Every day we all hear rumors, big and small, mostly unfounded. Rumors like that large companies in the vein of Franklin American and Freedom Mortgage will soon announce large settlements with regulators, Navy Fed's CFPB exam is wrapping up, that Wells Fargo retail won't be able to do HARP or 203(k) loans until early 2016, that startups like Privlo are being shuttered. But one thing we know for sure is that mortgage denial rates were down last year compared to 2013, especially for black and Hispanic borrowers. The amount of conventional mortgage applications increased from 2013's 2.0 million to 2.1 million in 2014, but the denial rate fell to 11.2 percent from 12.4 percent during the same time period. Denial rates had dropped 5.1 percent for black applicants and 3.1 percent for Hispanic applicants.

Let's take a look at trends in appraisal-related news over recent months. The industry, of course, knows that the number of appraisers is declining - for reasons that are well documented.

HUD Handbook 4000.1, which became effective on case numbers assigned on or after September, contains numerous updates to previously established property eligibility criteria and appraisal requirements.  Onboarding to the Federal Housing Administration's (FHA) Electronic Appraisal Delivery (EAD) portal is well underway for FHA-approved mortgagees participating in the first onboarding phase. The second onboarding phase began on November 15 and mortgagees intending to participate in this phase must be registered before this date.

Plaza updated its appraisal fees last month in San Bernardino, San Luis Obispo and Santa Barbara Counties. Clients are required to disclose appraisal fees on the initial Loan Estimate or Itemization of Fees based on their knowledge of the area, including any additional fees for complex or unique property types, rush requests or additional products, such as a completion report. If clients know the appraisal fee is higher than what is shown on the fee sheet, they are required to disclose the most accurate amount. If additional fees are required due to unforeseen events, a valid Change of Circumstance may reset the tolerance. Note: A Request for Change of Circumstance must be reviewed and documented to be considered valid.

Pacific Union has posted miscellaneous enhancements and updates. Appraisal forms for conventional loans via Desktop Underwriter (DU) will require a field review (Form 1032/2000) for the following: appraised value ≥ $1,000,000 and LTV/(H)CLTV > 75%, or Loan amount > $625,500 and LTV/(H)CLTV > 80%. Loans underwritten via Loan Prospector (LP), a field review (Form 1032/2000) is required when the appraised value is ≥ $1,000,000 and the LTV/(H)CLTV is > 75%. The LTV/(H)CLTV must be based on the lesser of the original appraised value, field review value or sales price (if applicable). This guideline update is applicable only for High Balance properties located in Alaska and Hawaii.

Loans with borrower(s) who work within the mortgage industry or are employees of NYCB Clients are eligible, provided the Interested Party is not involved in the origination process of their Mortgage Loan. Any situation that would create a conflict of interest between the borrower and any real estate professional associated with the origination or processing of their loan should be avoided. Some examples are loan officer cannot take their own application, and appraiser cannot appraise their own collateral. In addition, all applicable MI company specific guidelines will apply. Email answers@mynycb. com for any additional scenario-based restrictions or exclusions.

Clients of US Bank Home Mortgage know that its policy changed with regard to properties that have had additions or conversions and the appraiser has referenced in the appraisal that improvement were done without permits.  Appraisals will either be made "As Is" or "Subject To", both being acceptable under the following guidance: If the subject property is appraised "as is" then: any work done without permits is not included in the GLA unless the appraiser states the addition/conversion was completed in a workman like manner and the appraisal is supported by comps with similar addition/conversion that will not have a negative effect on marketability. I.e. a property with a garage converted to a 3rd bedroom was not comparable to property that was built as a 3 bedroom with or without a garage. Appraisal made "Subject To Permits", permit(s) must be obtained or a letter from a licensed General Contractor to ensure no health and safety issues exist and that the addition or conversation was done to code. 

The big news yesterday, shooting stocks to the moon but leaving the bond market nearly unchanged, were the minutes from the recent meeting of the Federal Open Market Committee.

"Members emphasized that the change was intended to convey the sense that, while no decision had been made, it may well become appropriate to initiate the normalization process, provided that unanticipated shocks do not adversely affect the economic outlook and that incoming data support the expectation that labor market conditions and that inflation will return to Committee's 2% objective".

I don't know how we're one week from Thanksgiving, but we are. And we've had some news: Initial Jobless Claims for the week ending 11/14 and Continuing Jobless Claims for the week ending 11/07 (-5k to 271k), and the November Philadelphia Fed (+1.9). Coming up is the October Leading Indicators figure. We closed the 10-yr Wednesday at 2.27% and this morning it is sitting at 2.26% with agency MBS prices a shade better.

Jobs and Announcements

In retail job news American Bancshares Mortgage out of Miami Lakes, Florida is expanding its footprint in the North and South Eastern states. "ABSM is a 20 year old direct seller/servicer committed to the American Dream. We have a strong company culture and have made a commitment to exceptional service levels, said John Cosculluela, President. We are looking for Branch Managers and Loan Officers who are passionate and have a strong work ethic." Contact Sandy Garcia, VP of Production, for more information about ABSM's benefits, commission structure, products, exceptional turn times for underwriting and closing, and to schedule a confidential interview.

