Every lender or investor with an “a” in their name seems to be subject to rumors and news in recent months. (More on Flagstar and American Pacific below.) Know anyone named “Bernadette”? The name is actually Latin for, “The act of torching a mortgage.” (Yes, it is cutting edge humor like that which brings you back.) Burning liens isn’t a topic, but paying them off early is, and with mortgage rates off of their highs, early pay offs, or EPOs, were a conversation topic at the conference this week. And with it, loan officer compensation follows. Can a lender pay an originator based on pull through? Yes. Can lenders pay different originators under different payment plans, as long as the originator sticks with one plan? Yes. Can a lender, if they comply with state labor law, ask for compensation back after an EPO or EPD? Yes, and it may depend on the contract signed by both parties at the beginning of employment. As always, consult your in-house counsel or a lawyer well-versed in mortgage banking. While we’re on originators, occasionally I am asked about training for brand-spanking-new loan officers. No, this is not a paid ad, but veteran LO Tanya Blanchard has created Madison Chase Academy, “6 Months to 6 Figures: A Loan Officer’s Guide to a Profitable Business” with a sneak peak on the website. (This week’s podcast is sponsored by Richey May, a recognized leader in providing specialized advisory, audit, tax, technology, and other services in the mortgage industry and in banking.)

Lender and Broker Software, Products, and Services

Business Insider’s list of the worst endings in literary history reminds us that authors of great skill can still choke on the ending. In a borrower’s homeownership story, the last thing a lender wants is to give a borrower a disappointing ending. Understanding the unique perspectives of each character in the homeownership story — from borrower to mortgage advisor to loan servicer — empowers lenders to provide more timely, consultative services that keep borrowers coming back for more. On Feb. 8 at 1 pm ET, join Sales Boomerang and Mortgage Coach’s Alex Kutsishin and Sagent’s Dan Sogorka to learn how mortgage professionals can play a more prominent role in each chapter of the borrower story. Start writing a great story today.

Like 2020 and 2021 before it, 2022 threw a slew of challenges at mortgage professionals. Macroeconomic markets faltered, the world grappled with geopolitical turmoil, and inflation put a burden on many families. Through it all, TMS remained resolute. A Top 10 Subservicer on a national scale yet again, TMS sustained a 98.4% customer satisfaction rate, a 90.4% first-call resolution rate (including an average 35-seconds call wait time), an 82.7% Net Promoter Score, and attained memberships in organizations hoping to make housing more affordable for all. Crises test business fundamentals. As TMS says, steady fundamentals endure, while shaky fundamentals struggle. Check out the latest blog to see how TMS’s fundamentals fared in yet another challenging year.

Get the accounting support you need to fit any market condition, flexibly. With skilled mortgage accounting staff getting harder to find and more expensive to hire, lenders need solutions they can afford and trust. Richey May’s Client Accounting and Advisory Services (CAAS) team provides the industry expertise you need to outsource your accounting functions at will. Think of it as outsourced bookkeeping… And a whole lot more. CAAS lets you scale up or down, transitioning fixed to variable costs in tune with the market. Need help capturing the right data for loan-level accounting? We have deep experience in this area. Plus, we not only know how to communicate with operations and accounting, but we also know the best practices used by the most successful lenders. Most of all, we have the cost-effective, flexible solutions you need now. Contact us for details and learn more here.

You’ve been hearing a lot about Gibran Nicholas’ new book this week, The StorySeller Adventures. After reading the book myself (Gibran gave me an advance copy), here’s my personal review: “The StorySeller Adventures: How to Grow an Epic Business and Find More Meaning in Your Work combines two major themes that most of us struggle with: creating and running a flourishing business as well as doing something for a living that is enjoyable and has substance. Gibran and found a very entertaining way to weave both together, regardless of what business you’re in. Sales and communication matter regardless of your field, and the ability to both believe in something and convince someone else of its merits is invaluable. The author understands the obstacles and hurdles that entrepreneurs face and provides advice on how to overcome them. I would recommend this book to practically anyone who interacts with other people in their business.” CLICK HERE to get the book.

Lenders: Are your appraisal operations set up for success in your local markets? From turn times to appraisal fees and revision rates, it’s vital to ensure you are performing optimally to gain and retain borrowers and avoid sunken appraisal costs. Learn how you stack up against other lenders with Reggora’s Appraisal Performance Index: 2022 Insights report, containing 12 months of aggregated data on turn times, fees, and revision rates from across the continental United States. Want to view the full Index AND receive a personalized analysis of your appraisal performance compared to data in your market? Book a private benchmarking session with one of Reggora’s experts.

Are you looking for a new point-of-sale that doesn’t break the bank but still provides that 5-star customer experience today’s modern homebuyers expect? If you answered yes, you should probably check out LiteSpeed by LenderLogix. LiteSpeed is not the bulky, 6-month-to-implement POS most lenders are familiar with. It features what you need and nothing you don’t, keeping the experience simple for homebuyers and streamlined for you. Because the easier (and faster) it is for them to fill out your application, the more applications you can expect to collect. Maximize your Encompass® by ICE Mortgage Technology™ investment by layering on this light, fast, and beautiful front-end solution. Learn more and schedule a demo here.

