title, "Too much time on one's hands", anyone involved in the
residential construction/remodeling business might find this, uh, interesting.
the "mortgage space" continues. Altisource's
Origination Services Division is currently hiring DE Underwriters in Missouri,
Texas and Ohio to support its growing Correspondent and Quality Control
businesses. Altisource is a "global provider of services focused on
high value, knowledge-based functions principally related to real estate and
mortgage portfolio management, asset evaluation and customer relationship
management." Any interested parties should forward their résumé to firstname.lastname@example.org.
I have been retained by an Orange
County, California-based lender that is looking for a highly skilled
director/manager that can develop and lead a national wholesale operations team
to be "Best in Class" with strong customer centric focus. The lender, which has
been in the news lately for its growth, has a very strong balance sheet
including servicing portfolio, is a direct GNMA seller/issuer and has no legacy
loan liabilities. The candidate should either live in Southern California, or
be prepared to relocate. If you know someone who is interested, they should
send their resume to me at email@example.com.
My Dad is fond of saying, "Hard work may pay off in the future. Laziness
will pay off now." But many LO's who have built their livelihoods around
FHA production are dreading what is coming up. Last week, President Obama
released his budget for fiscal year 2013. As part of the overall budget, and as
the commentary reminded folks of yesterday, HUD stated that it will be implementing a 10 basis point increase to
annual premiums for single family loans, and a further 25bp increase for loans
over $625,500. So even though the FHFA has already implemented this for
Freddie & Fannie, it is only a matter of time until the change hits
comments made by HUD Secretary Shaun Donovan and the current state of the FHA
fund, some believe that there is a fairly
high likelihood that the FHA premium increase will be more than the 10 basis
points mandated by the payroll bill from a few months ago - perhaps as high as
25 basis points. If FHA premiums increase by that much, prepayments will
drop, as will new production, which investors like, but one would expect that LO's
and borrowers will try to "front run" any increase in FHA premiums and push
through production. Finally, it is worth highlighting that HUD and FHA will
constantly be monitoring the performance of the insurance fund and if losses
continue to exceed their base case expectations, we are likely to see further
increases in FHA premiums, and potentially an increase in FHA putbacks.
Speaking of the agencies, occasionally I will ask the question, "Why have
both Fannie Mae and Freddie Mac?" especially as they are on parallel
paths. I'll even occasionally call the agencies "Frannie." Yesterday
they were back in the news when the FHFA said that, with its conservatorship of
F&F now in operation for more than three years "and no near-term
resolution in sight," it was time to assess its goals and
directions. Few think anything will happen ahead of the November
election, but Acting FHFA Director Edward
J. DeMarco set out a Strategic Plan for Fannie Mae and Freddie Mac
Conservatorships with three goals: build a new infrastructure for the
secondary mortgage market, gradually contract the Enterprises' dominant
presence in the marketplace while simplifying and shrinking their operations,
and maintain foreclosure prevention activities and credit availability for new
and refinanced mortgages.
It is important for us average folks to remember that the agencies are
currently carrying out two basic roles: a guarantee role and a portfolio role.
And the suggested plan from DeMarco, basically, peels off one of those roles. The
MBS prices for each agency jumped a little on the news, but if you think about
it, this is all a much longer term process and any Gold (Freddie) and Fannie
MBS price movement will really be determined by simply supply/demand - just
like always. If the two are combined into one Enterprise (Frannie), this equals
potential selling of the portfolios, which in the very long run is a net
negative for MBS's. There are still slight underwriting differences on the
production side, and slight differences on the back side the way pools are
guaranteed and handled, so combining the two will take some work if it happens
at all. You can read the actual statement here .
There are numerous ways, too many to list, to make money from real estate and
mortgage origination. But one way is to invest in the finished product - and folks
sense that some MBS's are "cheap".
need a place to live, right? And second, if you own a lot of places, why sell
them one at a time when you could sell hundreds at a time? Freddie Mac has
begun talks with institutional mortgage-bond investors interested in buying
hundreds of distressed single-family residential properties across the US in
order to convert them to rental units.
