What, if anything, is putting a crimp in expected loan production?  Perhaps the CFPB's QM rules are indeed restricting residential lending. In one example, here is what the public sees on the narrow QM DTI box. But hey, no one at the CFPB ever said that non-QM loans were bad loans, although the consequences from unintentionally doing a "bad" loan are truly on the collective mind of the industry. It is just so darned hard & expensive to originate a "perfect" loan...

"Rob, it seems like all my co-workers are yapping about risk. Is there anything different about the risk lenders have now versus 10 or 20 years ago?" Yes and no. The basic risks are the same, but the importance, scope, and minimization of risk have increased dramatically, as has the cost of reducing it. There's no position of "risk dude" or "risk dudette" at a lender although many lenders have chief risk officers if they can afford them. (And can a company afford not to?) But everyone is pulled into the risk equation: underwriters, appraisers, head of operations, modeling & analytics, financial analysts, quality assurance managers, compliance, fraud investigators & auditors, production and servicing. And if you think that pretty much sums up the bulk of the personnel, you're right.

The Agencies are "happy" to deal with credit risk. After all, that is what guarantee fees are for, right? But when someone like Fannie is dealing with approximately 1,400 lenders, operational risk is not something they want to assume. The Agencies, and other investors, are carefully watching the migration away from the pristine risk profile that the industry has developed over the last several years. They want viable counterparties with plenty of net worth, and lenders exiting or merging cause some instability. And any investor walks a fine line between offering more and more to their clients versus protecting themselves. Given the recent announcement from the FHFA about the Agencies needing to focus on non-regulated servicers, the premise that the Agencies aren't interested in operational risk oversight may be shifting.

The interesting thing is that everyone I have asked has told me that not every loan should be done - so logically not every borrower will qualify for a loan. Fred Jackson wrote to me saying, "Regarding the comments on mini-correspondents, after all this time, does it not amaze you that many (still) believe that Fannie and Freddie underwrite the loans they buy. No matter how many times it's explained that it's the responsibility of the seller to qualify and underwrite the loans, with DU or LP or manually, and how obvious it is that, to underwrite every loan bought , F&F would need to have as many underwriters as all their sellers put together, why don't people get it? The same applies to large correspondents who are seller/servicers. Do the math, folks."

Risk management in mortgage lending is a burgeoning field. How does one measure, track, and reduce loan defects? What will the upcoming RESPA/TILA changes mean to risk? Are you preventing all fraud in your originations? And if not, why not? How are you handling your underwriting, repurchase, indemnification, and rescission risks? The CFPB appears to be focused on counterparty risk - how are you monitoring your vendors? What about cybersecurity, or the risk of the janitor throwing a bunch of loan files in the dumpster (I saw that one happen several years ago)? Is the company monitoring appraisal and review appraisal risks? Collateral valuation is critical to investors. How about for third party originators - how are they watching their broker clients?

But wait - there's more! Are you hedging your secondary marketing risk correctly? Will your warehouse lender be around next month? Conversely, will the warehouse bank's clients be around next month? Are you adequately training your staff on risk metrics and avoidance? Are you at risk of your LOs running amok in social media, saying they have the best rates in town? And the CFPB wants to make sure that a lender's LOs are not being compensated to steer borrowers in one direction - the risk of a lender not doing that are pretty darned steep.

And when a lender has their eyes on all of that, is there any time or resources to actually originate a loan profitably? Is it easier doing all of that when you're a big bank than when you're a lender doing $30 million a month? Not only are lenders measuring, tracking, and reducing loan defect rates, but they are also mitigating repurchase, re-default, and rescission risk. And all of this is for QM and non-QM loans, vanilla product or expanded - that should have little bearing on a company monitoring and minimizing risk. Indeed, managing risk is critical, and expensive, for lenders.

Not coincidentally, the MBA's Risk Management and Quality Assurance Forum is scheduled on September 7th-9th in Miami Florida. "Hear from a distinguished panel of key industry leaders and GSE staff as they discuss updates and challenges to current business processes in two general sessions. Register before August 4th, member price $840 and non-member price $1040. For complete details and registration information: MBA.

The MBA/MW if offering a Fundamentals of Mortgage Banking course starting today in Herndon, VA. "A comprehensive two-day course that every Loan Officer Assistant, Loan Officer or new Processor should attend. Taught by industry renowned instructor Mary Kay Scully of Genworth Mortgage Insurance.

The CMLA and AMLG are hosting a complimentary comprehensive 90 Minute Repurchase/Make-Whole Defense Webinar: "The Latest Patterns, Trends and Solutions to Resolving Repurchase/Make Whole Claims in 2014 and Beyond" on Tuesday, July 29, from 11-2:30PM PST. Topics include various trends with the major secondary market investors both in and out of court, insights into the latest case law from around the country and how such may affect forward-moving repurchase/make-whole defense and resolution strategies, updates to legal defenses that lenders can use to push back a repurchase demand; common allegations asserted in support of repurchase/make-whole demands and a number of the strategies that should be considered to rebut such demands, etc.

