Seattle will hit 110 degrees F today. Change is afoot. Last week changes of personnel within the CFPB and the FHFA (hence Fannie & Freddie) captured our industry’s attention since they may lead to eventual changes in their footprint or policies. (But the FHA’s program changes, spelled out below, are worth noting.) For decades stability, liquidity, and transparency have been, more or less, provided by the Agencies. Currently that has become debatable. Lenders know that if products are shifted to private label pricing and execution, borrowers will see a direct price hit. Risk must be aligned to price. For example, every lender knows that plenty of NOO and 2nd home borrowers are of a higher quality, and lower risk, than many owner occupied or primary residence borrowers. Those who can are happy to tuck those loans away in their portfolios. The audio version of today’s commentary, available here, is sponsored by Origence, and features an interview with Susan Hartsock, Senior Director of Strategic Alliances. Susan & Robbie discuss data-based systems versus forms-based systems, and how lenders can act on the data at their fingertips.)
Broker and Lender Products and Services
A New Day: Sunshine. Outdoors. Getting together with friends. All the things that we took for granted, only to have them taken from us during last year’s lockdowns. This year let’s appreciate what we have and go out and enjoy them. Until last year, going to the office was a drag and working from home was a bonus. By now, most of us are thrilled to get out and actually see and interact with live people. At the same time, many lessons were learned as we figured out how to operate our businesses while physically separated from our colleagues and clients. And it’s important to take those lessons with us as we hit the refresh button to our businesses, especially in light of the over- staffing conversations that will be occurring the few months. One of those lessons was the ability to get Trailing Documents retrieved, audited, and delivered to investors with your back-office partner, DocProbe. Reach out to Nick to let that DocProbe sunshine light up your Trailing Doc fulfillment process.
“No one likes VOEs. Determining who to verify with, waiting, re-directions, waiting, third-parties, and did we mention more waiting? Well, verification of employment just got a whole lot easier! Place one cascade request with Partners Credit, and we will cycle through all options automatically, so you don’t have to. The process begins with instant checks of employer and payroll databases via The Work Number and our brand-new offering Experian Verify, giving you 50- 60% employee coverage. Employment information not found? Your request can automatically cascade to our Finicity VOIE. Your borrower receives an email, offers consent for access to their financial account, and income is verified with a review of all direct deposits. IF all else fails, your request will cascade to our team of experts for a fast manual verification. Choose this or any cascade order based on price or preference. To get started now contact Partners!”
Are you looking for a more efficient way to confidently provide your borrowers with competitive mortgage insurance (MI) pricing in one platform? Mortech, a Zillow Group business providing technology solutions for mortgage professionals, recently added private mortgage insurer, Essent, to its growing list of industry-leading providers. With access to live MI pricing options from Arch MI RateStar®, National MI Rate GPS®, and now Essent’s risk-based pricing engine, EssentEDGE®, you will be able to see side-by-side price comparisons on borrower scenarios within Mortech’s pricing engine platform, decreasing LO cycle time while increasing productivity through a more efficient workflow. With an easy setup process, lenders utilizing Mortech’s PPE can take advantage of quoting MI within one platform to quickly expedite a response with competitive pricing options back to the borrower. Contact Mortech Sales via email or phone at 855.298.9327 to begin quoting mortgage insurance premiums with Mortech’s pricing engine platform today.
Haven’t heard of The Loan Store? See why this conventional lender is creating a buzz in the wholesale channel! Along with their 5-Star average Google and Yelp service reviews, TLS continues to offer consistently aggressive pricing across all products, including the newly released 5- and 7-year ARMs! Be sure to add The Loan Store as an eligible lender in Loansifter and price them against the competition. TLS maintains the highest level of customer support by giving all broker partners direct access to their own support team, underwriters, and management. They prioritize purchases and are closing ALL loan types in less than 30 days on average! To be approved as a broker partner with TLS in visit www.theloanstore.com.
