Daily Mortgage News & Commentary

June 7: U/W, Ops, AE, MLO jobs; subservicing, training, U/W, 2nd lien, marketing products; why LOs should care about the FHFA

Willie Sutton never actually uttered the phrase, “I rob banks because that’s where the money is.” But he did admit never feeling more alive than when he was robbing them. Fraud and wire theft isn’t as blatant, but is more expensive and insidious. Anywhere there’s money, there are people who want it. Loan officers, compliance, QC, and audit personnel tell me that it’s on the rise, unfortunately, whether it originates with the borrower, title company, underwriter, wire transfer agent, or other player in the process. Certainly mortgage fraud is on the FBI’s radar, listing common mortgage schemes and recent examples of mortgage fraud that should be taught to every mortgage employee. Lenders and auditors see growing numbers of both altered images & pdfs, as well as issues of mismatched documents indicating suspicious activity. Lenders are increasingly conducting retro analysis on the documentation of defaulted loans (both mortgage and small business lending) and there are usually early signals that could have been caught by applying detection and cross source validation. Ocrolus published two articles that are worthwhile: “10 Important Visuals on File Tampering Detection” and “Forensic Accounting.” On a more positive note, today’s podcast is available here. Black Knight is providing innovative solutions that are transforming the industry and that help lenders of all sizes benefit from cutting-edge technologies and automation. Today’s features an interview with Andy Walden and Brennan O’Connell on the current rate environment.

Employment & transitions

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“While many lenders are shedding jobs, we are adding to our thriving platform. We are a national retail and wholesale lender and we are hiring! We are filling roles in the following positions: underwriters, account managers, closers/funding, as well as our disclosure desk. We allow WFH and have generous benefits and competitive compensation packages for the right applicants.” Please email Anjelica Nixt for more information. (Please specify the opportunity.)

“If you’re wanting to take your Originating career to the next level, we will get you there! In most cases when an originator hits a plateau it’s because the platform they are in doesn’t allow them to grow beyond what they’ve already achieved. One of the Top Originating teams in the nation is looking to help 1 Originator achieve their goals and successfully navigate a challenging market. Looking for a new opportunity is scary, but when that opportunity has a proven track record, a dedicated operations team that has been together for 4 rising rate cycles, fear turns into excitement! Top producers have some advantages not available to everyone. It’s time to give yourself those same advantages, start dominating your market, and take your career to the next level. If you close $20M or more per year and are looking for a breakthrough, contact Anjelica Nixt to schedule a confidential conversation. (Please specify the opportunity.)”

Finance of America Mortgage was the TOP jumbo-sized mortgage company in customer satisfaction in 2021 ranked by Experience.com! Finance of America Mortgage averaged a 4.92 star-rating with over 9,500 total reviews. In an interview with Experience.com, Finance of America Mortgage Retail President, Mike Farr said, “To us, the customer experience is everything. Aside from the actual mortgage products themselves that we sell, we sell an experience and we sell a process. That ultimately is our product, and confirmation of creating a world-class experience for someone buying or refinancing a home is once they refer a friend or family member over. That’s when we know we’ve confirmed, and we’ve hit that world-class experience. And, utilizing this tool at Experience.com helps us understand when we did hit it on the mark.” Looking to join the #1 ranked company in customer satisfaction? Look no further than Finance of America Mortgage: contact Tim Cotten today!

On a different note, life… No one lives forever, but some are taken too soon. I spent a fair amount of time with CoreLogic economist Frank Nothaft at conferences, and MBA SVP and Chief Economist Mike Fratantoni issued this on his death at age 66. “MBA is shocked and saddened by this news. For decades, Frank has been a key voice for the mortgage industry at Freddie Mac and then at CoreLogic. He was the best housing market analyst in the business, able to clearly and concisely convey information that helped our industry understand the current market and make decisions to prepare for the future. Frank had an inimitable style, both in terms of his presentations and his ever-present bow tie.”

Lender & broker software, services, and programs

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Uncertainty with your pipeline and rates putting a strain on your day-to-day operations? Button Finance, your Home Equity partner, is redefining the 2nd-lien space. Button Finance provides security to you and your borrowers. With industry-leading technology and world-class operations staff, you’ll have certainty that you’re in the best hands. Our average submission to CTC is 7 days, which is unparalleled in the space. You’ll be able to confidently close your loans with seamless piggyback or standalone transactions. These products will help your borrowers get into their dream home, consolidate debt, or do home improvements. Button Finance is committed to the wholesale channel and to helping brokers diversify their product offerings and to ensuring that you impress your referral partners. The HELOAN (Home Equity Loan) has term offerings of up to 30 years and expanded DTI ratios, helping as many borrowers as possible access their equity with a closed-end fixed rate with low monthly payments. Sign up today!

