Mar. 19: U.S. population growth stalls; Warehouse banks & fraud; vendor news; the CFPB & fees; Saturday Spotlight: Cenlar FSB

Here in Miami, amidst Florida’s population influx, even people in their 60s and 70s, heading toward “elderly” and their “Golden Years” can feel young. I received a note from one attendee stating, “Without saying, this song comes into my head every time Miami comes up: Miami Jingle. Another wrote, “Last night I was gambling in Havana, and I took a little risk…” Regardless of where they are, personnel in the residential lending industry is watching the regulatory environment, and Attorney Brian Levy offers some somber reflections on the evils unfolding in Ukraine and then quotes SCOTUS Justice Kavanaugh and hypothesizes real and imagined fact patterns to amuse legal and compliance nerds with how RESPA could really be a thought crime. And think of all the new potential borrowers out there! According to the U.S. Census Bureau, the population of the United States grew in the past year by 392,665, or 0.1 percent, the lowest rate since the nation’s founding. The slow rate of growth can be attributed to decreased net international migration, decreased fertility, and increased mortality due in part to the COVID-19 pandemic. This is the first time that net international migration (the difference between the number of people moving into the country and out of the country) has exceeded natural increase for a given year.


Saturday Spotlight: Cenlar FSB 


Your trusted partner, each and every day.

In 3-5 sentences, describe your company:


Cenlar successfully services residential mortgage portfolios for clients across the United States and its territories. We are a pioneer in the industry born from 100 years of experience first as a savings and loan, and then as a mortgage company, with decades of that time focused on subservicing. Over the years, we’ve built a diverse portfolio of banks, mortgage companies and credit unions of every size by caring for their unique needs with customized, flexible mortgage servicing solutions. Our talented team strives to be a trusted partner to our clients each and every day.

Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why.

We are committed to helping communities be a better place to live, work and play. Cenlar is a partner with Habitat for Humanity. Every year, our summer interns volunteer at Habitat for Humanity upon completing their internships. Cenlar volunteers at ReStore, which are independently owned stores operated by local Habitat for Humanity.

We hold employee food drives support local shelters in all of our locations in New Jersey, Pennsylvania, Arizona, and Missouri. We support many national organizations, including: the American Cancer Society, American Heart Association, March of Dimes, Toys for Tots Foundation, and Wounded Warrior Project. Our participation in the Boots on the Ground campaign delivers care packages to service members on active duty. Each fall, Cenlar delivers backpacks and school supplies to students in need.

What does your company do to help elevate your employees’ growth? Describe any mentoring programs, outside classes or training, in-house training. How does the company help people develop?

Whether employees want to grow in their current role, or they aspire to explore new opportunities within Cenlar, we support everyone.

We offer a variety of educational resources and certification programs for employees who want to enhance their skill sets and grow their careers. We have a partnership with the Mortgage Bankers Association (MBA) and many employees have gone through the MBA and completed their certification programs. Cenlar University was also created to offer specialized training and structured education for employees.

Tell us how your company maintains its culture in a work-from-home environment, or how you plan on bringing employees back into the office, if applicable.  

Our culture and our values (Respect, Trust, Integrity and Caring) have been Cenlar’s North Star throughout different points in our history to where we are today. As an employee-owned company, it’s how we work together as one and positively impact our workplace. Our values, especially caring, guided our efforts to quickly get our 3,000 plus employees out of the office in the early days of the pandemic. Caring also drove our teams to quickly help homeowners get the mortgage assistance they needed. Today, our values are shaping how we’re thinking about creating a new hybrid workplace that best serves our clients, their homeowners, and our employees.

Things you are most proud of that don’t have to do with sales. 


While many organizations say that their people are their greatest asset, Cenlar lives this every day. We are impressed by the talent across the organization who work diligently to serve our clients and their homeowners.

Our people are so important to us that we have created an employee recognition program called True Blue to call out those team members who inspire us by living our culture and core values.

Fun fact about Cenlar. 

