“Once you lick the frosting off of a cupcake, it becomes a muffin. And muffins are healthy. You’re welcome.” Adding another expense to a transaction is certainly not welcome, yet that’s exactly what was voted into effect by residents of Los Angeles County in November. When you sell a house, paying a 5-6 percent commission to the real estate agent is typical. In LA there’s another 5 percent tax on top of that for high-priced houses to help fund affordable housing. Apparently home sellers in Los Angeles are slashing prices and sweetening deals before a new “mansion tax” goes into effect on April 1. The effect on supply and demand and pricing will be interesting, especially how it impacts the volume of sales. Along those lines, don’t pad your volume numbers, especially if you’re about to go public, otherwise the Department of Justice may come knocking like it did with Sterling Bancorp. (And don’t discriminate. In this environment where every deal is precious, why would you? This Long Island, NY company ran afoul of the law.) (Today’s podcast can be found here and this week is sponsored by MGIC. Since 1957, MGIC has insured more than 13.5 million mortgage loans. With innovative products, tools and strategies that help customers solve problems and fuel growth, MGIC is a true partner to lenders. Explore tools and solutions to boost your business here. Listen to an interview with LexisNexis Risk Solutions Kevin King on alternative credit data and expanding the consumer credit box.)

Lender and Broker Services, Products, and Software

If Team Italy can have an espresso machine in its dugout during the World Baseball Classic, then why shouldn’t your organization leverage technology to give loan officers a boost in this sluggish market? SimpleNexus, an nCino company, gives lenders an edge in delivering a modern, convenient mortgage experience via a user-friendly mobile interface. The platform keeps mortgage stakeholders on the same page with a seamless homeownership experience for borrowers, lenders, real estate professionals, and settlement agents. Watch a brief video overview of SimpleNexus’ groundbreaking suite of products. Then, see first-hand how SimpleNexus can help brew up a grand slam in your mortgage pipelines.

Westlake Origination Center is turning leads into sales for mortgage companies and creating a buzz among loan officers struggling to find new clients on their own with little success. WOC creates exclusive leads using custom tailored data algorithms and verified fail-proof tactics to identify and engage with targeted clients, ensuring a steady stream of high-potential leads for businesses. Every exclusive live transfer is a potential client that is qualified and truly looking to buy a home in the LO’s specific area! With a combined 30 years in the industry, WOC’s team works closely with clients to ensure leads convert to sales. Seasoned LOs are currently at a 62 percent application rate after the initial call from a generated WOC live transfer. "Our platform is the result of years of research and development and is designed to be flexible and scalable, so it can adapt to the changing needs of our clients," said EVP Matt Matsuda. "This has proven to be a game-changer for businesses looking to sell and succeed in today's highly competitive marketplace.” Connect with Justin Clark at Westlake Origination Center to capture your market share.

Spring break may be coming to a halt, but the mortgage market is wild as ever. That's why credit unions, banks, IMBs, and FinTechs partner with Computershare Loan Services (CLS). CLS is a third-party provider that offers peace of mind across your business, from originations to servicing. Catch up with the CLS team at the Great River MBA Conference on April 4-6, CMLA Mortgage Lenders Expo on April 6, and TMBA’s Annual Convention on April 30 – May 2 to find out how CLS can help you stay one step ahead. Contact the CLS team today to schedule a meeting!

In his 1972 hit song, Bill Withers made a timelessly true statement: "We all need somebody to lean on.” As mortgage servicers grapple with tight margins and increasing loan servicing costs, they could use a reliable partner. The good news is that Indecomm is here to help. If you are a mortgage servicer in need of timely, accurate, transparent, and efficient lien release services, lean on Indecomm’s tech-enabled lien release services. Just call on Indecomm for a streamlined lien process, MERS and regulatory compliance, nationwide recording/e-recording processes, and reduced lien rejection rates. With Indecomm’s expert team by your side, you can say goodbye to missing state statutes, while minimizing risk and fines. Reach out to Kevin Quinn to learn more.

After starting his business during the 2008 financial crisis, InstaMortgage Founder and CEO Sheshank Shekhar is no stranger to overcoming historic market challenges. Sheshank offered his insight and advice to lenders on how to be successful in today’s market and reach the growing Gen Z population. Hear what he had to say on the Expert Insight’s podcast with Total Expert’s Joe Welu and browse the full list of episodes featuring financial services leaders, including Dan Catinella, Sue Woodard, and more.

