Daily Mortgage News & Commentary

Mar. 5: Vendor & 3rd party news; Agencies active in the secondary markets; Saturday Spotlight: American Advisors Group

Often, I take a break from pure economic & mortgage news on Saturdays and jabber on about whatever. But interest rates have been volatile, and it is worth taking a gander at yesterday’s unemployment data given that jobs and housing drive our economy although jobs data from the past is overshadowed by data and video from the present of Russia’s wanton devastation of villages and civilians of Ukraine. The MBA’s SVP and Chief Economist Dr. Mike Fratantoni had some thoughts about February’s report on employment conditions. “This report is likely to reaffirm recent comments from Federal Reserve officials indicating that they still plan to increase rates at their upcoming March meeting, despite the market volatility stemming from the situation in Ukraine. Job gains were strong again in February, with multiple aspects of the report highlighting a tight labor market. At 3.8%, the unemployment rate is likely lower than what can be sustained over the long run. With little change in labor force participation, the unemployment rate is likely to go lower in the months ahead, and we now expect it will dip below 3.5%, the very low level last reached in February 2020. Wages were up 5.1% over the past year, a strong pace, but still short of the price gains shown in the Consumer Price Index (CPI)… Turning to housing, construction jobs were up 60,000, with gains in the categories for contractors. Permits for new homes have increased, and now we see hiring picking up. However, supply chain constraints continue to pose a challenge for builders meeting the strong demand for new homes.”

 

Saturday Spotlight: American Advisors Group, a leader in reverse mortgages

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In 3-5 sentences, describe American Advisors Group (AAG), NMLS ID: 9392

Founded in 2004 by Reza Jahangiri, AAG offers an array of home equity solutions to help older Americans live and retire better. In addition to being the nation’s leading Home Equity Conversion Mortgage (HECM) lender, AAG offers proprietary, traditional, VA, and other home equity-based mortgage solutions. Headquartered in Irvine, California, with offices in New York, Georgia, and Arizona, AAG is a proud member of the National Reverse Mortgage Lenders Association (NRMLA) and an approved lender of the U.S. Department of Housing and Urban Development (HUD).

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

As a caring and ethical company with the goal of helping older Americans live and retire better, we are constantly investing in the ongoing education, development, and leadership of our employees. AAG is one of a select few mortgage companies that pay for newly hired, unlicensed loan officers to go through internal training to prep and pass the SAFE exam and maintain their licenses through our Continuing Education (CE) platform. Our employees further chart their career path through “AAGYou,” a rich and well-resourced library and learning bank of online courses and videos.

With regard to ongoing leadership development, AAG offers exceptional opportunities through both its LEAD and KLE (Key Leadership Experiences) programs, which are quarterly live sessions focused on helping leaders take control of their own leadership evolution.

This year, for our new and newly promoted people-leaders, AAG has also launched three distinct opportunities. First, “Dig In,” a holistic onboarding program that includes one-on-one personal and professional strengths coaching within their first two months. Second, “Ask Me Anything (AMA) New Leader Discovery,” a jam-packed question-and-answer session to expedite the get-to-know-you process between new leaders and their team. And third, “Dig in Mentorship,” a program for new leaders with structured monthly focuses (Month 1 Leading Your Team, Month 2 Building Relationships Across the Organization, Month 3 Leading Change for Better), supervised by an AAG Leader/Mentor.

Tell us how AAG maintains its culture in a work-from-home environment

By staying true to our core values, we doubled down on our communications outreach with monthly town halls, quarterly all-hands-on-deck meetings, and industry-leading training to help 96% of our employees successfully transition to working remotely. We also maintained our human connectivity by participating in blood drives, volunteering at food banks, donating money to COVID relief funds, and checking up on isolated seniors. To ensure we listen and respond to the needs of our employees, we monitor our employees’ engagement through regular pulse surveys.

Thing AAG is most proud of that doesn’t have to do with sales

Reverse mortgage loans are the closest we get to a “First Time Home Buyer” life-changing impact on borrowers. We are so proud to be a part of that.

Fun fact about AAG

AAG’s Wholesale Division turns 10 this year!

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

Vendors & third-party providers: always up to something

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Providers do plenty more than capitalize letters in the middle of their names, or not capitalizing them at all. Let’s take a random look at who’s doing what.

The MBA relayed information that MISMO® is seeking public comment on updates to MISMO Engineering Guideline (MEG) 7 establishing class words that enable consistency in the naming and structure of data point names. The 60-day public comment period runs through April 23, 2022.

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.)

wemloSM, the first third-party mortgage processing solution with an all-in-one digital platform, announced it has added support for new loan products to provide a seamless and efficient loan processing experience for mortgage brokers and loan originators. wemlo now supports 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. Made for mortgage brokers and loan originators, wemlo’s award-winning technology features a secure borrower portal and unique brokerage dashboard. (To learn more, visit here or book a 30-minute demo.)

