Daily Mortgage News & Commentary

Nov. 13: Letters on appraisers and AMCs; vendors & new products; Saturday Spotlight: HouseCanary

Did you know?! By replacing your morning coffee or cocoa with herbal green tea, you can lose up to 90 percent of what little joy you still have left in your life. Some readers know that I’m up at 4AM PT every day. But sometimes I’m up at 2 or 3AM, fretting about whatever, and thank you to Kris W. for passing along this explanation of why my liver is the culprit. (Or maybe it is my diet of M&Ms.) Mortgage software engineers are also probably up at all hours as well. “Smart Contracts”? “Two new-home mortgage leaders, Laura Escobar, president of Lennar Mortgage, and Ashley Kendrick, chief operating officer at Inspire Home Loans of Century Communities, have started to implement several digital strategies and processes at their own companies and shared the digital mortgage process perks that they hope will help builders in the long run.” Plenty of third-party companies are also hoping they will change the mortgage landscape; more below in the vendor section.

Saturday Spotlight: HouseCanary, providing software and services to reshape the real estate marketplace

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In 3-5 sentences, describe your company (what it does and how you help lenders and consumers).

Founded in 2013, home valuation-focused national real estate brokerage HouseCanary provides software and services to reshape the real estate marketplace and help consumers. Top banking, lending, and housing firms use HouseCanary Solutions for industry-leading valuations, forecasts, and transaction-support tools to make home buying, loan buying, and loan approval decisions. And America’s top bank and nonbank lenders use HouseCanary’s ComeHome – the home search and engagement platform to convert homebuyers faster, grow refis, and retain customers for life.

How does HouseCanary Solutions help banks, lenders, investors, and iBuyers purchase homes and loans and grow their business?

You need the best data to stay ahead of home prices that are now in seasonal decline. HouseCanary powers real-time decision making for top bank and nonbank mortgage lenders, SFR REITs, whole loan buyers, warehouse lenders, hard money lenders, iBuyers, and digital brokerages. With 113 million home valuations within 2.9% accuracy, 88 million rental property valuations, and 19,000 zip codes, HouseCanary Solutions lets you get granular quickly with your own comps and valuation methods. Test drive HouseCanary for free.

How does HouseCanary’s ComeHome – the home search and engagement platform help lenders?

Purchase units will be 67% of the market next year with only 4.83 million total purchase units. ComeHome makes your firm, and your salesforce, the most modern homebuyer engagement player in the game. Here’s how: You give every borrower access to your lender (and LO) branded ComeHome engagement platform on any device to search, tag homes, connect with your LOs, and receive updates throughout the homebuying process, so borrowers don’t stray. Instead, they remain with you, and focused on precise valuations to write smart offers that win bidding wars.

What role does ComeHome play in rate/term, cash-out and home improvement to drive homeowner retention? 

ComeHome for homeowners gets clients thinking about equity by giving them a real-time view on their home(s) in a world-class, modern experience. You can promote refi and cash-out options and a direct path to your LOs. Clients can model cost and ROI on home improvements, then get loans from your LO. With record $9.15 trillion in tappable equity and just 28% refi retention, ComeHome makes you the leader in responsible cash-out while resetting the bar on retention.

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

Appraisals & appraisers & waivers… oh my

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Appraisals are near the top of any list of current lender and borrower complaints about the processing of mortgages. Of course if you’re a borrower or lender you want speed and low costs, and appraisal waivers fit in to that nicely. But will they give secondary market investors comfort that the collateral is being adequately checked? Nearly 40 percent of all loans Fannie Mae purchased in August received appraisal waivers, not inconsequential. And check out the refi numbers! Click here if you want the full report with data.

Last Saturday the Commentary ran a note from Mike Simmons, Co-President of AXIS AMC. “I’ve heard of something overhanging the appraisal industry. Namely, that appraisers are ghosting (abandoning) orders and are beyond accountability… Part of everyone’s frustration is the feeling that appraisers aren’t subject to any oversight or can be held accountable by anyone. Except that’s not true. Every State has a Board or Commission (or some Agency) that serves as an overseer for appraisers. They test & license appraisers and have the responsibility to discipline them. The problem is that their rules, regulations, laws, and statutes are, if you’ll pardon the expression, all over the map… While the issue causing most of the heartburn only involves a small percentage of appraisers, it’s spreading and eroding the public’s trust in all appraisers. The goal is to find ways to change the behavior of those few outliers that are causing all the noise.”

