“SMONDAY: The moment when Sunday stops feeling like a Sunday and the anxiety of Monday kicks in.” Do you think the shareholders and management of Credit Suisse felt that, given Credit Suisse is being purchased by UBS for $3.3 billion? Remember when CS was a renowned jumbo buyer? Now we can watch the layoffs. The CS price per share marked a 99 percent decline from Credit Suisse’s peak in 2007. Mark Twain said, "The older I get, the more clearly I remember things that never happened.” The S&L Crisis certainly happened, but have regulators, auditors, and rating agencies forgotten about it? Under the “getting ready to fight the last war” category, the Federal Reserve is evaluating tougher rules for midsized banks after the failures of Silicon Valley Bank (SIVB) and Signature Bank (SBNY). It is looking at tougher capital and liquidity requirements and could beef up annual "stress tests" that assess banks' ability to weather a potential recession. Large U.S. banks have been inundated with new depositors as smaller lenders face turmoil. (Today’s podcast can be found here and this week is sponsored by Black Knight, Inc. As a premier provider of innovative, high-performance software, data and analytics for mortgage and home equity lending and servicing, Black Knight, Inc. is transforming the mortgage industry through its best in class solutions. Listen to an interview with HOA.com’s Brandon Barnum on the art of the referral business.)
Lender and Broker Services, Products, and Software
You may have heard of fashion influencers and hobbyist influencers… But what do you know about mortgage influencers? In 2022, NFM Lending partnered with @thatmortgageguy, Scott Betley, to launch an influencer division, which, supported by Surefire CRM and Mortgage Marketing Engine by Black Knight, has been a runaway success. According to NFM VP Laura Clapper, “When videos go viral, the leads pour in. In one month, we brought in more than 4,000 leads (97.5 percent of whom want to purchase) for our team to nurture over the coming months. At the time, we had just eleven influencers in the program.” With the Surefire Power Video product, NFM can send video outreach to followers, clients, and referral partners on behalf of influencers at scale. Want to learn more about how NFM is generating thousands of leads a month without spending a dime on ads? Read the full case study to find out how.
Can an Appraisal Management Company really help a loan officer get more business? That is the question! R3’s Concierge Services is a front-to-back solution that includes qualified buyer leads through the HomeScout Vida app, pre-listing support, transaction troubleshooting, and post-close marketing, as well as social media and educational content. R3 AMC and its Concierge Services are designed to help loan officers secure more business by serving them as both an appraisal management company and an appraisal marketing company. And yes, it’s Dodd-Frank/AIR compliant! Contact Brent Jones, CEO/Chief Appraiser (800-791-6817) for more information.
“OptifiNow TPO is truly the first CRM that is designed specifically for wholesale lenders. Our wholesale-specific CRM keeps sales and marketing on track, enabling Account Executives to do more with less effort. If you’re a wholesale lender that is frustrated with CRMs that simply don’t work, OptifiNow TPO has you covered. We have worked with dozens of wholesale lenders for nearly a decade now, such as REMN Wholesale, Logan Finance, Oaktree Funding, and many more. OptifiNow seamlessly integrates with any mortgage loan origination system and has wholesale-specific features like Instant Rate sheet Distribution, Automatic Broker Account Scoring, and Loan Scenario Tracking with PPE integrations. Let us show you how our solution can benefit your TPO business in as little as 30 days. Contact us now to schedule a demo.”
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Registration opens today for The StorySeller Virtual Summit on April 19 with nine guest speakers including master FBI negotiator Chris Voss: How to Uncover Hidden Opportunities in Life and Business, NAR chief economist Dr. Lawrence Yun: How to Overcome Objections About Today's Housing Market, and industry legends Tim Braheem and Carl White on Your Inner Story and the Habits of Top Producers. The event is hosted by best-selling author and Momentifi CEO, Gibran Nicholas. The theme of the event is How to Grow an Epic Business and Find More Meaning in Your Work. Registration is free, but you can also sign up for a VIP All-Access pass that includes Momentifi's personally branded homebuyer education tools and other member benefits. This is a great way to kick off the Spring Home Buying Season with your team and referral partners. Click here to learn more or sign up. You can also click here to inquire about group tickets.