NAMB National will have its 40th Annual Conference in Vegas baby! The Nation's Largest Conference & Tradeshow for Mortgage Professionals is scheduled for September 13-15 at the Luxor Hotel. Attendee registration price is $295 increasing to $345 after Thursday July 31st. For complete conference details, visit the website: NAMB. As an added bonus, you can fulfill your complete 8 hour continuing education requirements for your NMLS license renewal. "This is a separately-ticketed bonus offering. Make the most of your time in Vegas by getting your federally-required CE in addition to a conference full of networking, education, opportunities and prizes. Continuing Education course is provided by Mortgage Educators & Compliance. Important Note: You must take the entire 8 hour class to qualify for credit.

If you want to head to Seattle to toss some salmon through the air, you may-as-well take in the American Association of Residential Mortgage Regulators AARMR annual conference in Seattle on August 4th - 8th.

The 41st Annual CMLA Convention is in Vail Colorado is August 6-8.

The Community Home Lenders Association (CHLA) has announced plans for its second annual fall conference to be held September 8-9 at in Washington DC at the Liaison Hotel on Capitol Hill.  The conference will once again feature attendance by key federal policy makers that affect the future of the mortgage banking industry and housing finance reform. The Conference also includes a Lobby Day with key members of Congress. "CHLA has taken the lead on important issues affecting independent non-bank mortgage bankers, including being the first national trade association to call on FHA to reduce annual premiums and calling for bank mortgage originators to have testing and training requirements commensurate with those that apply to non-bank mortgage lenders."

If you find yourself in the Northwest in early September, you may want to check out the Pacific Northwest Mortgage Lenders Conference, September 7-9. This year's event will be held at The Benson Hotel, a historic landmark in the heart of downtown Portland, Oregon.  The Oregon Mortgage Bankers Association (OMBA) is pleased to host this year's tri-state event for Oregon, Washington and Idaho. "The guest speakers will cover topics that include regional and national economic forecasts, GSE reform, CFPB updates, Private MI changes, and QM updates. The MBA will provide critical and timely updates on legislative issues that affect our business."

The TMBA's 13th Annual Reverse Mortgage Day will be held at the Westin Galleria Dallas in Dallas, Texas on Thursday, September 11 with a Welcome Reception on Wednesday September 10. This event will bring industry professionals from all over the country to the Lone Star State seeking strategic options and information about the business of reverse mortgage lending. Attendees include upper management from the nation's leading reverse mortgage lenders, loan officers, real estate attorneys and title companies. Individual registration fee, before August 8th, $159.00, after August 8th, fee is $209.

If you are in Charleston in late September, you may want to attend the MBAC 59th Annual Convention September 21-23.

And AllRegs has some upcoming webinars of note: Highlights of the TILA and RESPA Disclosure Integration July 31st, how-to-organize-your-compliance-management-system August 19th, and also available: ALLREGS Custom Training.

MMBA's Crab & Shrimp Feast Social is Wednesday, September 10, 2014 from 5:30PM - 8:30PM at Bo Brooks Restaurant & Catering located at 2780 Lighthouse Point Road, Baltimore, MD. Price is $69 MMBA Members; and $89 Non-members, rates increase by $10 per person if registered after 8/15/14.

What happens in Vegas shouldn't stay in Vegas... The CMBA's 19th Annual Western States Loan Servicing Conference is taking place August 3rd - 5th at the Encore in Las Vegas. This year includes an added a golf tournament to kick off our conference which will happen on Sunday, August 3rd at Spanish Trail Golf Course, just a few minutes from the conference hotel.

The markets: Ukraine, Gaza Strip, and Malaysian Airline disaster, take your pick. Overall prices and rates ended Monday about where they ended Friday, despite turmoil and lack of U.S. news. Today we'll have the Consumer Price Index numbers for June, seen just below the prior read of +0.4%, the FHFA house price index for May (expected slightly higher) and the June's Existing Home Sales (also expected higher). In the early going the 10-yr is still at 2.48% and agency MBS prices roughly unchanged from Monday's close.


Impac Mortgage Corp. is adding to their operations and national sales teams in retail and correspondent lending. The Retail Lending team has immediate openings for Call Center Loan Officers who hold multiple state licenses and are local to headquarters in Irvine, CA. Interested and experienced call center candidates only please. For operations, to meet growing volume needs, the company is seeking experienced underwriters specifically with DE, VA/SAR, and conventional experience. The Correspondent sales team is focused on mortgage bankers, community banks and credit unions across the country and currently recruiting Account Executives for coverage in the Atlanta market and also Michigan, Indiana, Ohio and Kentucky and the SF Bay area. Candidates must have recent correspondent experience.  Candidates should email resumes and the position of interest to Impac Mortgage Corp.

And congratulations to Corey Caster, Premier Nationwide Lending's new Senior Vice President of National Production. "Corey brings a wealth of experience in growth and Senior Leadership. 'I'm ecstatic to build upon the platform that Premier has created and grow the organization nationally. The FAMILY environment is incredible and it reflects in the top producers Premier has been able to attract and retain.'" Premier is indeed expanding on the retail side; contact Corey Caster directly on click on the site above.