Sep. 4: Note on compliance, affordable housing, demographics & housing; Saturday Spotlight: Thrive Mortgage

A government’s interest in housing isn’t confined to the United States. For example, there’s this story about Ireland’s plan which, “…includes a guarantee of 20 billion euros ($24 billion) of state funding over the first five years, is aimed at increasing homebuilding to an average of 33,000 units per year by 2030 from around 20,000 last year. (More on the U.S. below.) Demographics play a roll, and in this country The Urban Institute Housing Finance Policy Center sent out, “A Three-Decade Decline in the Homeowner Gender Gap. What Drove the Change, and Where Do We Go from Here? Authors Jung Hyun ChoiLaurie Goodman, and Jun Zhu examine the narrowing of the homeownership gender gap, exploring the overall changes and how they show up among different racial and ethnic groups. The biggest factors driving this march toward parity are household income gains and the fact that more married women are head of household.

Saturday Spotlight: Thrive Mortgage: Making the American Dream the American Reality.

In 3-5 sentences, describe your company (when was it founded and why, what it does, where, recent growth and plans for near-term future growth). 


Thrive Mortgage has spent much of 2021 celebrating its 20th anniversary. And there has been a great deal to celebrate. Last year was a record-breaking year for many lenders in terms of growth. Thrive’s origination volume grew by more than 120% in 2020 (56% was purchase business). In 2021, that record-breaking success has not slowed down with year-over-year purchase growth exceeding 86% as of the end of August 2021.

Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why. 

Thrive’s involvement in the local community is deeply ingrained in our culture. One such example is the company’s recent partnership with an organization named Defenders of Freedom. Based in the Dallas, TX area, Defenders of Freedom works with military veterans to overcome the impact of Post-Traumatic Stress and Traumatic Brain Injury. The partnership is more than financial commitments, however, as Thrive employees and leaders donate their time and expertise to assist the organization with their ability to fundraise, their marketing, and even their technology infrastructure.

What does your company do to help elevate your employees’ growth? Describe any mentoring programs, outside classes or training, in-house training. How does the company help people develop? 

Thrive Mortgage is deeply vested in the development of the talents and skills of its employees. Whether through internal coaching initiatives or promoting external opportunities for development, Thrive believes that the best talent often comes from within the organization. Employees frequently rank the topic of “Opportunity for advancement” as one of the key reasons they remain at Thrive.

Tell us how your company maintains its culture in a work-from-home environment, or how you plan on bringing employees back into the office, if applicable. 

Prior to the pandemic, Thrive Mortgage maintained a remote workforce of almost 70 percent, so the preparedness and infrastructure provided a means for the company to continue operations seamlessly with no interruption to our ability to serve our clients. As communities began opening up, in-person events resumed for many departments, but innovation and adaptability is what enables our success.

Things you are most proud of that don’t have to do with sales. 


Thrive Mortgage is all about its people. Fully two-thirds of the employees at Thrive are female, and more than 70% comprise the Executive and Department Management positions. Thrive actively addresses issues of minority homeownership and housing needs in underserved markets.

Fun fact about Thrive Mortgage. 

Thrive Mortgage’s CFO, Michael Jones, got his start in the family-owned mortgage business as a receptionist, office assistant, loan officer assistant, and general errand runner. He was in the 8th grade at the time.

Is there anything else you’d like to share along these lines? 

Community is the best descriptor of our people. Our achievements are celebrated together. Collectively, we support and engage in the things that matter. Our culture is what drives our success.

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

Demographic & housing shifts

I receive many notes about large companies owning large collections of single-family residences and renting them out. Along those lines I received this note about BlackRock (or possibly others as well). “Rob, how can the price of houses ever go down when we have large companies buying up the residential housing stock at premium prices, financed by 1% cost of capital and renting to the next generation of young people at 4% return and creating a 3% ROI money machine? Is it societal poison: ‘own nothing, be happy!’? “Not to mention the potentially impactful on the mortgage industry. It all seems like a bad direction for the American Experiment that I still believe in. I would think it would be a big issue for the MBA.”

