Daily Mortgage News & Commentary

May 9: MI, Cap. Mkts., MLO jobs; consulting, appraisal, prequal, MI, specialty products; Costco, SoFi, & mortgages; rates march higher

Recently in Reno I overheard someone predict, “Forget Wikipedia. How about someone create ‘Liquorpedia’ with an encyclopedia of alcohol and drink recipes?” Remember when many “experts” predicted that a) Amazon was going to enter the lending biz and trample everyone, and b) Costco, after announcing it was offering mortgages to members, was going to drive any remaining lenders out of business? Neither has happened, and in fact, Costco has ended its mortgage “perk” for members. (There’s even some Costco humor in the joke section.) Meanwhile, Zillow, which has ended its iBuying business, is watching its stock hit multi-year lows, mimicking nearly every lender’s stock price. And why not? We’re seeing the highest 30-year mortgage rates since 2009, firmly in the 5s, and little inventory for sale. Rate and term refis have nearly vanished, and last week’s move by our Fed has short term rates predictably moving higher for the rest of 2022. (Mortgage rates perhaps not so much, and here’s “A Primer on the Federal Reserve and Mortgage Rates.”) Today’s podcast is available here and this week’s is sponsored by SimpleNexus, an nCino company and award-winning developer of mobile-first technology for the modern mortgage lender. Today’s has an interview with attorney Marty Green, an attorney with mortgage law firm Polunsky Beitel Green, on what the latest Fed meeting means for the housing market.

Jobs & transitions

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A large, independent omni-channel mortgage banker licensed in 50 states has an open role for a Capital Markets Director. The Director of Secondary Marketing works with company leadership on developing, maintaining, and pricing mortgage loan programs. This includes the monitoring of the mortgage secondary market, establishment of daily mortgage prices and rates, hedging the interest-rate risk on our secondary market loans, managing the daily risk position, best execution of our loan deliveries into the secondary market, and serving as a primary contact with investors and private insurers. This position is a senior level position. Preferred candidate lives in the DFW area, as a largely in-office work schedule is expected. Interested applicants can send resumes to Anjelica Nixt and specify this opportunity.

Radian is looking for Regional Account Managers in AZ, CO, KY, and MO along with other roles in Mortgage Operations. Come join a fun, enthusiastic team but more importantly come join a company that is making a difference in the real estate market. Come join Radian! Interested candidates should have sales and mortgage banking experience. Please apply here.

Are you a loan officer with a desire to work at a company that gives back to the military community? Look no further than Caliber Home Loans. Caliber is committed to supporting the brave men and women who serve our country, which is why we are proud to be recognized as a Military Friendly employer and Top 10 Spouse Friendly Employer. Since 2016, Caliber has given sent over 100,000 Challenge Coins to every veteran or military service member who closes a loan as a token of our appreciation for doing business with us and serving our country, as well as to show honor, loyalty, and commitment to the community. Ready to make a move and join a supportive team of mortgage professionals? Apply now or contact Brent Lubahn, Vice President of Recruiting.

Recently National Bank Holdings Corporation announced an agreement to acquire Bank of Jackson Hole with operations in Jackson Hole, WY and Boise, ID. There are advantages in being an originator for a national bank, and NBH is looking for growth-oriented originators in its footprint states which include CO, MO, KS, TX, UT, NM, ID, and WY. Any loan originators interested in a career with NBH, please send me a resume for forwarding.

Fairway Independent Mortgage Corporation has operations and production career openings nationwide.

FHA has two vacancies in Washington D.C. for a Loan Specialist (Realty) (Loan Guarantee Underwriter) making up to $116k per year. Duties include individual case underwriting, analyzing inherent risk in the issuance of a loan guarantee and perform technical desk review of the Direct Guarantee Underwriter’s analysis. And is hiring three Loan Guarantee Specialists in Washington D.C. (salary up to $138k per year), developing policies, program standards, procedures and guidelines in response to the unique problems and issues in Indian, Alaskan Native areas, and Hawaiian homelands. Initiate and prepare comprehensive policy documents that recommend statutory changes.

Flagstar Bank announced it has hired Mark Herron as chief brand officer for the company where he will be responsible for marketing strategies, sales, branding, technology transformation, data analytics, marketing automation, change management, oversight of the client experience and internal communications. That’s a lot!

Lender & broker products and services

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The most critical decision for businesses is knowing when to stay the course vs change direction. As the homebuyer market pivots to purchase, community banks need to adjust their strategies to succeed in 2022. Fortunately, SimpleNexus’ comprehensive digital homeownership platform helps lenders win in any market. On May 11 at 3 pm ET, tune into SimpleNexus’ free webinar discussing ways lenders can seize more opportunities by evolving their sales strategies, focusing on underserved markets, and leveraging a mobile-first tech stack that reduces costs and elevates borrower experiences. The choice is simple: dwell on the declining refi boom or register and look to the purchase-heavy future.