Did you know that Cenlar has 112 employees in the company’s 20-Year Club? Formed in October 2002, the 20-Year Club celebrates employees who achieve their 20-year tenure at Cenlar. That’s many years of experience and a whole lot of heart dedicated to helping clients and their homeowners.

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

Warehouse banks and fraud: be careful out there


Lenders spend a huge amount of time and resources developing cybersecurity plans for their employees. And with good reason: buying a home is where the money is, and borrowers are susceptible to fraud.

This past week, Secure Insight attended the annual L1 Summit in Phoenix, AZ. A common topic that came up was whether or not warehouse banks cover mortgage lenders against third party settlement agent fraud at the closing table. A common mis-conception was: “my warehouse lender does this for me.” Amanda Padd, VP of Client Development said, “It is really surprising the amount of mortgage lenders we speak with who tell us they do not have a current risk mitigation tool in place against closing and wire fraud because they rely on their warehouse bank at the closing table.


“We presented this scenario to a few warehouse lenders and asked if their process is for the benefit of their clients and whether it offers any kind of indemnification for a lender loss from wire fraud or closing fraud of any kind. The answer was universal: ‘Definitely not! All lenders are required to do their own due diligence regarding wire fraud and settlement agent risk.’ Mortgage lenders who assume they are ‘ok’ because they use a warehouse lender who may or may not have some type of risk process, and forgo one themselves are mistaken.

Regulators require a lender to manage their own closing fraud risk against third parties. Being a party to a warehouse lending agreement does not relieve a lender from regulatory and legal liability, and lenders need their own type of risk mitigation tool that includes background searches along with wire, insurance, bond, and license evaluation that has ongoing monitoring. We are increasingly seeing this subject appear on agency and regulatory audits and our detailed risk management process has helped many lenders satisfy such audit questions.” Thank you, Amanda.

The current water temperature


Within the last few weeks industry vet Tom LaMalfa did a survey of the current business environment. The survey covered office return rates, production volumes, changes in margins, revenues, expenses, employee retention, house price expectations, and “buy to let” investors’ effect on homebuyers. The majority of respondents said that refi volume was down more than 33 percent from a year ago, gain on sale margins were down more than 25 percent, and expected revenue in the first quarter to be down more than 25 percent from a year ago. The majority of respondents expect aggregate production to be down more than 33 percent.

And a relatively small number of firms have more than 10% of their 1Q20 workforce back in the office in the current quarter.

Compliance: It never stops


With the new Administration, and head of the Consumer Finance Protection Bureau, residential lenders are wondering what’s in store. To shed some light on that, recently the CFPB announced an initiative “to save households billions of dollars a year by reducing exploitative junk fees”. While the emphasis was on credit card charges, mortgages were also included.

The CFPB’s first step is to encourage the public to comment about their experiences with fees incurred in consumer financial transactions. These include fees for things consumers thought were covered by the baseline price of a product or service, unexpected fees for a product or service, fees that seemed too high, and fees where it was unclear why they were charged.

Regarding mortgage fees, the CFPB notes, “…priced into most mortgages are thousands of dollars of application fees and closing costs, which few people are well-positioned to shop on.” “Advocates and reporters have noted that many closing costs, like title insurance, may not always be subject to standard or appropriate competitive forces.” “These fees can act as a barrier to homeownership, strip wealth from homeowners…and deter some homeowners from refinancing”. “…homeowners can find themselves forced to pay fees for making payments over the phone…” “Borrowers who face financial hardship and struggle to make mortgage payments can find themselves unable to catch up due to the snowballing of a plethora of fees related to the mortgage delinquency. Monthly property inspection fees, new title fees, legal fees, appraisals and valuations, broker price opinions, force-placed insurance, foreclosure fees, and miscellaneous, unspecified “corporate advances” can all price a homeowner out of a home.”

The CFPB expects to take several actions. These include using information to issue new rules and guidance “to spur competition and transparency.” Reviewing rules that the CFPB inherited at agency’s inception. Identifying companies that “don’t compete on certain types of fees and features.” Will aid in identifying illegal practices through supervision and enforcement work. “Learn what new market entrants are doing to be more doing to be more upfront and honest with prospective customers.”

