Oct. 5: LO jobs; hedging cost, reno, CRA, HELOAN, home inspection, cybersecurity products; LO conversation shift; Ginnie, USDA, FHA news

Hal M. writes, “Monday is a holiday. The observance reminded me of the small Italian parade we had in Maine on Columbus Day. All the marchers were under 5 foot 4.” Bah dah bum. Clients come in all shapes and sizes. An experienced loan originator will tell you, “Never tell a client about a problem until you’ve solved it.” An originator will also, when talking to a client, show them that their timing matters more than market timing. Put another way, home price appreciation is earned by buying a place and holding it, rather than timing the purchase based on interest rates. Roughly speaking, there are 4.8 million real estate sales in a given year, and 3.6 million of them will have a loan. Figure about 1.3 million refinances, which gives us a total of about 4.9 million mortgage transactions. These include debt consolidation refinances, moving out of 3 percent loans but paying off 30 percent credit card debt with a 7.5 percent loan. Originators are telling their borrowers, “A few years ago we saved you money on your interest rate. This time, given the rate on your credit cards, let’s take a look at your entire debt picture.” (Today’s podcast can be found here and this week’s is sponsored by TRUE. TRUE creates accurate data that powers automation and optimizes every step of the lending lifecycle, helping lending organizations rapidly process loans, dramatically cut costs and risk, and radically improve the customer experience. Hear an interview with Fairway Independent’s Adam Levitt on renovation loan solutions for buyers, existing homeowners, contractors, and real estate agents.)

Employment

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Why have 46 LOs returned to PrimeLending in 2023? “Our team returned for the top-notch leadership, culture, and operations,” says Scott Fleming (NMLS# 657538), Branch Manager, Kansas City, MO. “PrimeLending’s unique family culture, advanced technology, and unmatched support brought me back,” adds Renee Deputy (NMLS# 177264), Senior Loan Originator in Reno, Nevada. “PrimeLending is HOME and it’s where I feel best equipped to deliver the level of service our referral partners and customers deserve,” says Saul Kittelson (NMLS# 1205600), Production Manager in Kansas, MO. “The biggest things I missed were the amazing leadership and support staff,” said Brandon Burgett (NMLS# 1287847), Loan Originator in Anchorage, Alaska. “The fact that I can go straight to the top and get assistance is unheard of. I will never leave PrimeLending again!” Still looking for your forever home? Contact Nic Hartke today.

Sovereign Lending Group, LLC is expanding its team of consumer direct loan officers at Fashion Island in Newport Beach, CA. This is a great opportunity for those interested in joining a company that provides superior marketing and a diverse suite of products, committed to adding value for its loan officers and creative borrower solutions. If you’re interested in joining SLG’s team, be sure to contact Matthew Cataño today (949-736-9148).

Lender and broker software and services

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This year’s MBA Annual in Philly has a lot to offer: cheesesteaks, the Rocky stairs, and the Liberty Bell, just to name a few. Another main attraction you should check out at MBA Annual is the MMI booth. Whether you’re looking to expand your community lending efforts, find new real estate agent partners or get a more in-depth look at your transaction data, MMI has the answer. MMI has assembled the industry’s most comprehensive real estate and mortgage transaction database which is leveraged by thousands of mortgage professionals daily. Schedule a meeting or stop by booth 426 to see how MMI can help you achieve your goals.

Stewart Valuation Intelligence (SVI) has been verified and approved to support the GSE’s Appraisal Modernization efforts through its VALIDITY home inspection platform. SVI has an experienced national network of real estate agents and brokers that collect property data, so you can rest assured that a trained, vetted and screened real estate professional is doing your inspection. Through VALIDITY, SVI helps lenders expedite the lending process and save time and money for borrowers. For more information about how Stewart Valuation Intelligence supports Appraisal Modernization, please meet our team at MBA (Booth #727) or visit stewartvaluation.com, an important part of the Stewart Lender Services offering.

Click links, ask questions later. The most common attack vector for a cyberattack is the human element. It’s what phishing emails, phone calls and text messages all have in common. Yet while it’s the weakest link, the human element could be your organization’s greatest prevention layer if trained correctly. In an industry that incentivizes people based on sales goals, every mortgage lead has bottom line potential. And in the current market, it’s only human to go after leads without stopping to consider their legitimacy. But recent data shows just how risky clicking without thinking can be. According to ISACA, in 2022 social engineering (tricking humans) was the #1 attack vector, and even the best teams are vulnerable. Learn how to do a better job at testing and training your team to identify legitimate leads. Talk to Richey May’s cybersecurity experts for help assessing and defining your cybersecurity training needs.

