real estate is local. (Yes - that statement is original, and pithy.)
For those of you about to give a presentation to your buyer, borrower,
or local Realtor group, or just curious, here's a study from a few weeks
ago about value trends. And don't forget that Freddie Mac has its fancy, patent pending, market indicator.
the jobs side this morning, one Southern California Lender is rapidly
growing and is looking for the right team to fuel its' growth. Synergy One Lending, a mortgage lender based in San Diego, is searching for a Chief Operating Officer, VA Underwriter with SAR/LAPP/DE, and a Secondary Market specialist
as they continue their expansion nationwide. It is aggressively
recruiting established, well-run branches and qualified originators who
will have the unique opportunity to earn equity and build long-term value. Please direct inquiries and resumes to Info@SynergyOneLending. com.
Three thousand miles away, Mortgage Financial is growing and searching for originators. "New England Loan Originators! - Do you want to love where you work again? Mortgage Financial has been a correspondent lender in New England for over 27 years,
providing stability and a culture that is unique in today's
environment. A sense of urgency flows throughout the Mortgage Financial that ensures dates are met and clients are always the number one
priority. We do this while ensuring that regardless of the
circumstances, the loan officer always looks like the hero. Our size is
our strength. We are large enough to command the best pricing and
investors available, but small enough to avoid the multiple levels of
management that can sometimes delay important actions and/or decisions
regarding your loan. Like most, our service levels are great today, but
they will also be great tomorrow and beyond, because the process and
technology have been designed to accommodate all market conditions. In
addition, our Marketing solution is the best of breed, allowing you to
maintain contact with all your borrowers and referral sources with
minimal effort. The entire model was built around and for, successful
Loan Officers." If you are interested in a conversation, please contact
Dan White at email@example.com.
companies directly, or indirectly, are influenced by Freddie and Fannie
the fate of which is determined by Congress (with hopefully some input
from industry groups). After being delayed, it seems that the Senate Banking Committee will vote on the Crapo GSE reform bill next week. The measure is expected to pass out of the Committee but not the full Senate.
(Read More: Kicking the Can; Housing Reform Given Little Shot at Success)
In late summer 2008 the Treasury
Department initially pledged $200 billion of financial help for F&F
in anticipation of future mortgage defaults, a pledge later doubled to
$400 billion. Did they use all of it? Heck no: the companies actually
received $188 billion of taxpayer aid, less than the $203 billion of
dividends paid by Fannie and Freddie to the government since the 2008
bailout. After conducting stress testing,
the FHFA said FNMA and FHLMC might need a bailout of up to $190B in the
event of a severe economic downturn. (I don't know why no one did a
stress test on me in the event of an economic downtown, but I have told
the dogs that the kibble ration may be cut back - they merely stared at
me unwittingly.) A severe economic downturn would result in Fannie Mae
and Freddie Mac requiring rescues ranging from $84 billion to $190
billion by the end of 2015, according to the worst-case, "stress-test"
scenario under Federal Reserve stress-test assumptions, according to the
Federal Housing Finance Agency. The FHFA used different economic models
in its own stress tests, which showed that the mortgage giants wouldn't
need additional taxpayer money.
not saying its easy being a member of the U.S. Congress, however,
having the ability to delay work by commissioning "impact studies" is
quite the perk. Try this next time your spouse asks you when you're
going to clean up the garage..."ah, ya, I'm just waiting on that impact
study I ordered, and then I'll get right on it." As the Senate considers
the Johnson-Crapo bill, policymakers are asking about the proposal's
potential impact on mortgage markets. In particular, some have expressed
concern that the bill may exacerbate currently tight credit conditions
for certain underserved or highly leveraged populations. This brings us
to Zillow; right or wrong, depending on how you feel about the firm (as I
know there are a lot of differing opinions) they have access to data.
The Zillow Economics Research piece "Assessing the Impact of Housing
uses data from the Zillow Mortgage Marketplace (ZMM), an online
platform that connects thousands of mortgage borrowers and lenders each
day, as well as HMDA's database and the U.S. Census Bureau's American
Community Survey (ACS) to profile populations that are currently
underserved or face high levels of debt.
Let's take a look at some recent random state-level mortgage news.
Hawaii and Iowa
have recently adopted provisions to help establish the Uniform Power of
Attorney Act in Senate Bill 2229, and Senate File 2168, respectively.
The new chapter is effective immediately, and makes the state the 15th
in the union to pass such legislation. As many know, the Uniform Power
of Attorney Act provides ways for people to deal with their property by
providing a power of attorney in case of future incapacity. While
chiefly a set of default rules, the act also contains safeguards for the
protection of an incapacitated principal. Washington, Mississippi,
Pennsylvania, and Connecticut all have introduced such bills this year.
Maryland has amended provisions regarding residential real property foreclosure with House Bill 595.
The bill, which amends owner occupied foreclosure sales, states, "if a
certified community development financial institution makes an offer to a
secured party to purchase owner-occupied residential property, no
person may require as a condition of the sale any limitation on
ownership or occupancy of the property by the immediately preceding
mortgagor. Any affidavit, statement, or agreement is unenforceable
against any person named in such document if its purpose is to avoid a
sale or transfer of property to a certified community development
Kentucky has amended KRS 426.530,
which lays out the right of redemption of real property which has been
sold in pursuance of a judgment, or order of a court. The revisions are
effective on July 14, 2014, or 90 days after legislative adjournment.