Of course, individual states are also enacting laws and regulations impacting all facets of our business. For example, New Hampshire Senate Bill 134 enacts the Revised Uniform Law on Notarial Acts, including provisions for notarizations on electronic records and for remotely located individuals which took effect on February 6, 2022. View First American Docutech document updates for details.

Concerned about avoiding UDAAP violations? UDAAP is a sort of generic rubric for many, many regulatory requirements. Several federal and state regulatory agencies are involved in monitoring UDAAP implementation. Can UDAAP be boiled down to just a few basic rules? Lenders Compliance Group wrote an essay on how to be ready for a UDAAP examination, especially now that the CFPB monitors it in its examination and enforcement protocols. The firm recommends a three-part test based on a representation you make to a consumer: Does the representation, omission, or practice mislead or be likely to mislead the consumer? Is the consumer’s interpretation of the representation, omission, or practice reasonable? And is the misleading representation, omission, or practice must material?

Vendors on the move


wemlo has added support for new loan products. Processing solutions for nonqualified mortgage (Non-QM) loans including DSCR & Bank Statement, Specialized Borrower Assistance loans for low credit score and down payment assistance, Manufactured Home, and Construction loans, plus VA IRRRL and FHA Streamline loans are now supported. “Made for mortgage brokers and loan originators, this revolutionary mortgage technology platform seamlessly manages demand, allows for automation, and streamlines communication. wemlo is currently authorized to do business in 46 states, plus Washington, D.C.

MeridianLink released its Q4 earnings, reporting revenue of $64 million which grew 19% year-over-year. Read the news report for details on MeridianLink’s fourth quarter report and fiscal year 2021 results. The company launched MeridianLink Engage, a unique and comprehensive end-to-end consumer lending, account, and card marketing automation solution, in beta in Q4 and expanded to general availability in January 2022. In addition, MeridianLink also announced the acquisition of StreetShares, a financial technology company that provides digital small business lending technology to banks and credit unions. The acquisition will accelerate MeridianLink’s small business lending capabilities.

A one-stop shop was recently announced with the launch of GO Companies, merging the services of a real estate agency (3 Degrees Realty), a lender (GO Mortgage), and a title company (MeyMax), a one-stop shop. The company will be adding an insurance company called QuickInsured when the deal is finalized. Homebuyers will be provided with everything they need to purchase a home under one roof including lower rates and fees. GO Companies will be led by Michael Isaacs. Isaacs has more than 20 years of experience operating real estate businesses, including mortgage banking companies.

HomeBinder announced the availability of its Adaptive Home ValueTM tool that paints a more accurate picture of a home’s value by including property-specific details not currently considered with AVMs such as regular maintenance and upkeep, projects and renovations, and updates to the major systems and appliances of the home. The web-based platform is powerful enough to take in a breadth of home data logged in a homeowner’s binder, analyze that data, and algorithmically calculate its immediate and long-term impact on overall home value.

Partners Credit reminded clients of its Score Protection tool, used to protect your borrower’s credit scores, and potentially save your loan in the process. “Following the completion of a bureau tradeline update, Partners Score Protection allows users to merge scores across different credit reports, pulled for the same borrower. Reports pulled within 30 days of each other can be merged with this game-changing new tool at a click of a button. Avoiding hard inquiries for unnecessary additional pulls can help avoid drops in credit scores that can impact your borrower and change the direction of the loan.” (Contact the team with questions.)

(Thank you to Stephen S. for this one.)

A minister waited in a long slow-moving line to have his car filled with gas just before a long holiday weekend.

The attendant worked quickly, or as quickly as he could, but there were many cars ahead of him in front of the service station.

Finally, the attendant motioned him toward a vacant pump.

“Reverend,” said the young man, “Sorry about the delay. It seems as if everyone waits until the last minute to get ready for a long trip.”

The minister chuckled, “I know what you mean. It’s the same in my business.”

Visit 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, “Lenders Continue to Pivot” about how lenders and MLOs continue to shift to a purchase-centric focus. The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).


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Rob Chrisman