Sometimes the industry standard is substandard. LERETA’s tax and flood services go beyond what is considered “industry standard” to get it done right, every time. Whether it is setting up meticulously accurate tax lines or using our ParcelPro technology to identify “ghost parcels”, we take the necessary steps and care that other tax service providers don’t. Our streamlined implementation process onboards portfolios quickly and our experienced associates leverage our advanced technology to identify potential issues before they become problems. Isn’t it time to work with a tax service designed to support diverse business rules and at the same time solve for vendor diversification? Experience the LERETA difference today, contact Jess Johnson for more details.
How many times have you answered the phone only to hear, “Hello, we’ve been trying to reach you about your car’s extended warranty”? Nobody likes spam, and if your loan officers are cold calling, they're spamming. Wouldn’t you rather call customers when you know they’re ready for a loan and credit-qualified? If this sounds too good to be true, you’ll want to join Sales Boomerang’s Alex Kutsishin and Volly’s Jerry Halbrook on July 7 at 1 pm ET as this duo discusses the technologies and strategies that create meaningful borrower interactions. Register today and stop spamming your own customers.
Warehouse Product News
Flagstar Bank began its warehouse banking practice in 1994, on a foundation of best-in-class client service: assigning clients a processor who knows them and their preferences, and who will stop at nothing to make their business successful. Fast-forward 27 years later, and Flagstar has grown to one of largest mortgage financing providers in the nation, with the scale and product lineup clients demand. Plus Flagstar’s MSR, advance and EBO financing, when bundled with its warehouse lines, lets Flagstar offer better pricing on the entire loan package. It’s Flagstar’s Human Interest Rate in action: interest in customers, and interest in warehouse banking solutions that put them first. Contact Jeff Neufeld or Joe Lathrop today to discuss what Flagstar can do for your business.
“What distinguishes a premier warehouse lender from the other choices available in this market? We believe it comes down to diverse product offerings, including a broad array of Agency, Government, and Non-Agency/Non-QM investors; exceptional service; and basic economics. We provide facilities from $20MM to $175MM for small to large mortgage bankers with varying business models. Axos now funds Non-QM loans to approved investors, loan amounts up to $5MM, and Agency and Government loans with no overlays. Our extended funding times to 6:30 p.m. ET and our own Portfolio Non-QM Loans make us an essential partner to help grow your business. Contact Eric Nelepovitz and the Warehouse Lending Team at 888-764-7080 to learn more about all the features of the Axos Warehouse Lending program.”
FHA and Ginnie News
Ginnie Mae’s recent Press Release announced the creation of a new pool type to support the securitization of modified loans with terms up to 40 years.
FHA delayed the effective date for the Servicing and Loss Mitigation Section III, Appendices 4.0 and 5.0 of Handbook 4000.1 until March 31, 2022. Read Mortgagee Letter 2021-14 for details.
FHA issued a reminder that the temporary guidance concerning FHA’s re-verification of employment, and exterior-only appraisal scope of work option policies will expire as intended on June 30, 2021. Recent data reflects low usage, FHA believes the expiration of this guidance will have a minimal impact to the industry.
FHA released Mortgagee Letter (ML) 2021-15 clarifying additional measures to help homeowners with FHA-insured mortgages who are struggling due to COVID-19.
A recent Press Release discusses the recent measures which include FHA’s extension of its Foreclosure and Eviction Moratoria, start date for COVID-19 Forbearance and Home Equity Conversion Mortgage Extensions and the establishing of a New COVID-19 Advance Loan Modification.
In a recent Press Release, FHA announced the publication of Mortgagee Letter (ML) 2021-13, Student Loan Payment Calculation of Monthly Obligation. This ML updates the monthly mortgage payment calculation for borrowers with student loan debt who apply for FHA-insured mortgages.
