Feb. 24: Production & Ops jobs; banks confront regulation overload; LO survey results; MBA & zombie house proposals; risk sharing securities

Zelman and Associates published its January Homebuilding Survey, indicating that 2015 is off to a strong start. Order growth increased 32% year-over-year, bumping 2015 first quarter order growth to 21%. The homebuilding survey increased to 60.5 from 58.4 in December, reaching its highest level since June of 2014. Traffic metrics have shown the strongest improvement in three years, and improved YoY surpassing builder expectations. About 45% of respondents said they reported better than expected traffic in January, and website traffic was up 19% YoY. Prices have also increased 4% YoY and a 4.3% increase is expected over the next year. For more information, contact Ivy at ivy@zelmanassociates.com.


In jobs news, Equifax Mortgage Services, a leading vendor of mortgage products, is expanding its IT group and is looking for talented Development manager/Business Analysts/Developers to fulfill multiple positions. “We are looking for IT resources who have worked in the Mortgage or Financial Services industry and have good working knowledge of MISMO and all basic Mortgage concepts/products like Tri-merge reports etc. Contractor or full time opportunities available. If you are interested, please send your resume to mortgage.itrequests@equifax.com.


Wow, time flies!!  PennyMac is in its eighth year of operations and has come a long way in realizing much of the Company’s original vision of creating a legacy-free mortgage banking enterprise that would participate in and influence the revitalization of the U.S. mortgage market.  PennyMac is now recognized as the 3rd largest correspondent aggregator and the 15th largest mortgage servicer with a portfolio in excess of $105 billion. With that type of growth, comes expansion and the creation of jobs.  PennyMac is hiring Loan Officers, Managers, Underwriters, IT, Processors in the Dallas-Ft Worth area, Sacramento and Pasadena. PennyMac will be hosting its first in a series of job fairs in Dallas Ft-Worth on Friday, February 27 from 2-8PM and Saturday, February 28 from 8-1PM. It is by appointment only; resumes can be sent to careers@pnmac.com, Subject line: “Chrisman”.


And bluepoint Mortgage is growing, is seeking Regional Sales Managers and Account Executives in AZ, CA, OR, UT, and WA along with Loan Set Up, Account Management, VA LAPP/SAR Underwriter, Doc Drawer, Funder, Post Closer, Investor Relations Specialist personnel on the Ops side. “We are one of the fastest growing new mortgage companies in California. What sets us apart is not just our focus on customer service, not just our broad product suite, not just our great pricing but, balance. At bluepoint we consistently ask ourselves one simple question: ‘How do we make sure a loan is clear to close in 8 days?’ We have consistently proven that closing loans quickly is our #1 goal and that this goal starts with best-in-class employees representing the firm. If you fit this bill, we want you to join our firm!” For more information on the firm visit the site above; confidential resumes may be sent to: careers@bluepointmtg.com. We have a full spectrum of agency products, great jumbo programs and nonconforming products. Offering AEs and brokers access to pipelines via web apps for handheld devices. Early appraisal order program allows loans to close in as little as 3 days from underwriting.”
A quick congratulations is due JaJean Leaf: PRMG announced that effective March 1st JaJean Leaf will be its new Correspondent Operations Manager! “In her new role as Correspondent Operations Manager, JaJean Leaf will be responsible for ensuring that all service level agreements established by the company are maintained while efficiency, quality and productivity goals are met for processing, underwriting and closing.


Banks certainly know a thing or two about operations. And banks are beginning to say “no mas” to the overload of regulations. “The federal bank regulatory agencies requested comment on a second set of regulatory categories as part of their review to identify outdated or unnecessary regulations applied to insured depository institutions. The Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA) requires the Federal Financial Institutions Examination Council, Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, and Board of Governors of the Federal Reserve System to review their regulations at least every 10 years. The agencies also are required to categorize and publish the regulations for comment, and submit a report to Congress that summarizes any significant issues raised by the comments and the relative merits of such issues. Comments will be accepted until May 14.”


