union, a not-for-profit financial cooperative that puts people over profit, is excited to announce the addition of two new team members, Mario Gonzalez and Christina Ridgely. Gonzalez has been named Retail Mortgage Sales Manager and joins Westerra with over 25 years of experience in managing mortgage sales, marketing and operations at lenders and big banks. He is passionate about building high performing teams. Westerra welcomes Ridgely as Lending Call Center Manager, with a goal of giving members the best experience possible. She brings with her 24 years of knowledge in banking, customer service and sales.

“We’re searching for Licensed Originators looking to make a difference in their career! Partners United Financial, a Newrez Family of Companies, is actively seeking Loan Officers who reside in the following cities: Dublin, OH, Dayton, OH, Hilliard, OH, Worthington, OH, and La Canada, CA. At Partners United Financial, partnership is at the very core of our beliefs and values. Our product set consists of Smart Series, Fixed Rate Loans, Adjustable-Rate Loans, First Time Home Buyer Loans, Refinance, FHA Mortgages, Loans for Veterans, and Construction Financing. Ideal candidates will have 2+ years of lending origination experience and an active federal or state NMLS license. Join our growing team! Click to apply, contact our recruiting team or Michael Mulgrew, JV President.

Old and fast: ACC Mortgage the oldest Non-QM also has the fastest turn times. Experience matters! The first half of 2021 was ACC’s best ever and ACC is not slowing down. Non-QM loans to $5MM. 90% ITIN and more for 2021! Check-out www.Nonqmpricer.com  or now on Loan Sifter. ACC is hiring only 8 experienced account executives to support growth and maintain turn times, while always looking for quality operations folks. If you are passionate about Non-QM and want to join the leader, e-mail resume to [email protected].

The Freedom Mortgage Wholesale Division is looking for National Account Executives! With unlimited earning potential, our Account Executives are responsible for soliciting quality first mortgage loans through our Broker and Non-Delegated Wholesale Correspondent platforms. The opportunities are limitless! Put yourself in the driver’s seat to contact Broker Partners across the country as opposed to an assigned territory. Freedom Mortgage is focused on growing all channels of distribution following our record performance in the first half of 2021. For over 30 years, Freedom Mortgage has prided itself on fostering homeownership by providing brokers and non-delegated correspondents with the products and solutions needed to bring their borrower’s dreams to reality. Fresh ideas and perspectives help us foster this vision – if you bring passion, commitment, and focused energy, you’ll fit right in. Learn why Freedom Mortgage was recently recognized as one of the 2021 Top Workplaces in the USA, apply today!

“Towne is hiring Account Executives. Towne Mortgage Company is a multi-channel, national mortgage lender with the strength and stability of nearly 40 years in business. Despite an influx of acquisitions throughout the industry (and the heartburn that comes with it) we are still growing and have a strategy in place to continue. Today we offer single account territories in large markets to ensure AE’s have the opportunity to expand and excel. Our AEs sell cross-channel (Wholesale, Non-Del, and Full Delegated) and have access to full Agency and Renovation product sets. Currently, Towne has wide-open markets: WA/OR, VA/MD/DC, OH/IN, TX, FL, TN/AL/KY, LA/MS/AR, NC/SC/GA, Illinois, and Connecticut. If you’re looking for an extremely competitive compensation and benefits package, along with a one-of-a-kind business support Team look no further. Come for the stability, stay for the culture. To apply today, visit Towne Careers or contact Mark Zierott directly.

What do ex-CFPB directors do? Some might run for office. Others, in this case Kathy Kraninger, join crypto-native risk monitoring, market surveillance, and fraud-prevention firms like Solidus Labs to lead regulatory affairs. Congratulations!

Broker and lender products & services

There’s been no shortage of historic wins, celebrations and once-in-a-lifetime moments at the Olympics thus far. There has, however, been a shortage of fans, and that’s really lousy. Know what else is lousy? Mortgage lenders’ borrower retention rates. On average, mortgage lenders retain just 18% of their customers. Sales Boomerang, the #1 automated borrower intelligence and retention platform, has set out to change that. Lenders using Sales Boomerang’s Borrower Retention Playbook report borrower retention rates as high as 85%! That sounds historic, memorable, AND once-in-a-lifetime! Download the free Borrower Retention Playbook today and start operating at Olympic levels.

“If you aren’t using the Symmetry HELOC in your origination toolkit, you need to contact Symmetry Lending today! Find your Area Manager to learn how we can help you close more business and keep things simple with industry-leading turn times. Whether you are under a time crunch, challenged with pesky jumbo guidelines, or looking to maximize flexibility for your clients, Symmetry can provide solutions for all of this and more. If you have already experienced Symmetry’s Service, Speed, and Simplicity, do your colleagues a favor and send them to your Symmetry Area Manager to learn why our HELOCs are a must-have solution for your purchase and refinance clients. Follow us on LinkedIn, Facebook, and Twitter for our ongoing updates and resources.

NP, Inc. announces new non-QM product rollout! NP, Inc. is about to celebrate its 25th anniversary and is now one of the fastest-growing Non-QM lenders in the United States. The company enjoyed record months in Non-QM fundings for each of the last 120 days and was one of the first to bounce back in August 2020 from the Covid-19 market crash. Mortgage forecasters predict the Non-QM lending industry to explode over the next few years. The company is poised for major expansion in 2021 and beyond with the rollout out of a new line of Non-QM products in its Wholesale and Correspondent divisions coupled with a slew of strategic new hires. Click here to learn more about NP, Inc.’s Non-QM products and how they can help grow your business, or contact [email protected].

Fun fact: the world’s largest cowboy boots are 35 feet tall and located in San Antonio. Useful fact: FormFree’s AccountChek 3n1 provides lenders with asset, income, and employment verification at a fraction of what other verification services charge and comes with pay stubs and W-2s to boot. Here’s what Atlanta-based Highland Mortgage’s founder had to say: “Over the course of my career, I’ve had the opportunity to test drive several VOA providers, and AccountChek has always stood out as the original and the best. Now with 3n1, we love getting all three verifications. Our fallback VOE provider doesn’t give us any pay stubs. With 3n1, we get six of them along with W-2s before we’ve even sent disclosures out to our client.” Download the full case study to see how 3n1 is helping Highland grow.

Events & education in September going forward

More on August events later this week, but these will give you time to book flights.

Join the Florida Association of Mortgage Professionals for the 2021 State Convention and Trade Show at Hilton Orlando Bonnet Creek from September 1-4. For the FAMP speaker lineup and agenda, click here.

The Indiana Mortgage Bankers Association State Convention is September 13th and 14th at the Renaissance Indianapolis North Hotel in Carmel, IN.

The Mortgage Collaborative (TMC) is getting its national family of 240+ lender member companies back together at the fabulous Terranea Resort just outside Los Angeles, CA on September 19-21 for the TMC Reunited Summer Conference. The interactive lender-driven agenda and schedule of events can be found here. Contact TMC President & COO Rich Swerbinsky with questions.

The Five Star Conference and Expo is all-in, and committed to the mission of preserving and protecting the American dream of homeownership, September 19-20 at the Hyatt Regency in Texas.

CUMA’s Annual Conference is in-person celebrating its 25th year of serving mortgage-lending credit unions. Reconnect and recharge at CUMA’s LIVE WIRE 25, September 12-15 in Washington D.C. Click here for conference details and registration information.

Registration is open for the MISMO Fall Summit, September 20-24 in Washington, DC. This in person event is focused on Achieving Interoperability: The Path Ahead. Highlights include educational sessions and collaborative meetings on key real estate finance standards and initiatives, networking events, Co-located events including MISMO Boot Camp and Commercial MISMO Workshop. Sign up by Aug. 20, 2021, for early registration discounts.

The AIME Fuse 2021 National Conference: the largest nationwide gathering of independent mortgage professionals in the country, happening at the Bellagio Hotel & Casino in Las Vegas is on Friday, September 24, and Saturday, September 25!