American Home Mortgage Servicing knows people need a place to live,
and the nation's #13 servicer is changing its name to Homeward Residential. The name change reflects the firm's expansion
into home lending and other real estate finance-related activities. In the past
12 months American Home/Homeward Residential has added loan closing services,
REO management, special servicing, subservicing, risk management, a correspondent
and warehouse lending division, and so on.
other end of the spectrum, commercial real-estate firm Grubb & Ellis Co. filed for Chapter 11 bankruptcy protection,
requesting an expedited sale as it faces $30 million in debt that matures on
March 1 and insufficient cash to make it through the first quarter. BGC
Partners Inc. has agreed to acquire Grubb & Ellis with a $30 million credit
bid, or the use of debt as currency, plus $4.8 million in bankruptcy financing.
(BGC Partners just purchased Newmark Knight Frank late last year, another large
commercial real-estate firm.) Based in Southern California, Grubb & Ellis
blamed the loss of a major facilities account, a merger gone wrong and
continued operating losses resulting from the economic crisis and slow recovery
for its financial woes.
The publication "Mortgage Currentcy" sent out some recent statistics from the NMLS,
specifically a comparison of licensee stats during the last six months of
2011. In June 2011 there were 16,153 companies holding 30,945 licenses,
and at the end of 2011 there were 17,155 companies holding 33,106 licenses. The
number of branches also increased from June to December, going from 17,387 to
18,902, although the number of licenses those branches held dropped from about
267k to 226k. But, per NMLS and Mortgage Currentcy (edited by Karen Deis), the
individual licenses shot up from 201k to 376k. And their research showed that
the top 3 lending institutions hold 43% of all licenses, and there are nearly
3,000 MLOs licensed in 11-21 states.
is a good thing, especially since few can keep up with current events. The next
monthly conference call of the California
Mortgage Bankers Association's Mortgage Quality and Compliance Committee (MQAC),
which is free, is tomorrow at 11AM PST. "If you missed the recent NMLS Annual
Conference, or if you have questions for CSBS, here is your chance to catch up
on the latest!" It is a webinar, and contact Dustin Hobbs (firstname.lastname@example.org) for web information, or, to join
the teleconference portion, dial 1-800-351-6802 and give the operator passcode
about VA IRRRL's is more to your
liking, there is another free webinar tomorrow at 9AM PST, 12PM EST, offered by
REMN Wholesale. "In this webinar,
you will learn about the opportunity in offering VA Interest Rate Reduction
Refinance Loans (AKA VA Streamline): the simple process of offering our
veterans savings each month, in many cases, only a drive by appraisal is
required, and diversify with this new source of business." The link to register
Yes, it is
Wednesday already, there was no U.S. economic news yesterday, the Treasury's
sale of $35 billion in 2-yr notes went just fine, and Tradeweb reported that mortgage
banker MBS sales volume was a little light (has everyone who could refinance
done so?). With Greece being a little less risky, the "risk off" trade showed
up (more on that tomorrow) and our 10-yr T-note worsened nearly .375 in price
and closed around 2.05%; rate-sheet MBS prices were worse by about .250.
mortgage application data (for week ending Feb. 17) from the Mortgage Bankers
Association came out this morning. The MBA said its seasonally adjusted index
of mortgage application activity, which includes both refinancing and home
purchase demand, fell 4.5%, with purchase apps down about 3% and refi's down
almost 5%. The refinance share of total mortgage activity dipped to 80.1% of
applications - still the lion's share.
still too early to know exactly where the markets are heading, and things look pretty close to where they
closed out Tuesday. Generally, Wednesday's session looks to be influenced
again by Treasury supply ($35 billion of 5-yr notes) and Greece. We'll also
have NAR's Existing Home Sales numbers at 7AM PST.
(Parental discretion advised, I guess.)
Students in an advanced Biology class were taking their mid-term test. The last
question was, "Name seven advantages of Mother's Milk," worth 70 points or none
One student, in particular, was hard put to think of seven advantages. He wrote:
1.) It is perfect formula for the child.
2.) It provides immunity against several diseases.
3.) It is always the right temperature.
4.) It is inexpensive.
5.) It bonds the child to mother, and vice versa.
6.) It is always available as needed.
And then, the student was stuck. Finally, in desperation, just before the bell
rang indicating the end of the test, he wrote:
7.) It comes in 2 attractive reusable containers.
He got an A+
interested, visit my twice-a-month blog at the STRATMOR Group web site located
at www.stratmorgroup.com. The current blog discusses
residential lending and mortgage programs around the world, part 2. If you have
both the time and inclination, make a comment on what I have written, or
on other comments so that folks can learn what's going on out there from the