UniversalCIS | Credit Plus has a new name, Xactus, marking a new beginning for the company. The comprehensive initiative includes the creation of a new logo, website, key messages, and tagline, “Advancing the Modern Mortgage,” which speaks to Xactus’s focus to be an innovative and transformative force in the mortgage industry. Xactus reflects the company’s qualities of being exact, factual, accurate and its commitment to advancing the delivery of the modern mortgage. This strategic shift reflects the company’s evolution and the significant growth it has experienced over the last two years due to the recent mergers of Credit Plus, Universal Credit Services, CIS Credit Solutions, Avantus, DataFacts Lending Solutions, and SharperLending. The intertwining of these legacies makes Xactus uniquely capable of advancing the modern mortgage.

The latest news from Clear Capital is the expansion of its Clear Capital Partner Network. In collaboration with its partners, Clear Capital seeks to reduce friction of transformation and enable the vendor ecosystem with unique technology, data, and analytics solutions. Solutions include data and analytics to increase the certainty of desktop and hybrid appraisal fulfillment; mobile technology to enable digital property inspections and floor plans; managed data collection services with non-appraiser workforces; and automated appraisal QC and AI-powered photo review software. To learn more about Clear Capital’s partner program, visit ClearCapital.com/company/partners.

Big in tech partnership news: Mortgage Coach has enhanced its integration with Black Knight’s Surefire, customer relationship management (CRM) and marketing automation software to provide lenders with Total Cost Analysis-embedded marketing content. Through this integration, TCA-enriched, text- and email-marketing content that engages borrowers with interactive loan comparisons is now available to mutual customers in Surefire’s creative asset library. Lenders can also leverage Surefire’s marketing automation capabilities to build TCA-enriched content into prospect, nurture, and Client for Life workflows, as well as deploy targeted campaigns on a one-off basis.

Quality Mortgage Services (QMS) is merging its industry expertise into the innovative QC Verify framework, a proven, data-driven audit solution provider. The merger will also encompass QMiS Systems, LTD, a subsidiary of QMS. QMiS Systems represents the future of BPO and SS engagement, delivering process automation solutions that support the entire mortgage life cycle from origination through servicing. This distinctive combination is now available through a single contemporary third-party provider platform, delivers unrivaled sophistication, security, and digitization of industry processes. Quality Mortgage Services Owner and CEO, Tommy Duncan, will continue to lead the combined organization as a majority partner to the transaction. QC Verify will also be headed by Founder, Claudia Duncan, well known in the industry as the president of QMS, the mortgage quality control and audit technology solutions company.

Sales Boomerang, announced its application programming interface (API) integration with OptifiNow, a cloud-based sales, marketing, and customer relationship management platform. The integration ensures accurate borrower data flows seamlessly and automatically between the two systems, giving lenders more time to focus on nurturing borrower relationships and exceeding sales goals. Sales Boomerang’s new integration with OptifiNow can be applied to any of the borrower intelligence platform’s 11 unique loan opportunity alert offerings.

CRM also generates a history of alerts for each prospect in a lender’s CRM database. Synchronizing Sales Boomerang’s real-time opportunity alerts with OptifiNow’s CRM offers LOs a more nuanced understanding of a prospect’s financial situation and enables lenders to build custom borrower data reports based on Sales Boomerang alert history.

DocMagic, Inc. integrated multiple digital lending solutions with Take Three Technologies’ (“Take3”) cloud-based and fully-integrated loan origination system LoanMAPS™.The new integration clients by eliminating the need for an initial disclosure desk and closing department, which results in reducing the clients’ full-time employee count and slashes clients’ cost to produce loans. Via the integration, LoanMAPS users can easily and compliantly generate loan documents, eSign, and will offer eClosing capability. Additionally, unlike most commercially available LOSs, LoanMAPS also includes a robust CRM, POS, and Report Generator, which eliminates the need to add third party applications, dramatically lowering the cost to originate loans while maximizing productivity. Take3 encourages clients to take their Cost to Produce Challenge and see how much they could save with LoanMAPS.

Insellerate announced the hiring of Meg Bennett as VP of Partnerships focusing on partner success and growth. She is an industry professional and driven national sales executive with proven results selling and managing Top National Lenders. Meg believes in advocating for her clients, building solid, long-term relationships & the power of teamwork. Bennett’s goal is to share her passion for relationship building and create a tribe of those who resonate with these values by being authentic to her personal brand.

Agencies: active in the secondary markets 

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Lender supply and investor demand drive mortgage rates, and it is important for originators to at least know what is happening to their conventional conforming production (either within a few months of origination or years down the road).

