Jan. 29: Ops jobs & correspondent investor; change in views on credit; HSBC & lending to Chinese Nationals; WAC’s servicing deal

Since its Friday let’s veer away from mortgages for a quick moment. With the recent rash of celebrity and music deaths, including the Jefferson Airplane’s Paul Kantner yesterday, here is a site that lists the “Top 100” musical stars still alive. How old is Willie Nelson? Heck, those turning 80 this year include Bill Wyman, Englebert Humperdinck, Kris Kristofferson, and Charlie Daniels. But while we’re on entertainment, it certainly seems that lenders’ commercials will be evident during the upcoming Super Bowl. There are rumors of an ad by SoFi. And rumored to be one by Quicken Loans.


Indecomm Global Services, a leading provider of mortgage technology, training, and outsourcing services is seeking experienced loan closers. Clients include prominent top tier, mid-tier lenders, and regional lenders as well as title and settlement companies. The successful candidate will provide a high level of customer service, communicating well with loan officers, brokers, account executives and processors with the primary function being to ensure the timely and accurate closing of loans. The candidate may also be assigned additional duties as required. This position is located Charlotte, NC. The ideal candidate should have 3 years minimum, 5 years preferred, of continuous loan closing experience, with a preference for wholesale closing experience. Interested candidates should send their resume to HR Manager Candy Mechels.


For lenders looking for a new correspondent investor, “Some Correspondent lenders are struggling with buying TRID loans more than others in the marketplace. The Money Source Inc. is currently averaging less than 10 days from delivery on all Correspondent loan purchases. With their unique approach to treating their correspondent lenders as partners, The Money Source has averaged 8 days to purchase new files for all of 2015. TMS has worked tirelessly the last few years to build a Correspondent platform with just the right combination of speed, price, and service that is the cornerstone of success for their sellers. To find out more about what a Partnership looks like compared to a ‘Transactionship’, please email EVP of Correspondent Lending, Jeff Vanderluit.”


On the flip side, last month it hit the press that Citi would be laying folks off. Certainly this “RIF” (Reduction in Force) is hitting the mortgage side of Citi’s business this month. Sorry to hear that, although those impacted can post their resumes – for free – on www.LenderNews.com.


Altisource Portfolio Solutions has been on a hiring spree as well, bringing on board Eric M. Lapin, Kevin J. Cooke and Devin P. Daly.


And congrats to Guild Mortgage who “achieved record growth in 2015, with loan volume reaching $13.8 billion, up 86.1 percent from $7.4 billion in the 2014 period. The growth continues a trend started in 2010. In five years, loan volume has more than tripled from $4.1 billion and Guild has expanded from its western base with 75 branches in 16 states in 2010 to 234 branches in 25 states at the end of 2015.”


Australia’s Computershare, which purchased Specialized Loan Servicing for $113.6 million about five years ago, announced that it signed an agreement to acquire Altavera Mortgage Services, a provider of independent, third-party mortgage origination services to residential mortgage lenders.


Flagstar reported revenues that beat many expectations due to higher MSR (servicing) income, higher NII, a rep & warranty benefit, and lower expenses. But generally analysts are trimming future earnings for “Flag” and other publicly held residential lenders due to lower mortgage volume forecasts. (Can everyone lower their expenses? We’ll see!) Flagstar’s gain-on-sale income declined to $46 million from $68 million in 3Q15. Mortgage origination volume fell by 26% to $5.8 billion, down from $7.9 billion in 3Q15. The company reported a GOS margin of 92 bps down from 105 bps in 3Q15 and up from 87 bps in 4Q14. Management attributed some of the weaker earnings in mortgage banking to the new TRID disclosure requirement.


Europe’s biggest lender HSBC will no longer provide mortgages to some Chinese nationals who buy real estate in the United States, a policy change that comes as Beijing is battling to stem a swelling crowd of citizens trying to get money out of China.


Walter Investment Management Corp. announced the acquisition of assets from Residential Credit Solutions (RCS) including certain assets of the RCS servicing platform and the transition of core operational employees to the Ditech servicing organization. The deal also involves WAC entering into new subservicing agreements with RCS and the transfer of certain existing residential mortgage loan subservicing agreements. This involves $9.8 billion of UPB. RCS had previously announced that it has decided to close its operations in Fort Worth, TX, a move that will result in an estimated 134 jobs being eliminated.


