Making headlines is United Wholesale averaging $15 billion a month in production and earning total net income of $3.4 billion for 2020, quite a change from the $415 million of net income in 2019. And over time, we change. In your 20s: “I fell asleep backwards on a coffee table last night and woke up just in time to run a 5k.” In your 30s: “I bought the wrong pillow. Put me in hospice.” Even Matt Damon changes: he’s selling his house in Southern California for a move to New York. (Schedule a tour of 1401 San Remo Dr. if you like.) Some argue that government never changes, but many argue that it does indeed. With all the headlines about the inner workings of government, many wonder how we are actually being governed as a nation. (Thank you to Len T. reminding me of that clip.)
Lender and Broker Products and Services
Rocket Mortgage is making some incredible moves lately that are focused solely on benefiting the broker community. The company has been releasing hilarious teasers for a Super Bowl campaign starring SNL alum Tracy Morgan all week long. While an ad during the big game isn’t new Rocket Mortgage, they are really shaking things up this time around. It announced it will air TWO Super Bowl ads – with one amplifying the importance of local mortgage brokers. On top of that, the launch of a national mortgage broker directory on RocketMortgage.com was another groundbreaking move they recently announced. Rocket Mortgage is making it clear that no matter how consumers see the brand, it can lead the client to a broker. Watch the Super Bowl this Sunday on CBS (and play close attention during the third quarter) to see brokers highlighted on a massive stage like never before.
The fifth annual "State of the Default Servicing Industry” Survey Report was just published by Altisource®, an integrated service provider for the real estate and mortgage industries. Get an in-depth look at how companies are adapting to the changing default servicing market, from COVID-19 and vendor performance to portfolio management and technology. This report highlights the results and analysis of a survey to 200 professionals in the U.S. default servicing industry. The insights it provides can help you optimize your operational and marketing strategies for 2021. Read the report here.
ReadyPrice founder Rick Soukoulis has been disrupting the mortgage industry with tech innovations since the early 90’s, and he is at it again with the ReadyPrice, a platform creating a virtual lending community between broker and lenders in the wholesale channel. “ReadyPrice will change the way MLOs and Lenders work together forever!” explains Rick in his recent interview titled, “The Next LO Technology Set to Disrupt the Mortgage Industry.” Click to access the interview with Rick and find out if ReadyPrice is something that might fit your business needs today and in the future.
Market instability has led lenders to shrink their credit boxes, leaving many deserving consumers behind. But there’s more to calculating risk than credit scores alone. Insight into consumers’ cash flows and ability to pay (ATP) can help lenders identify 680 credit scores that perform like 720s, opening up housing opportunities to a whole new universe of creditworthy consumers. FormFree is leading the charge to financial inclusivity with technology that accurately decodes consumer financial DNA. You can read about how Christy Moss, CMB is helping lenders transform their business with FormFree technologies in her recent interview with Faith Schwartz. Or hear Brent Chandler’s vision for the future in the now on-demand #NEXT21 session.
DACA, URLA, and Tax Form Changes
Mortgage Solutions Financial posted Announcement 23_20C regarding Hurricane Delta.
Effective March 1, 2021, all IVES tax transcript submission requests are required to use the new Form 4506-C including the Qualified and Non-Qualified coversheets.
AmeriHome is encouraging Sellers to provide the new Form 4506-C in the loan file prior to the mandatory March 1, 2021 date to minimize potential reverification impacts with loans selected for QC review.
FHA has opened up eligibility for individuals who are classified under the "Deferred Action for Childhood Arrivals" program (DACA) with U.S. Citizenship and Immigration Services (USCIS) and are legally permitted to work in the United States. All other FHA requirements remain in effect for all potential Borrowers, including those with DACA status. Refer to the Non-US Citizen Borrowers section of loanDepot's FHA Lending guide for details.
In alignment with FHA’s recent announcement, Plaza Home Mortgage® has updated our FHA programs to allow individuals classified under the “Deferred Action for Childhood Arrivals” program (DACA) as eligible applicants.
