Don’t forget to put your flag out today for Flag Day. To warehouse banks, a “red flag” is a client who loses money for months on end, or for several quarters, and with good reason: counterparty risk has increased. (Below: a quick opinion of the current warehouse bank situation.) But back to the flag thing… Did you know that there are 986,000 U.S. flags in Manhattan? You didn’t? Me neither, and I just made up that statistic. The U.S. Census Bureau doesn’t make things up, and it reported that New York City continued to exhibit the largest numeric decline of any U.S. city, losing 123,104 people from 2021 to 2022. But this was nearly 60 percent less than its 2020-2021 population loss of 305,465. Declines also slowed in other large cities that had experienced significant population losses, including Boston, Chicago, Los Angeles, Philadelphia, Portland, and San Jose. Fort Worth, Phoenix, and San Antonio were the largest gainers. Do you have the products and branches to help those moving? (Today’s podcast can be found here and this week’s is sponsored by SimpleNexus, the homeownership platform that unites the people, systems, and stages of the mortgage process into one seamless, end-to-end solution that spans engagement, origination, closing, incentive compensation, and business intelligence. Today’s has an interview with SimpleNexus’ Ben Miller on why mobile matters to the modern mortgage movement.)

Broker and Lender Services and Software

“Are you thinking of using Artificial Intelligence? The adoption of AI is easily the game-changer that mortgage servicing needs as margins are compressed, resources restricted, and the cost to service increases yearly. However, the real question is, are you ready to implement AI into your operations? Read our blog "How to Prepare For and Measure the Effectiveness of AI in Your Servicing Operations?" and explore what steps you need to take to gain the most benefit. Step number one is the implementation of workflow automation. CLARIFIRE® is positioned to help mortgage servicers deliver workflow automation that captures the best aspects of operational efficiencies through process standardization and AI to optimize the results. Find out more about the steps to prepare for AI's benefits. Prepare your organization with CLARIFIRE, truly BRIGHTER AUTOMATION®.”

We have always heard about the need to be an "advisor" in the mortgage space. In this different market, now is an ideal time to revisit this for yourself and your team. Take 90 seconds and watch this great message from renowned industry speaker, author, and trainer Todd Duncan as he reminds us about the "why" behind this, while giving a nod to our good friends at Mortgage Market Guide, Tabrasa, and Bill Bodnar. You can learn more about Mortgage Market Guide here and reach out to Bill for special team, group and enterprise pricing for MMG. There has been a lot of sales atrophy in our space. You may wish to take a look at Todd Duncan's High Trust Sales Academy coming later this year.

More than 77 million consumers have thin or “invisible” credit files*, yet many may have the income and employment status that otherwise makes them qualified loan applicants*. (*Equifax Data & Analytics, 2022) The Work Number is the largest commercial repository for consolidated income and employment data. With access to 618 million records, The Work Number INSTANTLY returns records, updated each pay cycle, provided directly by employers and payroll providers, so there’s no need to collect an applicant’s private banking credentials, potentially exposing them and yourself to risk. Lenders and brokers have a choice: access The Work Number directly from Equifax or through our pre-built integrations with over 60 Point of Sale (POS) and Loan Origination Systems (LOS). Gathering all of the necessary information about potential borrowers through your LOS or POS is quick and efficient and can eliminate the need to swivel back and forth between systems, juggling multiple logins. Learn more.

“Tired of playing shuffle with your business? At wemlo®, we know variety isn’t always the spice of life, especially when it comes to providing an outstanding borrower experience. You work hard to consistently deliver a positive lending experience to help generate word-of-mouth business. We also want to help earn you more referral business. That’s why transparent communication and customer care are some of wemlo’s top priorities. Our processors work directly with the borrower and lender to seamlessly track everything down, so you don’t get bogged down with admin tasks. Trust us, we’re in the business of keeping customers happy – just look at our 4.7/5-star rating from borrowers. Ready to work with third-party processors that keep consistency at the heart of every borrower transaction? Learn more about wemlo’s reliable processors today. NMLS ID 1853218. *Q1 2023 Borrower Score: 45 responses 4.7/5.0.”

