Before heading to Wisconsin for a few days, over the weekend I called The Bellagio to find out the betting lines on the PATH Act, Johnson-Crapo, Corker-Warner, and now Maxine Waters' lender co-op bill. They were all too busy watching basketball games to bother, but the odds against reconciling the proposals on Fannie & Freddie's fate in an election year are not to be underestimated. (One person wrote to me Friday, calling the players a "hodge-podge of politicians, most of whom know little about the lending business or the function of Fannie or Freddie, trying to make a name of themselves with their constituents.") Ms. Waters' bill's nuances can be found here.
One thing we know for sure is that some companies are continuing to hire. Cole Taylor Mortgage (CTM) continues to actively expand retail branches and wholesale lending relationships throughout the U.S. CTM is a division of Cole Taylor Bank, a Chicago-based bank founded in 1929, that originates residential loans in 44 states plus Washington, D.C. In retail, CTM provides centralized IT and accounting support, dedicated retail operations, training, and marketing services at no cost to the branch. CTM is specifically looking to grow retail branches in the Texas triangle and Southern California markets. Interested branch managers and loan officers in any market should contact Mike O'Brien at mobrien@ctmtg. com. Or, if you're looking for a wholesale lending opportunity, click here to find a local Area Manager and get started. Cole Taylor Mortgage is an Equal Housing Lender and Member FDIC, NMLS#493677.
And on April 3 Carrington Mortgage Services is hosting another career webinar. "Join Carrington Mortgage Services and Ray Brousseau, EVP Mortgage Lending for a Career Webinar with Carrington Mortgage Services. Discover the opportunities for loan officers, managers, and branches." By the way, Carrington just announced new loan products down to 550. "Great compensation, benefits and a wide variety of programs that can help you take your performance and sales to the next level." There are morning and afternoon sessions on Thursday.
Flood insurance legislation has been in the news, and now the FBI is investigating flood maps. Darren M. contributes, "Interesting recent research into FEMA flood map changes." Thanks Darren!
There has been a lot of appraisal news in recent weeks, the most important perhaps being that six government agencies issued a proposed rule that would implement minimum requirements for state registration and supervision of appraisal management companies (AMCs). Just so we're clear, an AMC is an entity that serves as an intermediary between appraisers and lenders and provides appraisal management services. In accordance with section 1124 of Title XI of the Financial Institution Reform, Recovery, and Enforcement Act of 1989, as added by section 1473 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the minimum requirements in the proposed rule would apply to states that elect to establish an appraiser certifying and licensing agency with the authority to register and supervise AMCs.
The proposed rule would not compel a state to establish an AMC registration and supervision program, and there is no penalty imposed on a state that does not establish a regulatory structure for AMCs. However, an AMC is barred by Section 1124 from providing appraisal management services for federally related transactions in a state that has not established such a regulatory structure. Under the proposed rule, participating states would require that an AMC register in the state and be subject to its supervision, use only state-certified or licensed appraisers for federally related transactions, such as real estate-related financial transactions overseen by a federal financial institution regulatory agency that require appraiser services, require that appraisals comply with the Uniform Standards of Professional Appraisal Practice, and so on - over a dozen more requirements.
The proposed rule would provide participating states 36 months after its effective date to implement the minimum requirements. It certainly has some heavy-weight backers: the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation (FDIC), the Consumer Financial Protection Bureau (CFPB), the Federal Housing Finance Agency (FHFA), and the National Credit Union Administration (NCUA). The public will have 60 days to review and comment on the proposal. Publication of the proposal in the Federal Register is expected shortly.
Mike Ousley with Direct Valuation Solutions writes, "In the original Dodd-Frank Act there were provisions that generally followed the new proposed rule for participating states to register AMCs, however, it was generally perceived that the states had 36 months to establish a supervision program that would comply with Dodd-Frank. What's interesting about this proposed rule is the following: 'The proposed rule would not compel a state to establish an AMC registration and supervision program, and there is no penalty imposed on a state that does not establish a regulatory structure for AMCs. However, an AMC is barred by section 1124 from providing appraisal management services for federally related transactions in a state that has not established such a regulatory structure.' One could theorize that certain state appraisal regulatory agencies, many that are run by independent appraisers upset that AMCs even exist, would push to have their state opt out of AMC regulation and supervision, thus barring AMCs from all federally related transactions within their state. Lenders active in those states that had relied upon AMCs to manage the appraisal assignment and management process would then be forced to either establish an affiliate AMC and deal with the CFPB rules on affiliate charges as related to qualified mortgages and the 3% points and fees calculation, or contract directly with appraisers within those states by utilizing a platform such as Direct Valuation Solutions to assign, track and deliver appraisals for federally related transactions. The AMCs that fought the original registration and supervision by states may now be forced to actually embrace and push for more state level oversight of their activities in order to not get left out entirely."