TPO and Correspondent loan programs

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Spring EQ recently announced the company has entered into a definitive agreement to be acquired by an affiliate of Cerberus Capital Management, L.P. (“Cerberus”). Spring EQ will partner with Cerberus’ Residential Opportunities platform to support its mission to deliver best-in-class offerings and expand its leadership in the home equity financing market. Spring EQ’s rapid growth continues as demand accelerates for home equity solutions, driving further investments in technology, new commercial opportunities, and growth-based operational initiatives. And now, pricing home equity second mortgages is faster & easier with Spring EQ’s new pricing engine tool! Simply adjust loan parameters and get instant quotes. Don’t forget, with Spring EQ you can earn traditional broker compensation on HELOCs and HELOANs. Spring EQ’s primary focus is second mortgages. So, think of them first for all your seconds. Become a partner now or contact your Account Executive to learn more.

“Attending the MBA Annual 2023? Discover new ways to grow home loan volume with the Planet Home Lending Correspondent Team. We make it easy to offer profitable niche products, including renovation, home equity, manufactured housing, buydown, and USDA loans. Meet with us to discover how Planet’s product expertise can strengthen your product lineup to hit CRA/affordable housing goals and boost profits. A 30-minute meeting with SVP, Correspondent Sales Jim Loving (414-270-0027) can elevate your home lending volume all year.”

Are you attending MBA Annual? Meet with NexBank and learn about the benefits of working with a full-service depository bank. NexBank supports Wholesale, Non-Delegated & Delegated Correspondent channels with Portfolio, Conventional, FHA, and VA products. Our portfolio products include Full Doc and Non-QM, available for loan amounts up to $2 million, with ARM and Fixed Rate options along with Interest Only. Plus, no LLPAs for FICO or second homes and we allow cash-out to 80 on primary with no dollar cap on cash-out amount, where applicable by law. Ask about our unique 6-month ARM! Our account executives, with an average of 24 years’ experience, know our business and are dedicated to helping you grow yours. This month, we celebrate the 10th anniversary of Patrick Von Hoven, who has contributed to the success of our clients with $4 billion closed volume! Contact us. Restrictions apply. Subject to change. For mortgage professionals. Not intended for general public. Member FDIC. Equal Housing Lender. NMLS672886.”

Newrez Wholesale introduces RezPool Plus, a renovation loan that allows borrowers to bring their dream yard to life. It has never been easier for your borrowers to completely transform the exterior of their homes to create the outdoor escape of their dreams, whether by designing a beautiful garden, hosting family & friends on an expansive covered patio, throwing pool parties, or entertaining company with the ultimate grilling accessories and outdoor kitchen. All renovations must be permanently affixed, and even external home renovations for a detached ADU are permitted. Ready to help your borrowers bring their outdoor oasis to life? Contact your Newrez Account Executive to learn more about RezPool Plus.

Ginnie Mae, FHA, USDA, and VA lender and investor news

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Ginnie Mae announced the launch of its “Social Bond” label for Single-Family Forward Mortgage-Backed Securities (MBS) prospectuses and released the Social Impact and Sustainability Framework. Together, these updates support Ginnie Mae’s mission-oriented work and communicate the positive social impact of its programs to investors. Increasing investor awareness of the value proposition in Ginnie Mae securities and opportunities to attract new sources of capital in support of lenders and borrowers Ginnie Mae ultimately serves.

Ginnie Mae announced revisions to its Home Equity Conversion Mortgage (HECM) Mortgage-Backed Securities (HMBS) requirements to allow securitization of multiple participations related to a particular HECM in any one issuance month. The intention of this enhancement is to reduce liquidity pressures on HMBS Issuers and ensure the HECM program remains viable and able to serve America’s seniors.

Effective October 1, 2023, Ginnie Mae revised its prospectuses for Single-Family Forward MBS contained in the Ginnie Mae MBS Guide, HUD Handbook 5500.3, REV-1 Appendices to include a Social Bond Label section. Learn more by reading the APM 23-10  and the Social Impact and Sustainability Framework here​.

Resulting from the rural area review process, changes to the eligibility of certain rural areas, new ineligible areas will become effective on October 1, 2023. The new ineligible area maps for the Rural Development Single Family Housing (SFH) and Multi-Family Housing programs will be updated to the USDA Income and Property Eligibility Site The current maps will be moved to the “Previous Eligibility Areas” tab. All new applications must be for properties located in an eligible rural area based on the new eligibility maps, effective October 1st.