Corporate News

From Northern California comes news of American Pacific Mortgage’s asset purchase of Lend Smart Mortgage, LLC, based in Minnesota. Lend Smart Mortgage is licensed in 29 states, adding strong production outlets in both Minnesota and Arizona, along with branches in key areas for the company. “Lend Smart Mortgage will retain its name, leadership, and brand while leveraging all that APM has to offer. This includes a robust suite of specialty mortgage products, industry-leading technology, an unrivaled company culture, and becoming part of a 49% employee-owned company.”

“Bill Lowman, CEO of APM, sagely observed, “We’ve attracted several well-known and established companies like Lend Smart Mortgage that fit with our core values and want to plug into the APM engine and all we have to offer, without losing their identity. In addition, they provide production outlets in areas where APM is actively growing. We see Lend Smart as the perfect fit with our company culture and look forward to joining forces.”

In other corporate news, texts and emails swept through my phone yesterday from people about Flagstar Bank either closing a mortgage branch, several mortgage branches, closing everything outside the bank’s footprint, or closing its entire retail mortgage operation. Take your pick. Regardless, other retail lenders were only too happy to hear the news. One CEO wrote to me saying, “News like this just makes it easier for us to pick top producers and bring them on board without paying for the entire team.”

(Anyone impacted can post their resumes for free at www.lendernews.com and employers can view resumes for several months for a nominal fee of $75.)

Those laid off posted through social media (keep the source in mind) that their access to the company’s systems, computers, and emails was shut off immediately. The company offered severance payments based on tenure and job position.

Inside Mortgage Finance notes that Flagstar, through its wholesale and retail channels, originated $27 billion in mortgages last year, down about 38% year-over-year. Volume declined from $8.2 billion in the first quarter of 2022 to $4.1 billion in the last quarter. Retail is doing about $700 million a month.

Capital Markets: What Recession?

Ginnie Mae announced, in two All Participants Memoranda (APM), that it is extending certain delinquency reporting exemptions for issuers and permitting the use of alternative audit procedures. Details regarding the extension of these temporary measures related to delinquency thresholds and audit policy can be found in APM 23-01, and APM 23-02 respectively. APM 23-01 recognizes COVID-19 continues to impact Issuers’ independent auditors’ ability to perform certain on-site document custodian review audit activities, requiring physical inspection and observation. The temporary flexibilities extended in APM 23-01 allow alternative audit procedures for Issuers with a fiscal year ending on or before June 30, 2023. APM 23-02 extends the delinquency reporting exemptions for six months which is the timeframe provided in previous APMs. Whether additional extensions of the exemptions are warranted will be considered and announced later this year.

We had a strong day of data yesterday that showed little signs of a coming recession, which fueled speculation that the Fed will be able to pull off a fabled “soft landing” and not send the economy into a nosedive while putting on the brakes. Q4 GDP was stronger than expected, registering at 2.9 percent, though the growth rate was down from Q3. December durable goods orders were strong in the headline (5.6 percent versus 2.9 percent expectations), and jobless claims, which tend to be noisy at this time of the year, were lower than expected at 186k.

New home sales increased 2.3 percent month-over-month in December to a seasonally adjusted annual rate of 616k units. The recent fall in mortgage rates has spurred some renewed demand among home buyers, though affordability and supply pressures continue to hold back many sales for many prospective buyers. On a year-over-year basis, new home sales were down 26.6 percent.

Today contains more first tier economic data starting with personal income and spending for December, up 0.2 percent and down 0.2 percent month-over-month, respectively. The Core PCE Price Index rose 0.3 percent month-over month and 4.4 percent year-over-year, as expected, compared with 0.2 percent and 4.7 percent previously. Later this morning brings final January Michigan sentiment and December pending home sales. We begin the day with Agency MBS prices worse .125 and the 10-year yielding 3.53 after closing yesterday at 3.49 percent.


“Looking to join a team that will celebrate your wins? Caliber Retail is sure to be the place for you! Our top performers have just returned this week from Puerto Rico where we celebrated their 2022 accomplishments at our annual Circle of Excellence trip. A longstanding tradition, Circle of Excellence is just one example of the dedication to our employees that continues to be a core value of Caliber. When you join us, you will be joining a company that supports your growth and truly appreciates the employees that make us who we are. To learn more about what we have to offer, contact Tina Jablonski.”

Success Mortgage Partners out of SE Michigan is looking to hire an operations manager, senior accountant, and a marketing manager. Success Mortgage Partners is licensed in over 40 States and is continuing to expand their team. Please send resumes to Allison Johnston.

Ross Mortgage Company continues its expansion into the Pacific Northwest market. Lead by Dave Pederson, with over thirty years of industry experience, Ross is uniquely positioned to quickly penetrate this new market thanks to a full suite of loan products, committed leadership and support staff, and most importantly rates you can win with! In a challenging market like this one, why wouldn’t you give yourself the best chance at success? Joining Ross Mortgage Company is that chance. To learn more about what makes originating with Ross different, email Dave Pederson!

Few people actually retire from our business. They come back as consultants, advisors, board members, whatever. Earlier this week I spent a little time with Jack Konyk, who has basically been doing what he’s been doing for 50 years, and he tells me that he is actually retiring. Currently the Executive Director of Government Affairs at Weiner Brodsky, shoot him a congratulatory email!