Sep. 30: Retail & wholesale jobs; Cordray speaks out on TRID; Latinos, household growth, culture, & the housing market

Do you have fewer competitors than you did a few years ago? A recent MBA Chart of the Week highlighted HMDA respondents and found that in 2014, 7,062 institutions reported lending activity under HMDA, down from 7,190 lenders in 2013. The decline in HMDA reporting is due to a drop in the number of both depositories and non-depositories. But check this out: the share of the purchase market for non-depositories has increased from 27 percent of purchase originations in 2008 to 46 percent in 2014. The big banks are seeing a bit of a rebound in this. And the number of credit unions reporting mortgage activity under HMDA also declined but had modest gains in purchase share.


“Are you a retail mortgage loan officer looking to join a successful bank with a strong product offering, competitive pricing, and significant income potential? Nationally chartered MB Financial Bank currently has opportunities in several states for retail branches, loan officers, and producing teams. Contact Mike O’Brien, Mortgage SVP, to see how you could become a part of MB. Our leadership team has extensive retail branch experience, and is dedicated to growing and nurturing MB’s retail presence nationwide. We provide you competitive compensation, quality benefits, internal training, marketing support, servicing portfolio leads, and generous tiered commission compensation plans – all to promote your success. MB Financial Inc. is the Chicago-based holding company for MB Financial Bank, N.A., which has approximately $16 billion in assets and a 110-year history of building deep and lasting relationships with middle-market companies and individuals. We are proud to be an Equal Employment Opp/Affirmative Action employer (Minority/Female/Disabled/Veterans). Equal Housing Lender and Member FDIC. NMLS#401467


It’s amazing how many people are still scrambling to prepare themselves for the coming TRID changes. If you’re one of them, or just want a refresher on what’s to come when you step into the office next Monday, REMN Wholesale is hosting TRID refresher webinars to make sure you’re ready. REMN will be running free TRID webinars every day until Tuesday of next week. They’ll focus on new timelines and generating the Loan Estimate, two of the most critical changes brokers will need to be up to speed with. You can see the full schedule and register at TRID news aside, REMN Wholesale continues its search for seasoned account executives nationwide and underwriters its Woodland Hills, CA office. Know anyone who’d be interested? Have them send their resumes to REMN via


What does CFPB’s Richard Cordray think about the current state of companies trying to comply with TRID? “There is obviously a lot of angst around it and people are trying to make their systems work,” Cordray said. “We’re working now to provide written guidance on this, and we’re working with the other agencies so we all provide the same written guidance on this, that for some period of months—and I’m not going to be specific about it; it might be longer—there will be a diagnostic approach to this. Nobody believes that the market participants are trying to abuse consumers here. They’re just trying to change their systems and get it right. It will be diagnostic and corrective, not punitive, and there will be time for them to get it right and not have to be perfect on the first day.”


Meanwhile the Community Home Lenders Association (CHLA) released its Action Plan, outlining steps to reform Fannie Mae and Freddie Mac, preserve a government guarantee and protect taxpayers. The Action Plan recommends that the GSE profit sweep could end and that the Treasury should relocate profits in a Capitalization Reserve Account. The CHLA also identifies that congress should direct the FHFA to develop a plan on how the GSEs could be recapitalized, and that GSEs should control up-front risk sharing pilots with protections against market concentrations. Finally, the FHFA should complete a Common Securitization Platform and Single Security and the FHLB should not use explicit or implied taxpayer guarantee for MBS, unless all mortgage lenders, including non-banks, can partake on a non-discriminatory basis.


Early in the summer the Census Bureau reported that Latinos edged out whites to become the largest ethnic group in California. What does that mean? As California goes, so goes the nation? Size is one thing, but cultural empowerment is another. For example, Asians and Pacific Islanders make up less than 15% of California’s population and less than 6% of the United States’ population, but make up 41% of U.C. Berkeley’s entering freshman class. At Stanford and the Ivy League schools Asian-American enrollment accounts for 15-22%. Yet Latinos account for less than 14% of U.C. Berkeley’s incoming freshman class. African American/black enrollment accounts for less than 3% of Cal’s incoming freshman.


I received this note from Maria Zywiciel on culture and marketing. “What does culture have to do with marketing? Everything! Culture is what gives us our identity, what is learned, shared and passed on to others. Whether a company is trying to sell candy bars, energy drinks, cars, financial services or even mortgages, marketers need to know and understand the culture of their target audience. Companies who learn about the differences and similarities among consumers will develop the best products, promotions and strategies. Yet, when it comes to multicultural marketing, companies often get confused, intimidated or think it may not be worth the hassle.


“When it comes to the housing and lending industry, the numbers are compelling and make the case for why a company should make a concerted effort to reach out to the multicultural segments. Much has been written regarding the booming Hispanic population in the United States and homeownership trends.  For example, from 2000 to 2014, Hispanics accounted for 50 percent of the net growth of overall owner households in the country.  A 2014 study by the Urban Institute projects that Hispanics will account for 55.5 percent of new homeowners from 2010 to 2020.


“So what do these statics and culture have to do with each other? Organizations that take time to understand the culture of this consumer base will be the ones that will be best poised to attract, retain and serve this growing demographic. Just as companies research for the general market, they also need to do research to develop a well thought out Hispanic marketing plan. Understanding key elements of the Hispanic culture can help you understand how to better position your product / service.


