"Rob, I just heard of a major lender offering an internal incentive for originating FHA streamline refinances. The bonus is 100 bps on top of their normal commission. This sounds highly unusual and will directly relate in greedy loan reps steering clients back to FHA loans where they may benefit from conventional financing that they may be eligible for based on the clients improved credit history and equity position. Have you heard of such a thing?" Yes I have - kind of - but mostly related to rate sheet pricing. I am hearing stories of lenders pricing 2-3 points higher than everyone else the mad scramble for this product. Seasoned folks know that it will calm back down, but in the meantime there is plenty of grief for anyone setting rates.

You're not alone if you're still slightly confused about Fannie's Collateral Underwriter. On January 26, 2015, Fannie Mae began the phased rollout of the new Collateral Underwriter (CU) as part of the Uniform Collateral Data Portal (UCDP). This change will impact Seller's internal policies and procedures when an Underwriter reviews the UCDP and CU results during their collateral underwriting process. As a pilot lender, CMG found the CU messaging saved time on a large percentage of loans because the appraisal had no significant issues. For the small number identified as having elevated risk, extra effort during the collateral underwriting process reduced or resolved the risk. To help clarify CMG's requirements, CMG will host a webinar on Friday, January 30th at Noon (PST) Register today!

And there is more training ahead. Everyone is gearing up for the new Loan Estimate and Closing disclosures coming this August, along with the 1,888 pages of regulations that accompany them! Join New Mexico Mortgage Lenders Association (NMMLA) luncheon, February 12th, to learn about RESPA/TILA Reform and the New Combined Disclosures. Guest Speakers include the Mortgage Action Alliance Chairwoman, Amy Swaney, CMB and MBA's Nevada Ambassador. Click the link to register.

The St. Louis Association of Realtors TILA-RESPA Integrated Disclosures Seminar is scheduled for Thursday, February 5th, 2015. This seminar includes an 8:30am - 9:00am networking with breakfast from 9:00am - 10:30am. Register today.

And OwnOK is a special event is brought to you by the partnership of the Oklahoma Mortgage Bankers Association, Oklahoma State Home Builders Association, the Oklahoma Association of REALTORS® and Oklahoma Land Title Association. "By attending, you'll be provided an insider's scoop on relevant content that affects the entire real estate industry, a great opportunity to network with other related industry professionals, and an opportunity to help coordinate efforts to affect policy." If you are interested in attending this OwnOK event, register here.

In the last few weeks I have visited Florida, Oregon, Colorado, Southern California (its own state), and Arizona. Next week is Texas and Florida. There is a lot of optimism out there! So let's take a look at some of the surveys and metrics to see what is going on with land values, rent, builders, and the like.

Going back a couple months, remember that November's pending home sales improved from October levels and the National Association of Realtors (NAR) said the growth was felt in almost every region in the U.S., excluding the Midwest. The NAR's November Pending Home Sales Index (PHSI) was up 0.8 percent from October's slight downgrade of 104 to 104.8, but that was a 4.1 percent gain from PHSI of 100.7 in November of 2013, which was the largest improvement since August 2013. NAR states that signed contracts have not broken out of their more or less stable performance even though the economy has improved, but the high rent prices, low rates and moderating price growth should engage more first-time homebuyers in the market.  Falling gas prices should also allow more buyers to save for a down payment, as the 2014 median down payment for first-time buyers was 6% compared to 13% for repeat buyers. NAR is predicting that total existing home sales will finish December 2014 at 4.94 million units, down from 5.09 million in 2013, but sales in 2015 should rise to 5.30 million. The PHSI in the Northeast rose 1.4 percent to 89.1 in November and in the Midwest the index decreased 0.4 percent to 100. Pending home sales in the South rose 1.3 percent to 119.7 and increased 0.4 percent in the West to 98.5.

To have even more skin in the game, Quicken Loans developed two new indices, the Home Value Index (HVI) and the Home Price Perception Index (HPPI). The HVI is representative of home value trends based on appraisal data and the HPPI is the estimated gap between the value provided by homeowners and the value appraisers give to the property. Recent research by Quicken Loans, utilizing their new indexes, indicates that the difference in home value opinions is narrowing between appraisers and homeowners. The HPPI shows that appraisers' opinion of home values in November of last year was only 1.56 percent higher than homeowners' opinion. Although, three-quarters of the urban areas Quicken Loans examined had appraiser opinions higher than homeowner estimates, the difference in value varied. For example in San Jose, California, appraisers valued homes 6.0 percent greater than homeowners compared to Kansas City, Missouri, where appraisers values were 2.53 percent lower than homeowners'. Apart from the HPPI, The HVI showed that home values increased 0.27 percent in November of 2014 according to the national composite. This slight increase did not include the metro areas of Tampa, Phoenix and Minneapolis, where home values dropped between 6.0-7.0 percent. The largest growth in home value was evident in Boston, Massachusetts with an increase of 3.88 percent in November.