In 2022, NFM Lending launched its influencer division, which supported by Black Knight’s Surefire CRM℠ and Mortgage Marketing Engine, has been a runaway success. Using Surefire Power Video, NFM can send video outreach to followers, clients, and referral partners on influencers’ behalf at scale. With Power Video, NFM was able to close nearly 50 deals worth approximately $15 million in a single month, with over 4,600 leads converted over subsequent months. The Surefire Power Call feature has also been an incredible ROI generator for NFM, resulting in nearly 4,000 deals and around $1.3 billion in closed loan volume in 2022. Want to learn more about how NFM is generating thousands of leads without spending a dime on advertising? Download the full case study.

TPO Products for Brokers and Correspondents

Logan Finance has done it again. We exceeded our previous Non-QM funding record by over 50 percent in May and we’ll beat that record again in June. We want to extend a warm Thank You to all our clients who have entrusted us with their Non-QM business. We know we can only do this with great people. As part of our strategy to hire the best people in the industry, we have doubled our Non-QM AEs through the first half of 2023. Our rapid expansion, combined with a complete suite of Non-QM products and premier service, is a testament to the Great Experience Logan delivers. Speaking of products, check out our self-employed borrower solutions including 1099, Bank Statement, and P&L. Learn more about these Non-QM loan solutions, and let us show you the different ways We Work Hard to Make Non-QM Easy™. Call Todd Lautzenheiser at 317-721-9941 or visit us to learn why they call Logan The Agency of Non-Agency™.”

Verus Mortgage Capital just announced it is now offering a Closed End Second Lien Mortgage Program that allows borrowers to access their home equity for a variety of financial needs without impacting the interest rate on their first mortgage. This product features a fixed interest rate, a maximum loan amount of $500,000, a maximum CLTV of 80 percent, a minimum credit score of 700, standard income documentation (two years), and occupancy – primary residence. Verus offers a broad range of non-QM programs that help lenders generate new sources of ongoing business. As the industry’s indisputable non-QM leader, it has the experience, liquidity and financial resources originators need to successfully navigate the current environment. For more information or to set up a meeting, contact Jeff Schaefer, EVP – National Sales (202-534-1821).

Warehouse News

As a reminder, and an immense simplification, warehouse banks, or some would term funding facilities, loan money to independent mortgage banks, who don’t have cash from deposits to fund loans like credit unions and banks, to make loans. When those loans are sold to investors, the warehouse line is paid off, ready to fund more loans. Obviously the contractual and financial relationship is very sturdy.

But many lenders are in violation of their warehouse agreements: They aren’t making any money. Although loans on a warehouse line are collateral and have priority in the event of an IMB going under, banks don’t like counterparties that are losing money. There are some who believe others will follow Comerica’s lead of exiting warehouse lending for that reason. Some banks may “look down” on warehouse lending as it is not a big piece of banking revenue (i.e., low margin) compared to the risk of a lender going under or a wire that goes astray through faulty cyber policies. Liquidity for some banks with warehouse facilities is often a concern, as is warehouse competitors reducing lending rates and bettering terms to be competitive.

If there is good news for well-run IMBs, it’s that rates staying elevated will cause further consolidation or exits from the business.

Choosing which warehouse bank to use to fund a given loan is not easy, and many IMBs have turned to Optifunder for help in making that decision. (No, this isn’t an ad.) If you’d like to have some fun, ask about bond loans sitting on warehouse lines for months, waiting to be purchased, or what happens if the rate a lender is paying on their warehouse line is greater than the note rate of the mortgage that was funded on it, as sometimes happens. Any questions about warehouse banks, what they charge, what their restrictions are, etc., should be addressed to a lender’s CFO or capital markets group.

Capital Markets

Inflation calmed down in May to post the smallest headline advance since March 2021, and further deceleration looks likely in the coming months. Per the consumer price index, May inflation came in lower than expected, increasing a modest 0.1 percent month-over-month and 4.0 percent year-over-year in May (from 4.9 percent year-over-year in April). Shelter (+0.8 percent) and used cars and trucks were the big contributing factors, but signs that used car prices and rents are coming down or stabilizing are also contributing to the slowdown in prices. Yet it is still a far cry from the Fed’s 2 percent inflation target. Excluding food and energy, the core CPI rose a much stronger 0.4 percent.

Fed Chair Powell has mentioned goods, housing, and services ex-housing are the three main components driving up inflation. Goods issues were driven by supply chain problems in the early days of COVID, but the latest ISM reports confirm that inventory issues are no longer a problem and commodity price inflation is largely over. Home prices peaked in June of last year and are down about 5 percent on average across the country from their mid-2022 peaks, and rents for new leases (which lag home prices by about 21 months on average) are flatlining. The inflationary contributions of the housing component should continue to fade in the second half of 2023. And wage inflation continues to work its way lower, making it less of a concern for the economy despite robust hiring. May marked the first time in two years that wage growth outpaced consumer price inflation, and it’s been said that Fed officials are rethinking their view that wage gains are fueling inflation.