Fannie Mae began marketing its twenty-fourth sale of reperforming loans as part of the company’s ongoing effort to reduce the size of its retained mortgage portfolio. The sale consists of approximately 8,050 loans, having an unpaid principal balance of approximately $1.3 billion, and is available for purchase by qualified bidders. Interested bidders can register here. Bids are due on March 1, 2022. Reperforming loans are loans that have been or are currently delinquent but have reperformed for a period of time. The terms of Fannie Mae’s reperforming loan sale require the buyer to offer loss mitigation options to any borrower who may re-default within five years following the closing of the reperforming loan sale. All purchasers are required to honor any approved or in-process loss mitigation efforts at the time of sale, including forbearance arrangements and loan modifications. In addition, purchasers must offer delinquent borrowers a waterfall of loss mitigation options, including loan modifications, which may include principal forgiveness, prior to initiating foreclosure on any loan.

But Freddie Mac has, in recent years, produced the lion’s share of deals in the secondary markets, especially in the multifamily sector. And these are often affordable for moderate- to low-income renters.

In January of 2022, Freddie Mac priced a new $1.1 billion offering of Structured Pass-Through K Certificates (K-137 Certificates), which are backed by underlying collateral consisting of fixed-rate multifamily mortgages with predominantly 10-year terms. The pricing benchmark used for the offered classes of K-137 Certificates was the P-curve. For more information on Freddie Mac’s When-Issued K-Deal, WI-K137, click here.

Freddie Mac priced a new $799 million offering of Structured Pass-Through K Certificates (K-F119 Certificates), which includes a class of floating rate bonds indexed to the Secured Overnight Financing Rate (SOFR). The K-F119 Certificates are backed by floating-rate multifamily mortgages with 10-year terms, which are SOFR-based. The one offered class, Class AS, has a weighted average life of 9.48 years, a coupon of 30-day SOFR average + 21 bps, and a $100.00 price.

Freddie Mac priced a new $829 million offering of Structured Pass-Through K Certificates (K-F128), which includes a class of floating rate bonds indexed to the Secured Overnight Financing Rate (SOFR). The K-F128 Certificates are backed by floating-rate multifamily mortgages with 10-year terms, which are SOFR-based. The one offered class (Class AS) has a weighted average life of 9.53 years, a coupon of the 30-day SOFR average + 23 bps, and a $100.00 price.

Freddie Mac priced a new $550 million offering of Structured Pass-Through K Certificates (K- I07 Certificates), which includes a class of floating rate bonds indexed to the Secured Overnight Financing Rate (SOFR). The K-I07 Certificates are backed by floating-rate multifamily mortgages with 3-year terms (subject to two 1-year extensions), which are SOFR-based. Each of the mortgages was originated pursuant to Freddie Mac’s Value-Add program. The one offered class, Class A, has a weighted average life of 2.90 years, a coupon of the 30-day SOFR average + 17 bps, and a $100.00 price.

 

Freddie also priced another offering of Structured Pass-Through K Certificates (K-F122 Certificates) that includes a class of floating rate bonds indexed to the SOFR. The approximately $767 million in K-F122 Certificates settled on October 28, 2021. The K-F122 Certificates are backed by floating-rate multifamily mortgages with 10-year terms, which are SOFR-based. Class AS ($767 million) has a weighted average life of 9.55 years, a coupon of the 30-day SOFR average + 19 bps, and a $100.00 price.

Freddie Mac priced a $767 million offering of Structured Pass-Through K Certificates (K-1518 Certificates), which are multifamily mortgage-backed securities. Pricing for the deal is as follows. Class A-1 has $138.039 million of principal, a weighted average life of 8.86 years, a spread of S+46 bps, a 1.192% coupon, a yield of 1.18556% and a $99.9985 price. Class A-2 has $629.888 million of principal, a weighted average life of 14.67 years, a spread of S+60 bps, a 1.860% coupon, a yield of 1.62704% and a $102.9872 price. The K-1518 Certificates were expected to settle on or about November 17.

Freddie Mac priced a $1.1 billion offering of Structured Pass-Through K Certificates (K-740 Certificates), which are backed by underlying collateral consisting of fixed-rate multifamily mortgages with predominantly 7-year terms. Pricing for the deal is as follows. Class A-1 has $59.300 million of principal, a weighted average life of 4.11 years, a spread of S+17 bps, a 0.5940% coupon, a yield of 0.5858%, and a $99.9965 price. Class A-2 has $990.091 million of principal, a weighted average life of 6.80 years, a spread of S+31 bps, a 1.47% coupon, a yield of 1.0009% and a $102.9980 price. The K-740 Certificates were expected to settle on or about November 20.

One night, Mrs. Mulligan answers the door to see her husband’s best friend Paddy standing on the doorstep.

“Hello Paddy, but where is me husband? He went with you to the brewery…”

Paddy shook his head. “Ah Mrs. Mulligan, there was a terrible accident at the beer factory, your husband fell into a vat of Guinness stout and drowned.”

Mrs. Mulligan starts crying. “Oh don’t tell me that Paddy. Did he at least go quickly?”

Paddy shakes his head. “Not really. He got out 3 times to go to the loo!”

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, “What’s Next” about how lenders and MLOs are shifting 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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(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.)