In USDA Rural Development bulletin, the Single Family Housing Guaranteed Loan Program (SFHGLP) announced revisions to technical Handbook-1-3555, Chapter 9, Income Analysis and Chapter 10, Credit Analysis. These changes became effective upon the recent issuance of a Procedure Notice (PN).

USDA issued a bulletin advising lenders of new ineligible areas resulting from the rural area review process, announcing that funding will not be available for a short period of time at the beginning of FY 2024 and that fees will not change in FY 2024. See AmeriHome Mortgage Company Product Announcement 20230907-CL for more information.

FHA announced a much-anticipated enhancement now available in the FHA Catalyst: Claims Module that enables bulk submissions of supplemental claims, including supporting and required documentation. With this enhancement, users are no longer required to individually submit supplemental claims. This new functionality continues to improve and modernize the process for FHA-approved mortgagees to electronically submit supplemental claims for the single-family forward mortgage insurance program.

During the anticipated USDA temporary lapse in funding, PRMG will fund USDA Rural Housing loans with Conditional Commitments subject to availability of commitment authority. As always, loans without a Conditional Commitment are not eligible to be purchased. Guarantee Fees will remain at 1.00 percent for the Upfront Guarantee Fee and 35 percent for the annual fee on purchase and refinance transactions. View PRMG Product Update 23-43 for further details.

FHA published updates to the Single-Family Housing Policy Handbook including the incorporation of changes announced in previous Mortgagee Letters. As detailed in AmeriHome Mortgage General Announcement 20230911-CL, AmeriHome accepts the updates in the timeline provided by FHA. Unless otherwise stated, these updates may be implemented immediately, but are mandatory for case numbers assigned on or after November 7, 2023.

Pennymac will continue to purchase USDA Rural Housing loans with Conditional Commitments subject to the availability of commitment authority. Correspondents must ensure all standard Reps and Warrants, and underwriting requirements are met. The Loan Note Guaranty will be required as a post-purchase stipulation. Additional information available in Pennymac Announcement 23-64: Funding for USDA Rural Housing 2024 Fiscal Year.

Capital markets: employment data continues

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Looking for new areas to save on costs? Agile Trading Technologies’ whitepaper, How (and How Much) Agile Helps Mortgage Originators Save on Hedging Costs, discusses several ways mortgage bankers may pick up basis points and reduce errors. According to the latest Agile TBA Execution Data Study, lenders who use platforms that limit competition to only four dealers miss out on improvement in execution. Although past results do not guarantee future performance, lenders can expect to save three basis points on average. Download the whitepaper to learn more. Looking for more insights from two of the industry’s most well-renowned? View episode 166 of the CMBA Connect Podcast to hear Susan Milazzo, CEO of CMBA, and Greg Vacura, President of Agile Trading Technologies, discuss insights into how companies can make themselves stand out from the competition.

We saw a bit of reprieve in bond yields yesterday after some soft private-sector job growth, reported by ADP, and slowing growth in the September ISM Services PMI. The ISM Services PMI still connoted an expansion in services sector activity for the ninth consecutive month, but at a slightly slower pace than August. The economy added 89,000 jobs in September, according to the ADP Employment Report. That follows an upwardly revised 180,000 in August. Job stayers saw a 5.9 percent year-over-year pay increase, which was the 12th straight month of slowing growth. Factory orders surged 1.2 percent month-over-month in August, not indicative of an economy losing its growth momentum in a convincing way.

Today’s calendar began with September layoffs from Challenger, Gray & Christmas. U.S.-based employers announced 47k cuts in September, down 37 percent from the 75k cuts announced in August but up 58 percent from the 30k announced in September 2022. This was followed by the August trade deficit ($58.3 billion, lower than expected) and weekly jobless claims (207k filings last week, up from 205k; continuing claims at 1.664 million). Later today the Treasury announces the auction sizes for next week’s new 3-year notes, reopened 10-year notes, and 30-year bonds auctions, Freddie Mac’s latest Primary Mortgage Market Survey, and a litany of Fed speakers. We begin the day with Agency MBS prices unchanged from Wednesday afternoon and the 10-year also unchanged, yielding 4.74.

Some people you’re glad to see coming; some people you’re glad to see going.

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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 2023 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.)

Rob Chrisman