The amount of single young adults who are fully employed has increased from 25% in 1976 to 40% in 2013. But married young adults where both spouses worked full time declined from 25% in 1976 to 15% in 2013. As I travel around and gawk at the urban cores of places like Nashville, Birmingham, San Francisco, Denver, etc., plenty of these youngsters are paying some pretty hefty rents. Zillow reports rents have jumped 7% nationwide over the past year, as the average renter now spends 30% of their income on rent. Renter or owner, here is a pretty neat site: slowly type any address and watch the picture of the current address unfold. Any address – all over the world. And it is more interesting when you do it slowly.
On the opportunities side, VITEK Mortgage Group, a purchase-focused retail mortgage banker, is looking to partner with top producing Branch Managers, Origination Teams, and Independent Loan Originators located on the West Coast. Candidates should have extensive, current retail loan origination experience and a solid track record of proven success. VITEK is a direct agency lender with a solid servicing portfolio, has been in business since 1986, and is financially stable. Our company was built and run by originators, and provides purchase focused Originators with the tools and operational support necessary to distinguish themselves in today’s competitive market. If you are interested in learning more about what VITEK has to offer, please contact Martha Di Rienzo at [email protected], and for more information on the company visit www.teamvitek.com.
“Are your employees engaged? According to Gallup’s 2013 State of the American Workplace “30% of the U.S. workforce is engaged in their work, meaning that the vast majority of workers (70%) are not reaching their full potential.” It is no wonder the mortgage industry gets such a bad rap when it comes to employee happiness and engagement. However, there are some companies in our field bucking this trend and Endeavor America Loan Services is one of them. Endeavor America was recently featured in Inc. Magazine explaining a few of the ways they focus on creating an actively engaged and happy workforce. EA believes that an engaged workforce leads to a culture of caring. This is one of the reasons that its correspondent and wholesale channels have had such dramatic growth over the last 12 months. It probably does not hurt that they are purchasing loans in as little as 2-3 days as well. To learn how to become approved with Endeavor America, visit their correspondent or wholesale website.
Lastly, a leading West Coast Retail Mortgage Banker, with GNMA and agency approvals, is seeking a dynamic Regional VP of Operations to run its Northern California-based team. Ideal applicants should embody a customer-centric approach, and be comfortable working in a fast-paced environment where no two days are alike! This is a strategic role requiring proven leadership and team development track record, as well as strong critical thinking skills. RVP will have oversight of Processing, Underwriting and Closing teams in the region. Responsible for driving operations standards, while motivating teams to deliver world-class service and productivity levels. Compensation is commensurate with experience. Submit confidential resumes to me at [email protected].
On the personnel front, congrats to industry veteran Brad Seibel who has accepted the position of Executive Vice President with Planet Home Lending. Seibel will help Planet, a top 20 GNMA servicer, in the national expansion of their mortgage platform and customer retention efforts. And congrats to Dallas’ Highlands Residential Mortgage (and CEO Ken Hickman) who just received its GNMA approval.
Larry Gunnin with the Mortgage Network scribes, “Rob, I hear you asking, ‘Is the consumer better off?’ when lenders/banks/mortgage companies merge or are acquired. Do you really think that the mortgage business needs more lenders and more originators on the streets? My view is there are not enough loans to go around now, and 2015 forecast state the numbers may be even less next year: with margins shrinking along with compliance cost escalating something has got to give. While CFPB’s objective is to protect the consumer, they are driving up cost, etc., but instead of getting rid of the ‘bad apples’ in the business it seems the opposite is happening. The lenders that slide under the radar are still conducting business while the good companies who are trying to comply and do business as directed get hit the hardest. In that regard, the consumer is still at risk. As with most government agencies that start out with good intentions, their effect only hurts business and damages the wrong people.”
Heck, as an example of what Larry’s talking about let’s look at Oregon: reports show that it has lost 2/3 of its mortgage workforce since 2005.
