Anti-Money Laundering Still a Concern; Investor Updates; Secondary Conference Chatter
Here's a little more informal/off-the-record chatter from the Secondary Conference.
First, there is a general sense of optimism among the participants
although the MBA revised their 2014 estimates down to about $1 trillion.
Sure, March and April were good months, and May is showing a lot of
promise with lock numbers - but anything compared to January and
February has to be better, right? Citi "says" it wants more biz - we'll
see. (More below.) Fannie & Freddie reps are going about their jobs,
with perhaps a little more of an "attitude" than in previous years.
They will eventually come out from under the government, but it will
take years. And they are making money - although much of their earnings
have come from settlements, and that is not a sustainable source of
income. Between that and being under conservatorship, well, the big
parties they threw in the past are long gone: hosting a big party
attended by individuals from companies they took settlement money from
jobs & expansion news, currently celebrating its 55th year in the
mortgage industry, Mid-Island Mortgage Corp. is, once again,
experiencing significant growth in originations. Headquartered in
Westbury, NY and a Regional Office in Woburn, MA, Mid-Island Mortgage Corp. is currently interviewing for referral-based loan originators for both locations.
"Extremely competitive in rate, aggressive in our comp, contributing to
health and 401(k), with full marketing and operational support makes
Mid-Island the ideal career spot for serious mortgage pros."
Privately-owned Mid-Island Mortgage has its own growing servicing portfolio, and has full agency approval (Fannie, Freddie, Ginnie). Email your resume to careers@mortgagecorp. com today.
On the wholesale side, REMN Wholesale continues to show its dedication to the broker channel. REMN just opened a new West Coast operations center in Newport Beach and is actively recruiting experienced underwriters and account executives to help build the growing office. As a division of HomeBridge Financial Services, Inc., REMN Wholesale
is known for its commitment to same day turn times on new files and
their leadership in renovation lending. (REMN Wholesale will have a
major presence on the floor of the NAMB National Conference in Las Vegas
this September and those at the event are invited to join them at the
REMN 25th Anniversary Celebration at LAX nightclub on the 14th.)
Experienced AEs and underwriters interested in joining the REMN
Wholesale team should send their resumes to aerecruiting@REMN. com for AE opportunities and uwrecruiting@remn. com for positions in the underwriting department.
In other company news, Citi
has developed a solid reputation in the industry for waffling: it is in
the market, out of the market, in, out. Sometimes its pricing is great,
but service levels are poor, or vice versa. Although actions speak
louder than words, yesterday CitiMortgage CEO Jane Fraser announced that
it is looking to increase its market share in the U.S. mortgage market by beefing up the correspondent biz.
Fraser called the correspondent market "very important" and said that
Citigroup was "open for business" with correspondent lenders. Fraser
also said that the bank would look to hold the new loans on its balance
sheet and would be "extremely careful" about the quality of the loans it
will make. Citigroup fell to #7 in terms of volume last quarter, quite a
drop from a year ago. Citi,
like the other aggregators, needs to remember that its competitors
aren't necessarily the other aggregators but are now the Agencies and
non-bank servicing buyers.
Poor MERS can't catch a break.
Over the last few years have come repeated court challenges to its
business model - and MERS continues to do business in every county in
every state. And now...it has a disease named after it! More accurately, there is a disease that shares its acronym.
MERS, the disease, has spread to 18 countries, and is a viral
respiratory illness caused by a type of coronavirus, according to the US
Centers for Disease Control and Prevention. It was first reported in
2012 in Saudi Arabia. One write-up I saw humorously noted that "the
virus has similar traits to other viruses such as Dodd Frank and other
ridiculous regulations. Those infected with MERS start off with symptoms
like high stress, baldness with potential development of comb
over, weight gain causing a tighter waistline, tiredness from over
regulation and inefficient requirements, and loss of income from high
expenses. More than 500 cases have been reported worldwide, and about 30
percent of those infected have died from MERS, Reuters reports - but the disease, not the Mortgage Electronic Registration System.
Besides the large number of training guides produced by the MBA and others, there are some other books that LOs or secondary marketing folks might find of interest.
Fleming, an industry veteran of 35 years and trainer and mentor to
mortgage originators, has published a new book aimed at consumers of
real estate finance services called The Loan Guide: How to Get the Best Possible Mortgage. The
book teaches readers how to think about whether to get a mortgage at
all, how to determine what loan product and pricing is best for their
specific situation, how to manage their debt over a lifetime, and a
great deal more. Casey
is offering consumer-oriented seminars based on the book that can be
used to help originators build relationships with Realtors and to build
can't spend a single day without thinking about compliance - which is
fine until it negatively impacts the access to credit by borrowers. Part
of that includes, especially for banks, include FinCEN. In February, 2012, the Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) issued a
Final Rule requiring non-bank residential mortgage lenders and
originators (RMLOs) to comply with the provisions of the Bank Secrecy
Act by establishing anti-money laundering programs. The Final Rule stated that RMLOs must have a compliant AML program established on or before August 13, 2012. The
Final Rule contained "4 pillars" that an AML program must contain, one
of which was qualified AML training for all relevant employees.
there must be provisions for initial, new hire and ongoing training; an
adequate system to verify that each employee took the training; and
that records be kept documenting the type of training, the presenter,
the material covered and the test results. Exchange Analytics, Inc. is a leading supplier of Anti-Money Laundering compliance training services to the mortgage lending and mortgage origination industry. It offers a web-based AML training course
designed specifically for employees of RMLOs. Exchange Analytics'
services also provide for the specific documentation and record-keeping
requirements of an AML program. To learn more contact Larry Israel at lisrael@xanalytics. com.