This note came over. “I was interested in the appraiser topic because I know it is such a big issue right now. But I have heard about the appraiser issue for years. My understanding is that the problem is really centered on the lack of people in the appraisal industry. Why is that? I believe that is due to the fact that it is extremely difficult to become an appraiser. Many states have apprenticeship requirements that rely on existing appraisers to train their replacements. That doesn’t seem to be working. Anyway, when engaging the state boards it seems that the goal should be to work with them to find ways to get more qualified appraisers rather than trying to get ones out that can’t keep up with an avalanche of files (who could?).”

And from North Carolina Dan F. writes, “Mike’s commentary on appraisals really strikes a nerve. We have struggled with the same issues over the last couple of years. I think a big part of the problem is the shortage of new appraisers getting into the business. If we had more appraisers (and then more competition for lender’s business), I think they would have to be more responsive.”

A seasoned broker from out West lent, “I don’t buy it. An AMC in Chicago, with rosters for 50 states, is not the way to create confidence and accountability in the industry. AMCs do nothing but maintain a roster and act as a payment pass through. There is no accountability for an appraiser at the appraisal level. If I file a complaint, the appraiser simply says, ‘I don’t agree’ and that is the end of the story. But my client or I paid for a worthless appraisal. Few other businesses collect the full price prior to delivery of the product. My client and I cannot simply switch to another appraiser and do a new appraisal. And appraisers can demand higher than the stated fee so the originator doesn’t know what to quote the borrower. So we can’t contact the appraiser for a quote and the AMC takes 25 – 30% of the fee. Pretty good for doing nothing but verify a license and collect payment and pass through.

The note wrapped up with, “Yes, there is the appraisal review. The AMC holds up the appraisal to review and be sure the boxes are checked. Yes, states have Appraisal Boards. Good Luck. Get rid of the AMC and go back to ordering appraisals from licensed appraisers that operate a business and get paid for what they do. Do a good job, you get business. Do a bad job, and you don’t get my business. I think that is called capitalism. The American way.”

From the East Coast Judy M. writes, “It is not the appraisers that lack oversight. In my opinion it is the AMCs that are lacking in oversight. Looking to make hundreds of dollars while trying to find an appraiser for the least amount possible…. And then wondering why an appraiser may not be willing to take an assignment. I was in the mortgage world for 36+ years without AMC, as a community bank we have a preferred panel of our local appraisers. I have had AMCs indicate that all our panel appraisers declined an order. But when I reached out directly to a couple of the appraisers on our panel, they never received a request. These are appraisers I know personally and have worked with for 30+ years. I try to anticipate how much more an appraisal fee will be. Last week I quoted $1,000 for a lake property only to have one AMC indicate $1,100, and before cancelling we reached out to the other AMC and received a quote for $850.00.

This is just a small indication of why the AMCs need oversight.”

Vendor doings

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Third party companies in the residential area do much more than create names that wreak havoc on spellcheck software and capitalize letters in the middle of words. Let’s take a random look at who’s been doing what recently.

“Fin-tech platform CredEvolv, recently launched by banking and mortgage industry veterans Jeff Walker and Steve Romano, and former Get Credit Healthy Founder Elizabeth Karwowski, provides the ultimate solution to the industry-plaguing issue of redlining and discrimination in the lending process. Addressing head-on the systemic inequities faced by LMI consumers in gaining access to credit and financial knowledge, CredEvolv integrates with Lenders, Loan Officers, and Real Estate Agent systems, to help their credit-challenged borrowers become loan ready™. CredEvolv provides significant tangible ROI to lenders, by helping them turn “NO” into “NOT YET,”™ through their end-to-end credit education and remediation platform. They utilize a unique combination of consumer-permissioned data, proprietary analytics, and personalized credit coaching to help credit-challenged consumers who are traditionally underserved, become loan ready™ in just a few short months. They are mortgage bankers providing responsible credit remediation for mortgage bankers. Learn more about how the platform can drive significant ROI for your institution.