But regulations aren’t only weighing down banks. From Jim in Pennsylvania comes “Why would anyone want to come into this business when they keep lowering the amount you can make. We now can barely pay are bills to make ends meet. Licensing is a small fortune for each state. We have to also pay for the audits the banking department sends down. ‘The Man’ was here for 3 days for 22 loans and it cost $1,500 – a ridiculous for a small mom & pop shop business. I had 5 loan officers now it is just me. No one has yet to address the small businessman who has 800 scores but needs to write everything off, because that is the way the tax system is set up, so he can’t qualify for a mortgage. I had to get audited financial just to get licensed in New Jersey that cost $3-5 thousand. Licensing at $1,300 plus $530 for an individual license (because you need both), $1,000 for a bond although we don’t handle money, finger printing costs. It costs about $8k just to obtain a Jersey license so what young kid is going to be able to do that? If you want to be a loan officer with a bank even somebody with my experience they want to make you a subcontractor on commission and expect you to bring in your own deals. Walmart is paying better; at least it provides health benefits. Oh, and by the way, for 2 people 59 years old the health insurance cost around $20k this year and the out of pocket is $6,400.”


Speaking of the lifestyles of LOs, Hammerhouse released the results of its Fifth Annual Survey of Originators’ Opinions. The annual survey asked originators for their opinions on critical issues facing the mortgage industry and impacting their performance of their jobs.  Of the significant sample of more than 800 active mortgage loan originators that responded, 52% have annual production between $9 million-$24 million. “This year’s Survey found that a majority of mortgage loan originators (56%) are finding their career less rewarding than in the past and another 8% no longer find their career sufficiently rewarding. However, the results illustrate that originators are anticipating an improved future coming and are raising expectations.  87% of originators expect 2015 origination volume to equal or exceed 2014 levels, compared to last year when 56% of originators expected a drop in origination volume, and 73% expect their personal volume to increase in 2015, versus 53% who held that opinion last year.”


Switching gears, last week I highlighted New York legislation that would tackle the State’s “zombie property” issue if signed into law. However, the MBA believes this proposal doesn’t actually address the overarching problem: how do we rehabilitate the current backlog of vacant and abandoned residential properties? MBA argues that bringing these deserted properties back to market in an efficient manner would allow for new homeownership opportunities, improvements in community safety, and growth for neighboring property values. More property maintenance requirements for lenders/servicers, like the aforementioned legislation suggests, will simply not provide these results. As MBA President Dave Stevens put it – the real issue lies with the “foreclosure timelines that delay the process sometimes long after the owner has abandoned the property.”


In order to address the heart of the vacant and abandoned property dilemma, MBA formed a working group in Fall 2014, which included representatives from numerous large and independent lenders and servicers, along with leading industry attorneys, property preservation/foreclosure experts, and state MBA leaders. The working group produced a comprehensive resource for state legislators around the country who seek to introduce vacant and abandoned property legislation in the 2015 state legislative sessions. This resource consists of a series of “Principles” that – if implemented – would responsibly expedite the foreclosure process for vacant and abandoned properties in both judicial and non-judicial foreclosure settings.


These “Principles” are supported by the New York Mortgage Bankers Association – the statewide association representing the real estate finance industry –– and their leadership was also involved in their development. Together, MBA and the NY MBA, and other state MBAs, will be reaching out to the bill’s sponsors to offer this important alternative. For more information on efforts in New York, or to offer your support, please contact Marianne Collins and for more information on MBA’s nationwide efforts contact Scott Nowak.


