July 10: Best efforts trading, DPA for the disabled, marketing, dashboard, online app tools; correspondent & wholesale products; FHA & USDA news

“The only time I get asked for sex is on application forms.” Ba-dum-ching! Speaking of applications, most lenders will agree that the loan officer should be the first point of contact for a home buyer, not the real estate agent. But over the years real estate agents have done a great job of becoming the starting point of a homebuyer’s quest. But heck, how much house can they afford, what with current rates, homeowner’s insurance, utilities, etc.? Yes, good originators know the psychology of their clients under the “Know your borrower” basic tenant, especially first time home buyers: most homebuyers remain homeowners and the FHFA tells us that the persistence has increased over time across all homeowner demographics like race or ethnicity, regions of the country, and mortgage lending submarkets. (Today’s podcast is found here and this week’s is sponsored by nCino, makers of the nCino Mortgage Suite for the modern mortgage lender, uniting the people, systems, and stages of the mortgage process. Hear an interview with attorney Peter Idziak on last week’s Supreme Court vote to overturn the Chevron doctrine that called on judges to rule in favor of government agencies in instances where the law is ambiguous, and its impact on the mortgage industry.)

Lender and broker software, services, and products


Curious about what’s new in Encompass® by ICE Mortgage Technology®? ICE recently shared an article which dives into new innovations within the platform that are enabling the lending community to improve both productivity and efficiency. Read the full article here.

nCino and Talk’uments team up to provide lenders with multilanguage tools to more effectively reach more borrowers! Talk’uments, the premier digital language and limited English proficiency (LEP) technology provider for the mortgage industry, announced its integration with nCino’s Mortgage Suite technology solution. At a time when emerging markets like LEP continue to grow, this new partnership enhances multi-language resources to nCino’s users to provide borrowers with seamless, multi-language resources from originations to the final closing. Ben Miller, EVP of U.S. Mortgage for nCino, summed it up best. “We are proud to continue pioneering transformation in the financial services industry with the addition of Talk’uments to our Mortgage Solution, using multilanguage tools to help our customers and their applicants understand, access and trust the process and overcome a key challenge in buying a home.” For more information on Talk’uments’ capabilities, visit talkuments.com.

Have you been using expensive third-party tools for sales automation or paying your CRM extra money? Usherpa just changed all that with Pipelines, exciting new functionality that offers built-in, best-practice marketing and lead generation workflows that can easily be customized. Usherpa users get Pipelines at no extra cost and can build as many as they want. “The nation’s top LOs consistently outperform their peers because they have a better sales process. Now, every LO can have a winning process and win more business,” said Usherpa CEO Chris Harrington. Corporate stakeholders can create Pipelines with call scripting and push to their LOs. Usherpa delivers the daily tasks to loan officers via in-platform dashboard, email, and mobile app, and provides detailed reporting on each LO’s usage for management purposes. Schedule a demo with Usherpa to see this groundbreaking new tech.

You know how annoying it is when you have to create an account to buy something online? That’s how “Checkout as Guest” was born. Now imagine how annoyed your prospective borrowers are when you force an account on them as the FIRST STEP of an online mortgage application. So annoyed they might not do it? Probably, and it’s costing you business. Check out the world’s most borrower-friendly online application with LiteSpeed. Beautifully integrated with Encompass® by ICE Mortgage Technology™, no more account creation headaches or lost business.

“Are you trying to do more with less? Leverage a business intelligence platform to see how you’re performing in vital production and operational areas in comparison to your peers and highlight where you can reduce costs. For half the cost of a full-time employee, with RM Analyze + Peer View Ops you’ll gain access to a strong bench of mortgage industry experts and a suite of pre-built dashboards completely customizable to your needs. Our latest enhancements allow you to schedule email reports, so the most relevant KPIs are delivered straight to your inbox on a regular cadence so you don’t miss a beat. Use our valuable industry data to understand where to focus your efforts to be more effective and achieve sustainable growth. Empower your efforts, contact Spencer Smoot today!”