Start registering today for the MBAC 65th Convention October 4-6 in Wilmington, NC at the Hotel Ballast. Members can take advantage of Early Bird Discounts: contact Robin Weyrens (704-557-0204).

Registration is open for the 6th Annual Freddie Mac CONNECT virtual industry conference, October 5 – 6, 2021. RSVP now to save your spot.

The MBANJ Regional Conference of MBAs, “Simply The Best”, is back and in-person on October 3^rd -7^th at the Hard Rock Casino Hotel in AC.

On October 16^th in San Diego right before MBA’s Annual Convention & Expo, there is a full day event (the mPowering You Summit) you can join the conversation and be part the mPower movement.

The MBA’s Annual Conference is in San Diego from October 17-20!

Mark your calendars: Mortgage Bankers Association of Kentucky Education Conference is November 3rd at the Galt House in Louisville; Registration will open in early August.

While we’re talking about training & education, don’t forget that the Mortgage Bankers Association offers the MBA’s Path to Diversity & Inclusion Scholarship. Use the funds towards your education and to sharpen your loan admin skills. The program enables employees from diverse backgrounds to advance their professional growth and career development through education and training. Scholarship recipients will receive a voucher to cover conference registration fees or course registration fees, up to a maximum of $2,000, for any of the qualified MBA Education programs and courses listed below. Applicants must be currently employed by an MBA member firm or state MBA member firm, and have two years of experience in the mortgage industry, or some equivalent in real estate finance experience or training. Applicants can be awarded the scholarship once per calendar year and up to three times in their career. For more information on MBA’s Diversity and Inclusion commitment, visit the Diversity and Inclusion Resource Center.

Capital markets

What is the narrative we want to push about the economy and its impact on the bond market? Are we going to have new variants of COVID for the rest of our lives? Recent economic data highlights that demand continues to exceed supply in many areas of the U.S. economy and that policy makers are divided on what actions are needed to return things to “normal.” During the last cycle, policy makers couldn’t explain why inflation was so low despite the lowest unemployment rate in decades and now they struggle with understanding the current situation where there is still slack in the labor market and inflation that may or may not be on a tear. Mortgage rates remain low as the calendar inches closer to the start of school and the full expiration of enhanced jobless benefits.

U.S. economic output measured by GDP has officially surpassed pre-pandemic levels, but is still somehow missing expectations due to a decline in government spending and supply chain bottlenecks that have depleted inventories. To close last week, we saw that June personal income and spending both increased more than expected while employment costs showed a smaller than expected increase for Q2. The PCE year-over-year inflation figure came in at 3.5 percent for June which is the largest annual gain since 1991. The University of Michigan Consumer Sentiment Survey posted the second highest pandemic-era reading while the Chicago PMI approached its high from May.

The Federal Open Market Committee (FOMC) did not make any major policy changes following last week’s meeting and Chair Powell identified multiple views as to when the committee should begin to reduce the Fed’s balance sheet at his press conference following the meeting. We did have some “taper talk” in the form of St. Louis Fed President James Bullard saying markets are “very well prepared” for the central bank to start paring back asset purchases in the fall. He added that he’d like to see the asset purchases program end by “the first quarter of next year,” which is faster than has been suggested by other Fed officials. Economists expect the committee will announce a tapering formally by December and start the taper in early 2022. In the meantime, the utilization of the Fed’s reverse repurchase facility meant to lend short-term capital during cash flow issues exceeded one trillion dollars for the first time.

The August economic calendar kicks off this week with the usual early month releases before concluding with the July employment report on Friday that will show how the labor market is healing. Today brings final July manufacturing PMIs from Markit and ISM, as well as June construction spending. With regards to MBS, the Desk will purchase $4.9 billion per day on average this week, including $5.2 billion 30-year 2 percent and 2.5 percent today, while July agency prepayments will be released after the close on Thursday. We begin the week with Agency MBS prices up slightly and the 10-year at 1.22 after rallying to close last week at 1.24 percent.

Students in an advanced Biology class were taking their mid-term exam.

The last question was, “Name seven advantages of mother’s milk.”

The question was worth 70 points or none at all.

One student, in particular, was hard put to think of seven advantages.

However, he wrote:

It is perfect formula for the child.

It provides immunity against several diseases.

It is always the right temperature.

It is inexpensive.

It bonds the child to mother, and vice versa.

It is always available as needed.

And then the student was stuck.

Finally, in desperation, just before the bell rang indicating the end of the test, he wrote:

It comes in two attractive containers and it’s high enough off the ground where the cat can’t get it.

He got an A.

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, “A Primer on What Originators Should Know about the Fed”. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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 2021 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.)

 

Why focus on mortgage banking when there is a lot of exciting news coming out of the Olympics? For example, the reporter asking the swimmer about his phenomenal third leg? But there is a lot going on with lenders, as we deal with the real estate markets around the nation, changing guidelines, shifts in borrower demographics and credit profiles, evaluating vendor offerings, and the overall economy. For example, lenders must keep an eye on wealth. Homeowners 62 and older saw their housing wealth grow by 3.4 percent or $305 billion in the first quarter to a record $9.23 trillion from Q4 2020. This is according to the latest quarterly release of the NRMLA/RiskSpan Reverse Mortgage Market Index, which rose in Q1 2021 to 322.89, another all-time high. Let’s check in with what’s going on out there.

Saturday Spotlight: Bonzo, focused on automated follow-up that gets attention.

“We’re back with more Bonzo news. Have you ever wanted to get into the mortgage industry as a Loan Officer? Are you a company that is looking to source and hire new Loan Officers? Look no further.

“There has been talk about Bonzo’s new ‘Conversationalist’ product before, but it deserves another mention. It’s important to the story since with this product Bonzo is not only offering full access to its innovative platform, but Bonzo is also dedicating members of its team to convert and qualify your leads. As an external extension of your team, a talented ‘Conversationalist’ will be assigned to the success and growth of your business by way of converting digital leads. When a lead is qualified, they book an appointment right on your calendar. It’s pretty cool stuff.

“The coolest part about the Conversationalist, however, is the initiative and commitment to grow and develop their employees. Bonzo paves a path for their Conversationalists who interested in becoming a Loan Officer. They set aside several paid hours per week to go through pre-licensing course work and study so that they can pass the NMLS exam. From there, as employees work in their role, they are receiving sales and personal development training to ensure a successful future in the mortgage industry.

“Bonzo is committed to growth and to its employees and those of its clients. Growth for their business (obviously), growth for their user’s businesses, and growth for their employees. The feeling of being stuck is a terrible one, and they’re trying to solve that problem on multiple fronts, starting with their employees. (To learn more about this program or to inquire about the availability to hire a turnkey, ready-to-produce LO email Miles Miller.)

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

Credit perspectives

Everyone in lending should know that the five Cs of credit are character, capacity, capital, collateral, and conditions. But these tend to be lumped together under “credit” when lenders are doing hundreds of thousands of loans every year. Analyzing credit and counter-party risk is what we do as an industry, so let’s take a look at some helpful news.

The domination of the FICO (which stands for Fair, Isaac and Company) credit score may be threatened, with several large lenders working to phase out the use of it in credit decisions. Capital One and Synchrony Financial have cut FICO for most decisions, and JPMorgan Chase and Bank of America have reduced the role FICO plays in some decisions. About 53 million adults in the U.S. don’t have a FICO score because they lack a borrowing history. The company that makes FICO scores, Fair Isaac Corp., derives about 40 percent of its revenue from the scores, but pretty much all of its profit.