Lenders are focused on compliance, credit, and profitability, the order depending on the lender, and let’s see what has been happening with credit lately.


Marty Flynn, EVP with Colorado’s Advantage Credit wrote to me discussing “Trended Credit Data” and the Agencies. “Your readers may recall Fannie Mae’s October 2015 announcement regarding their planned use of trended credit data beginning in 2016: Fannie Announcement on Trended Data.  Although implementation information from Fannie has been scant since then, the credit reporting agency community, aka credit resellers, have recently received updates from the two national credit bureaus who are participating in Fannie’s trended data initiative at this time, Equifax and Transunion. By the way, Experian is expected to start mandating trended credit data beginning in 2017.


“With Fannie’s trended data policy as the backdrop, Equifax and Transunion have mandated all credit resellers operating within the mortgage industry to start delivering trended credit files to their mortgage lender clients. This includes mortgage tri-merge origination, prequalification, secondary use and credit reports for quality control. Equifax and Transunion both state that the trended data policy will extend to all credit reports accessed by mortgage lenders/brokers and there will be no carve-out for non-conforming loans. Conversion to trended credit data is expected to occur throughout March.  Equifax, Transunion are allowing a grace period for credit report price adjustments pertaining to the new (higher) cost of trended credit files. Expect new pricing from resellers to be effective around June.


“It is estimated that over 26 million consumers today are “credit invisible” and this will help lenders by increasing home ownership and mortgage access among younger consumers and first-time home buyers. In addition we should see scoring a higher percentage of consumers that were deemed un-scoreable by traditional risk scores, making the best lender terms available to a larger proportion of the population, identifying borrowers headed towards mortgage default earlier, and identifying ‘transactors’ versus revolvers with up to 30 months of utilization history.” Thanks Marty!


Credit Plus announced the availability of Reps and Warranties coverage for all of its verification services. The coverage allows customers to better defend their companies against the negative financial consequences of a possible loan default and the resulting repurchase requests. The firm has undergone a stringent review process to obtain certification of its processes and as a result, its customers are able to obtain the insured products. The insurance is underwritten by an insurer rated A by A.M. Best and A+ by Standard and Poor’s. By offering insured products and extending the benefits of Reps and Warranties coverage to its customers, Credit Plus is acknowledging and responding to the Consumer Financial Protection Bureau’s (CFPB) and Office of the Comptroller of the Currency (OCC) expectation that lenders are now ultimately responsible for practicing effective third-party risk management.


Fannie Mae will implement expanded whole loan committing grids on Monday, Feb. 1, providing greater transparency and enhanced certainty of execution for 15-year and 30-year commitments. This change will give its whole loan sellers the transparency of the specified market that has historically been available through an MBS execution. View the infographic by clicking the link.


Fannie Mae is targeting the release of Desktop Underwriter (DU) Version 10.0 for the weekend of June 25. DU Version 10.0 will include enhanced credit risk assessment using trended credit data, and simplified and automated underwriting for borrowers with multiple financed properties. Release Notes will be posted by the end of February and may include additional items. We are providing a DU Version 10.0 Preview Notification and Integration Impact Memo to allow lenders and technology solution providers time to prepare.
Freddie Mac spread the word that servicers are “now able to directly change the reporting of a third-party sale to an REO status without submitting a rollback request. We’ve updated our foreclosure sale reporting error codes to more accurately reflect today’s housing market and align with Servicers’ business needs.”


As has been mentioned in this commentary, Freddie Mac and Lenders One have established a new alliance. This relationship will give Lenders One members who are Freddie Mac Seller/Servicers pricing and execution benefits, enhanced access to mortgage products, and professional training and development opportunities.


Pacific Union Financial has updated its VA non-delegated DTI to include no maximum required for AUS approved recommendations. Also, specialty high balance cash-out refinance transactions are allowed. Also updated are its Conventional guidelines regarding ineligible programs. Guidelines have been updated to indicate that the Fannie Mae HomeReady and Freddie Mac Home Possible programs are not permitted.