DACA Status Recipients are permitted to apply for FHA Insured Mortgages effective January 19, 2021 per FHA. View the Mountain West Financial Bulletin 21W-007 for details. Also sent out was MWF’s Wholesale Bulletin 21W-011addressing GSFA Platinum and AzIDA Home+PLUS Permit DACA Status for FHA Financing.
PRMG updates its product profiles to allow DACA borrowers for FHA standard and high balance products, including streamlines. This change is in effect for all loans in process as well as any new loan applications.
REMN Wholesale announced major changes to guidelines for borrowers with Deferred Action for Childhood Arrivals (DACA) status. These changes are effective immediately and apply to new loan submissions as well as pipeline loans.
Flagstar Bank’s FHA Underwriting Guidelines will be updated removing the Immigration Status listed under the Process and Procedures Section based on FHA’s change to DACA program.
Yes, a new application is there. Arch MI, for example, offers a class titled, “Loan Processing Using the Redesigned URLA/Form 1003: Making the Loan Application Process Easier.”
First American Docutech issued a reminder regarding Revised Version of the URLA
On March 1, 2021, USDA’s New GUS goes live. Lender final submissions received by USDA via Legacy GUS by 11:59pm ET on February 12, 2021 will be considered for Conditional Commitment prior to the February 26, 2021 closure of Legacy GUS. Loans submitted after February 12, 2021 are unlikely to be reviewed. Complete and detailed guidance of the Legacy GUS to New GUS transition can be found under the “New URLA Guaranteed Underwriting System (GUS)” tab in the LINC Library Training and Resources section. Existing applications in Legacy GUS that have not received a Conditional Commitment will require the application to be reentered into New GUS for consideration by USDA.
The secondary mortgage market marketplace can be a confusing place, comprised of banks, investors, and financial institutions that trade mortgages, servicing rights and mortgage-backed securities. It has a direct impact on the mortgage a borrower qualifies for and the rate they pay. After a lender funds a homebuyer’s loan, or refinance, it could keep the loan on its books for the loan’s term, but the lender often doesn’t hold the loan, instead selling the loan into the secondary mortgage market. This enables the lender to use their limited capital efficiently and generating fees to cover overhead and add to reserves. Selling the mortgage allows the lender to use the capital again to fund a new loan.
Many loans are sold to the government-sponsored enterprises Fannie Mae and Freddie Mac or other aggregators (including mortgage originators themselves), which can earn fees from repackaging the loans as MBS that appeal to specified investor needs, or hold them on their own books and collect the interest from borrowers. Servicing rights (the right to collect the monthly principal and interest payment) may or may not be retained, which can be a lucrative stream of fees. The servicer receives a fee for processing the monthly payment, tracking the loan balance, generating tax forms, and managing escrow accounts, among other functions.
To be sold to the agencies, the loan must be “conforming”: the loan must meet certain standards set by the agencies including a maximum loan amount and debt to income ratio, and a minimum down payment percentage and credit score. The demand for conforming loans helps push down the mortgage rates for borrowers who can meet the standards. Even amongst conforming loans, mortgages can be sliced into tranches with varying degrees of safety (the safer the bond, the lower its yield). Investors looking for a higher interest payment can buy mortgages or mortgage-backed securities perceived to be riskier. Investors looking for other traits (e.g. based on risk or timing of cash flows) can find other MBS bonds to meet their specific needs. Investors have appetite for exposure to specific kinds of securities that better meet their needs and risk tolerance, and that fuels demand in the space. To put it succinctly, the secondary market exists to create more efficiency and better meet the needs of the players in the space, driving a lot of the behavior in the primary market.
Yesterday’s bond market action, which determines rates for borrowers, saw Treasuries pull back in curve steepening fashion yet again and the MBS basis close tighter (which is a good thing for mortgage prices) after hefty Fed support. In fact it was the largest Fed support since the Federal Open Market Committee adopted the current policy of reinvestments consisting of paydowns plus a $40 billion per month increase. Economic data on the day was led off by the better-than-expected ADP Employment Report for January showing a net job gain of +174k on heels of a -78k net decline in December. The U.S. Treasury announced that $126 billion worth of notes and bonds will be sold next week.