Mike Simmons with Axis Appraisal Management wrote, "Kudos for noting one of the standout provisions that allows states, without penalty, to opt out of establishing an AMC registration and supervision program. What's noteworthy is that while those states that elect that path won't be penalized, their citizenry will. Since AMC's will be proscribed under Section 1124 from providing management services, borrowers will either be limited in their choices of loans and lenders, or face increase costs from having a shorter list of lenders invest in building and managing their own panels in what will be a small number of states. Since there are 38 states that currently have AMC laws, perhaps this an elliptical way for the rule to encourage 100% participation? Given the fact that states benefit financially from the fees levied on AMC's for maintaining such oversight, and that they can and often do impose higher standards versus the new federal rule, we'd be surprised at less than full participation. For those of us who truly embody service in this era of increased regulation, the contribution we add to lenders, appraisers, consumers and their communities is both significant and valuable."
Hey, what company would rather do 4 loans for $200k each or 1 loan for $800k? It is easy to make the argument that doing one loan for the same amount as the others combined requires less time and cost, and limits the odds of future problems. That debate aside, independent mortgage LOs continuing to "complain" about the rates offered by banks like Wells Fargo on their jumbo loans - but hey, if I am a bank, I'd rather only service one $800k loan than four $200k loans with lower rates. And research staffs are cutting their estimates of the total jumbo biz for 2014, which is really too bad for the scores of hedge funds and money managers investing money into thinking they're going to be next coolest thing in jumbo loans. "Demand from banks for jumbo loans prompted JPMorgan Chase & Co. analysts this month to lower their forecast for 2014 issuance of non-agency, or private label, securities to $5 billion to $10 billion, from about $20 billion." And just to bring you up to date, Redwood Trust issued a new MBS for $342 million.
Let's take a look at some upcoming events, promotions, and training modules that might be of interest.
First, the Colorado Mortgage Lenders Rocky Mountain Expo is coming up in a couple weeks - here's the link to the event home page.
Michigan's Northpointe Bank announced that Wendy Minter has joined the bank as Director of Correspondent Lending. Wendy has over 20 years of Mortgage Banking experience in both correspondent and wholesale lending and will be expanding Northpointe Bank's correspondent customer base nationwide (it is already buying loans in 45 states). To learn more about Northpointe Bank's correspondent program, contact Wendy at wendy.minter@northpointe. com.
For IT and compliance folks, on April 8th Byte Software will be hosting an in-depth webinar exploring the differences between BytePro Standard, BytePro Enterprise and BytePro Online. BytePro Enterprise employs Microsoft SQL Server to satisfy the security, compliance, scalability and flexibility requirements of larger organizations. This webinar will outline the functionality and advantages that each system offers, including features such as the enhanced visibility of your compliance process and a comprehensive audit trails to track changes.
Secure Settlements, Inc., a data intelligence and risk analytics company for the mortgage industry, announced that the Honorable Kenneth Donohue, former Department of Housing and Urban Development (HUD) Inspector General, has joined its Industry Leader Advisory Board. Secure Settlements, Inc. is "the first company to offer a standardized risk management process and information database of fully risk-assessed mortgage closing professionals that protects both consumers and lenders, reducing fraud and ensuring that federal regulatory requirements are met. The SSI process delivers the most advanced closing fraud risk analysis in the industry and helps lenders meet the risk management expectations for third-party risk assessment of vendor relationships, as outlined by CFPB, OCC, HUD, FDIC, Fannie Mae, Freddie Mac and the National Credit Union Administration."
First Look Appraisals, a leading national appraisal management company, announced the completion of a software integration that gives all users of Ellie Mae's Encompass mortgage management solution the ability to order appraisals directly from their software. "The integration eliminates common delays and data entry errors, and provides loan originators with the highest level of dedicated service while keeping them informed during every step of the critical appraisal process. With First Look's solution, loan originators don't need to rekey any data from the loan file, so data entry mistakes that typically cause delays in the appraisal process are eliminated."
Here we are, on the last day of the first quarter, staring at a new week of economic news - and who knows what might happen overseas! Today is the Chicago Purchasing Manager's Survey, tomorrow is the ISM Manufacturing Index (from purchasing managers of 300 manufacturing firms about general trends) and Construction Spending, Wednesday are the ADP employment numbers (always of questionable predictive ability for Friday's employment data) and Factory Orders. Thursday we'll find have Initial Jobless Claims and some trade balance figures. On Friday, April 4th, we'll have the usual series of employment data, arguably the most important U.S. data of the month. For numbers in the early going, the 10-yr closed Friday at a yield of 2.71% but this morning is up to 2.75% and agency MBS prices are worse about .125.
Instead of some humor today, let's swing the other way. Besides a lot of us driving, many of us have kids either driving or riding their bikes on the roads. Late last week The National Safety Council released its latest injury and fatality statistics. Did you know that over 25% of car accidents are linked back to cell phone usage? Here you go.