And for more good news, the National Reverse Mortgage Lenders Association/ Risk Span Reverse Mortgage Market Index (RMMI) grew for the tenth straight quarter. The RMMI, a quarterly report which evaluates trends in home values, home equity and mortgaged debt of homeowners, aged 62 or older has reached its highest level since Q3 of 2007 at 183.87, a 2.5% increase from Q2 of 2013. The index indicates that Americans 62 years old and older now have more equity in their homes than any time since 2007 and senior home values have grown by more than $97 billion in Q3, whereas collective home equity continues to increase, reaching a total of $3.84 trillion. Currently, Americans in this age group hold $1.08 trillion in mortgage debt an amount that has remained steady since 2012.

Zelman and Associates reported a strong homebuilding survey at the end of 2014, as the homebuilding survey increased to 58.4 from 58.2 in November, the first increase seen in four months. December orders only declined 1% sequentially, compared to the representative 6% decline. About 32% of survey respondents reported stronger-than-expected traffic in December, and website traffic grew 19% YoY. Prices have grown 3.8% YoY. Pricing is forecasted to grow by 4.2% in the next year and YoY order growth increased to 26% from 17% in November. For more information on Zelman and Associates contact Ivy Zelman.

According to Clear Capital, the Midwest is to lead the recovery in 2015.The Home Data Index (HDI) Market Report through December 2014, predicts that low tier homes should grow around 3%. The December data indicates that these low tier homes, selling under $95,000 saw a gain of 10.4% nationally, but may decline in growth in 2015. Conversely, the low tier of the Midwest may see a growth of 7% and the price growth in this region could outpace the nation on all tiers by 1.6%. Most cities forecasted for price growth reside in the Midwest, such as Columbus, Dayton, Cleveland and Cincinnati. In 2014, the West realized a home price growth of 8.7%, whereas the Midwest experienced a growth of 7.7%, and the South and Northeast regions ended the year with a price growth of 6% and 2.9%, respectively. Clear Capitol predicts that in 2015, the housing market will regress back to normal growth rates and newly ignited consumer confidence could have a positive impact on a previously distressed market in the Midwest.

Looking at the markets, fortunately the volatility we're seeing in rates is toward the downside, and most lenders changed their prices for the better Wednesday afternoon - especially after the FOMC minutes were released (which provided little of note) and the 10-yr closed at 1.72%. Agency MBS prices did not fare as well as Treasury securities however, due to the perceived prepayment risk on the higher rates. The pricing engines are putting many current coupon 30-year mortgages into 2.50% passthrough securities. But they aren't liquid - yet - so expect some volatility as investors figure out where they should trade. Adam Quinones from ThomsonReuters reports that we've "Only seen one FNCL 2.5 pool issued this year (by USAA) and there's only about $11bn total RPB outstanding - tough to make a market when one dealer or the Fed could potentially own every bond."

Today is a new day, and we have Thursday's usual Initial Jobless Claims (a big drop of -43k down to 265k from 308k - the lowest since 2000). Want to know what impacts the employment picture? Headlines like, "Baker Hughes to axe 7,000 jobs: US oil services group warns over the fall in drilling in its home market" sure do. Later on tap is the Pending Home Sales number - expected to have crept up somewhat. At first blush the 10-year T-note is sitting around 1.76%, with agency MBS prices worse about .125, after closing at 1.72%.


Jobs and Announcements

Crystal Lake, Illinois-based Home State Bank welcomes industry veteran Howard Ackerman as its mortgage group Senior Vice President. "Howard's extensive mortgage experience and contacts are integral to Home State's strategic growth plans." Home State is recruiting Sales Managers and MLOs in McHenry, Lake and Cook County, operating from bank branches, real estate offices and a mortgage sales office in Schaumburg, IL. MLOs will have immediate opportunities to work an established MSA relationship throughout the Northwest Suburbs. Home State is also seeking experienced MLOs for two mortgage sales offices in Southeast Wisconsin. Please contact Howard Ackerman with confidential inquiries.

To the south, 360 Mortgage is currently recruiting for both underwriters and an underwriting manager position with relocation to Austin, Texas. 360 services retail, wholesale and delegated correspondent business channels with the majority of business stemming from third party originations.  While the rest of the industry's production declined 36% from 2013 to 2014, 360 grew production by more than 18%.  In fact, 2014 was the highest producing year on record for 360.  Additionally, the company has not downsized a single operations position in over 3 years.  As the industry leader in technology and service, the company continues to innovate without having to risk balance sheet.  While many competitors choose to dabble in the risky subprime, alt-A and stated income loan types which cratered the industry - 360 does not.  Join the industry leading team today by sending your resume to resumes@360mtg. com.

A client of Menlo Company, a leading M&A and production growth management firm, is expanding its Retail Lending Footprint. "Its model organizes regional lending centers, built on and around your team, to provide a unique and highly service oriented offering of mortgage services to consumers in your market. Therefore, if your company and/or production team is looking to be acquired (or transitioned) to lead the expansion in your market, give me a call to discuss further. The main requirements include a focus on retail lending." E-mail Rick Roque with inquiries or call his cell: 408-914-5895.

A couple congratulatory notes are due. First, hats off to marathon runner Jay Hughes who is now in Milwaukee to head up National Sales for MGIC (Cheryl Webb is retiring at the end of the month). And Statebridge Company, LLC, a leader in residential mortgage special servicing, announced that it has hired Brad Young as its Director of Business Development. Mr. Young will be responsible for implementing the business development strategy for the continued growth of the company.