Earlier this month I had some information from Tracey King-Danadio, COO of Partners Credit & Verification Solutions, on the timing of credit reports and impact on credit evaluation. “The credit bureaus recognize that consumers need the ability to shop around when financing a large purchase like an automobile or a home. They have provided grace periods during which multiple inquiries may appear, but only the first one will impact the score. It varies by bureau, something to consider. Since Experian has the shortest time frame, it sticks to the 14 days as most credit pulls are tri-merges (Equifax, TransUnion, and Experian). Equifax has a grace period of 45 days, Experian 14 days, and TransUnion 45 days. The time before the first inquiry impacts the score is 30 days for all three.”

Barrett Burns, President and CEO of VantageScore Solutions, LLC, expanded on this. “To give a little more color to the window relative to credit scoring models, it depends on which model a lender is pulling a credit score from. In our case, if a lender is pulling a VantageScore credit score, we have a 14-day window that consolidates all inquiries into one inquiry. Since our models are identical across all of the national bureaus and the models were developed at the same point in time for all three thus driving consistency across the three, the 14-day window is identical when pulling VantageScore credit scores from any or all of the three bureaus. This includes all consumer loan asset classes: mortgage, auto, credit card, personal loans etc.”

 

Vendor updates

Vendors do a lot more than make up company names and capitalize letters in the middle of them. Let’s take a random look at who’s doing what.

Insellerate, the leading mortgage Customer Experience Platform featuring Lead Management, CRM & Engagement that helps lenders close more loans by increasing efficiency gains across sales, marketing, operations management, announced that its DATA IE solution has grown over 200% in the last six months. The DATA IE solution enables loan officers to craft the right message at the right time with the right offer through the power of intelligent data and engagement. This delivers timelier and more personalized engagement, enhanced borrower retention, and higher conversions.

On August 3^rd Secure Insight and Reti360 will launch their product integration designed to offer real estate agents and consumers verified identity and risk reports on attorneys, title agents and escrow officers. The reports will be accessible through the Reti360 transaction platform without a fee. SI Founder and CEO Andrew Liput stated that “we are very excited to be able to offer our risk reports to consumers for the first time, assisting them in evaluating those professionals referred to them by others so they can make their own decision whom to hire in the mortgage and real estate contract and closing process.” (Questions can be directed to CEO Andrew Liput.)

The parent company of Better Mortgage is rapidly building out its real estate brokerage and title insurance businesses as the next step in Better’s end-to-end platform. With the addition of Minnesota, Vermont and Virginia in April, Better Mortgage is now licensed in 47 states and Washington, D.C. But the Better family of companies also includes Better Cover LLC, a provider of homeowners insurance policies, and Better Settlement Services which provides title insurance in 24 states.

Lendsmart has successfully integrated with Freddie Mac Loan Product Advisor^® (LPA^SM), accelerating its efforts to allow more borrowers to get a loan, refinance, or purchase a home, while saving time and reducing the origination costs for lenders. Lendsmart’s centralized platform unifies all parties involved while also automating manual tasks, improving accuracy, minimizing lender risk, and reducing origination and operational costs. The partnership will accelerate Lendsmart’s efforts to allow more borrowers to get a loan, refinance, or purchase a home, while saving time and reducing the origination costs for lenders.

Mortgage knowledge process outsourcing company Verity Global Solutions announces the launch of QCWorks, a pre- and post-close audit service. “QCWorks is enabled by a robust automation and client interfacing technology allowing lenders to achieve real-time quality control with extensive reporting capability… Access real time view of audit review stage per file, real time QC – documents released to clients as reviews are complete, clients easily build granular custom reports with a drag-and-drop design tool, generate real-time reports, receive automated action plans, direct rebuttals to specific individuals or groups in the Audit Response Center, and bundle loan audits.

Tavant announced that its new Touchless Mortgage™ Platform, an AI-powered lending-as-a-service platform, can be used by LOs, processors and underwriters to optimize workflows to “engage with data and make decisions faster, instead of relying on physical documentation and manual data entry. The Touchless Lending platform integrates effortlessly with existing core systems, including the LOS, and efficiently automates mortgage production.”

Previous legislation preventing DACA recipients, or Dreamers, from obtaining loans was recently overturned, now allowing some undocumented immigrants who arrived in the U.S. as children to qualify for FHA loans. Financial experts at Bankrate created this guide to walk readers through the loan process and how to qualify for an FHA loan, or alternative home loans.

Compass, Inc. and Guaranteed Rate entered into a definitive agreement to form OriginPoint, a new mortgage origination company. Once Guaranteed Rate’s digital mortgage platform is fully integrated into Compass’ suite of AI-driven cloud-based software, OriginPoint will originate mortgages for clients of Compass’ real estate brokerage, as well as any other brokerage. OriginPoint will be available to all consumers in every market where Compass operates and OriginPoint is licensed regardless of the brokerage they choose to work with.

XINNIX announced the newest Performance Training, The ASCEND™ Program for experienced operations professionals looking to transition into a career as a Junior Underwriter. The program provides organizations with a training partner dedicated to career development within the mortgage industry.

Online mortgage company Morty just announced $25M in Series B funding. The round was led by March Capital, which has also invested in successful companies like Crowdstrike and ThoughtSpot. Morty helps home buyers shop for mortgages with an Amazon-style marketplace, enabling cheaper prices, more transparency, and faster time to close, which is especially important in a housing market with such competition. Morty manages the entire buying process, which separates them from other companies that function more like Kayak.com-style marketplaces. In the past twelve months, Morty has processed more than half a billion dollars in loans.

With the recent Evolve Mortgage Services acquisition of E-Notary Seal, mortgage borrowers can remotely sign and notarize a document from anywhere on any device. Evolve has integrated a full library of SMART Docs, e-Sign, eNotary, eVault and e-Registry, services with modern technology for a post-pandemic world. Yes, Evolve Mortgage Services, a top provider of on-shore outsourced mortgage services, has closed its acquisition of E-Notary Seal LLC, enabling mortgage borrowers to remotely sign and notarize a document from anywhere on any device. Evolve has seamlessly integrated a full library of SMART Docs, e-Sign, eNotary, eVault and e-Registry, and can be utilized to complete other types of property transactions, including loss mitigation. “The transaction is the final piece Evolve needed to provide home lenders and title companies with a purely digital closing process.”

Regions Bank announced the launch of a digital solution designed to make it easier and more convenient for homebuilders and developers to utilize the construction lending process. “The centralized, digital solution is offered by Regions in collaboration with Built, a construction finance software and payment technology leader. The solution gives builders and developers new construction loan management options through a cloud-based platform. The app simplifies the loan administration process through a unique portal experience that aligns the builder, inspector, and lender, among other stakeholders.”

LoanLogics announced that an affiliate of Sun Capital Partners, Inc. “Sun Capital,” has completed an acquisition of the company. Since 1995, the firm Sun Capital has invested in more than 425 companies worldwide with revenues in excess of $50 billion across a broad range of industries. LoanLogics demonstrated ability to leverage its technology to create, validate and perfect digital mortgage assets and automate processes across the mortgage workflow makes it ideally positioned to grow in the fragmented mortgage technology market, which has an estimated value of more than $10 billion. Terms of the private transaction were not disclosed.

Ephesoft Inc. and Zia Consulting announced their new automation solution for mortgage processing, Ephesoft Mortgage, powered by Zia. This AI and OCR-powered solution automates the most labor-intensive aspects of mortgage including retail, wholesale, mortgage insurance, due diligence, and servicing. Now available for customers nationwide, Ephesoft Mortgage

delivers significant cost-savings, offers accelerated revenue opportunities, improves customer experience, and provides visibility into the mortgage process for enhanced compliance and business intelligence.

In major mortgage technology integration news, FormFree and ICE Mortgage Technology^TM have partnered to make AccountChek 3n1’s combined asset, income and employment verification service available to lenders through Encompass. Reliably sourcing VOA and VOIE orders through a single vendor, FormFree^®s  AccountChek 3n1 securely delivers direct-source VOA and VOI/E data in less than a minute, significantly shortening loan application timelines and collecting critical underwriting documents earlier in the application process.