Fannie Mae has the new HomeReady Income Eligibility Lookup tool provides lenders and other housing professionals with a quick and easy way to determine potential eligibility for HomeReady. Simply use the tool to look up census tract income eligibility by property address or by Federal Information Processing Standards (FIPS) code. This easy-to-use tool is available 24/7 to provide you with the information you need to serve your customers. Also, if you haven’t had a chance to take a look, check out all the HomeReady resources available on the HomeReady page


Fannie Mae and Freddie Mac (the GSEs) have updated the Release Notification on their respective Uniform Collateral Data Portal (UCDP) websites with additional details about the UCDP appraisal-sharing solution, featuring the Feb. 7, 2016, release date. This new functionality enables correspondent lenders to easily share appraisal information in UCDP with their aggregators. Aggregators will have access to real-time results for their correspondents’ appraisals to ensure they have the most up-to-date information.


Wells Fargo has expanded its prior approval High Balance Loan programs to align with recent Fannie Mae’s changes. Expanded LTVs/TLTVs/CLTVs, addition of cash-out refinance for 2-4 unit primary units, 2nd homes and investment properties. Contact Wells for its temporary lock and registration procedures for its expanded products.


NYCB Mortgage Table Funding Clients are no longer required to use the Record of Account IRS Transcripts for Conforming loan transactions only. The Return Transcript may be provided for underwriting purposes. Examples include: YTD paystub & 1 W2 = 1 year completed 4506T, YTD paystub and 2 W2s = 2 years completed 4506T, 1 year personal tax returns = 1 year completed 4506T and 1 year IRS transcripts. The requirements noted above do not apply to High Balance loan amounts, Jumbo Fixed, Portfolio ARM, and Portfolio Fixed loan programs. Two years of IRS Transcripts are required for loan approval on these products.


Sun West announced several changes to its conventional high-balance product guidelines. Investment properties now offered for high-balance transactions with FICOs greater than 660, Maximum LTV/CLTV extended up to 95% for fixed-rate mortgage transactions for single unit principal residences, Removed requirement of field review of property for loan amounts greater than $625,500 with an LTV, CLTV, or HCLTV ratio greater than 80%, LTV, CLTV, and HCLTV ratio maximums for high-balance product for borrowers with 5-10 financed properties now aligned with standard product requirements, Non-Occupying borrower’s income and liabilities are now considered by DU for all principal residence mortgage transactions. Previously, only the credit and assets were considered by DU.


Turning to something simple like interest rates, by the time all was said and done Thursday rates hadn’t moved much versus Wednesday’s closing levels. But fixed-income securities initially shot higher after a pitiful December Durable Goods number, then sold off on an oil spike as the Russian energy minister talked about cutting supply, and then rallied back as oil retreated and equities sold off. LOs saw some rate changes by lenders. The $29 billion 7-year Treasury auction was met with strong demand, drawing the highest indirect bid since the Treasury began issuing 7-year notes in 2009! Mortgage rates are now close to their lowest levels in three months and most rates sheets are in the 3.75-3.875% range on conforming 30-year fixed.


This morning we’ve already seen the BOJ (Bank of Japan) surprise everyone by deciding to bring deposit rates into negative territory – so you have to pay them to keep your money! We’ve also had the Q4 GDP (Gross Domestic Product) figures (+.7%), and the Q4 Employment Cost Index (+.6%). Coming up are some secondary numbers: the January Chicago Purchasing Manager’s Index and the January Michigan Sentiment number. We closed Thursday with the 10-year yielding 1.99% and after these early numbers it is down to 1.94% and agency MBS prices are better by .250.



The Importance of Water: Interview with 101 year-old Hattie Mae MacDonald of Winifred, Kentucky.

Reporter: “Can you give us some heath tips for reaching the age of 101?”

Hattie: “For better digestion, I drink beer. In the case of appetite loss, I drink white wine. For low blood pressure, I drink red wine. In the case of high blood pressure, I drink red wine. And when I have a cold, I drink Schnapps.”

Reporter: “When do you drink water?”

Hattie: “I’ve never been that sick.”





(Copyright 2016 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