Give move-up buyers the options they need. Even experienced borrowers face obstacles, and often need advice from a savvy loan officer to help them achieve their goals. See how mortgage insurance can help move-up buyers move up to more, finance a fixer-upper, or retain funds for other priorities. Make more deals when you use mortgage insurance as a strategy to help move-up buyers do more with their money. Check out MI Solutions from MGIC.

Flagstar Bank is aggressively expanding its specialty-lending offerings, including new product advancements and non-QM. On the menu are higher LTVs on jumbo products like the Jumbo Express, the upcoming relaunch of Flagstar’s Advantage product which will include ARMs, LTVs up to 90 percent and loan limits that span from $100,000 to $3 million Eileen Lindblom was recently named Flagstar’s director of non-agency mortgage lending, and she’s rapidly building on Flagstar’s already strong leadership position in the space. Visit Eileen and the Flagstar team at the MBA Secondary in New York May 15-18 to have a sneak peek at all the exciting new products in the Flagstar pipeline.

The adjustable pre-qualification letter is here to stay. When the top lender in the country is willing to spend upwards of $20 million to advertise their adjustable pre-qualification letter during a football game… you know it’s legit. So why are your loan officers still issuing static pre-qualification letters via email or through your POS? QuickQual by LenderLogix is a best-in-class solution for lenders who want to ditch their 2005 customer experience. The best part is that since LenderLogix is an official ICE Mortgage Technology™ partner, loan officers can issue their pre-quals using QuickQual right from Encompass®. Head over to LenderLogix and they’ll shoot you a text to show you what an adjustable pre-qual letter looks like and you’ll never go back to emailing PDF letters again.

In a world where we can easily order and monitor our food and package deliveries, why couldn’t the same be true for appraisals? Now it is. Get ready to serve your clients with a better appraisal experience via iValuator, an addition to the BROKER AdvantEDGE program by Sprout Mortgage. Easily order appraisals, track progress, and speed up turn times by automating manual workflow tasks. Contact your Sprout account executive to get started.

Cenlar is more than just a mortgage servicer. We strive to be our clients’ trusted partner each and every day. And a big part of that is how we care for our clients’ homeowners. A home is most likely someone’s largest asset. It’s more than just a house. It’s a place where people make memories. That’s why we are continuously evolving to provide the best homeowner experience… not a single moment in time but one that can last a lifetime. Whether that’s the regular cycle of onboarding, escrow, monthly payments and year-end or challenges facing homeowners like the pandemic and natural disasters, we are responsive, anticipatory, and always caring. What’s more, our longevity and sheer breadth of expertise enables our talented team of mortgage servicing professionals to deliver the best homeowner experience.

Let’s discuss how Cenlar can meet the mortgage servicing needs of your organization. Call 1-888-SUBSERV (782-7378) or visit here. We want to be your trusted partner, each and every day.”

Richey May is pleased to welcome its new Director of Mortgage Banking Consulting Services Seth Sprague, CMB. Drawing on more than 25 years of mortgage banking and mortgage servicing experience, Seth has invaluable expertise and a holistic perspective on the intersection of policy with economic and market conditions and its impact on the mortgage ecosystem. His in-depth background in mortgage strategy, profitability and operations comes at a critical time for Richey May’s mortgage clients as they continue to navigate the industry’s dynamic environment. Seth will lead the firm’s mortgage banking consulting practice and will also serve as a strategic leader for the entire Richey May suite of services. To learn more about how our mortgage banking consulting services can help you, please contact info@richeymay.com.”

Assorted retail, wholesale, and correspondent tweaks ___________________________________________________

Rocket Pro TPO offers up an extension of its “Fast 15 Guarantee.” “We promise all eligible purchase loans will be clear to close in 15 business days or we’ll give your clients $2,500!1 Rocket’s Fast 15 Guarantee also covers correspondent partners: ‘We guarantee that eligible loans will be clear to close in 15 business days or we’ll waive the $999 acquisition fee.2’”

SoFi and HomeStory have partnered to deliver the all-new (and free) SoFi Real Estate Center, “your complete home buying and selling experience. You’ll be paired with a prescreened local agent through HomeStory to help you navigate the process. They’re equipped with personalized search results and robust market information and analytics. You’ll also receive $350 to $9,500 cash back based on the purchase (or sale) price of the home when you clinch the deal. * Plus with a SoFi Mortgage, you’ll be looking at low rates, flexible term options, exclusive membership discounts, and more.”