(Part Six of Six of corny English puns.)

24. What did the surgeon say to the patient who insisted on closing up their own incision? Suture self.

25. I’ve started telling everyone about the benefits of eating dried grapes. It’s all about raisin awareness.

26. Two parrots are sitting on a perch….one turns to the other says…. “do you smell fish?”

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, “A Primer on What Originators Should Know about the Fed”. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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 2021 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.)

 

Yesterday I received this note from Tennessee. “Rob, thank you for the commentary, as always. Among several noteworthy items in yesterday’s, one thing stood out. ‘NAR has 1.5 million members but only 1.2 million active listings.’ That sure sums things up in my area.” (And most of those listings, when actually purchased, will have average closing costs over $6,000.) When you’re a hammer, all you see are nails. And when you’re a baby boomer, you think you’re one in a million. The National Association of Realtors (NAR, not to be confused with the NRA) has released a study finding a “dire shortage” of housing which requires a “once-in-a-generation” response. As Brent Nyitray smartly sums up, “The US housing stock grew at a 1.7% pace from the 1970s through the 1970s, however it has averaged only 1% since, and has fallen to 0.7% over the past decade. They estimate that the supply gap is about 6.8 million units, which would require housing starts of more than 2 million units per year. In 2020, housing starts came in at 1.3 million, however COVID did impact those numbers slightly. Housing starts have returned to historical normalcy” but hasn’t kept up with the population growth. (The audio version of today’s commentary is available here and this week’s is sponsored by Origence, helping financial institutions provide mortgage, consumer, indirect, and home equity loans with greater efficiency and increased scale. Today’s features an interview with Michael Farris on how having native system configurability benefits lenders.)

Employment 

The new leadership team at Anchor Loans, the nation’s largest fix-and-flip lender, is looking for talented sales professionals with extensive experience in the private money lending space to help the company meet its ambitious growth targets. In the past year, Andy Pollock has come on board as CEO, and this summer industry veterans Matt Miles and Andrew Jewett have joined as head of capital markets and enterprise sales, respectively. To date, Anchor’s originated more than $9.5 billion in bridge loans to professional investors (85% are repeat customers) and is growing rapidly. The company offers attractive compensation, sign-on bonuses, top-tier benefits, and hybrid work options! To learn more, contact Anchor’s Human Resources Department.

“Know a Unicorn? Candor is paving the path for the future Mortgage Industry. Candor is adding to #TeamCandor Underwriting Specialist (no pipeline, just brainpower!), Scrum Master, Data Engineer, Software Engineer, and several more. Is that you?”

275 basis points Agency, 325 bps Govie, and a P&L model with rapid turn-times. Recently named among Top 6 Best Large Mortgage Companies to work for by National Mortgage News, Geneva Financial Home Loans is filling Branch Manager and Loan officer positions in 45 states. Close in as little as ten days. Large volume branches can opt for same-day Underwriting with in-branch Ops option.  P&L includes zero fees for credit reports, AUS, LOS, CRM, technology fees, employer taxes (commissioned employees), VOEs, 4506Ts, and warehouse costs. See why Geneva Financial has a 5-star Google rating with over 1,800 verified borrower reviews!

“Our commitment to Non-QM is Maverick Strong and we want YOU on our team! FGMC is looking for experienced Wholesale & Correspondent Account Executives and Non-QM Underwriters to join our growing team across the United States. These remote positions provide impressive benefits, highly competitive compensation, and a seamless hiring process. For Non-QM Underwriters sign-on bonuses and buyouts may be available! FGMC has been in business since 1987 and is dedicated to growing the Non-QM space. Send us your resume or any questions you have about our open positions to [email protected]. Looking for a Non-QM & Non-Agency partner? You can learn more about working with Maverick Solutions, FGMC’s proprietary line of alternative financing products!”

Lender and broker services & products

No inventory? No problem. Create more move-in ready or upgraded home inventory using Renovation loan programs. Let Planet Home Lending’s Renovation lending experts show you how to take advantage of the power of “as improved” appraised values for both purchase money and refinance transactions. From first-time homebuyers and millennials to move-up buyers and right-sizing retirees, Planet Home Lending has the programs that help you close more loans! To boost your local inventory, Contact Jim Bopp, Vice President of National Renovation Lending, now at 518-348-6426.

Do you want to increase your team’s efficiency, boost customer and partner satisfaction, and minimize human error? If you’re not harnessing the power of a fully LOS integrated CRM, you’re missing out on all of this and more. Jungo, the CRM built on Salesforce and customized for loan origination teams, is proud to announce its safe and secure integration sync with LendingPad. With the Jungo + LendingPad LOS Sync, a complete sync between CRM and LOS ensures that loan files and customer records are consistent across all platforms. Plus, Jungo’s email and texting automations trigger loan process updates to your borrowers and referral partners as soon as a loan file is updated in LendingPad. Ditch double data entry and do mortgage pipeline management better with the Jungo + LendingPad LOS Sync! To learn more, click here.

Since Tokyo is more than 12 hours ahead of the U.S., Olympics superfans will need a game plan to catch all the events. You know who else needs a game plan? Lenders that want to hold on to their borrowers for future loans. On average, mortgage lenders retain just 18% of their customers. Sales Boomerang, the #1 automated borrower intelligence and retention platform, recently studied 19 mortgage companies that are beating those odds with an average three-year refi retention rate of 59.33% and drew up a winning game plan for lenders looking to stand at the top of the borrower retention podium. Going for gold? Download the free Borrower Retention Playbook today.

Deliver a consumer-centered homeownership experience. Here’s one thing that’s abundantly clear: consumers want an easier, less stressful, and less expensive way to purchase homes. And now, lenders have an opportunity to add value to the homeownership journey by bringing integrated activities and increased operational efficiencies into an end-to-end customer experience. The first step? Understanding what consumers really want, and identifying opportunities to precisely deliver that throughout the homeownership journey. Blend commissioned this study by the Aite Group to survey over 2,000 American consumers to identify consumer pain points in the homeownership journey and explore new, lender-facilitated solutions. Inside this report, you’ll find key consumer insights and strategic recommendations for how lenders can power a new, customer-centric standard for homeownership. Download the report, “Reframing the Homeownership Journey: Consumer-Focused, Lender-Led”, and dive into key consumer survey takeaways and how your peers are approaching the challenge.

The AIME Fuse 2021 National Conference just got even bigger with the additions of bestselling authors and entrepreneurs Simon Sinek and Molly Bloom, who will be joining five-time NBA champion, Naismith Memorial Hall of Famer and inspirational philanthropist Earvin “Magic” Johnson as keynote speakers. Don’t miss out on the largest nationwide gathering of independent mortgage professionals in the country, happening at the Bellagio Hotel & Casino in Las Vegas on Friday, September 24, and Saturday, September 25!

Agency changes never stop

Fannie Mae issued SVC-2021-04, updating the Servicing Guide broadening the requirements for acceptance of mortgage assistance funds, introduce a new process for filing conventional mortgage insurance (MI) claims in the new Fannie Mae MI Claims Portal (MICP), simplify the REOgram™ notification process, and include a reference to recently added Selling Guide policies for notarization standards and remote ink-signed notarization.

To assist Lenders with help identifying condotels and transient use, Fannie Mae created a condo training video providing tips on determining condotel project characteristics and resources to help gain certainty and clarity on its condo project eligibility guidelines.

Watch the condotel projects training video.

Fannie Mae updated the instructions to the Multistate Fixed Rate note and Multistate SOFR notes, and the summary page instruction for the Maine Fixed Rate Note. These changes apply to the current notes and are already incorporated into the new (July 2021) note instructions.

View a summary of the updates and Access the updated instructions.