“With Total Expert, it’s significantly faster and easier for our loan officers to develop outreach emails and find flyers and social media posts for the individualized marketing they do on behalf of Castle & Cooke Mortgage,” said Scott Kirkessner, Castle & Cooke Mortgage Vice President of Marketing and Business Development. And that’s just scratching the surface of how Total Expert is helping Castle & Cooke build deeper customer relationships, uncover more loan opportunities, and drive growth in a stubborn market. Read our full Castle & Cooke Mortgage case study to learn more.

During Disability Pride Month in July, Down Payment Resource challenges lenders to help more home buyers with disabilities and their family caregivers qualify for a mortgage with the help of down payment assistance. Eighteen programs within DPR’s extensive database of 2,300+ offer funds ranging from $2,000 to $117,000 to help people with disabilities fund down payments, closing costs, pay down their interest rate or make accessibility modifications. Many can be combined with other homebuyer assistance programs, providing individuals with disabilities with additional financial support and resources. DPR can help you unleash this power with its suite of lender tools that provide easy access to DPA programs in your footprint. Schedule a demo today to learn more.

Wholesale and correspondent products


Citi Correspondent Lending is thriving in 2024! While remaining dedicated to the support of diverse markets and continued responsible, sustainable growth, we’re seeing record production volume. With a growing product suite that includes expansion of our Community Lending platform, a robust set of CRA incentives, and a quality-focused pre-purchase loan review process, Citi is well positioned to help you grow your business. Complete our Prospective Correspondent Questionnaire or schedule some time with a Citi Account Executive at the Western Secondary Market Conference coming up next month. We would welcome the opportunity to chat with you about all that Citi Correspondent Lending has to offer.”

LoanStream wants you to heat up your pipeline this summer with specials on Prime with 25 BPS price improvement on all Conventional loans >= to $400,000 including High Balance/Super Conforming and 25 BPS Price Improvement on FHA/VA/MaxONE (DPA) loans 620+ FICO (excludes CalHFA), plus 50 BPS price improvement on Non-QM Purchase (excludes Non-QM select), and a 25 BPS price improvement on all Closed End Seconds. Restrictions apply, specials are valid for loans locked 7/1/24 through 7/31/24. Talk with your AE for details. Non-QM Specials also available through our Correspondent lending channel, Home – LoanStream Mortgage Correspondent (lscorrespondent.com), contact your Regional Sales Executive for more information. Plus, make a Splash by closing more Non-QM loans, join LoanStream’s NEW Bank Statement and P&L Webinar. Reserve your spot for this informative webinar for you or your entire team.

FHA, VA, Government program & policy updates


As the USDA Mortgage Recovery Advance (MRA) is a federal lien, USDA Rural Development issued a bulletin on 07/03/2024 providing guidance for servicers completing foreclosures impacted by the 8th Circuit “Show Me” ruling.

USDA is offering up “Top Tips for Successfully Navigating Appraisal and Property Requirements” tomorrow. “Don’t miss this LIVE, virtual training opportunity! This training is available at no cost to all USDA Single Family Housing Guaranteed Loan Program (SFHGLP) lenders and real estate agents.”

The Federal Housing Administration (FHA) is announced updates to its FHA Connection (FHAC) system and an industry stakeholder briefing webinar as part of the implementation of its Appraisal Review and Reconsideration of Value Updates Mortgagee Letter (ML) 2024-07 published on May 1, 2024. The ML established standards for appraisal reviews and FHA’s Reconsideration of Value (ROV) policies, including requirements for a process by which borrowers may request an ROV if they identify a problem with the appraisal. The ML required mortgagees to offer a borrower-initiated ROV process meeting certain minimum requirements, including delivery of disclosures to borrowers at loan application and upon delivery of the appraisal with instructions on how to request an ROV.

Recall that the FHA issued a proposal, in the form of a draft mortgagee letter, to update its origination defect taxonomy to include fraud or misrepresentation involving sponsored third-party originators. The FHA suggested that if the FHA determines a mortgagee knew or should have known that an employee of the mortgagee or its third-party originator was involved in fraud or should have questioned red flags in a loan file, it will be considered a Tier 1 severity and subject to penalties of that severity level. “Based on this update, FHA will seek life-of-loan indemnification from mortgagees when there is evidence of fraud or material misrepresentation involving a sponsored TPO, regardless of whether FHA identifies specific red flags that should have been questioned at underwriting.”

