Not only are origination staff asking for refreshed marketing efforts as volumes show a tinge of falling off, but how about this note that I received from a CEO of a large lender in the Northeast? “Rob, what are you hearing about signing bonuses out there? Is it just my staff that is receiving unsolicited emails, or everyone out there?” Hah! Join the crowd: signing and retention bonuses have again become rampant. Through the wonders of the internet, and what is self-reported to news outlets that I won’t mention, your LOs’ production numbers are fair game. If you think that a lender is going to make 100 basis points on each loan, it doesn’t take a math whiz to take production, multiply it by a point, and figure the net present value over the period of time that the LO is “hand-cuffed” to the company, which in some cases can be more than a year with a claw-back. And it just isn’t LOs: experienced processors and underwriters and other Ops team members are being bid up. Meanwhile, leaders of lenders and vendors have truly risen to the task of educating their staff, and not over-sensationalizing. They’re keeping track of the pace of change, which continues to be rapid, and are good at relaying that information to employees. They’re good at communication, clarity, conviction, and reminding their staff to focus on what they can control versus what they can’t. Your employees appreciate it!
Lender Services and Products
Effectively manage increased forbearance requests and loan modification volumes from COVID-19 impacted borrowers. If your business is facing an influx of home loan forbearance requests, read this insightful article by George FitzGerald, Black Knight’s EVP of Servicing Technologies. Gain insight into the right technology and common practices servicers can use to help keep up with forbearance volumes and increase flexibility to support loan modifications for loans impacted by COVID-19 and any future crisis situation.
BETTER Direct Mail Marketing for Mortgage Lenders from Monster Lead Group: “We’re able to grow and scale operations because of the predictability of Monster’s campaigns. It's a real marketing system. It's not just sending mail.” (Brad Bennett, Caliver Beach Mortgage.) “It's been your consistency; it's been unbelievably consistent. It's really like clockwork… We're able to grow and scale because of the predictability of the Monster campaigns.” (Steven Sless and Andrew Parker, PRMI Reverse Mortgage Division.) “Somebody can charge me half as much as you guys do, but I can’t get beyond the level of your results. For me, service means a hell of a lot and the results speak for themselves.” (John Kresevic, JFQ Lending.) "We've basically stopped doing all other marketing and gone 100% with Monster." (Manny Fajardo, Premier Lending Corp.) Monster Lead Group: better than whoever you’re using. See how here.
Still reeling from the crazy demand for refis? For lenders handling appraisals internally, if your team has been run ragged by the sheer volume of business so far in 2020, what are you going to change to ensure this doesn’t happen again? For one thing, you could consider outsourcing appraisals to an AMC. We know, we know - there are AMCs out there that don’t provide the service you deserve, that don’t turn around appraisals quickly enough, that don’t communicate well. But not all AMCs are like that, and many lenders are enjoying all the benefits of outsourcing without any of the drawbacks. Read four compelling reasons to consider outsourcing appraisals here. This resource, as well as other resources about managing appraisals during this challenging time, are provided by Triserv, a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service. Contact Triserv at firstname.lastname@example.org.
Are you struggling to create great content to fuel ongoing email campaigns that will actually get opened and read? Or are your email campaigns lacking the punch necessary to engage your target audiences and cause them to take action? Seroka’s branding and marketing experts know how to create and execute custom, branded email campaigns that generate impressive open and click through rates for use with your automation platform. And, with its vast mortgage industry experience and deep bench, Seroka will hit the ground running for you. So, if your email strategy needs compelling content and overall improvement, contact Seroka today!
Innovation, typically done at the Agencies, has gone onto the back burner as pilot programs have been quiet for the last several months. Most lenders reap benefits from Freddie and Fannie competing against one another resulting in better pricing, innovation, risk management tools, responsible underwriting, and products. For people in the government to want to remove the government from housing and housing finance, many believe, is short-sighted. Director Calabria has made clear the intention to scale back their footprint through pricing or guidelines.
Would you buy stock in Freddie Mac or Fannie Mae if either/both have an initial public offering (IPO)? The current Administration is certainly heading toward removing them from conservatorship. But regarding investing money in them, I received this note from a grizzled vet which summed up many other notes I’ve received on the topic. “I’m not against F&F building their own capital base organically. I’m just not ‘for’ an IPO without all the details worked out and in place to ensure F&F do not get into the primary mortgage market any further than they already have. The Treasury’s own plan for FM is far from realization and if one culls out those tasks in the plan that Congress must address all that is left are those tasks that the Administration can impact. And if IPOs are launched with only the Administration initiatives in place, I’m not sure what unshackled Fannie & Freddie will look like.”
Let’s see what the Agencies have been up to in recent months to help see the development of polices and procedures as the industry follows their guidance. As always, contact your rep with questions.
Both have COVID response pages worth a gander: Fannie Mae and Freddie Mac. And the list of updates for Fannie Mae and Freddie Mac are available.
Fannie Mae issued a Selling Notice announcing that the 2020 HomeReady income limits will be implemented in Desktop Underwriter (DU) on June 20th. Income limits will increase by 4.4% on average. Approximately 87% of the counties will experience increases, with 27% seeing an increase of over 5%.