Freddie Mac updated Guide Exhibit 19, Credit Fees in Price and Loan Selling Advisor® to reflect elimination of the 50 basis points, market condition credit fee in price for certain cash-out and “no cash-out” refinance mortgages. If the market condition credit fee in price is assessed on a refinance mortgage that is allocated to a cash contract with an acceptance date prior to June 1, 2021, and the mortgage funds on or after August 1, 2021, Freddie Mac will reimburse you according to the monthly ACH process described in Guide Section 6303.2 Payment of fees.

Rapidly fluctuating markets present unique appraisal challenges and the current environment of upward pressure on pricing in many markets has been particularly difficult. Learn about how this environment has led to a rising trend in appraisals below contract price and some of the tools available to appraisers to help them navigate it in this Freddie Mac Article.

Lenders can sell Freddie Mac community land trust (CLT) mortgages secured by certified CHOICEHome® mortgage manufactured homes with Freddie Mac written approval. Because manufactured homes typically cost less than site-built homes, financing a CHOICEHome with a CLT mortgage brings sustainable homeownership within reach for more households. CLTs sell homes in their inventory to eligible homebuyers and lease the lots on which the homes sit to the homebuyers at below market rates. Lenders need a second term of business (TOB) to sell and service loans secured by CHOICEHome-certified manufactured homes on a CLT. For more information, review Bulletin 2021-25, CHOICEHome FAQs and the CLT FAQs.

Freddie Mac’s Construction Conversion Mortgages Secured by Manufactured Homes makes it easier for borrowers who want to replace interim construction financing used to buy a manufactured home and/or pay construction costs like those related to the installation and anchoring of the manufactured home. Find out more in manufactured housing FAQs.

Freddie Mac now permits energy reports to be dated up to 24 months prior to the note date instead of 120 days. Also, the energy report exception previously applicable only to solar panels to also include other renewable energy sources, such as water efficiency devices, wind turbines and geothermal systems. View GreenCHOICE FAQs

Use Fannie Mae’s new Self-Assessment resource to ensure your post-COVID-19 forbearance evaluation process complies with the contractual obligations in your Lender Contract and the Fannie Mae Selling and Servicing Guides.

Do you have processes in place to detect and prevent undisclosed borrower debt throughout the loan manufacturing process? In this Fannie Mae issue of Quality Insider, tips to enhance your internal controls from origination and prefunding to post-closing.

Freddie Mac announced the launch of its new, comprehensive CreditSmart^® financial capability curriculum aimed at helping consumers learn about the importance of building, maintaining and using credit. According to a recent Freddie Mac survey of homeowners and renters, many Americans are confused about the impact of debt on their credit profile. For example, one in three Americans are not aware that credit score elements, such as the length of credit usage or having joint credit and loan accounts, are reported to credit bureaus. The new CreditSmart Coach^® curriculum for facilitators will be available on October 1. More information about the newly launched CreditSmart is available online.

Fannie Mae’s Collateral Underwriter® (CU®) Version 5.0 launched on June 25. CU now has an improved user interface, as well as fewer messages with more robust content to help lenders make more informed decisions. Watch the CU 5.0 Quick Start Guide.

Capital markets

“Do you need to sell loans your company no longer needs or desires to hold? NASB works with mortgage lenders and sellers of all sizes across the country to facilitate whole loan trades. Whether it’s a reaction to historic volume from 2020 or adjusting to the new Government Sponsored Enterprise (GSE) purchase caps, we can help. NASB Whole Loan Trading has a dedicated loan purchasing team, that provides a quick turnaround along with competitive pricing. Regardless of if it’s ‘scratch and dent’ seasoned or non-seasoned loans in your portfolio, we buy both scenarios. NASB purchases* in bulk or even potentially individual loans. We buy residential property loans (1-4 units), mortgage loans in 1^st lien position (excluding HELOCs), and loans underwritten to Agency standards but are non-salable. Contact NASB Whole Loan Trading Today! (*Purchase approval subject to NASB’s purchase loan due diligence review. NMLS ID: 400039, EHL, & Member FDIC.)”

Not much movement in the bond market yesterday despite some noticeable headlines as we continue to be focused on COVID developments’ impact on economies. Initial Jobless Claims numbers disappointed, putting some fire-power behind Powell’s comments emphasizing that we have a way to go for the labor market to recover. GDP came in lower than expected at 6.5 percent, putting a finer point on the fact that growth may be stalling. Yes, in some ways the economy is now ahead of the pre-pandemic levels, but inflation and the COVID delta variant are beginning to weigh on the economy and jobless claims are still at almost double pre-pandemic levels.

Oddly, Black Knight reported a 31k increase in the overall number of active forbearance plans since last Tuesday. Despite the increase, there are still 163k (-7.9 percent) fewer plans than at the same time last month. As of July 27, 1.9 million borrowers remain in COVID-19 forbearance plans. For good news, the Primary Mortgage Market Survey from Freddie Mac for the week ending July 29 saw another cycle low in the 15-year fixed rate, falling 2bp to 2.10 percent, while the 30-rate ticked up 2bp to 2.80 percent.

Today closes out month-end trading for index purposes and we have a busy slate of economic data to go with it. Personal income and spending for June (+.1 and +1.0 percent, respectively) and Q2 employment costs (+.7 percent), the Chicago Purchasing Manager’s Index, and Michigan Consumer Sentiment. “Fedspeak” returns following this week’s FOMC events with St. Louis Fed President Bullard and Governor Brainard both on the podium. The Desk of the NY Fed will purchase up to $4.6 billion of conventionals. We begin the day with Agency MBS prices better/up .125 and the 10-year yielding 1.24 after closing yesterday at 1.27 percent.

(Part Five of Six of corny English puns.)

21. I got over my addiction to chocolate, marshmallows, and nuts. I won’t lie, it was a rocky road.

22. What do you say to comfort a friend who’s struggling with grammar? There, their, they’re.

23. I went to the toy store and asked the assistant where the Schwarzenegger dolls are and he replied, “Aisle B, back.”

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, “A Primer on What Originators Should Know about the Fed”. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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 2021 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.)

Mission Statements are so passe. We now have “long term vision statements.” For some, great literature consists of the Bible, or Moby Dick. For others of limited intelligence, like me, the pinnacle is National Lampoon’s 1964 Yearbook. (The Freshman section is classic.) For others it is the FHA Handbook or the charters of Freddie Mac and Fannie Mae. Or perhaps it is the National Association of Realtor’s Code of Ethics. Earlier this week I attended an online NAR research meeting. (NAR has 1.5 million members and 1.2 million active listings.) Lenders can usually learn a thing or two from NAR, and one topic during the session was foreign buyers. Per the National Association of Realtors, the state with the most foreign buyers of real estate? Florida (Europeans), then California (Asians), then Texas (Mexicans), Arizona (Canadians), followed by New Jersey and New York (across the globe). The benefit to lenders of these buyers is questionable, as they tend to use lots of all cash for (usually) higher-priced properties. The percent of recent immigrants taking out home loans, however, has been increasing as our low rates are too hard to ignore. The NAR suggests that potential buyers, regardless of ethnicity, are not buying due to a continued lack of inventory. (The audio version of today’s commentary is available here and this week’s is sponsored by Origence, helping financial institutions can provide mortgage, consumer, indirect, and home equity loans with greater efficiency and increased scale while also delivering a convenient and personalized experience to borrowers.)

Employment  

 

“Are you a Licensed Originator eager for a new opportunity? Homeowners First Mortgage, a Newrez Family of Companies, is actively seeking Loan Officers who reside in Southern California/Orange County, CA in the following cities: Carlsbad, Yorba Linda, Downey, Huntington Beach, Irvine, Rancho Cucamonga, Hesperia, Mission Viejo, Laguna Niguel, La Canada, Newport Beach, and Cerritos. Homeowners First Mortgage offers the promise of longevity and security along with a commitment to service excellence. Our product set consists of Smart Series, Fixed Rate Loans, Adjustable-Rate Loans, First Time Home Buyer Loans, Refinance, FHA Mortgages, and Loans for Veterans. Ideal candidates will have 2+ years of lending origination experience and an active federal or state NMLS license. Make a change today! Click to apply or contact our recruiting team or James Barton, JV President.”

