In New York, the New York Mortgage Bankers Association's website is now live. The group is functioning and has already had meetings with DFS, so lenders looking for things to be done on an "industry vs. company" level should reach out to the NY MBA to make their industry issues known. And by visiting the site one can read comments about Benjamin Lawsky stepping down from the NY Department of Financial Services post he now holds.

Speaking of which, the NY MBA spread the word to members that the NYDFS proposed regulation of force-placed insurance. "Under the proposed regulation, insurers and servicers are prohibited from: obtaining insurance in access of borrower's last known amount, unless that amount did not comply with mortgage requirements, issuing force-placed insurance on mortgaged property serviced by a servicer affiliated with the insurer, receiving compensation with respect to the force-placed insurance, including the cost of insurance tracking in the insurance premium, providing tracking services to the servicer at no cost or at a reduced fee.

It also posted information on proposed NMLS changes to the Mortgage Call Report. The National Mortgage Licensing System (NMLS) has issued a proposal that would make significant changes to the Mortgage Call Report (MCR). The NYMBA has signed on to a letter urging a postponement of the proposed changes.

And New York is considering a "borrow and save" pilot program as an alternative to high-cost mortgage programs. President Jim Bopp writes, "Although this pilot program is not directly related to mortgage loans, the NY MBA would support any program that helps NYS residents establish traditional credit histories that would enable them to build a credit rating that would help them qualify for the most competitive rates and terms available based on an established or improved credit score. This program executed correctly could result in more people being able to purchase a home and for the borrowers to realize the American dream of homeownership and all of the benefits related to achieving it."

Turning to agency news, Fannie Mae and Freddie Mac announced significant revisions to their respective rep & warrant frameworks. These revisions provide lenders with greater clarity concerning the post-sunset enforcement of Life of Loan exclusions, as well as certain other reps & warrants. Look for higher thresholds for "Life of Loan" breaches with numerical triggers for misstatement & misrepresentation and data inaccuracy. Perhaps the reduction of uncertainty to Life of Loan breaches will encourage lenders to expanding lending with larger players likely unmoved by the clarity with smaller ones set to fill the void. Fannie Mae's announcement can be found here; Freddie Mac's can be found here. FHFA Director Watt's statement concerning these revisions can be found here.

As this commentary has mentioned many times, lenders say, "We can play by the rules - just tell us what they are." This is an effort to do that by F&F, and may lead to an expansion of the credit box. For example, under the new rules seen by clicking on the links above, if there is a defect but the loan still would have qualified for purchase by F&F, the lender will have to cover the difference once the loan is re-priced but will not face a repurchase request. Dave Stevens of the MBA writes, "These changes build off the revisions announced earlier this year and are intended to provide lenders with clarity regarding R&W enforcement after a loan qualifies for repurchase relief. Life of loan exclusions concerning misstatements, misrepresentations, & omissions and data inaccuracies have been revised to state that the GSEs will only issue repurchase requests for significant violations that reflect a pattern of activity involving multiple parties to the transaction." The guidelines require that the same lender has 3 or more loans with qualifying misstatements, misrepresentations, or omissions prior to a life-of-loan R&W kicks in and the threshold is higher for data inaccuracies as the same lender/entity must have 5 or more inaccuracies before triggering the life-of-loan R&W.

For purposes of the life of loan exclusions, the definition of fraud has been revised to clarify the distinction between fraud and misstatement under the Guides. These revisions are applied retroactively to loans delivered to a GSE on or after January 1, 2013. The GSEs will lengthen the expected foreclosure timelines in 47 out of the 55 covered jurisdictions effective for all foreclosure sales completed on or after November 1, and will temporarily suspend compensatory fee assessment in four states (New York, New Jersey, Maryland and Massachusetts) for at least six months until more data can be gathered to determine an appropriate timeline effective for foreclosure sales completed on or after January 1, 2015. In addition, both GSEs have raised the de minimis exception- a threshold where there will be no compensatory fee invoice-from $1,000 per month to $25,000 per month, effective for foreclosure sales completed on or after January 1, 2015. This will provide significant relief for smaller servicers. Changes to both of these frameworks could not have occurred without the diligent work put in by MBA staff and a number of very engaged MBA members."

"There are qualified borrowers who are not being served in today's market," Andrew Bon Salle, a Fannie Mae executive vice president, said in a statement. "With this clarity, lenders should have greater confidence in lending to Fannie Mae's full credit standards and making mortgages available to more borrowers."