What’s good for homeowners is good for lenders, and currently, home equity is one of the fastest-growing channels for accelerating your business. Now is the time to expand your home equity business with the right technology. Black Knight’s home equity experts are fielding your questions at CBA LIVE 2023. Plus, Andy Walden, Black Knight’s VP of enterprise research, will be diving deep on how to identify equity opportunities in this shifting market. Learn how to better manage your home equity loans with first mortgages, while developing better relationships with your borrowers. Block off time at CBA LIVE to sit in on Andy Walden’s live session on Tues., March 28 at 11:40 a.m. Then visit Black Knight at booth #33 to see how it can help you transform your home equity business, or schedule a meeting.

What have over 250,000 MLOs and real estate agents adopted in just the past 6 months? Emerging new technology company Milestones has hit the ground running since their July 2022 Series A and go-to-market announcement. The technology is fully white-labeled and gives homeowners an all-inclusive homeownership experience including: home value & equity monitoring, home maintenance reminders and how-to articles, cloud-based document storage, one-click access to hire professionals for various projects around the home, and much more. Its unique revenue model allows MLOs to double down on their commitment to client retention and maturation, while substantially lowering their tech spend (and offering more value to both homeowners and Realtor partners). Connect with Milestones’ Chief Revenue Officer, Ashley Terrell, at #NEXTSpring23 or email, and you can learn more at here.

Want to launch your next chapter in life and business? Reserve your seat at The StorySeller Virtual Summit on April 19. Topics include: How to Start and Grow a $1 Billion Company with No Venture Capital, How to Find Hidden Opportunities in Life and Business, and The Stories We Tell Ourselves as Entrepreneurs and Why They Matter. The event is hosted by best-selling author and Momentifi CEO, Gibran Nicholas with sessions from several other speakers. The theme of the event is how to use StorySelling and the 9 human archetypes to grow an epic business and find more meaning in your day-to-day work. Registration is free, but you and your team should reserve your spot now because seating is limited. 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.

HUD, Ginnie, FHA, VA News and Investor Changes

HUD announced the submission of a final rule (Reinstatement of HUD’s Discriminatory Effects Standard) which would rescind the agency’s 2020 regulation governing Fair Housing Act (FHA or the Act) disparate impact claims and reinstate the agency’s 2013 discriminatory effects rule. Explaining that “the 2013 rule is more consistent with how the [FHA] has been applied in the courts and in front of the agency for more than 50 years,” HUD emphasized that it also “more effectively implements the Act’s broad remedial purpose of eliminating unnecessary discriminatory practices from the housing market.”

FHA issued a reminder to servicers, FHA INFO 2023-19, about the use of the U.S. Department of the Treasury’s Homeowner Assistance Fund (HAF) financial assistance to help borrowers, with FHA-insured single family forward mortgages and Home Equity Conversion Mortgages (HECM), struggling with their mortgage.

FHA published in the Federal Register (FR), Mortgagee Review Board: Administrative Actions [Docket No. FR-6379-N-01]. This FR Notice is the annual notification of all completed administrative actions taken by the Department of Housing and Urban Development’s (HUD) Mortgagee Review Board from October 1, 2021, through September 30, 2022, where settlement agreements have been reached, civil money penalties were imposed, or FHA participation was terminated as of February 21, 2023.

On March 24, USDA Rural Development posted updates to FY 2023 Area Loan Limits and related changes.

A Proposed Rule was published in the Federal Register to amend the Single-Family Housing Guaranteed Loan Program (SFHGLP) regulation to implement changes related to the use of special servicing options for non-performing loans. Rural Development invites the public to submit comments on all aspects on the proposed rule. Comments to the proposed rule may be submitted via the Federal eRulemaking Portal located at www.regulations.gov. While the public comment period is open for 60 days, RD encourages all interested parties to submit comments as soon as feasible. Comments must be submitted on or before March 28, 2023.

Recently, the VA announced the effective dates for both Circulars 26-23-03 and 26-23-04 are revised. The required updated forms are now effective for loan applications taken on or after April 1, 2023. See AmeriHome Product Announcement 20230211-CL for details.