Let's keep playing catch up with some relatively recent investor news.
Impac Mortgage Corp.
has announced Vermont is now an eligible state. It has updated the
matrices for the Freddie Mac Conforming Fixed and ARMs to include 5/1
arm product both conforming and super conforming. HPCT (higher-priced
covered transaction) qualification for 7/1 and 10/1 ARMs have been
clarified. Matrix pertaining to manufactured homes has been updated as
well including the elimination of the overlay on FHA manufactured with
respect to derogatory credit waiting periods on manufactured home loans
as they will follow FHA guidelines. Matrices for Fannie Mae products
have been updated as well. Limitations have been set to new mortgage
insurance contracts to either Borrower Paid monthly premium or Lender
Paid Single Premium Guides are also available for viewing.
Impac has lowered the minimum credit score for all of its VA products to 620, including the new 3/1 and 5/1 VA ARMs. For
FHA transactions, the minimum FICO is 580, including the new 3/1 ARM,
with certain restrictions pertaining to 580-619 scores.
the Jumbo Platinum product, Impac has updated the guidelines on
appraisals, business funds, the use of authorized user accounts and
non-traditional credit as trade lines, gaps in employment, VOEs for
self-employed borrowers, pricing on loans without escrows, eligible
property types, qualifying rates for ARMs, and fraud.
enhanced its Conforming Fixed guidelines to allow a total DTI that is
the more restrictive of 50% or the AUS findings and to allow
LTV/CLTV/HCLTVs up to 85% on 2-unit primary residence purchase and
limited cash-out transactions that are underwritten by DU. The
guidelines for MyCommunity Mortgage transactions have also been relaxed
to allow subordinate financing with a 95% maximum CLTV/HCLTV.
And the Correspondent Lending Division of Envoy
announced the release of its Jumbo Products with the following
features: Specific Lender approval required for product; LTV/CLTV/HCLTVs
allowed up to 80%; Loan amounts allowed up to $1,500,000; Loan amounts
allowed up to $1,000,000 for First Time Homebuyers; Cash-out allowed up
to $300,000; Minimum loan amount is $417,001; Maximum DTI is 43% on
1-unit properties; Envoy Mortgage must underwrite all loans - Delegated underwriting is not allowed.
Last month we learned that ditech Mortgage Corp.
will now purchase single and double wide manufactured housing on FHA
product. Per HUD QM Rule, FHA Manufactured Housing loans are exempt from
the points and fees limit and therefore assured a safe harbor
designation under the HUD QM rule assuming all other QM standards are
met. Expansion of their LPMI products in an effort to reach more
borrowers and offer a great tool to help loan officers compete in this
purchase market. ditech has also rolled out My Community Mortgage
program (as either a fixed, ARM or LPMI option) and removed the minimum
borrower investment overlay on conforming loans (100% gift now
Bank of Internet has
added the new Meridian 7/1 and 10/1 ARM programs to its product suite
and has made several changes to the Meridian Fixed programs, which are
available to price and lock through Optimal Blue. For Portfolio ARMs, the previous prepayment penalty has been removed.
First Community Mortgage
has expanded its wholesale lending territory into West Virginia.
Numerous changes have been made to their guidelines. Conventional
products will require full property tax rate and for qualifying PITI.
Assets and reserves modifications regarding borrower contribution
amounts when using gift funds, donations from entities, or employer
assistance have been updated. Sourcing
large deposits in single or multiple aggregated non-payroll deposits or
VOD variances that represent amounts in excess of 25% of the borrower's
gross monthly income is also addressed. Other topics are outlined as
well such as mixed use/non-residential use property, added condo
guidance, Non-Permanent Resident Alien ineligibility, FHA manual
underwriting credit score, DTI, and compensating factor requirements
additions, and VA requirements to name a few. Please see the full
guidelines at WHOLESALE PRODUCT & PRICING BULLETIN 2014-03b for
specific details regarding these changes.
the lack of news rates in the U.S. have been pretty steady this week,
although Wall Street traders are seeing a pick-up in agency MBS volume.
Yesterday rates decided to improve despite the pick-up in volume, and
current coupon mortgage-backed securities improved about .250. The move
was mostly attributed to comments
from FRB Cleveland President Plosser who said the strengthening economy
could mean the Fed would have to hike rates sooner versus later.
know it's a slow day when the only news for the morning is the MBA's
application numbers. Apps were up slightly last week (.9%) with refis up
almost 4% and purchases down about 3%. But we will also see the minutes
from the last FOMC meeting - don't look for any surprises. The 10-yr is sitting around 2.53% and agency MBS prices are down/worse about .125.