Hey, remember when New York put the kibosh on the sale of $39 billion of servicing from Wells Fargo to Ocwen? Well, Ocwen is a seller! OCN signed an agreement in principle to sell $9.8 billion UPB of Freddie Mac servicing to Nationstar Mortgage. The transaction is expected to close at the end of 1Q, with servicing transferring to NSM in April 2015. OCN said it looks forward to exploring additional transactions with NSM. Analysts suggested that this is could be viewed positively by the market for Nationstar since Ocwen could end up being a source for pretty meaningful growth for Nationstar. Ocwen has a total of roughly $140 billion of Agency MSR and another $40 billion of Ginnie Mae servicing, and the company has said it will sell between $5-$20 billion of MSRs a month.


Fannie & Freddie announced earnings recently. Declines in the value of derivatives for hedging interest rates led to lower fourth-quarter and 2014 profit at Freddie Mac: it made $7.7 billion last year, down from $47.8 billion in 2013, according to a regulatory filing. Freddie’s lower profit shows the vulnerabilities of F&F. In addition, capital reserve required by its 2012 rescue plan is shrinking, narrowing the margin between profit and loss.


And Fannie Mae reported net income of $1.3 billion for the fourth quarter. That’s down sharply from $6.5 billion a year earlier due largely to losses on investments used to hedge against swings in interest rates. Still, it was the 12th straight profitable quarter for Fannie – and what senator or Congressman wants to do away with that? Especially when Fannie also said that it will pay a dividend of $1.9 billion to the U.S. Treasury next month. Fannie will have paid $136.4 billion in dividends, exceeding the $116 billion it received from taxpayers during the financial crisis. Freddie also said it will pay a dividend of $900 million to the government in March.


Last week Fannie Mae announced its first Capital Markets Risk Sharing transaction of 2015. The credit risk sharing transaction of 2015 falls under its Connecticut Avenue Securities (CAS) series.  The $1.47 billion note offering priced last week is scheduled to settle on February 26.


While many argue that we are poised to enter another refinance market in 2015 (recently Goldman Sachs raised their forecast on agency MBS issuance from $890B to $990B, mainly due to lower rates and recent policy changes) the biggest jump in issuance (percentage wise) may be in the form of rental bonds. As Bloomberg reports, “Blackstone Group LP is offering the first securities of 2015 tied to rental homes, the start of what Morgan Stanley analysts predict may be a more than doubling of issuance this year in the nascent market for such debt.” Blackstone’s Invitation Homes is planning a $513.8 million deal backed by 3,072 properties. A total of $227.8 million of top-rated securities may be sold at yields that float about 1.35 percentage points above a borrowing benchmark. Sales in this sector may be robust this year, and could reach as much as $15 billion this year.


Looking at the markets, not a whole heckuva lot happened Monday although rates improved somewhat as did agency MBS prices. And frankly, aside from the usual volatility in Greece not much happened overnight. But today Fed President Janet Yellen begins the first of two days of testimony on monetary policy before Congress, beginning with the Senate Banking Committee. We will also have some non-market moving S&P/Case-Shiller house price numbers and February readings on Consumer Confidence (102.9 prior), as well as Richmond Fed PMI (+6 last). For numbers we had a 2.06% close on the 10-year and this morning we’re back to 2.08% with agency MBS prices a shade worse.



Part 2 (of 5) of “You know you’re Italian” when…

You netted more than $50,000 on your first communion.

And you REALLY, REALLY know you’re Italian when…Your grandfather had a fig tree and gave everyone cuttings.

You eat Sunday dinner at 2:00.

Christmas Eve – only fish.

Your mom’s meatballs are the best.

You’ve been hit with a wooden spoon or had a shoe thrown at you.

Clear plastic covers on all the furniture.

You know how to pronounce “manicotti” and “mozzarella.”

You fight over whether it’s called “sauce” or “gravy.”

You’ve called someone a “mamaluke.”

And you understand “bada bing”.

Italians have a $40,000 kitchen, but use the $259 stove from Sears in the basement to cook.

There is some sort of religious statue in the hallway, living room, bedroom, front porch and backyard.





(Copyright 2015 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

Rob Chrisman