“When marketing, a company can explicitly communicate their product and service by listing all the benefits to a consumer.  This, however, wouldn’t necessarily make a connection with a buyer.  With so many companies to choose from, why would a consumer choose to partner with a company that doesn’t bother to understand them or make a connection to them?  Some companies simply don’t know how to incorporate the elements of culture into their marketing plan. Here are some considerations to help you start to think a little differently.”


What is the projected changes in households by age from 2014-2024? A report recently released by the MBA titled Housing Demand, suggests that by 2024, demographic, social and economic changes will bring one of the largest expansions in the history of the U.S. housing market – 15.9 million additional households. Household growth will be led by 5.7 million more Hispanic households in 2024 than in 2014, 5 million more non-Hispanic White households, 2.4 million more Black households, 1.9 million more Asian households and 890,000 other households. The majority of growth will be driven by Baby Boomers, with 12.9 million more households age 60 and over in 2024 than there are today, followed by 5.1 million more households among Millennials and Gen X will have 2.1 million fewer households age 45 to 59 in 2024 than there are today.


Phil Kneibert, the president of Mortgage Lenders of America, sent, “I’m not sure if you saw the demographic research the MBA generated.  Your column today made me think about the growing Hispanic population and how we can or cannot market to them.  I’ve attached a link to the demographic info below. Of note is that of the 15.9 Million new households projected, 5.7MM (36%) will be Hispanic – more than any other group.  It’s tempting to court the non-English speaking portion of that market, but it’s my understanding that we need to provide our ENTIRE experience in their native tongue.  As such, we would need to have a Spanish website; every disclosure would need to be in Spanish, Title policies, Insurance policies, etc.  Closing agent would need to speak Spanish, etc.  Interpreters don’t work since we cannot verify that the borrower is being told accurate information. The thinking is that if things go bad, it would be VERY easy for a non-English speaking borrower to indicate that he/she didn’t understand the obligation or process. Are you hearing anything contrary to the above?


If you need to give a speech and need some information on trends out there the MBA put out a paper titled, “Demographics and the Numbers Behind the Coming Multi-Million increase in Households.”


And those folks need a place to live, but the Census Bureau tells us that the rate of U.S. homeownership has reached a low that has not been seen in nearly 50 years. For the second quarter of this year, the homeownership rate was 63.4 percent, down 1.3 percentage points from the 64.7 percent rate from the second quarter of 2014. True, not everyone deserves to own a home, but it is regional. The homeownership rates were highest in the Midwest (68.4 percent) and lowest in the West (58.5 percent); the homeownership rates in all four sections of the country were lower on a year-over-year basis. Do you think that has anything to do with affordability?


Second quarter homeownership rates were highest for those householders ages 65 years and over (78.5 percent) and lowest for the under 35 years of age group (34.8 percent). White householders had the highest homeownership rate at 71.6 percent, while black householders registered at 43 percent and Hispanic householders at 45.4 percent. To keep things in perspective the U.S. homeownership peaked at 69.2 percent at the end of 2004. The 63.4 percent rate was last seen in 1966.


On the rental front, national vacancy rates in the second quarter were 6.8 percent for rental housing and 1.8 percent for homeowner housing. For both classes, vacancy rates were lower on a quarter-over-quarter and year-over-year measurement. The Census Bureau determined that approximately 87.1 percent of all U.S. housing units in the second quarter were occupied and 12.9 percent were vacant. Owner-occupied housing units made up 55.3 percent of total housing units, while renter-occupied units made up 31.9 percent of the inventory; vacant year-round units comprised 9.5 percent of total housing units, while 3.3 percent were for seasonal use.


In 1965, the US home ownership rate was 63% and rose to 65.6% in 1980. Home ownership then fell and held steady at about 64% from 1984 through 1994, when it began a meteoric rise and peaked at 69.4% in 2004. It’s since collapsed and is now 63.5%, where it was last in 1967. Demographics aside, home ownership is for, at most, 65.5% of the population. Above that, a bubble.


The trend goes back a ways. In May Zelman & Associates published their Apartment Survey for the month of April, as respondents indicated towards a growing a multi-family demand. Rent growth increased as occupancy stood at just 10 basis points below the cycle peak but turnover remained low. Pricing power improved the most in Sacramento, Portland, Seattle, Atlanta and Charlotte and Portland, Chicago, Phoenix, Dallas and Austin experienced the greatest growth in development activity over the past 3 months.


Turning to the markets, some heads were turned yesterday when the Conference Board released a number for consumer confidence in September that was a big surprise to most. Estimates were around “96” but the number came in at 103.0. The gain is centered in the present situation component, which hints at ongoing strength in the labor market and immediate strength in consumer spending.


In spite of that strong number U.S. Treasuries & MBS rallied as global growth concerns continued to dominate the minds of investors and the major equity indices failed to bounce after Monday’s fall. The market also shrugged off decent numbers from the Case-Shiller 20-City Index which showed year over year price growth of 5.0% (0.6% m/m) for July.


But today, as they say, is a new day and we’ve already had the MBA’s Mortgage Index for the week ending 9/26 (down nearly 7%, with refis dropping 8% – and now account for 58% of all apps, and purchases -6%) and the September ADP Employment Change (+200k, as expected). Ahead of us is the September Chicago PMI (09:45 ET). Tuesday the 10-year T-note closed below the range we’ve been in since early August – at 2.05% – and this morning we’re up to 2.09% with agency MBS prices worse about .125.



A lady inserted an ad in the classifieds:

“Husband Wanted”.

Next day she received a hundred letters.

They all said the same thing:

“You can have mine.”





(Copyright 2015 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.)

Rob Chrisman