Each year Force 100, a coalition organized by Mortgage Professionals Providing Hope, donates $100,000 to charities that supply housing and education services to those in need. Since its inception, Force 100 has provided permanent housing for more than 40 families, and in 2021 it helped fund a school in Nicaragua that now serves over 170 students. What could MPPH do this year with your help? Become part of the story when you join tomorrow’s Worthwhile Webinar at 2 pm ET. Your $10 donation immediately turns into $40 with matching donations from Sales Boomerang, Mortgage Champions, SDP Solutions and Mortgage Coach.

Why choose multiple pricing engines when you can choose one to replace them all? Lender Price is the only solution that is able to support agency, Non-Agency, and Non-QM products all together. Enter FLEX by Lender Price, an innovative pricing tool designed for Non-Agency and Non-QM lenders to market their products and pricing quickly and conveniently online. With FLEX, it’s the easiest, most effective way for Non-Agency and Non-QM lenders to let brokers know about their products. Lenders can also customize the look and pricing fields with FLEX’s configurable user interface without the complexity and cost of development. Not only does it make it easy for originators to find and price loans, but FLEX is also connected to a powerful backend that simplifies the managing of loan-level price adjustments, eligibility, and margin management. With Non-QM demand rising, now is the time to learn more and request a demo with Lender Price.

Today’s mortgage customers expect digital access to accurate product and pricing information. Thanks to a new lead-quoting API from Optimal Blue, a division of Black Knight, it’s easier for lenders and lead-aggregation vendors to meet these expectations. This API connects lead-aggregation vendors to the vast array of product and pricing information in the Optimal BlueSM PPE – the industry’s most widely used product, pricing, and eligibility engine. In turn, vendors can display real-time rates on behalf of lenders using the Optimal Blue PPE – seamlessly connecting customers to hundreds of investors and thousands of products for any mortgage financing scenario. By using this API, lead-aggregation vendors can deliver a better experience to their lender partners who are already using the Optimal Blue PPE, as well as consumers who want easy access to transparent product and pricing information. Learn more in the launch of this API in the press release.

Monster Lead Group tells us that direct mail continues to be a critical component of originating mortgages and has released a helpful guide on the best practices of direct mail marketing. This 12-page guide on the seven essential practices they use in every direct mail campaign explains their techniques for producing high return, high converting direct mail campaigns that led to more than 1,000,000 unique calls and $25+ Billion in loan originations for their mortgage lenders since 2019. View the guide here.

“We get to Conditional Approval 14 days faster, and our underwriters review 12 files per day.” Travis Rulle, COO, FBC Mortgage. At 1 bps per day, these Candor clients add massive margin to every loan. For a bullet proof underwrite whiplash fast they use Candor’s Loan Engineering System. “We’ve cut our cycle time in half,” Kenny Parkhurst, COO Get A Rate. The Machine as an Underwriter conducts: OCR, 1100 data crosschecks, income calculation, information scrutiny, condition generation & condition clearing. It renders decisions and backs each one with a warranty. How much profit could a faster manufacturing process Do the math. You can be a raving client in just 30 days. Schedule a demo.

While we are regularly faced with near-constant change, there has been an especially significant shift in how we live and work over the last two and a half years. Is it any surprise that the way we build leaders who manage the changing workforce has shifted also? The lack of required transformation in leadership is a costly gap and a part of today’s “Great Resignation” for many organizations. Join XINNIX on June 16 at 2 PM ET as they host “Transformational Leadership Development: The Antidote to the Great Resignation”, a live panel discussion with three of the nation’s leading experts on the topic Michael “Go-To” Norton, XINNIX President; Dr. Bryan Price, Founder of New Jersey-based performance coaching and mental skills training firm, Top Mental Game; and Dan Carusi, Co-Founder and Chief Adventurer at Red Paint Consulting, a firm specializing in performance improvement, change management and leadership development. Reserve your seat today!