Today’s economic calendar began with the latest BoE decision and markets are reacting to discussion about the use of negative rates, though no implementation anytime soon. Domestically, January Challenger job cuts (nearly 80k, up slightly from December), initial jobless claims (-33k to 779k, better than anticipated), continued claims (4.6 million), Q4 productivity (-4.8 percent) and unit labor costs (+6.8 percent). Later this morning brings December factory orders and Freddie Mac’s Primary Mortgage Market Survey for the week ending February 4. Two Fed presidents are currently scheduled to speak: Dallas’ Kaplan and San Francisco’s Daly. The Desk of the NY Fed will conduct three MBS purchase operations, one in each class. We begin the day with the 5-year T-Note and Agency MBS prices worse/down a few ticks from Wednesday night and the 10-year yielding 1.15 percent (the highest since last March!).
A well-capitalized bank in the greater New Orleans area is looking for an experienced Lock Desk Manager to complement its Capital Markets team. Candidate should have Secondary Marketing experience in a fast-paced environment. Interested parties should send their confidential resume to Chrisman LLC’s Anjelica Nixt for forwarding.
Black Knight continues to experience significant growth as more lenders select Black Knight’s innovative technologies to service their loans. As a result, the company is seeking knowledgeable, qualified mortgage professionals to join the team. Black Knight is adding an experienced Account Director, a Sales Support Engineer and an Investor, Cash and Corporate Accounting Business Consultant to its mortgage servicing business. The Account Director is responsible for all aspects of client account management, along with expanding the relationship and generating revenue for the company based on the account. The Sales Support Engineer will assist the company’s default and loan administration products, by providing demonstrations and technical support for its sales team. The Investor, Cash and Corporate Accounting Consultant is responsible for helping clients with conversion, training and consulting activities for the company’s MSP system. While the company is headquartered in Jacksonville, Fla., these positions are remote. To learn more, contact Megan Goulette.
In 2021, Citi will continue to focus on its multi-year mortgage growth strategy, and the Citi Correspondent team is looking for highly qualified individuals to be a part of the next chapter to their 200+ year history. Citi is currently hiring underwriter and reviewer positions to join its exceptional work from home team, offering an inclusive, employee focused culture that inspires personal growth and rewards innovation. The 2021 Correspondent roadmap at Citi includes new products and programs supported by technology designed to make loan delivery simple and efficient for lenders, thereby creating a best-in-class environment for employees. Be sure check out these telecommuter positions to support Citi’s growth initiatives: Underwriter 3, Sr. Underwriter 4 , Associate Credit Analyst 1, and Quality Review Specialist 4.
Caliber Home Loans CEO Sanjiv Das was a featured panelist for “The State of the Mortgage Industry: Building a Sustainable Operating Model for 2021 and Beyond” virtual webinar. During the discussion, Das focused on different challenges lenders faced in 2020 and steps Caliber is taking to prepare for a post-pandemic future. While historically low interest rates caused a giant wave of refinancing, Caliber experienced a massive surge in purchase volume as well. “Applying technology, automation and machine learning will be critical to propelling Caliber ahead in a post-COVID lending market. For example, our continuous improvement strategy includes refining data collection to enable more automated decisions and machine learning will streamline inefficiencies. Caliber never stops being at the forefront of cutting-edge technology. Visit our website today to learn more about open opportunities. To be immediately considered for Operations or Sales positions, email Jonathan Stanley or Brian Miller, respectively.”
AmeriHome Mortgage was recently named a Top Workplaces USA 2021 Winner! What makes AmeriHome a Top Workplace? One employee had this to say, "I can say with confidence that at AmeriHome, the leadership and overall culture is the best I have experienced, hands down.” The great news is that this top workplace is hiring for several positions in Southern California, Texas, and remote! AmeriHome’s Correspondent Division is hiring for several positions, including AVP, Conditions Manager, FVP, Correspondent Operations, Compliance Specialist, Non-Del Account Manager, Transaction Manager, and an Operations Account Representative. AmeriHome’s Consumer Direct division is looking for Sr. Underwriters, VP, Loan Processors, Sales Managers, and more! AmeriHome prides itself on creating an environment that fosters growth from within. To join one of the Top Workplaces in the country, visit their careers page to view all open positions, and submit resumes to schedule an interview.