When hiring, sometimes a candidate’s most desirable qualities or “green flags” won’t appear on a resume. Similarly, homebuyer green flags might not show up in traditional credit data. Which is why mortgage lenders are on the lookout for more ways to evaluate consumers, especially the 81 million with little-to-no credit history. Fortunately, Equifax is making borrowers’ green flags easier to see with powerful, verified Telco, Pay TV, and Utilities insights. These insights offer a strong indicator of past financial reliability and can be a helpful tool for understanding traditionally underserved homebuyers and supporting financially inclusive lending. Equifax even delivers them at no additional cost alongside its Trended Credit*Hi-Lite™ report. When most U.S. adults have at least one utility or cellular account, why not take advantage? Start building a simplified mortgage underwriting process and better borrower experience with less costs by finding more green flags today.
Are You Ready for Indecomm’s Mortgage Quality Control 4.0? If your mortgage QC partner is still relying exclusively on manual audit skills and reporting, Indecomm offers you a new approach, one that pairs modern QC technology and automation with a meticulous QC services team. Indecomm’s mortgage QC 4.0 uses AuditGenius technology to capture more errors, increase audit productivity by 40 percent, and rapidly expand QC scope from the standard 10 percent sample size to 100 percent of loans in review. Plus, Indecomm’s digitally-enabled QC services comes with a robust, interactive, customizable QC reporting module that gives you critical insights into defect and risk trends related to your loans, portfolios, teams and operations, empowering you to take fast, informed corrective action. Want to learn how tech-enabled QC services keep you compliant? Reach out to Neil Armstrong and register for our upcoming webinar, “Rate Your Own Risk: A Proactive Approach to Fannie Mae QC Calibrations.”
TPO Loan Program Info
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“Deephaven presents, “Sourcing the Non-QM Borrower! Are you looking for a revenue replacement strategy? Deephaven provides Non-QM loans to self-employed and property investors. Please register for this webinar to learn how to use our product line to strengthen referrals of these underserved borrowers while diversifying and cultivating new referral partners. Register today here. To view our calendar of events, please click here. If you are interested in adding a Non-QM Investor, please contact Deephaven’s Chief Sales Officer Tom Davis.”
I hope that you didn’t own any debt issued by Credit Suisse. Negotiated in “hastily arranged crisis talks over the weekend, UBS will purchase Credit Suisse in a deal to (temporarily) end a crisis in confidence. The Swiss bank UBS is paying 3 billion francs ($3.3 billion) for its rival in an all-share deal that includes extensive government guarantees and liquidity provisions. The price per share marked a 99 percent decline from Credit Suisse’s peak in 2007. The Swiss National Bank is offering a 100 billion-franc liquidity assistance to UBS while the government is granting a 9 billion-franc guarantee for potential losses from assets UBS is taking over. Regulator Finma said about 16 billion francs of Credit Suisse bonds will become worthless to ensure private investors help shoulder the costs. Remember that liquidity backstop set up by the Swiss central bank mid-week? It failed.
Five years ago, CS still had a market cap of $45 billion. While it has had a lot of problems since 2007, it still had all the pieces of a large financial center bank (investment banking, asset management, retail banking, and institutional banking, for example). It is/was a “too big to fail” bank. On the other hand, in this country, Silicon Valley Bank has been a fast-growing bank for the past five years, but was really only a regional bank with a concentrated clientele. CS was many, many times larger and more complicated than SVB. It will be interesting to see how the archival UBS handles the personnel decisions going forward… predictable, but interesting.
In the United States, Signature, First Republic, Silvergate, and Silicon Valley Bank…they will have an impact on regional banks. Remember that Silicon Valley Bank is a California-chartered commercial bank and part of the Federal Reserve system, so it is not eligible for bankruptcy and landed in Federal Deposit Insurance Corp. receivership instead. Its parent company, however, is eligible to file to protect its remaining assets and work on repaying creditors, including bondholders. SVB is the biggest bank to fail in more than a decade, with about $209 billion in total assets as of the end of last year. It’s also the second largest bank to fall under the agency’s receivership, behind only Washington Mutual Inc., which imploded in 2008.
Over the weekend the Federal Deposit Insurance Corporation (FDIC) entered into a purchase and assumption agreement for substantially all deposits and certain loan portfolios of Signature Bridge Bank, National Association, by Flagstar Bank, National Association, Hicksville, New York, a wholly owned subsidiary of New York Community Bancorp, Inc., Westbury, New York. The 40 former branches of Signature Bank will operate under New York Community Bancorp's Flagstar Bank, N.A., today.