Promontory MortgagePath LLC, announced Guild Mortgage Correspondent as the most recent addition to its investor network. As part of its comprehensive mortgage fulfillment services, Promontory MortgagePath manages investor relationships on behalf of its community lending clients, facilitating new relationships for clients seeking investor partners and adding and delivering to new investors based on clients’ existing relationships. Lenders that would like to learn more can contact Paul Katz. Investors interested in becoming part of Promontory MortgagePath’s investor network should reach out to Louann Bernstone.

Rocket Pro TPO, the division of Rocket Mortgage working exclusively with independent mortgage brokers, announced several innovations to help brokers grow, strengthen, and protect their businesses. Rocket Pro TPO committed to deliver $100 million of Rocket technology to its broker partners in 2021 and has delivered many game-changing tools including Pathfinder, Rocket Connect and Rocket Pro TPO’s new pricing calculator. Now, Rocket Pro TPO Brokers’ clients can now use a brand-new Rocket Pro TPO Client Portal, to upload and eSign their mortgage documents.

A tech-enabled mortgage originator, Interfirst Mortgage Company, has attracted a $175 million strategic investment led by the principals at StoicLane with funds managed by Oaktree Capital Management, L.P., MFA Financial, Inc, family offices and other strategic investors. Through its proprietary platform, Interfirst aims to eliminate the upfront fees, cut interest cost, and decrease the complexity of a traditional mortgage by utilizing technology and artificial intelligence (AI). StoicLane’s strategic partnership is designed to accelerate growth, innovation, and technology advancement. “The mortgage industry is fragmented and ripe for disruption by tech-enabled, customer-centric platforms,” said Al Goldstein, co-founder, CEO, and chairman of StoicLane. “We look forward to partnering with Interfirst’s talented management team and employees to help accelerate the realization of Interfirst’s potential.”

ICE an, announced the launch of Transaction-Based Indices for residential mortgage interest rates calculated daily and will track the average interest rate of new residential home loan applications processed by ICE Mortgage Technology. The ICE U.S. Residential Mortgage Rate Lock Index Series tracks 10, 15, 20 and 30 year first-lien and subordinated mortgage applications on both single-family and multi-family properties. The indices include new purchase, construction and refinance applications for conventional mortgage loans, jumbo loans and those submitted under U.S. government programs, including the Federal Housing Administration, U.S. Department of Veterans Affairs, and the Rural Housing Service of the U.S. Department of Agriculture. The indices are calculated each business day and published the following morning.

Truework is now an authorized report supplier for Fannie Mae’s Desktop Underwriter® (DU®) validation service, a component of Day 1 Certainty®. Mortgage lenders can now use Truework for automated income and employment verification reports through Fannie Mae’s DU validation service.

First American Financial Corporation has completed First American’s acquisition of subservicing company, ServiceMac LLC, which has provided lenders, investors and other mortgage servicers customized solutions that enhance security, customer satisfaction, retention capabilities and profitability. ServiceMac’s mortgage subservicing business will enhance First American’s ability to provide lenders and servicers with end-to-end mortgage, settlement, post-closing services and servicing-related products and solutions. ServiceMac will have enhanced access to First American’s industry-leading property and homeownership data and mortgage solutions products, further advancing the company’s ability to add value to its existing services and develop new products and services. ServiceMac’s management team, including President and CEO Bob Caruso, will continue to lead the company, which will now operate as a wholly owned subsidiary of First American.

To empower consumers and help lenders responsibly extend credit, Experian announced new verification capabilities that provide lenders with access to more than 120 million consumer permissioned payroll accounts. By leveraging technology from Citadel API, Experian is empowering consumers to easily permission access to their payroll accounts when applying for credit. Experian’s new offering ensures lenders can quickly verify an applicant’s income and employment status and compliments the company’s existing solutions to provide lenders with greater coverage and flexible options.

Sometimes, someone unexpected comes into your life outta nowhere, makes your heart race, and changes you forever.

We call those people cops.

 

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, “A Primer on Hedging Servicing.” 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 2021 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.)