CMG Financial, named “Best Lender for First-Time Home Buyers” by Investopedia, has added to its Central Division leadership with the hiring of Dan Humes, Area Sales Manager. Dan’s Texas roots plus his leadership experience will be instrumental in growing CMG’s presence across North and East Texas, Arkansas, Oklahoma, and Missouri. The central U.S. housing market is experiencing rapid growth spurred by record-low mortgage rates and active home builders. As a direct lender with extensive local coverage and regional support, CMG Financial is prepared to streamline the mortgage experience in an exceptionally busy market. CMG loan officers deliver quality preapprovals and faster closings, giving home buyers the competitive advantage to get their offer accepted. Dan will lead his team to serve more home buyers and homeowners throughout the area. For the latest career opportunities contact Central Division Manager, Chris Blevins or visit CMG Recruiting.

Did you hear? American Pacific Mortgage (APM) recently announced its move to become a partially employee-owned company on the heels of a record year in 2020. “Every full-time employee will be included, including originators,” noted Kurt Reisig, Chairman of APM. “It is a huge advantage for our people and for those considering a move, owning part of the company you work for keeps everyone working towards the same goals, and reaping rewards from their combined efforts.” This is a highly unusual move in an industry where companies are acquired, consolidated, or absorbed with very little gain for the employees. APM’s mission to Create Experiences That Matter “isn’t just for our customers, but also for our employees,” mentioned Bill Lowman, CEO. “In an industry that doesn’t offer a lot in the way of retirement, this is a way to help provide a nest egg, and to reward and empower our branches and employees.” Learn more at joinapm.com.

Leading non-QM lender Angel Oak Mortgage Solutions added to its impressive roster of account executives in July 2021. Adding additional coverage across the country, they are pleased to welcome the following: Kris Koepke in Colorado, Lisa Hoot in Texas, along with Anthony Rodriguez and Tim Luxemburger in Inside Sales. As well, Angel Oak welcomes back AEs Shelley Parker in Southern California and Michael Hooven in Philadelphia. These new Account Executives have been educating brokers and correspondents on non-QM and how easy it is to work with Angel Oak. And they’re not done yet as they are continuing to add Account Executives in many additional markets including Missouri, Northern Virginia, Louisiana, and Dallas/Houston. To learn more about joining the leader in non-QM, visit JoinAngelOak.com.

Ready for a career upgrade? Top-ranked Embrace Home Loans, which had a record $6 billion in originations in 2020, is doubling its retail salesforce in 2021 and is actively seeking loan officers, retail executives and support staff to add to its award-winning team. “We offer much more than a job,” says Patrick Mullen, Embrace’s director of recruiting. “We nurture our talent by working with each employee to carve out a clear career path that enriches their lives.” Need proof? The average tenure of Embrace loan officers is just over seven years across all channels, compared to the industry average of two years. Plus, Embrace is consistently named to Best Mortgage Companies to Work For by National Mortgage News every year and ranked first in Social Survey’s Top Mortgage Companies in Customer Satisfaction in the Large Division. Ready to join a winning, supportive team? Contact Patrick.

Lender services and products

Whether associated with a ransomware attack or a former loan officer who inappropriately takes private consumer information to a new job, the risks associated with data breaches have been and continue to be a major concern for our industry and our nation as a whole. It is with these concerns in mind that James Brody, Chair of Johnston Thomas’s Mortgage Banking Practice Group, will be moderating the Mortgage Bankers Association’s leading webinar on the topic, titled “Compliance Considerations Before and After a Data Breach”. To register for this event, which is free for all MBA members and which is scheduled for 2:00 PM EST on August 10^th, click here. For inquiries regarding the data breach program or any of the complimentary compliance webinars provided by Johnston Thomas (LO Comp, Loss Mitigation, MSAs/JVs, Wage/Hour/Discrimination Claims, etc.), please contact Mr. Brody.

Let your people continue to work from home while improving efficiency with a virtual assembly line. Henry Ford reduced car production-time from 12.5 to 1.5 hours with an assembly line. The benefits were shorter timelines, increased efficiency, near-zero errors, plus the ability to employ both high and moderately skilled workers to get work done. This works for mortgages. This year has seen more mortgage operations move to a “virtual assembly line” model to produce higher volumes and shorten “lead-to-close” timelines. Case in point: A division of American Pacific Mortgage quadrupled its volume and produced 280% more revenues after implementing TeamworkIQ, a simple task-based-workflow platform that drives virtual assembly lines. Work moves forward faster. bringing the right task to the right person at the right time with the right priority. And some tasks can even be automated to achieve even greater efficiency. See the case study and request a test-drive.

Are you advanced enough to get started with securitization? MBS delivery allows you to be the master of your own fate… But your processes must be flawless, as you cannot afford any mistakes! If you feel that you’re ready for the benefits of this unique freedom, it may be time to jump into MBS delivery. MCT’s latest blog, “A Lender’s Guide to Agency Approvals and MBS Delivery” will answer all of your most common questions to ensure your confidence in this transition. Learn how agency approvals will open up the door for increased profitability.

Redwood

Right or wrong, our industry tends to watch Redwood Trust as a proxy for the general health of the jumbo market, so plenty took notice when Redwood released its second quarter financial results this week. The company locked $3.9 billion of jumbo residential loans, the Company’s second highest lock volume on record. Lock mix was approximately 60 percent purchase money loans and 40 percent refinances. RWT also displayed its distribution capabilities with three securitizations backed by $1.5 billion of Select Jumbo loans in aggregate, and $1.8 billion of whole loan sales. Economic return on book value for the company was 8.2 percent for the second quarter and 19.0 percent for the first half of 2021.

Capital markets

Since mid-March, when all the experts thought rates would do little beside head higher, the rate on the 10-year Treasury bond has dropped from a high of 1.74 to near 1.25 percent, despite rising inflation. Fed Chair Powell has consistently stated that the inflation is transitory. The new Delta variant of COVID, and fear of future variants and the possibility of wearing masks for the rest of our lives, is stalling the recovery. Monetary stimulus is expected to be removed earlier than previously thought, so less fiscal stimulus is anticipated from Washington DC. Recent economic data has been lackluster, and supply-chain/labor-market bottlenecks continue unabated.

Fed officials signaled yesterday they’re moving closer to when they can start reducing massive support for the U.S. financial system. The economy is not quite there yet, as we’ve yet to reach full employment or the long-term 2 percent inflation target, so policy will remain accommodative for the time being. The statement for the first time hinted towards the “taper” of Treasury and mortgage securities purchases. The Fed is buying about $120 billion ($80 billion of Treasuries and $40 billion of MBS and more) each month as part of their purchase program. Announcing a taper would be a calculated move to ensure an orderly market reaction when the time eventually comes. Australia’s central bank is set to delay its planned taper of bond buying just four weeks after announcing it, due to economic fallout from prolonged lockdowns triggered by the delta variant. During his press conference, Fed Chairman Powell said that a rate hike is still a long way away, and know that “taking a foot off of the accelerator” is different than “putting your foot on the brake.”

MBA SVP and Chief Economist Mike Fratantoni weighed in, saying “mortgage rates remain historically low and are supporting a strong rebound in refinance activity. Purchase application volume has waned the past few months due to the lack of homes on the market and the consequent rapid increase in home prices. MBA expects that a taper of asset purchases, and somewhat higher mortgage rates, are to come in the second half of the year. We are also hopeful that the increased pace of housing construction, and more existing homes on the market, will boost inventory levels and help to fuel renewed growth in the purchase market.”