At TMS, great people + great tech makes for rock-solid service. This culture of care is how TMS continues to Grow Happiness for customers and clients. Like when TMS helped Stephanie Elliott, Post-Closing Manager at Meadowbrook during their GNMA audit, “The loan servicing files that were sampled were in perfect order, which is indicative not only of TMS’s overall professionalism, but to the quality of its integrated loan servicing platform.” TMS knows first-hand how critical it is to provide quality service, full transparency, and visibility into your portfolio. Which is why its best-in-class technology, powered by the servicing platform SIME (Servicing Intelligence Made Easy), was designed to give real time access to virtually all loan information and performance statistics at the click of a button. At TMS, they don’t subservice, they over-service. Ready for a rock-solid experience? Partner with TMS.

FHFA on the move

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Why should the average mortgage loan officer (MLO) care what the FHFA does? Originators have certainly turned some of their collective attention to non-QM, jumbo, or bond programs. Still, Freddie Mac and Fannie garner the lion’s share of residential loans in the United States, and what the FHFA says impacts their business. Gone are the days of talking about GSE reform and of weekly opinions about recapitalizing and releasing them (although those are still long-term goals), leaving F&F to focus on carrying out activities such as helping first-time home buyers, looking at affordable housing goals, and helping finance “the common man” rather than investors who own several rentals or second homes.

The Federal Housing Finance Agency (FHFA, which oversees Freddie Mac and Fannie Mae, aka, GSEs) introduced new public disclosure requirements to the enterprise regulatory capital framework. View the Final Rule announcement.

And yesterday the FHFA released its inaugural Mission Report that describes the activities of Fannie Mae and Freddie Mac (the Enterprises) and the Federal Home Loan Banks (FHLBanks) in 2021 to provide greater access to financing for targeted economic development and affordable, equitable, and sustainable housing.

Capital markets

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Persistent inflation, rising interest rates, and a slowdown of global economic growth are the primary contributing factors to updated expectations that full-year 2022 real GDP will grow at the reduced rate of 1.3 percent, 0.8 percentage points less than previously predicted, according to the May 2022 commentary from the Fannie Mae Economic and Strategic Research (ESR) Group. The ESR Group continues to believe that the Fed’s efforts to curtail inflation by tightening monetary policy are unlikely to result in a so-called “soft landing.”

Why did rates go up yesterday when there was no scheduled news? Well, China’s COVID crisis seems to be winding down, which is good for global growth prospects. And the elephant in the room is the Fed’s winding down the balance sheet, which began on June 1 at an initial combined monthly pace of $47.5 billion, a move that will further tighten credit for U.S. households. The Fed is on track to reduce its balance sheet by about $3 trillion over the next three years. Will there be buyers of what the Fed is selling? The Fed is on track to raise the Fed Funds rate 50 basis points at the next two meetings to bring down demand in better balance with aggregate supply.

The April trade deficit kicked off today’s calendar. Much like yesterday, it’s another light economic calendar, as the week after the first-Friday-of-the-month jobs report is generally data-light. The only other scheduled events are April Consumer Credit and a Treasury auction of $44 billion 3-year notes. Given no further Fed-Speak ahead of the June FOMC meeting, the biggest economic report & market mover may be the Consumer Price Index on Friday as investors focus mainly on the month-over-month numbers to see if inflation is beginning to moderate. We begin the day with Agency MBS prices a shade better from Monday’s close after the big selloff and the 10-year yielding 3.01 after closing Monday at 3.03 percent as the focus is on inflation and foreign central banks fighting it.

(Thank you to Colorado’s KC Harney for this one.)

A judge was interviewing a South Carolina woman regarding her pending divorce and asks, “What are the grounds for your divorce?”

“About four acres and a nice little home in the middle of the property with a stream running by.”

“No,” he said, “I mean what is the foundation of this case?”

“It is made of concrete, brick, and mortar,” she responded.

“I mean,” he continued, “what are your relations like?”

“I have an aunt and uncle and 12 cousins living here in town, as well as my husband’s parents.”

The judge took a deep breath and asked, “Do you have a real grudge?”

“No, we have a two-car carport and have never really needed one cuz we don’t have a car.”

“Please,” he tried again, “is there any infidelity in your marriage?”

“Yes, both my son and daughter have stereo sets. We don’t necessarily like the music – all that hip hop and rap trap – but we can’t seem to do anything about it.”

“Ma’am, does your husband ever beat you up?”

“Yes, he gets up every morning before I do and makes the coffee.”

Finally, in frustration, the judge asked, “Lady, why in the hell do you want a divorce?

“Oh, I don’t want a divorce,” she replied. “I’ve never wanted a divorce, my husband does. The damn fool says he can’t communicate with me.”

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, “The All-Cash Phenomenon.” 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 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 2022 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.)