Large investors are specifically addressed in the Biden administrations announcement of a goal of creating 100,000 new affordable housing units for both homeowners and renters over the next three years, with steps to include boosting the supply of manufactured housing and 2-4 unit properties, making more single-family homes available to individuals, families, and non-profit organizations, rather than large investors, and working with government officials to reduce exclusionary zoning restrictions. The administration said these goals will be achieved through the relaunch of the Department of Housing and Urban Development’s Risk Sharing Program and the Federal Financing Bank, raising Fannie Mae’s and Freddie Mac’s equity cap for the Low-Income Housing Tax Credit, and making more funding available for Community Development Finance Institutions and affordable housing production under the Capital Magnet Fund.

In response to this announcement, Evan Blau, Chair of the Agency Lending and Affordable Housing practice at Cassin & Cassin LLP, comments, “The announcement from the Biden administration shows a strengthened commitment to affordable housing. Fannie Mae and Freddie Mac’s further expansion into the low-income housing tax credit space solidifies the profound impact that the government-sponsored enterprises (GSEs) can not only have on the lending side of a transaction, but equity as well. This increased tool will further assist the GSEs in their commitments to ensuring our communities provide safe and secure affordable housing nationally.”

MBA President and CEO Bob Broeksmit, CMB, issued, “MBA strongly supports the administration’s efforts to increase the housing supply by encouraging the construction and rehabilitation of affordable apartments and homes for renters and first-time buyers.

“The lack of supply is a huge problem, and HUD and FHFA should do what they can administratively while Congress considers more significant initiatives. MBA looks forward to continuing to work with the administration, Congress, and all other stakeholders on ways to address supply constraints and ensure government programs appropriately complement private capital to help both renters and homeowners.”

The National Association of Local Housing Finance Agencies (NALHFA) released, “NALHFA applauds the announcement on the relaunch of the FFB and HUD Risk Sharing Program, a top priority for NALHFA over the past few years,” said NALHFA Executive Director Jonathan Paine. “Since the program was allowed to expire, NALHFA has been working with HUD and Congress to restore this critical program that is estimated to create over 20,000 affordable housing units over the next two years.”

Is the red-hot housing market beginning to cool off? Redfin thinks so. “For the first time in over a year, homebuyers don’t need to feel rushed,” said Redfin Chief Economist Daryl Fairweather. “Although the market still feels tight and competitive, the number of homes for sale keeps creeping up as more homes are listed. Those home sellers are adjusting their price expectations or seeing their homes sit on the market. There could be even more listings coming on the market as mortgage forbearance ends and homeowners with missed payments decide to sell. And mortgage rates remain near all-time lows with no signs of an increase on the horizon.” I bet Daryl would happily snap up a home for himself if the price was right, or buy one as a rental.

Who’s buying the houses that are being bought? The National Association of Realtors tells us that buyers between the ages of 22 and 39 (admittedly, a wide swath) accounted for 38 percent of purchase loans in 2020. And nearly a third of that age group who aren’t homeowners are interested in buying. I’ve sat in on several first-time home buyer webinars and breakout sessions, and there are some common themes. First, people that age, in general, have good credit and are financially ready to apply for a mortgage. Second, instructors will remind MLOs that down payments can be less than 20 percent. First-time home buyer LTVs hover around 94 percent, protected by private mortgage insurance or government-sponsored MI. And if a borrower doesn’t have the full down payment, there are plenty of down payment assistance programs. In fact, HUD tells us that there are more than 2,500 DAPs. And don’t forget gift funds!

Rates are still low, despite ticking up from the recent lows. That means affordability is better than in past decades, and a lower percentage of income is needed for monthly payments. And lenders and vendors are only too happy to help. For example, Arch MI has its “Roadmap to Homeownership Toolkit.”

The U.S. Census Bureau 2020 Characteristics of New Housing Report showed annual statistics on the characteristics of new privately owned residential structures by census region. Some highlights of the 912,000 single-family homes completed in 2020. The median size of a completed single-family house was 2,261 square feet. 90k had two bedrooms or less, 421k had three bedrooms, and 401k had four bedrooms or more. 831,000 were framed in wood and 75,000 were framed using concrete.