Today’s economic calendar is already underway with the first look at Q2 GDP (+6.5 percent, much lower than expected). We’ve also received weekly jobless claims (-19k to 400k, slightly higher than expected, continuing claims 3.269 million) and the core PCE deflator (). Later this morning brings the Pending Home Sales Index for June, Freddie Mac’s Primary Mortgage Market Survey, and a Treasury auction of $62 billion 7-year notes. After the Desk released a new MBS purchase schedule yesterday covering today to August 12 with no changes to coupons, the new schedule kicks off with the Desk purchasing up to $5.2 billion 30-year 2 percent and 2.5 percent. We begin the day with Agency MBS prices unchanged from the Wednesday’s close and the 10-year yielding 1.25 after closing yesterday at 1.26 percent after a weaker-than-expected GDP.

 

(Part Four of Six of corny English puns.)

17. Bono and The Edge walk into a Dublin bar and the bartender says, “Oh no, not U2 again.”

18. Prison is just one word to you, but for some people, it’s a whole sentence.

19. Scientists got together to study the effects of alcohol on a person’s walk, and the result was staggering.

20. I’m trying to organize a hide-and-seek tournament, but good players are really hard to find.

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, “A Primer on What Originators Should Know about the Fed”. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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 2021 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 didn’t sign up for a 401k. I can’t run that far. Understanding numbers is important, as is accurately reporting them. For example, yesterday I mistakenly noted that the TMBA’s Annual Convention was August 29-30 when it’s actually the August 29-31. Borrowers aren’t the only ones refinancing. Are you going to take a cruise soon? Me neither, but Carnival Cruise Lines just issued (sold) some debt to investors with a coupon of 4 percent to pay off debt it issued last year at 11.5 percent. Speaking of refinancing and numbers, and loan volume in general, traders estimate total daily origination supply is running $5-7 billion. On the demand side of the equation, through its trading desk in New York, the Federal Reserve is buying $4-6 billion per day of Agency MBS. You don’t have to break out your calculator to see what is happening on a daily basis. (The audio version of today’s commentary, available here, is sponsored by Origence providing lending technology that delivers the ultimate origination experience to increase loan volume, create efficiencies, and grow accounts.)

Employment & transitions

PCF Wholesale is excited to announce the addition of Lee Ann Casanova as its East Coast Divisional VP of Sales, TPO. “Lee Ann is a result oriented Senior Financial Executive with a noted track record in driving business development and building lending platforms. Lee Ann has vast experience in the leadership and creation of effective teams of sales,” says Keith McKay, CEO. East Coast Account Executives, if you like to be a part of our team, please contact Lee Ann directly. PCF Wholesale is a top priced lender on Loan Sifter, Conventional, FHA, VA, Jumbo, & Non-QM.

First Community Mortgage is expanding its Delegated Correspondent Lending Division! “This award-winning company is looking for AEs in the North, South, East, West, and all parts in between, to develop and deepen business partner relationships in our growing Correspondent channel. We are committed to offering unparalleled service and support to our business partners, as we seek to broaden our reach into all markets across the US. As a relationship lender with a penchant for service, FCM recognizes that people are the key to successful partnerships! If you are interested in learning more about FCM’s Correspondent Lending division and our ‘best in class’ operations team, please send a message to Brandon Sandefur, EVP Del-Corr.”

If you’re an Account Executive in TPO, it’s time to talk to PennyMac.  PennyMac has become one of the fastest-growing wholesale lenders by helping its business partners succeed. Now PennyMac wants to help you succeed and is hiring experienced Wholesale and Non-Delegated Correspondent AEs across the U.S. Here’s your chance to be a part of something great. With one of the largest national mortgage companies on your side, providing you with a range of innovative solutions, PennyMac can help change the way you do business. PennyMac has the tools and support you need to achieve your potential as an Account Executive. If you’ve got game in wholesale or non-del, you should be talking to PennyMac. Join this top 10 Wholesale Lender by reaching out confidentially to one of our SVP’s: Scott Houp (Wholesale East), Jason Bannister (Wholesale West), or Matthew Mead (NDC) today.

Lender services and products

Connexions is excited to announce its new ICE Mortgage Technology integration. This means Connexions can now deliver a more flexible user experience to those ordering Appraisals and other services from within Encompass. And it means that Connexions can now be even more responsive to customer requests regarding the ordering process in Encompass, by being able to deploy enhancements at will, versus on the ICE Mortgage Technology’s deployment schedule. Connexions can now give lenders and AMC partners an even higher level of automation while supporting more complex workflows. Discover why both Lenders and AMCs are looking to Connexions to optimize and streamline their valuation processes. Learn more about how Connexions latest product offerings can increase your productivity, and schedule your demo today.

JuVaughn Harrison made history at the U.S. Olympic track and field trials when he placed first in both the high jump and the long jump. He’ll be the first American man to compete in both events since 1912. To win gold, Harrison will need to approach each event with the right game plan. Most lenders I know have a game plan for winning new customers, but what about retaining existing ones? On average, mortgage lenders retain just 18% of their borrowers on future mortgage transactions. Thank goodness Sales Boomerang, the #1 automated borrower intelligence and retention platform, has put together a Borrower Retention Playbook to help lenders win the retention game! Download it today.

1000%. That’s how much jumbo production has increased at Stearns Wholesale in the last two months. By providing great rates, speed, variety, and flexibility with Stearns’ six jumbo products, brokers now have the opportunity to take back market share when it comes to jumbo origination. The rates on its six jumbo products are currently the best in the nation, so don’t miss out! To download the Stearns Wholesale Jumbo Product Guidebook, click here. If you’d like to partner with Stearns or learn more, click here to be contacted.

Did you know you can turn your Encompass® LOS into a printer/mailer? Yep, with the help of Connector by Velma®, Encompass will automagically print and mail goodbye letters, insurance transfer notifications, statements, NOI’s and more… At exactly the right time with the right information. Increase your accuracy and timeliness while eliminating labor costs for a positive ROI. More info here.

Compare & Share from digital mortgage point-of-sale Maxwell is a powerful addition for users of Optimal Blue’s product and pricing engine. QuickPricer Compare & Share ‌allows‌ ‌loan‌ ‌officers‌ ‌working‌ ‌borrower‌ ‌leads‌ ‌to‌ ‌quickly‌ ‌create‌ ‌and‌ ‌send‌ ‌multiple‌ ‌pricing‌ ‌scenarios. ‌‌Unlike‌ ‌competitor‌ ‌pricing‌ ‌tools,‌ ‌which‌ ‌require‌ ‌the‌ ‌loan‌ ‌officer‌ ‌to‌ ‌manually‌ ‌create‌ ‌side-by-side‌ ‌comparisons‌ ‌for‌ ‌the‌ ‌borrower‌,‌ ‌Compare‌ ‌&‌ ‌Share‌ ‌seamlessly‌ ‌integrates‌ with‌ ‌Maxwell‌ ‌for‌ ‌both‌ ‌the‌ ‌lender‌ ‌and‌ ‌the‌ ‌borrower. Its user-friendly interface saves the loan officer valuable time, letting them focus on building more referral volume and carrying more loans per month.‌ To find out more about QuickPricer Compare & Share and the other features that help LOs on Maxwell close 20% more loans per month, request a demo or start exploring here. 

“Do more with the Encompass LOS. Encompass by ICE Mortgage Technology is one of the most popular loan origination systems out there and it just got a bit better by adding an easy integration with Truework for VOE/VOIs. Loan processors can now submit VOE/VOI without leaving Encompass. Truework can verify any U.S. employee through its easy-to-use web app. Truework recently announced verifications for 1099 contractors (i.e. uber drivers) as well as employees at government agencies, all through the same tool! Sign up to Truework for free and never worry about VOE/VOI again because Truework is a verification tool where customer support actually responds to your questions.”

Ginnie, FHA, & VA on the move

Ginnie Mae is enhancing data disclosure for its Platinum securities to provide investors with information that supports their sustainable investing decisions and solutions. The new environmental, social and governance (ESG) data provide investors with Platinum pool level aggregate information about the extent of UPB dollars that are in low- and moderate-income areas. More details on this ESG enhancement can be found in the Bulletin update.