Per PennyMac announcement 23-09 - VA Circulars 26-23-03 & 26-23-04: Updates to VA Forms, Pennymac is aligning with the updates to the VA forms announced in VA Circulars 26-23-03 and 26-23-04. The VA issued both circulars on 1/17/2023 with a mandatory effective date of loan applications on or after 2/1/23. The MBA has reached out to the VA regarding the implementation timeline on the forms and are waiting for a response. If the VA does extend the effective date, Pennymac will align with those changes. Pennymac has confirmed that a couple of the major document providers expect to have the required form updates deployed by 2/1/2023. Clients should contact their document/form provider to confirm readiness of the required VA form updates within the VA’s required timeline.

United Wholesale Mortgage (UWM) expanded its One-Time Close New Construction product to include VA. The one-time close product provides LOs with a unique opportunity to generate new business and build referral partnerships with builders and real estate agents. There is only one full credit report to order, one down payment, one closing and one interest rate, with the option to modify down if the market improves once construction is complete. UWM works through the process every step of the way.

With Circular 26-23-06, the Veterans Administration (VA) announced a reduction to VA funding fee rates for purchase, construction, and cash-out refinance transactions, effective for loans closed on or after April 7, 2023. See AmeriHome Mortgage Product Announcement 20230306-CL for details.

Citizens Correspondent National Bulletin 2023-08 includes information on FHA and VA Product Updates.

Capital Markets

Let’s review. The Federal Open Market Committee raised the fed funds target rate by 0.25 percent last week, as expected, following a couple weeks of banking turmoil. The Committee also softened its stance toward future rate increases by changing the language in their policy statement, saying additional firming “may” be appropriate versus previously saying additional firming “will” be appropriate. The forecasts released along with the policy statement show policy makers expect unemployment to rise to 4.5 percent by the end of the year and the fed funds rate to be 5.00 percent to 5.25 percent, a level the markets are currently not anticipating. Given the current risks to the economy, some market participants anticipate a rate cut within three to nine months if the slowdowns in wage growth and inflation are sufficient.

Elsewhere, of great interest to lenders and real estate agents, new home sales rose 1.1 percent and prices rose 2.7 percent to a median price of $438,200 in February. Sales of existing homes spiked 14.5 percent as a result of the interest rates dip in mid-January.

Time flies. This week sees the end of both March and the first quarter. Over the course of the week, there is $142 billion in month-end supply from the Treasury to get through today through Thursday, along with several higher tiered releases, particularly the Fed favorite PCE (for February), January home price indexes, March consumer confidence, final Q4 GDP, and final March consumer sentiment. The highlight of today’s economic calendar is a $42 billion 2-year note auction in the afternoon. Scheduled data today is nearly non-existent. Markets will also receive remarks from Fed Board Governor Jefferson. We begin the week with Agency MBS prices worse .125-.250, the 2-year at 3.94, and the 10-year yielding 3.46 after closing last week at 3.38 percent based on sentiment that the terrible bank news is in the rear-view mirror.

LO Jobs

“If you’re a Freddie/Fannie Seller Servicer seeking to expand your production and profits in these turbulent times we have a plug-and-play opportunity for you. This group is a Non-Delegated and Best Efforts Delegated Correspondent platform that is producing and profitable. As a stand-alone division, it comes equipped with operating systems, accounts, and an experienced correspondent group. The group is a very low fixed costs operator, with minimal initial start-up outlays, that will be operational in 60 days. Through outsourcing relationships, it can produce large volume with a small number of employees. The group is seeking mortgage bankers, credit unions, and regional banks that are Freddie/Fannie Seller Servicers, with a license footprint and a strong balance sheet to partner with and take their production to the next level. Visit us or email us to get in touch and explore the opportunity to take your business to the next level.”

“We’re Looking to the Future at PrimeLending…and Hiring! You read that correctly! While other companies are worried about making it through another month, we’re opening branches and adding talented loan originators all across the country. In fact, we added 53 producers already in 2023. One reason why so many top LOs are joining us is the strength and stability of our ownership, Hilltop Holdings, a $16.3 billion financial holding company. We’re part of a diversified and proven family of companies (PlainsCapital Bank, Hilltop Securities, and PrimeLending) that strengthen and complement each other. It's a win-win relationship! So, if you’re tired of losing sleep over the security of your position, maybe it’s time to make your move to lender that can support you now and in the future. Contact Nic Hartke today and sleep easy tonight.”

CBC Mortgage Agency (CBCMA), a nationally chartered housing finance agency and a leading source of down payment assistance for first-time homebuyers, has hired Mark Leslie as director, capital markets. Congratulations!