Let's continue catching up with some investor, lender, and agency updates
to gain a sense of trends out there. As always, it is best to read the
full bulletin from the issuer. So many lenders, so many guidelines...
First, a correction to a note yesterday regarding the Right Step Program. Dave B. writes, "I want to correct your general assessment of the Right Step Program from TD Bank
(not TD Ameritrade); it is below market rates; currently available at
less than 3.75% @ par, it does have a hard cap on the front ratio of 33%
(41% on DTI), 660 FICO and it does require the consumer to contribute
3% into the transaction. Income caps as mentioned are waived if the
property is in a LMICT area (low to moderate income census tract). We
also will do a 90% 2-4 unit property with No M.I.. The Right Step
Program is offered by TD Bank, TD Ameritrade is our 'brokerage arm' for
investment products." There is no PMI for up to a 97% LTV and the credit
standards are "fairly reasonable" as well: 33/41 ratios and a 660 credit score minimum.
Kinecta Federal Credit Union
alerted us that, "The Wholesale Rate Lock Policy is updated and
Carrington Mortgage Services
has announced the appointment of Industry Veteran Chad Ruggles as
National Sales Director. Under Ruggles' direction, Carrington's retail
sales operation will focus on substantially growing its geographic
footprint, as well as providing a wide range of product offerings and
faster turn times to effectively meet market demands - particularly with
respect to serving the Nation's sizeable population of "underserved"
borrowers (typically those in the sub-640 FICO score range).
As a reminder, the FHA has made policy change for prospective Home Equity Conversion Mortgages
related to due and payable status published in Mortgagee letter 2014-7
amends the Home Equity Conversion Mortgage (HECM) program policy to
provide for a deferral of the due and payable status at the death of the
last surviving mortgagor for an eligible Non-Borrowing Spouse. The
policy is prospective only and changes will be effective only for case
numbers assigned on or after August 4, 2014. FHA hosted an overview
briefing conference call for HECM-approved originators, servicers,
counselors and other industry participants to review the operational
information last week.
The Collingwood Group reports, "At a recent VA Lenders' Conference in Houston, VA
announced that they will soon begin looking more closely at whether
lenders are complying with the program's requirement for a Quality
Control Plan. All
lenders who have been granted authority to process loans automatically
(virtually all lenders) are required to maintain a plan and execute it
in the course of making VA guaranteed loans. Lenders
were advised to become familiar with VA's quality control plan
requirements and be prepared for VA to scrutinize this process in future
Lender Monitoring Unit Audits. This initiative is consistent with VA
auditing an increasing percentage of loans to refine its targeted
is now offering , a direct VA program which offers features and options
that the standard VA program will not accommodate such as 600 minimum
FICO, 620 minimum for cash out refinances with LTVs > 90%, and 640
Minimum FICO for IRRLS using AVM in lieu of appraisal for 1 unit
properties. This program will not be available in Broker Connection,
WesLend's pricing engine, until the second week of May. Please refer to
the published guidelines for complete program details. Enhancements have
been made to their Direct ARMs to include high balance loan amounts,
for complete information and guidelines, visit their website.
revised the list of fees pertinent to finance charges in the APR
calculation, effective immediately. Refer to the PHH Sales Manual
section 2.1.8 for complete information. Conventional underwriting
guidelines have also been updated including the following topics:
trusts, contact/agreement of sale, reserve requirements as applicable to
new home purchase and conversion of their former home to an investment
property or second home, co-signed loans, Social Security, Supplemental
Security Income and Other Benefits history requirements, condo/PUD
project reviews and Co-Ops.
Overall interest rates continue to be range-bound.
Lots of people don't mind the lack of volatility, but LOs notice that
mortgage rates have been improving - yesterday agency MBS prices
improved over .250 in price. (Whether or not that was passed onto rate
sheets remains to be seen.) Yet the 10-yr T-note was virtually
unchanged. We're really seeing the supply & demand dynamics play out with plenty of demand for MBS, and supply dropping.
Deutsche Bank MBS analysts noted that as a result of the weak
production, the Fed may be able to exit QE without putting too much
pressure on MBS spreads (prices relative to Treasury securities).
(Read More: MBS RECAP: Bond Markets Happy With Lack of Surprises From Yellen)
(Read More: Mortgage Rates Push Further Into 6-Month Lows)
Chair Yellen, in her written testimony today before the Joint Economic
Committee, suggested the longer term outlook may not be as worrisome as
has been feared despite the Fed's tapering. Although she didn't say
anything surprising, she noted that recent indicators pointed to a
rebound in the economy from a weak first quarter that was adversely
impacted by weather. Yellen did not give any clarity on what the Fed
means by a "considerable time" when referring to how long rates will
remain near zero after QE purchases end, or about when reinvestment of
paydowns would stop and when the Fed's portfolio would start to
we are on Thursday already. Besides a spate of government financial
officials speaking, and a $16 billion 30-year bond auction, the only
economic news is Jobless Claims, expected to drop slightly. For a gauge
of rates, the 10-year T-note closed Wednesday at 2.59% and is sitting at 2.62%, and agency MBS are off slightly.