Changes in the banking & lending industries continue on. Frontier Bank, FSB, Palm Desert, California was closed last Friday by the OCC, which appointed the FDIC as receiver who turned it over to Bank of Southern California, N.A., to assume all of the deposits of Frontier. On the flip side, but still leading to one less bank in the United States, Chemical Bank ($6.2B, MI) will acquire Monarch Community Bank ($187mm, MI) for $26mm in stock. Community Trust Bank ($3.5B, LA) will acquire 4 branches in Houston, TX with $15mm in loans and $135mm in deposits from Whitney Bank ($19.2B, MS). BB&T and Susquehanna Bancshares, Inc. announced the signing of a definitive agreement under which BB&T will acquire Susquehanna in a cash and stock transaction for total consideration valued at approximately $2.5 billion and expand BB&T’s footprint in the Mid-Atlantic region. Bay Commercial Bank ($510mm, CA) will acquire Valley Community Bank ($135mm, CA) for $4.15 per share in stock. The holding company for Central State Bank ($436mm, IA) and Farmers & Mechanics Bank ($279mm, IL) will acquire Buffalo Prairie State Bank ($72mm, IL).
On the mortgage side, the rumors that this commentary has discussed for nearly a month proved out to be true. loanDepot, LLC., the nation’s second largest nonbank consumer lender, announced the signing of a definitive agreement to acquire Mortgage Master, Inc., a super-regional mortgage lender and one of the country’s largest privately-owned mortgage companies. Both companies combined retail loan funding volume in October 2014 was $1.75 billion with nearly $70 million in top-line revenue, will have 130 retail lending branches across the country, four web production centers, and employ 3,700 full-time associates including more than 1,200 licensed loan officers serving borrowers in all 50 states. MM’s Leif Thomsen and Paul Anastos will stay on.
Switching gears to technology, a couple of weeks ago I included an entry describing STRATMOR Group’s highly sought after LOS Technology Insight survey. Since that post, over 150 lenders– from the top 5 originators to small correspondent and broker shops — have registered to participate; most responding within minutes of registration. This survey currently represents feedback from at least 29 different LOS systems so, lenders, don’t miss this great opportunity to stand up and be counted! It takes about 15 minutes to complete and, by taking this survey, you will receive high-level summary information as regards to overall market share by product / vendor as well as implementation success metrics at no charge. Don’t delay and miss the opportunity to access these invaluable insights that will only be available to our Lender participants. Not that registration ends December 31st. As is STRATMOR’s practice, and to assure confidentiality, we will conduct this as a “blind” survey. All survey results will be aggregated; individual company results will not be disclosed, nor will we publish the results in a way that would enable individual respondent identities to be derived. To participate in the 2014 LOS Technology Insight, contact STRATMOR Group at [email protected].
We just wrap up Veteran’s Day when we are reminded that Congress has returned from its 2014 election season, and they we must rely on the lame duck folks to extend veteran home buying benefits. Yes, the VA’s loan limits for high-cost counties are set to roll back to 2008 levels at the end of December. Unless Congress takes action in the coming weeks, military buyers in costlier communities could suddenly face significant down payments that put homeownership out of reach. Personally I am sure they’ll do it – but do we really need to hear all the jawboning that goes along with it?
J.D. Power released the results of the 2014 U.S. Primary Mortgage Origination Satisfaction Study this morning. Again, hats off to Quicken.
I know it’s time to catch-up with MSR tapes I’m privy to when I receive emails asking if there’s been a slowdown in trading. So here we go….Interactive Mortgage Advisors is offering a $220.9 Million Fannie Mae, Freddie Mac, and Ginnie Mae Bulk Servicing Portfolio. The seller is an experienced well-capitalized independent mortgage bank, and the portfolio includes: 42.2% Texas properties, 4.157% WAC, 99.5% retail originations, with 6 1/2 months of seasoning… Phoenix Capital’s Project Newman is a $550 million bulk FHLMC GLD servicing rights offering. The package is 100% FHLMC GLD, 70% F30; 10% F15; 20% ARM, 4.125% WAC, WaFICO 738, WaLTV 95%Avg Bal $242K, 58% HARP, 78% No Cash Out Refinance, with 61% CA geography….want size to your trade? MountainView Servicing Group’s $3.8 billion FNMA/FHLMC non-recourse servicing portfolio from a well-capitalized counter-party; which is 100% fixed rate 1st lien product, WaFICO of 743, WaLTV 76.9%, WAC 4.25%, 50% purchase loans, average loan size of $240k, top states: California (23.2 percent), Massachusetts (7.9 percent), Colorado (7.8 percent), and Utah (5.8 percent).