Yes, the Census Bureau released a report with additional information collected during the 2020 Census, following the initial release of national and state population totals earlier this year. According to the results, there were 126.8 million households as of April 1st, 2020, representing an 8.7% increase from 2010, or an additional 10.1 million households. This marked the slowest decade of household formation in the country’s history.

Since housing and jobs drive our economy, we receive a plethora of housing news every month. Going back a couple months, was a trend developing? Sales of new homes fell 6.6 percent in June of 2021, with the rate falling to an annualized 676,000 homes, down from 873,000 in March and a peak of 993,000 in January. The expectation from Wall Street was around 795,000, meaning this was a significant miss. It’s believed to be fueled by high costs and a shortage of new properties for sale. The average cost of a new home is up 12 percent compared to a year ago, though the median sales price of a new home did fall to $361,000 in June from $380,700 in May.

Economist Dr. Elliot Eisenberg reported that, “June new home sales came in at a seasonally adjusted annualized rate of just 676,000/year, and May was revised sharply down. As recently as 1/21 sales were 993,000/year but have fallen sharply and are now below their pre-Covid-19 run rate. Moreover, months of inventory are jumping. After bottoming at 3.5 last September/October, they are now at a historically normal 6.3. Builders are pulling back in the face of high prices.”

While house price appreciation is blowing past wage appreciation, reducing affordability, there are countervailing forces. Rates remain low, and critically, US household wealth grew by a staggering $13.5 trillion in 2020, half from equities. However, stock and home ownership are not evenly distributed. To wit, 70% of the wealth increase went to the top 20% of the population, 32% to the top 1%. The well-off can easily keep buying houses.

Compliance morsels

Jonathan Foxx recently wrote on several compliance topics including reducing the likelihood of a successful phishing attack. A phishing attack, in short, is where the hacker mimics lenders’ written communications after gaining access to its email system with the intent of monetary gain. He recommended maintaining strong payment authorization procedures, labeling “EXTERNAL” on all emails from external sources, monitoring previously unused destination accounts, implementing Multi-factor Authentication for emails, periodically training and testing employees to identify and report phishing attempts, and potentially consider cyber insurance. If you are snared in a phishing scam, it’s a good idea to consider changing account passwords for employees, check relevant email accounts for any auto-forwarding rules, contact counsel familiar with cyberattacks to determine appropriate steps to investigate as well as law enforcement to assist in the recovery of the funds, and determine whether any other information was affected, such as personal information.


He wrote about how misinformation could lead to reputation risk. Companies need to attempt to contain the spread of misinformation (falsehoods, false rumors, insults, and even pranks) about themselves as reputation risk is among the top four risks associated with corporate and risk governance along with strategic risk, compliance risk, and operational risk. His suggestions included asking the questions: What is the misinformation problem, and where does it originate? What can be done culturally and preemptively? What can be done to deal with specific pieces of misinformation? He also recommended contacting him for a review if a company was guidance in evaluating its reputation risk procedures.


A topic that hasn’t kept everybody’s attention but is still in the news is forbearance. In a Mortgage FAQ, Lenders Compliance Group wrote on consumer complaints in forbearance, mostly to do with issues at servicing departments and loan originating departments. The volume of overall mortgage complaints increased to the highest level in almost four years as consumers experienced various communication issues related to forbearance plans and options available at the end of these plans, described confusion with mandatory account notices, and reported long delays in modifying their loans to address forborne payments.


Lenders Compliance Group wrote on unduly influencing an appraiser. State banking departments and regulators do monitor appraiser independence, and many companies that have spelled out policies and procedures don’t have them implemented. Don’t assume anything, though it is allowable to ask an appraiser to consider additional information about a dwelling or comparable properties or provide additional information about the basis for a valuation or correct factual errors in a valuation. On a case-by-case basis, a lender may also withhold compensation for breach of contract or substandard performance as provided by contract. Lenders Compliance Group offers the Appraiser Tune-up if you need an objective review.

We never really grow up… We only learn how to act in public. How about how one acts when they want to fail a sobriety test? Here’s a short entertaining video of exactly that.

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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 designed 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 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.)


Rob Chrisman