For those looking for a new correspondent investor, "The Money Source is growing by leaps and bounds. One of the reasons for TMS's dramatic growth is their customer-centric approach: a Correspondent and Seller relationship can either be a 'partnership' or a 'transactionship.' A partnership is where all parties' interests are aligned and they are each working toward a mutually beneficial goal. One way TMS brings this to life with their Correspondent partners is by co-branding their servicing statements, thus giving them the ability to have information such as your company's name, logo and contact information on the Borrower's monthly mortgage statement. TMS calls this their Balance Sheet Builder Program. Basically, TMS is trying to send business back to their Sellers - a refreshing approach in an industry not known for promoting others. To learn more about how you can build your balance sheet with The Money Source, email EVP of Correspondent Sales, Jeff Vanderluit."

And under the "new products" flag, MarX Financial Commercial is pleased to announce a nationwide "Fix and Flip" financing revolving Line of Credit (LOC) for real estate developers, and investors, that can provide financing of up to 85% of the total project cost. The line is available on non-owner occupied single family properties, multi-family, office, retail and industrial types of properties. Jay Michalowski, CEO of Marx states, "We can go up to 85% LTC financing for the acquisition and renovations. So the borrower walks into the closing with 15% of the total project and we will fund the rest."  Escrow funds are set-up and draw requests and payments are made after each inspection. Michalowski adds, "For residential and commercial mortgage bankers who receive these inquiries, and we know who your originators are, and we can provide a non-bankable, quick solution to meet your demand." To find out more about Marx Financials fix and flip and commercial programs, please contact Jay Michalowski.

Congratulations to Chris Sorenson. PRMG announced his promotion to SVP, National Director of Retail Production. A 27 year veteran, Chris will be responsible for overseeing all of PRMG's National Retail Production.

Join Lakeview Correspondent and Fannie Mae TODAY, Nov. 19 at 1PM EST to discover how Fannie Mae's Collateral Underwriter^® supports appraisal quality and provides a more transparent and efficient appraisal review. Tune into the webinar and hear how Desktop Underwriter^® provides a comprehensive risk assessment that determines whether a loan meets Fannie Mae's eligibility requirements, and listen in as Fannie Mae shares the value that their proprietary tools bring to the lending process. Learn how enhanced technology platforms may increase your operational efficiency by leveraging data and analytics, and hear more about the upcoming Desktop Underwriter^® release - register here.

This is your personal invitation to the launch of National Mortgage Professional Magazine's biggest FREE Holiday Networking Parties in years. The 2015 parties will be in Irvine, CA on Tuesday, December 8th, Dallas, TX on December 10th and Orlando, FL on December 15th. Each party starts off with the Next Gen Mortgage Professionals Rally to launch its campaign titled, "Recharge the Mortgage Profession" and college students, veterans and individuals interested in changing careers are invited to attend. The rallies will be followed by business building workshops from industry leaders such as Greg Frost from PRMI, Barry Habib from MBS Highway, and Frank Garay and Brian Stevens from NREP.  Workshops will be followed by a networking party where attendees will mix and mingle with other successful mortgage loan officers and celebrate the evening with music, complimentary food, prizes, and a heavy dose of holiday cheer! MLOs with NMLS numbers, college students and veterans attend free. Register by clicking the state that you wish to attend: California, Texas, or Florida.

Would you like to speak at an upcoming MBA conference on financing condominiums? Here's your big chance.

Speaking of condos, I owe an apology to Chris Carter, an LO in Naples, FL, who writes an original newsletter to Realtors every week or so. Last month I had a piece describing condo questionnaires ("The Condo Questionnaire gives a current snapshot of the property's physical, legal, and financial health - When a buyer applies for financing on a residential condominium unit, the lender ask the Management Company or HOA representative to fill out a Condo Questionnaire...") Chris wrote it, and I should have given him credit!

Congrats to Blackstone: it has grown its size nearly four-fold since its 2007 IPO. "But the biggest private equity firm on Wall Street has seen even greater growth in its real estate division, which has expanded from a $17.7 billion business when Steve Schwarzman took his company public to one that today manages nearly $100 billion worth of property." If that is correct it could very well be the largest private owner of real estate in the world.

And while we're discussing growth, The Mortgage Collaborative, an independent mortgage lending cooperative, announced the formal approval of 10 new preferred vendor partners to its national network. Rich Swerbinsky, EVP of National Sales & Strategic Alliances, sent over a list of the new "partners": AcuClix Social Media Compliance, Advantage Credit, American Mortgage Law Group, Credit Plus, DataTree by First American, Docutech, Icon Advisory Group, Richey May, The Rule Tool, and Spiegel Accountancy.

And in political chatter, the House of Representatives passed a QM-related bill. The "Portfolio Lending and Mortgage Access Act" would broaden the definition of qualified mortgages - those that qualify for the safe harbor - to include all mortgages held on a lender's balance sheet. Most, however, believe that even if it makes it to the President's desk it will be vetoed.

Pro Teck Valuation Services announced that its appraisal management services (AMC) are now available through Ellie Mae's Encompass all-in-one mortgage management solution. The seamless integration allows lenders to order Pro Teck's appraisal products directly through Encompass to drive quality and efficiency in the loan origination process.