Ginnie Mae is considering increasing the capital requirements for GNMA servicers. In addition to the $2.5 million and 0.35% of the GNMA servicing book UPB, it is looking at requiring 0.25% of the UPB of a servicers agency book. When the foreclosure moratorium ends, servicers will have a lot of wood to chop. Ginnie Mae is requesting feedback on Single-Family Issuer eligibility requirements. Read this Press Release for details.

The MBA called for more testing and transparency. “The risk-based capital provisions are entirely new and untested and could adversely impact otherwise strong issuers,” said Pete Mills, the MBA’s SVP of residential policy. “Ginnie needs to back-test this through prior periods to demonstrate the impact before moving forward.”

The VA is offering two new mortgage relief programs for those impacted by COVID.

FHA announced streamlined COVID-19 Recovery options to help homeowners with FHA-insured mortgages who have been financially impacted by the COVID-19 pandemic bring their mortgage current and remain in their homes. The simplified COVID-19 Recovery waterfall allows mortgage servicers to offer eligible homeowners who cannot resume making their mortgage payments a reduction in the principal and interest portion of their monthly payments. For homeowners who can resume making their existing monthly mortgage payments, FHA has established a revised COVID-19 Recovery Standalone Partial Claim. So yes, the simplified COVID-19 Recovery waterfall allows mortgage servicers to offer eligible homeowners who cannot resume making their mortgage payments a reduction in the principal and interest portion of their monthly payments.

The new FHA policy will allow mortgage lenders to use a borrower’s actual monthly student loan payment amount, even if it is below the traditional amount of 1% of the total balance. And if a student loan borrower’s calculated payment is $0 (which is possible under an income-driven repayment plan), the mortgage lender will automatically apply 0.5% of the outstanding student loan balance as an assumed payment, rather than 1%.

The Federal Housing Administration (FHA) published a new update to the Single Family Housing Policy Handbook 4000.1. The updates include enhancements and revisions to existing guidance as well as various other technical edits. In most cases this newly added language augments and enhances existing policy and various technical edits. In most cases, however, this newly added language augments and enhances existing policy. Highlights include Section I — Doing Business with FHA, Section II — Origination through Post-Closing/Endorsement, Section III — Servicing and Loss Mitigation, Section IV — Claims and Disposition, Section V — Quality Control, Oversight and Compliance.

First State Mortgage addressed clients about the FHA Student Loan and updated MERS fees.

Mountain West Financial^® announced the Diamond program is now available throughout Arizona, Oregon, and Utah. This flexible program provides an FHA first mortgage with up to 6.50% down payment assistance (DPA). Plus, Diamond is not restricted to First Time Homebuyers (FTHBs)! Generous income limits, credit scores as low as 620 and manual underwriting allowed.

Don’t forget that Flagstar Bank announced that manually-underwritten government (mostly FHA & VA) loans has been reinstated.

Recent loanDepot updates include changes to underwriting Commitment Fee, removal of expired COVID-19 Temporary VVOE Flexibilities in the FHA matrices, VA IRRRL policy expansion on exterior-only appraisals and updates to Conventional Lending Guide regarding transferred appraisals.

Citi Correspondent Lending issued Bulletin 2021-08 containing information and updates on COVID-19 temporary policies from FHA and VA Income & VOE loan requirements, FHA’s new Notification that two Regulatory-Related Manual Sections have moved, Disability Income, QM Eligibility and W-9 requirement reminders

PennyMac posted information on updates to Government LLPAs (FHA &VA) in Announcement 21-55. And for all FHA full doc and credit qualifying streamlines, PennyMac is aligning with the requirements in FHA ML 2021-13 Student Loan Payment Calculation of Monthly Obligation. Read Announcement 21-52 for details.

Capital markets

Argue what you will about the pandemic, the bond market reflects the reality of the current thinking about world economies. An uptick in COVID cases due to the delta variant shook markets last week as the yield on the 10-year Treasury note fell almost 10 basis points on Monday. The movement in the financial markets was somewhat unexpected as the uptick in cases had been widely reported for the last few weeks. Sure the markets mostly recovered as the week progressed and the focus turned to improving outcomes for the infected as hospitalizations and deaths have not risen in proportion to the number of infections. Given the outcomes, worry about a return to less socialization and the resulting effects on the economy waned. Meanwhile supply shortages continue to weigh on activity in most industries which is preventing stronger rebound in economic growth. Job openings remain near record highs with many industries reporting difficulty in filling open positions. This week all eyes will be on the Federal Reserve as committee members are expected to discuss the winding down of the asset purchase program in light of heightened inflation and a strong economic recovery.

Yesterday a solid $61 billion 5-year Treasury note sale, following Monday’s highly-demanded 2-year note offering, was good news for those looking for lower rates. At least those that believe Treasury yields and mortgage rates are correlated. Lower mortgage rates would certainly be welcome by those such as first-time homebuyers who feel that rises in home prices are crippling purchasing power. We saw some evidence of that yesterday in the backward-looking form of the FHFA Housing Price Index rising 1.7 percent in May and the S&P Case-Shiller Home Price Index rising 17 percent over the previous year in May. Those higher home prices are reflected in the declining share of purchase mortgage applications seen below.

 

We got a look yesterday at preliminary July agency prepayments. The “speed” of borrowers paying off their mortgages early is projected to slow between 4 percent and 5 percent on average. Why does that matter? Investors care about prepayment speeds because when mortgage loans are paid off early, the associated fixed-income securities no longer receive interest paid on the principal. In that event, investors must reinvest capital at current market rates, which are usually substantially lower. Bonds with prepayment risk often have prepayment penalties to compensate for their yield-to-maturity being unknown for certain at the time of purchase. Investors have early pay off penalties when they buy loans because a loan purchased at a premium (a price greater than 100) that pays off quickly was not worth being purchased at a premium. Which is one reason investors want their premium back when a loan pays off early.

The bond market’s attention is now firmly on the Federal Open Market Committee events today. With rates largely expected to remain unchanged at 0 percent to 0.25 percent and the Committee’s asset purchase program also expected to remain steady at $120 billion, any highlights should come from the statement, specifically, any discussion about reducing asset purchases, as well as Chair Powell’s remarks at his press conference. Before those FOMC events, we’ve already seen most all economic data points germane to mortgage rates today.

Mortgage applications increased 5.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending July 23. Refinances for conventional loans increased over 11 percent, though the purchase index decreased for the second week in a row to its lowest level since May 2020, and has now declined on an annual basis for the past three months. The refinance share of mortgage activity increased to 67 percent of total applications from 65 percent the previous week.

We’ve also received the June advance goods trade balance ($91.21 billion), June advance Retail Inventories (+.3 percent), and June advance Wholesale Inventories (+.8 percent). The Desk will purchase up to $4.5 billion of conventional MBS across 15-year 1.5 percent and 2 percent and 30-year 2 percent and 2.5 percent. In the afternoon, the Desk will release a new schedule covering the July 29 to August 12 period and expected to average $4.9 billion per day. We begin the day with current coupon Agency MBS prices worse .125 and the 10-year yielding 1.27 after closing yesterday at 1.23 percent.

(Part Three of Six of corny English puns.)

10. I once worked at a cheap pizza shop to get by. I kneaded the dough.

11. My friends and I have named our band ‘Duvet’. It’s a cover band.

12. I lost my girlfriend’s audiobook, and now I’ll never hear the end of it.

13. Why is ‘dark’ spelled with a k and not c? Because you can’t see in the dark.

14. Why is it unwise to share your secrets with a clock? Well, time will tell.

15. When I told my contractor I didn’t want carpeted steps, they gave me a blank stare.

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, “A Primer on What Originators Should Know about the Fed”. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is 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 2021 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.)