Fannie Mae’s SL 2020-03 provides updates regarding changes to lease review requirements, provides additional flexibility to lenders to choose the late charge amount identified in the note, clarifies project standards policies on horizontal property regimes and environmental hazard assessments, clarifies HomeStyle Energy debt pay-off policies, and other miscellaneous updates.
In response to the COVID-19 national emergency, Fannie Mae and Freddie Mac have provided temporary guidance to lenders on several policy areas to support mortgage originations, appraisals, and quality control (QC). These FAQs provide additional information on the temporary policies.
Freddie Mac’s Single-Family Seller/Servicer Guide (Guide) Bulletin 2020-8 announced additional selling flexibilities as well as some new temporary requirements to support your underwriting and closing activities when making credit decisions as the COVID-19 situation continues to evolve.
Fannie Mae updated Lender Letter LL-2020-03, adding temporary requirements on these loan origination policies: age of documentation; verification of self-employment; market-based assets; powers of attorney; remote online notarization; and lender quality control requirements. Additionally, Fannie Mae updated Lender Letter LL-2020-04 with additional temporary guidance on appraisal requirements, including flexibilities for new construction loans and Homestyle® Renovation loans
Fannie Mae has updated three Lender letters. LL-2020-03, Impact of COVID-19 on Originations outlining additional requirements for borrowers using self-employment income to qualify for loans. Two Payment Deferral letters were also updated. LL-2020-05 provides operational requirements related to reporting and completing a payment deferral and the process for obtaining servicer reimbursement for expenses upon the successful execution of a payment deferral. LL-2020-07 is specific to a COVID-19 payment deferral
U.S. Treasuries rallied yesterday, largely in response to equities dropping amid concerns the recent rebound is overdone. Risk sentiment was always likely to turn a bit more cautious ahead of today’s Fed events. Additionally, the day's $29 billion 10-year Treasury note reopening was met with weak demand and the 10-year yield closed the day -6 bps to 0.83 percent. As far as economic releases went, the NFIB Small Business Optimism Index increased slightly.
The big economic event today as far as the mortgage market is concerned will be the June FOMC Rate Decision, due out this afternoon. No change is expected to the fed funds rate, but the Fed should shed some light on various lending plans. Officials will also publish their employment and growth targets for the first time since the outbreak amid increasing focus on the racial disparities in joblessness. Along with the release of the statement will be the return of Summary of Economic Projections, which was not released for the March meeting, followed by Chair Powell’s press conference, both of which should provide further thinking regarding the form of forward guidance, along with the how the Fed plans on capping yields and an update on current lending programs.
Ahead of the Fed, the MBA is already out with its Weekly MBA Mortgage Index which showed mortgage applications increased 9.3 percent from one week earlier for the week ending June 5. If anyone cares about inflation, or the lack thereof, we’ve also had May CPI (-.1 percent). The May budget statement will be released in the afternoon. The Desk of the NY Fed will conduct two FedTrade purchase operations today totaling up to $4.47 billion starting with up to $1.5 billion GNII 2.5 percent and 3 percent followed by up to $2.97 billion UMBS30 2 percent through 3 percent. We begin the day with Agency MBS prices a shade higher/better versus Tuesday night and the 10-year yielding .80.
Employment and Transitions
Prime Choice Funding is rapidly expanding across the country and has an immediate opening for an experienced staff member in upper management with experience in both Sales and Operations. This is an opportunity to get in on the ground floor level in a well-established company, based in Southern California, that, because of recent growth, needs support. The company offers competitive compensation, outstanding benefits, and state-of-the-art technology. For more information or to submit your resume, please email Join Team PCF.
Promontory MortgagePath LLC is continuing its dynamic growth and searching for a regional VP of sales. Promontory MortgagePath is on a mission to fundamentally change the way lenders approach their mortgage businesses and is looking for trailblazers craving a growth environment where they can have a real, lasting impact. If you’re a results-driven sales professional with a proven track record selling to the financial services industry, Promontory MortgagePath wants to hear from you. Send your resume/questions to email@example.com.
Mortgage services firm Infinity IPS announced the addition of two industry veterans to its team. Congratulations to Ryan Joseph and Jayson Dammen have joined Infinity as Senior Vice Presidents of Due Diligence Sales. Ryan and Jayson bring a wealth of knowledge and experience to Infinity’s platform. IPS is a mortgage industry leader in providing end-to-end services and solutions, specializing in mortgage credit and compliance due diligence, pre-fund and post-close quality control, and mortgage servicing reviews. Services include valuation, risk management and specialized staffing and advisory assistance for investment banks, commercial banks, mortgage companies, government agencies and mortgage insurers.
Stearns Lending is excited to welcome Allyson Foley, SVP Operations, and Kathi Lauduski, SVP Operations to the Wholesale team. Foley comes to Stearns with 33 years of mortgage experience of which 15 years spent in leadership roles at top financial institutions. Lauduski comes to Stearns with 25+ years of experience as a result-oriented leader in all aspects of wholesale underwriting and mortgage operations. She held leadership positions with well-known residential lenders all with a focus on customer service. Stearns sales & operations have an aligned vision and organizational structure, ensuring a consistent and united team. Both Foley and Lauduski align with the Stearns mission to focus on people and supply a concierge-type experience to Broker and Non-Delegated Correspondent customers. For more information or to inquire about sales and operational positions with Stearns Wholesale Lending, click HERE.
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