Phoenix Capital has two deals I’ve seen recently; the first is Project Gilpin which is a $600M bulk Fannie Mae, Freddie Mac, and Federal Home Loan Bank MSR offering, originated by a Federal Savings Bank. The pool is 50% FNMA A/A, 47% FHLMC ARC, 3% FHLB, 82% Fixed 30, 17% Fixed 15, 3% DEL, 4.404% WAC, Avg Bal $199k, WaFICO 752, WaLTV 65%, CA (84%), NY (6%), NJ (2%) geography, 62% correspondent, 24% wholesale, 10% acquired, 3% retail; the second is Project Mcintyre which is a $355M Fannie/Freddie bulk, PLUS, $15-20mm per month flow MSR offering. The bulk portion of the deal is 83% FNMA, 17% FHLMC, 73% Fixed 30, 26% Fixed 15, 3.883% WAC, $180 Avg Bal, 762 WaFICO, 73% WaLTV, 95% IL properties; the flow portion perimeters will be 90% FNMA, 10% FHLMC, 84-89% Fixed 30; 100% Fixed Rate, Avg Bal $215-$230k, WaFICO 749-761; WaLTV 79-81%, 92% IL geography, and 100% will be retail originated.
With the day-of-days coming…that is to say, with the end of QE and a trend towards the “normalization” in the interest rate markets, many analysts groups have begun asking the when’s and how’s the mortgage industry will be facing well into 2015. Wells Fargo, never short of interesting papers, writes, “Our outlook is for growth at 2.5-3.0 percent for the next six months to a year. As for the labor market—“underutilization of labor resources is gradually diminishing”—we see this as evidence that the decline in the unemployment rate to 5.9 percent was greater than what the FOMC had initially forecasted a few months ago.” However robust, or positive, the economy may appear through the lenses of many economists, the Federal Reserve will face many concerns in the coming months, one being long end control of the yield curve. WF continues, “Going forward there is a significant challenge to decision makers. Although not completely market-determined, interest rates at the intermediate and long end of the Treasury curve will be less subject to Fed policy control than at the short end of the curve. This will open the door to more open-market pricing and introduce an element of volatility that has been suppressed in recent years. All the more likely, given that in the year ahead the FOMC will likely raise the funds rate to some extent.”
Taking a quick look at the daily bond market, because at this point that is all it deserves, yesterday mortgage-backed securities held in well most of the day as falling prices and a sloppy 10-yr note auction made for more attractive absolute yields on MBS. Today we’ll have the weekly release of Jobless Claims (+278k last), and the final leg of the November quarterly refunding concluding with $16 billion long bonds (30yrs) being sold at 1PM EST. Rates haven’t moved much all week, and after closing at a yield of 2.36% yesterday this morning we’re at 2.37% and agency MBS prices are nearly unchanged in the early going.
Two Trees and a Woodpecker
Two tall trees, a birch and a beech, are growing in the woods. A small tree begins to grow between them, and the beech says to the birch, “Is that tree a son of a beech or a son of a birch?”
The birch says he cannot tell, but just then a woodpecker lands on the sapling.
The birch says, “Woodpecker, you are a tree expert. Can you tell if that is a son of a beech or a son of a birch?”
The woodpecker takes a taste of the small tree and replies, “It is neither a son of a beech nor a son of a birch. It is, however, the best piece of ash I have ever poked my pecker into.”
(Copyright 2014 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)