Saturday’s commentary noted, “The roots of SVB's failure were sowed when it invested heavily in long-term US government bonds, especially mortgage-backed securities. Bond prices have an inverse connection with interest rates, and when rates rise, bond prices fall. As a result, SVB's bond portfolio began to lose considerable value when the Federal Reserve started raising interest rates rapidly to battle inflation. And when depositors wanted their money out of their deposits, since SVB did not have enough actual cash, it began selling some of its bonds at high losses.”
It prompted Ryan A. to write from Miami, “Your expert that you quote is absolutely incorrect. The bank failed because it didn’t hedge its bond portfolio along with making loans to fledgling startups that they could not pledge at the Fed window. It is amazing how people talk but don’t know what they are talking about. Why didn’t banks fail in mass when rates went up in the 80’s, 90’s, etc. Please stop spreading misinformation from so called experts who don’t have a clue as to what really happened or how banks really work!”
But let’s not forget the deposit side of the equation. Problems mounted for SVB mounted after Peter Thiel’s Founders Fund and other high-profile venture capital firms advised their portfolio companies to pull money from the bank. The calls followed parent company SVB Financial Group announcing that it would try to raise more than $2 billion after a significant loss on its portfolio.
The rapid rise of interest rates that began seven months ago claimed its first victims over the last week, overshadowing anticipated retail and inflation data. The collapse of several regional banks created uncertainty around the Federal Open Market Committee’s meeting this week, with volatile swings in expectations and rate movement as news was released. Markets still expect the central bank to continue its battle against inflation with a final 25 basis points rate hike with potential easing to happen in the second part of this year.
For the moment, the U.S. economy remains in positive territory as retail sales rose 0.5 percent in February and manufacturing production remained positive. Housing starts spiked 9.8 percent to a 1.450 million-unit annual pace in February due to a rise in multifamily starts. Additionally, single-family starts rose for the first time in 12 months as buyers that were on the sidelines re-entered the market. Combined with an increase in purchase mortgage applications through March 10, it is potentially a signal that housing activity is starting to stabilize.
The headline event of this week will be the aforementioned two-day meeting of the Federal Reserve's policy-making committee. Futures trading implies a 75 percent probability of a 25 basis point rate hike and a 25 percent chance of no hike at all. The odds for a 50-point hike are effectively off the table after being a betting favorite just a few weeks ago. Updated SEPs will also be released along with the Statement before Chair Powell’s press conference.
Outside of the Fed, economic reports include existing home sales, new home sales, and durable goods orders. After the Fed, the BoE, SNB, and Norges Bank will all be out with their latest decisions on Thursday. The week gets under way with a whimper, however, with no economic releases of note today and eyes on bank’s stock prices. We begin the week with the 2-year down to 3.76 percent, Agency MBS prices better by .125, and the 10-year yielding 3.36 after closing Friday at 3.40 percent.
Jobs and Transitions
A well-funded mid-size mortgage company with an experienced leadership team is excited to announce its expansion plans into Charlotte, NC, and is need of a producing branch manager. "We are thrilled to bring our extensive portfolio of programs, cutting-edge technology (including AI integration), and swift turn-around times to the Charlotte, NC market. A talented Producing Branch Manager is critical to our success. We are confident that the right candidate will help us build a strong presence in the area and expand our business in exciting new ways. The selected candidate will build and manage a high-performing sales team and maintain personal loan production. In addition, the manager will have access to our proprietary CRM to recruit loan officers and build a team efficiently. The ideal candidate must have at least five years of mortgage lending experience and a successful sales and business development track record. If you would like to learn more about the position please send your confidential resume to Chrisman LLC’s Anjelica Nixt.”
The FHA has one vacancy in Santa Ana, CA, for a Supervisory Housing Program Specialist to oversee the day-to-day management and operations of the Homeownership Center (HOC) within the assigned geographical area, and direct the supervisory staff who manage the professional, technical, and clerical staff required for the production and risk/asset management of Single Family Housing programs.
Patrick Creek has joined Non-QM lender Deephaven Mortgage LLC as Western Regional VP, Wholesale Sales, responsible for “working with brokers within and west of Texas to grow their Non-QM revenues, drawing on Deephaven’s flexible products, in-house underwriting expertise, and dedicated training and support.”