Bankers Advisory writes, "The changes to the framework are effective retroactively for whole loans purchased, and mortgage loans delivered into MBS with pool issue dates, on and after January 1, 2013, except that these changes do not apply to any loans for which Fannie Mae has issued a repurchase request prior to November 20, 2014. The changes to the Selling Guide provisions regarding compliance with laws are effective for whole loans purchased on and after November 20, 2014, and for mortgage loans delivered into MBS with pool issue dates on and after December 1, 2014.   It is Fannie Mae's expectation that any future modifications to the framework will apply prospectively.

"In addition to the above changes to the framework, Fannie Mae is also updating the Selling Guide, A3-2-01, Compliance with Laws, which among other things requires lenders to comply with applicable federal, state and local laws. These changes are effective for whole loans purchased on and after November 20, 2014, and for mortgage loans delivered into MBS with pool issue dates on and after December 1, 2014, without regard to whether the loan has obtained relief under the framework."

(Speaking of which, The Collingwood Group's November survey focuses on the GSEs and their impact on the industry. "We want to know what the industry thinks of GSE Reform, which FHFA initiative is most important for a market recovery, and how Fannie Mae and Freddie Mac could stimulate demand among other topics. Survey participants will get a "first look" at the report before we make it available to the public.)

Fannie Mae is offering sessions designed to help servicers understand Fannie Mae's updated (Property) Hazard and Flood Insurance policy. This course explains the new guidance for handling insurance losses based on the mortgage loan status at the time the servicer receives notification of damages, regardless of the cause. The sessions are scheduled on December 9th and 10th, to register, click here.

It becomes harder and harder to argue that housing is still in a slump. Yesterday we learned that Existing Home sales rose (+1.5%) in October for the second straight month and are now above year-over-year levels for the first time in a year, according to the National Association of Realtors. Sales are at their highest annual pace since September 2013. The median existing-home price for all housing types in October was $208,300, which is 5.5 percent above October 2013. This marks the 32nd consecutive month of year-over-year price gains.

And the Philly Fed made a huge move upward, from "20.7" to "40.8". This is the highest reading in over 20 years. The Bloomberg Consumer Comfort Index rose to 38.5, while the Index of Leading Economic Indicators rose to 0.9%. We saw 2.34% on the 10-yr at the end of trading on Thursday and this morning, with no scheduled news, we're...unchanged, as are agency MBS prices.


Jobs and Announcements

Congratulations to John F. Cady whom Mountain West Financial, Inc. announced as its SVP of Production. Mr. Cady will be focusing on developing both retail and wholesale channels for the company. Nearing its 25th anniversary, Mountain West Financial continues to grow and is seeking Loan Officers, Branch Managers, and Account Executives throughout the Western United States. "Approved with FNMA, FHLMC and GNMA, Mountain West offers a wide range of products paired with excellent turn times, user-friendly technology, and robust marketing tools. They are a team of professionals with shared principles and a promise to do the right thing, the right way, and for the right reason. If you are interested in joining a company that will stand behind and support you, please send your questions and resume to John F. Cady."

MSA Recruiting has been retained by one of its clients, a national lender based in the Midwest, to search for a Chief Operations Officer, responsible for Operations, QC and Compliance. The company operates under a retail lending platform and includes brick and mortar retail branches as well as a large Direct to Consumer division. The ideal candidate will have a strong track record in executive leadership of multi-state Operations, including underwriting, processing and post-closing as well as being technologically strong. Candidates should send confidential resumes to Tami Coffey.

Speaking of compliance, a tremendous amount of focus has been placed on the need for third-party governance to meet the demands of the regulatory requirements on vendor management. Notwithstanding, few organizations are focused on holistic solutions for lenders, servicers and vendors. HQ Vendor Management (HQVM), a MQMResearch (MQMR) product, does just that, with the ultimate goal to protect the consumer's best interest. MQMR has recently become a preferred vendor of Lenders One, a cooperative of 275+ lenders that prides itself on providing members with service solutions across the loan process. The combination of HQVM and Lenders One is a well-suited pair. HQVM provides market-centric solutions to lenders while also working to provide vendor management guidance to the broad array of vendor partners on the Lenders One National Programs platform. For more information regarding HQVM's vendor management program or to schedule a product demo, please contact Casey Hughes.