HUD announced a technical change to FHA’s underwriting guidelines that will alter the treatment of student loan debt and should slightly expand the credit box for first-time homebuyers accordingly. At the highest level, under the new policy FHA lenders will no longer be required to assume that prospective borrowers will make monthly student loan payments equal to 1% of their outstanding balance. Under the new standard, which becomes fully effective on August 16, lenders can assume either the actual amount paid or 0.5% of the outstanding loan balance when the monthly reported amount is zero. This is a practical change as it brings the FHA into alignment with the GSEs and is more reflective of the realities for borrowers with student loan debt, many of whom are in income-driven repayment plans (e.g., 10% of discretionary income).
The FHA changes to calculation of student debt was met with praise by MBA President and CEO Bob Broeksmit, CMB.
Register for FHA’s free webinar on June 28th, Home Equity Conversion Mortgage 101 Webinar.
MBA Education upcoming webinars: June 28 register for “Lending to the LGBTQ Community: Opportunities and Considerations.” June 29: Register for “Benchmarking for Performance and the Performance Ratios Every Mortgage Banker Must Know.” June 29 Register for “MISMO: Transformation Impact of Blockchain in Mortgage Industry and Realized Economic Benefits. July 8: Register for “CONVERGENCE: Intersections of Supply and Demand Challenges in Accessing Affordable Homeownership.” July 8, register for “Residential: A Strategy for Executing a Successful LIBOR Transition.”
The Mortgage Bankers Association of Hawaii’s Annual Conference will be held on June 30th using a virtual format. The theme for this year’s Conference is “It’s a Whole New World”!
Friday, July 2nd is the next edition of The Mortgage Collaborative’s Rundown with Rich and Rob. Rich Swerbinsky, the COO of The Mortgage Collaborative, and I will be covering current events in the mortgage market for 30 minutes starting at 3PM ET: “The Rundown with Rob and Rich.”
National MI upcoming July 2021 webinar sessions. Details and registration for sessions are available in the MI University webpage. Upcoming webinars include: Own Your Power with Jennifer Powers, Living on Purpose with Rebecca Lorenz, What Does Diversity Mean in the Mortgage Industry Today? with Tony Thompson, CMB, Pivoting Quickly in a Shifting Market, with Andrew Oxley, Freddie Mac Affordable Series – Solutions to Lack of Inventory with Nora Guerra.
(formerly Genworth Mortgage Insurance) offers a number of webinars and sessions designed to bring out the mortgage geek in you! Steve Richman and Enact reps will facilitate a panel discussion on opportunities they're seeing in the mortgage originations market. Also available are sessions on calculating and verifying assets, understanding ARMs and the basics of MI, and GSE renovation programs. View the full July Training Calendar here.
Do you want to unlock the secrets to elevate your real estate business and operate like an elite? Are you looking for the tactics used by the best in the business? Led by DLP’s Founder and CEO Don Wenner, a host of elite growth specialists, and celebrity speakers, this exclusive event has been developed specifically for growth-focused real estate operators. Learn to scale faster at the DLP Elite Mastermind Event from July 7 to 11 in Asheville, NC. Apply to attend.
Wholesalers along the West Coast should note that on July 11 CAMP is hosting Summer CAMP 2021: Cheers to 30 Years! (thecampsite.org).
The Chicago Mortgage Originators Expo, scheduled for Tuesday July 22 is a free event. Use code OCNFREE* when registering includes FREE optional NMLS Class. This Live and In Person event but seating for this event is limited, and going fast.
Follow the National MI channel at nationalmi.podbean.com for Leveraging the Power of Storytelling in Sales, with Julie Hansen ton July 22nd. Or find Being Better with Jennifer Powers by searching for “National MI” or “National Mortgage Insurance” on most of your favorite podcast platforms.