Effective Monday, May 2nd, Mountain West Financial Wholesale Division increased its underwriting fee. Additionally, a new MERS fee will be added to all first mortgages. Impacted loans disclosed on or after Monday May 2nd must have the new fee requirements. Review MWF Wholesale Announcement 22W-036 for new fee details.

PRMG TPO Resource Center Updates 22-06 includes information on PRMG updated policies, procedures, and information. Additional information related to General, VA, Jumbo, Non-QM and Second Mortgage Product Forms and Information.

In loanDepot Wholesale’s continuous efforts to improve the customer experience, lock desk hours have been extended, making it easier to get loans closed. In your time zone, the lock desk is open Monday-Friday 7:30am PT to 11:00pm and Purchases can be locked on Saturday and Sunday between 7:30am PT to 11:00pm.

First American Docutech Compliance News posted information on California’s announcement of a new, required appraisal disclosure, starting July 1, 2022.

Temporary Interest Rate Buydowns is PennyMac Correspondent’s May Product Highlight per Announcement 22-31.

First Community Mortgage posted information, effective for new applications on or after Tuesday, May 3, 2022, regarding HOL Credit Qualification, in Wholesale Announcement 2022-19.

 

Capital markets

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The latter half of last week saw a sharp selloff after investors decided the Federal Reserve’s implied policy tightening cycle ahead was still very hawkish, even as Chairman Powell said the committee was not currently discussing 75 basis point rate hikes. Investors remain nervous about the Fed’s ability to tighten financial conditions to combat inflation without sending the economy into a recession. With the war in Ukraine, sanctions against Russia, and Covid-19 lockdowns in China adding to food, energy and supply-chain disruptions, and reactionary tightening by central banks (in turn inflaming global growth risks and fears of stagflation), there’s no end in sight to volatility in financial markets.

 

The economy added 428k jobs in April, which was a touch above the 400k consensus estimate. Those new jobs, in conjunction with a declining labor force participation rate, kept the unemployment rate at 3.6 percent. The unemployment rate stirred concerns about wage pressures persisting given the record number of job openings. Year-to-date, the U.S. has added over 2 million jobs and the jobs market remains tight. Fed Chair Powell said that the committee expects the labor participation rate to increase given current market conditions as well as a slowing of job growth due to fiscal and monetary policies. The report is not expected to alter the Federal Reserve’s plan to continue to raise the policy rate multiple times in the coming months and chatter is that the odds for the Fed to engineer a soft landing have increased with the positive headline payrolls figure. The FOMC’s goal is to bring labor supply and demand closer together as there are still 1.9 openings for each unemployed person.

 

As markets adjust to a tighter monetary environment, they are currently pricing a peak to the fed funds rate near 3.25 percent sometime in mid-2023. Technically, the Fed is still in accommodative mode, with rates so low that inflation continues to be made worse. The underlying level of inflation is running at about 5 percent once you take out transitory factors, so the inflation-adjusted interest rate, the fed funds rate minus inflation, is deeply negative (about -4 percent). There are concerns that the Fed was premature in pushing back against talk of larger rate increases, but if the Fed increases rates too much and too fast it risks a recession, something some have argued is necessary to bring inflation back down.

At this stage getting to a neutral rate, where inflation is no longer being pushed even higher, is the top priority. The monetary policy stance is neutral when the federal funds rate is just a bit higher than the underlying trend of inflation. If underlying inflation is running at around 5 percent and the Fed raises the funds rate to around 6 percent, it’s not a restrictive policy, but rather the rate that avoids adding any further monetary accommodation and helps keep inflation from rising even higher. Getting to neutral, as Fed Chair Powell said, is still a long way off. Sticking with smaller hikes in coming months risks adding fuel to the inflationary fire. What is crucial for volatility is that the Fed be clear in explaining its strategy and reasoning to markets.

This week, “Fedspeak” will be prevalent now that the blackout period has ended. The week gets off to a relatively mundane start with the non-market-moving employment trends index for April and wholesale trade. The NY Fed Desk will purchase up to $1.9 billion in conventional MBS consisting of UMBS15 3.0 percent and 3.5 percent and UMBS30 3.5 percent through 4.5 percent. After rising 24 basis points over the course of last week to close at 3.12 percent, the highest level since 2018, we begin the week with the 10-year yielding 3.17 and Agency MBS prices worse .125-.250.

Are there Costco fans out there? Of course there are, and here’s a short video sent to me from Dallas just for you titled, “I Don’t Need It but I Want It.”

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, “A Primer on the Federal Reserve and Mortgage Rates.” 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.)