Although inflation continues to ease, inflation expectations rose during May and we’re seeing sentiment change amongst consumers and businesses. Consumer confidence slipped in May, reflecting worries about increased volatility and uncertainty in the labor market as buying plans dry up. Recent consumer credit reports show more reliance on the use of credit cards to maintain spending activity. The NFIB Small Business Optimism Index ticked up slightly in May, beating expectations of a decline. However, that bump in optimism was the first improvement in three months and came on the back of a 10-year low as owners are becoming more pessimistic about future growth and re-evaluate hiring and capital spending plans. Fortunately, for six straight months, more U.S. small businesses have been raising wages than prices, suggesting small businesses have returned to the pre-pandemic status quo of trying to find ways to avoid passing on higher labor costs to consumers.

Today brings the latest FOMC decision with the Statement and updated Summary of Economic Projections followed by Chair Powell’s press conference. The inflation data from yesterday should lock in a pause in rate hikes, though central bank officials will likely remain adamant that inflation remains far too high and that, even once they pause, they are likely to keep rates "higher for longer." Before the Fed, however, the MBS market took note that after mortgage rates declined for the second straight week, mortgage applications increased 7.2 percent from one week earlier. We’ve also received May producer prices. Expectations for the PPI were for a 0.1 percent decline month-over-month in the headline resulting in a 1.5 percent year-over-year increase, and they came in at -.3 percent and +1.1 percent year over year. We begin the day with Agency MBS prices better by about .125 and the 10-year yielding 3.80 after closing yesterday at 3.84 percent. The 2-year? 4.62.


A marketing leader seeking next career home! Are you ready to take your marketing to the next level? Or do you want to breathe some fresh air into your marketing department? Then you'll want to hear about this executive-level marketing professional. This person is upbeat, optimistic, has grown marketing teams from scratch, and has successfully driven annual loan volume increases by 78 percent! This professional has 18 years’ marketing expertise, over 10 years in leadership, and has extensive experience in the mortgage industry supporting branches and loan officers. With hands-on experience implementing the latest MarTech platforms such as Total Expert, Salesforce,, HomeBot, BombBomb, MBS Highway, Adwerx, Mortgage Coach, MonitorBase, HubSpot, and more, you’ll see immediate lift that will elevate your company. If you're looking for a new VP, CMO, or marketing director, send a confidential inquiry to Anjelica Nixt to learn more. Interested in remote opportunities only.

“SWBC Mortgage believes in exceptional service, and it starts at the top. Our leadership team cares about the employees and deeply values having direct communication with the field. The success of our loan originators is priority #1, and we strive to provide an unsurpassed level of support that will help grow their business to remarkable heights! We have big goals and are looking for those who can help us reach them. We combine innovation with personal interaction, empowering our loan officers to serve the communities where they live and lend. To learn more about how our unique setup helps maintain LO compensation and pricing, contact James Clark, Director of Strategic Growth, at James Clark or visit us here.”

“Yeah, you could keep hustling to grow someone else’s empire. Or you could use all your hard work to grow your own. But wait, how will you find the time to focus on expanding revenue while handling the day-to-day of a business owner? That’s where Motto Mortgage comes in. We’re a mortgage brokerage franchise, which means we’ve put an entire business together for you. We provide professional marketing content, product mix, wholesale lender relationships, compliance support, and more. From. Day. One. So let us do most of the heavy lifting. You have better things to do. Email us for all the details.”

Evergreen Home Loans™ created the Evergreen Cares Foundation with a mission to positively impact lives and help improve the communities they serve by encouraging and supporting their associates’ compassion for giving. This year, the Foundation partnered with Make-A-Wish® Alaska and Washington to sponsor two wishes for qualifying children, and the first of those wishes was granted for Coleman, who has battled bilateral retinoblastoma, a rare eye cancer. Coleman wished to go to Seattle Mariners Spring Training. He enjoyed a few wonderful days where he not only watched the team practice but was also able to spend time with them on and off the field, truly becoming an honorary Mariner. Giving back through meaningful causes like this connects to the company’s vision of changing the world one relationship at a time. Are you a loan officer that shares the same vision? View job opportunities on the Evergreen careers page.