Treasuries pulled back on Friday and the MBS basis ended the day wider, which means rates moved higher. Why? The Fed’s favorite inflation measure, the PCE deflator, continues to climb. It picked up to 3.9 percent year over year in May from 3.6 percent, while the core gauge, excluding food and energy, jumped 3.4 percent, the biggest advance since 1991. Still, Fed presidents played down the data. Minneapolis Fed President Kashkari cited the recent decline in lumber costs in predicting that spikes will "return down to normal,” while Boston Fed President Rosengren said that he doesn't expect higher inflation to continue next year and that it is time to think about how quickly accommodation should be removed. Separately, the final June reading for the University of Michigan Index of Consumer Sentiment slipped from the preliminary reading, but was still up from May, driven by households with incomes above $100k and their view of future economic prospects.
This week's economic calendar sees miscellaneous news concluding with the June employment report on Friday (which also is an early close in advance of the Independence Day weekend). Today’s calendar is light on data with just Dallas Fed Texas manufacturing for June due out later this morning. Three Fed speakers are also scheduled, starting with New York’s Williams, followed by Philadelphia’s Harker, and Fed Vice Chair of Supervision Quarles. Speaking of the Fed, the Desk released a new MBS purchase schedule Friday afternoon that covers the June 28 to July 14 period, which averages $4.5 billion per day, as expected. There are no changes to the coupons versus the prior schedule with UMBS30 and GNII operations targeting 2 percent and 2.5 percent while it is 1.5 percent and 2 percent in UMBS15s. Today’s schedule sees the Desk targeting a maximum of $5.2 billion 30-year 2 percent and 2.5 percent. We start the week with Agency MBS prices better/up nearly .125 and the 10-year yielding 1.50 after closing last week at 1.54 percent.
NextHome, the number one real estate franchise, and CMG Financial, a national privately-held mortgage banking firm, have launched a new mortgage experience, NextMortgage. The joint venture has opened branches in Florida, South Carolina, North Carolina, and Kentucky with national expansion in the works. Many states will be coming soon! NextMortgage will emulate the NextHome ethos of “putting humans first” while leveraging CMG Financials operational support and proprietary products such as HomeFundItTM, the online down payment gifting platform, and the All In One LoanTM, a first-lien HELOC that combines banking and mortgage financing. At NextMortgage you truly find a partnership that really enhances the homebuying journey for all parties involved. If you’re looking for a loan officer-centric culture with top tier resources and technology and focus on growth potential through partnerships contact Nancy Pattison, the JV Divisional, for any employment opportunities.
“Now hiring: Temple View Capital! Our strong 2020 growth continues into 2021 with new financing partnerships in place that provides billions for the company to allocate to DSCR, Fix & Flip, Ground Up Construction and Bridge loans to borrowers nationwide. Our products are designed using common sense underwriting approaches, making them perfect both for direct lending to borrowers and also as a white-label solution for brokers & correspondents. They are competitively priced as well, please visit TempleViewCap.com to see our latest DSCR and Fix & Flip rates. We are constantly innovating with new technology and honing our processes to ensure quick, easy, and consistent approvals making it smoother than ever to close deals. Because of our growth, Temple View is adding experienced BDMs, Loan Officers, Underwriters, Analysts and more. Want to be part of the fastest-growing private lender in the US? Email Doug Perry today for full-time and partnership opportunities!”
“An expert craftsman will tell you, the tools you use can make or break you. That’s why the launch of Caliber Home Loans new broker portal is so significant. We engaged partners from across the country to reimagine how we could harness the power of our H20 technology in a way that is easy to navigate, transparent in communication, and delivers powerful results. Critical enhancements include the ability to instantly see loans that need your attention and shortcuts to pending tasks, quick access to lock expirations, underwriting approval expirations and upcoming closing dates, real-time condition alerts to see what is needed for each loan, and the ability to create a customize pipeline view. Leverage our toolkit to create the next masterpiece experience for your clients. Contact your Caliber Account Executive to learn more or join the team at Caliber or email us to become an approved Business Partner.”