FHA is updating guidelines to expand and clarify requirements and expectations for gift funds transferred prior to settlement and gift funds transferred at settlement. These changes may be implemented immediately but are required for casefiles assigned on or after August 19, 2024. Pennymac is aligning with these changes effectively immediately, view Pennymac Announcement 24-66 for more information.

Capital markets: another read on inflation


An exclusive Conforming investor is joining the MAXEX loan exchange next week, but that’s just the start. On July 15, MAXEX sellers will have access to multiple investors offering up to 90 percent LTV for agency-eligible second home loans, and 85 percent LTV on NOO loans, without being subject to punitive Agency LLPAs. MAXEX offers best efforts flow trading, mandatory bids and works with many popular hedging platforms to give you plenty of ways to trade. Take a closer look at the MAXEX Conforming program and get better execution today.

No one owns a crystal ball… Without any market-moving economic data yesterday, Fed Chair Powell’s semi-annual testimony before the U.S. Senate took center stage. His appearance was a rather lackluster affair, as he was careful not to send any signals about the timing of future monetary policy actions. Sticking to the recent Fed script, he stated that while he was encouraged by recent signs of disinflation, there needs to be further evidence before the FOMC pivots towards a more accommodative monetary policy. He was careful not to offer a timeline for rate cuts, which investors are currently betting will begin in September.

Overall, inflation remains on a downward trajectory through the month-to-month noise. It dovetails nicely with the cooling employment picture in the overall narrative that the Fed is almost ready to cut rates. Average employment growth over the last three months slowed to the lowest since the start of 2021, there has been a sharp decline in job openings this year, and a growing number of people filing for unemployment benefits.

Measures of consumer confidence remain low and are tied largely to uncertainty surrounding this year’s presidential election. Small business sentiment remains sour amid a downshift in economic momentum. We learned yesterday that the NFIB Small Business Optimism Index improved modestly in June. However, high uncertainty and poor economic outlooks have cemented the index below its 50-year average.

Chair Powell is back on the Hill today, this time before the House Financial Services Committee. Other Fed speakers around the country include Governor Bowman, Chicago President Goolsbee, and Governor Cook. The economic calendar began with mortgage applications decreasing 0.2 percent from one week earlier, according to data from the Mortgage Bankers Association. Last week’s results included an adjustment for the July 4th holiday. Later today brings wholesale inventories and sales and a couple of Treasury auctions that will be headlined by $39 billion reopened 10-year notes. We begin the day with Agency MBS prices a few ticks better than Tuesday’s close, the 10-year yielding 4.28 after closing yesterday at 4.30 percent, and the 2-year down to 4.61.

(Warning: don’t read if sensitive material bothers you. No complaints please.)

On his 74th birthday, a man got a gift certificate from his wife.

The certificate paid for a visit to a medicine man living on a nearby reservation who was rumored to have a wonderful cure for erectile dysfunction.

After being persuaded, he drove to the reservation, handed his ticket to the medicine man, and wondered what he was in for.

The old man slowly produced a potion, handed it to him, and with a grip on his shoulder warned, “This is a powerful medicine, and it must be respected. You take only a teaspoonful and then say 1-2-3. When you do that, you will become more manly than you have ever been in your life, and you can perform as long as you want.”

The man was delighted. As he walked away, he turned and asked, “How do I stop the medicine from working after I’m satisfied?”

“Your partner must say 1-2-3-4,” he responded. “When she says that, the medicine will not work again until the next full moon.”

He was very eager to see if it worked so he went home, showered, shaved, took a spoonful of the medicine, and then invited his wife to join him in the bedroom.

When she came in, he took off his clothes and cried out, “1-2-3!”

Immediately, he was the most masculine of men.

His wife was excited and began throwing off her clothes and then she asked, “What was the 1-2-3 for?”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is titled, “Catastrophe and Climate Risk Is Only Increasing”. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).


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Rob Chrisman