Big and small, they aren’t the first and won’t be the last. Residential lenders everywhere are ruminating on Notarize laying off 75 percent of its legal staff, the closure of fledgling correspondent Cypress Mortgage Capital, “powered by Celebrity Home Loans,” and the announced winddown and shutdown of loanDepot’s wholesale channel, effective by Halloween, along with dramatic cuts to its retail division. Frank Martell took LD’s helm in April, and announced the bad Q2 results (fortunately helped by servicing income). loanDepot is not alone. Of course it’s stock, and that of nearly every lender, has not done well after its initial investors cashed out: LDI went public at $14 per share, hit a high that day of nearly $40 per share, and closed yesterday at $1.84. If someone had invested their life savings of $1 million at the high, their life savings would be worth $46,000 now. Thousands have been laid off, not only from loanDepot but from other lenders in their rush to lower expenses. (Those impacted can post their resume for free here and employers can view them for the nominal fee of $75.) United Wholesale Mortgage, however, posted a net income of $215.4 million in the second quarter, a 55% increase from 2021. And a look at the stock prices of Guild, Home Point, Finance of America, UWM, and Rocket all show similar patterns which are also reflected in the net worth of privately held lenders. And the autumn and winter are ahead of us. (Available here, this week’s podcast is sponsored by SimpleNexus, an nCino company and award-winning developer of mobile-first technology for the modern mortgage lender. Today’s has an interview with attorney Peter Idziak on temporary buydowns as a viable solution to affordability issues.)
Broker and Lender Services, Programs, and Software
“Western Alliance Bank’s Specialized Mortgage Services Group continues to be solution-oriented in changing markets by providing multiple financing vehicles and a comprehensive and robust suite of treasury management products and services. Our dedicated Deposit Services and Treasury Management teams understand the mortgage industry’s business needs and can react quickly and efficiently to customer needs. Our Warehouse Lending team finances a wide spectrum of loan types and works with borrowers to customize terms to meet investor and execution needs. Additional synergies exist for loans being sold to Western Alliance Bank’s wholly-owned subsidiary, AmeriHome Mortgage. MSR financing provides lines of credit that leverage Fannie Mae, Freddie Mac, and Ginnie Mae collateral. Lines can be annual or bi-annual revolvers or revolvers followed by term finance. Flexible structures provide solutions to accommodate originators’ MSR retention strategy. Contact Jennifer Schachterle, (720) 261-5774 or Mark Short, (469) 702-6212 for more information. Western Alliance Bank, Member FDIC.”
“Vegas may be all about luck, but don’t leave your secondary marketing strategy up to chance. If you’re attending the ACUMA Annual Conference from Sept. 18-21, make plans to chat with the experts from Optimal Blue, a division of Black Knight. Stop by our booth to discuss ways to boost competitive strategies and reduce costs so you can offer the most compelling products and rates to your members. You can also see our technology in action by visiting our innovation station, where we’ll be conducting engaging demos. With our actionable data and leading secondary marketing technologies on your side, you don’t have to wait to be dealt a lucky hand. Learn more at OptimalBlue.com.”
The need for REO asset management and disposition is set to increase as assets stalled in the moratorium pipeline become movable. Do you have an end-to-end REO asset management and disposition solution in place to help you handle the volume? Unlike others, Covius can address REO asset management, offer auction services, and bundle additional solutions to streamline processes and save expense. Whether it be through REO asset management solutions (including asset marketing, valuation, value assessment and closing and escrow), our Dual Path liquidation that opens two lanes for offers through REALTOR® partnerships and RealtyBid® auction or through our REO Straight-to-Auction program, clients rely on our expertise and hands-on approach. We have the market knowledge to adapt to the rapidly changing servicing environment, the skills to deliver maximized asset exposure and the solutions to enhance your net proceeds. Leveraging a single REO management and disposition solution can make all the difference! Contact our Covius/RealtyBid team to find out more.
Your appraisal order has been placed, the inspection has been done, and the appraiser turns in the report to your AMC. What are the final steps before you receive the appraisal report? What does your Quality Control (QC) review process entail? As part of our Lender Resource Series, we offer “The QC Review Process”; feel free to bookmark it for future reference. Brought to you by Triserv, a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service. To find out more, contact Triserv Appraisal Management Solutions.
Fatten up your pipeline for August with LoanStream Specials here for a limited time! New brokers, up to $500 off the appraisal fee (purchase), 25 bps off DSCR (purch & refi), 25 bps off Non-QM (purchase); for full details please visit here. Specials good only through 8/31/2022. Plus, work at your own pace and be in control of your loans in The Lounge (TPO Portal). The ONE Lender puts flexible and innovative technology to work for you. Submit in 6 clicks, disclose immediately & more! Submit a loan or Get Approved today!
Scale up or down on demand. Cycles will always come and go in the mortgage industry. If you’re still trying to manage the market’s cyclicality by adding or reducing headcount, you need a better solution. You’ll find it with the Mortgage Automation Suite by Richey May Automate and Zoral Group. Intelligent automation not only helps you weather downturns with fewer layoffs. It also helps you retain talent because there's less risk of jobs being eliminated and allows employees to focus on higher-level work. Hosted on Amazon Web Services (AWS), the Mortgage Automation Suite scales up or down on demand. So, you get a built-in backup virtual workforce that alleviates pressure on your staff from loan officers to underwriters and back-office employees. Learn more about how to decrease costs and increase productivity with the Mortgage Automation Suite by Richey May and Zoral. Sign up for a demo today.
Disaster Updates
Climate change, manmade or not, continues to impact people, impact the pricing of home loans in areas prone to fires and flooding and hurricanes, and impact insurance rates. Thank you to Brian B. for pointing out this story from the Sun Sentinel on how Weston Property & Casualty has become the fifth insurer this year to go insolvent.
Disasters, whether natural or manmade, coast to coast and beyond, can happen with no notice whatsoever or with plenty of warning. Lenders, investors, servicers, and insurance companies take their cue from FEMA’s declared disasters. And it is expensive stuff. For example, FEMA estimates that just one inch of water can cause $25,000 in damage to a home.
On 7/22/2022, with Amendment No. 4 to DR-4655, FEMA declared federal disaster aid with individual assistance for 1 additional Montana county affected by a severe storm and flooding from 6/10/2022 to 7/5/2022. See AmeriHome 20220704-CL Disaster Announcement for inspection requirements.
Mortgage Solutions Financial posted Announcement_DR-4663_09-22C. In response to FEMA’s Disaster Declaration for the State of Kentucky.
FEMA’s declaration of Kentucky as a federal disaster area with Amendment No. 2. to DR-4663, individual assistance has been made available to 2 additional counties See AmeriHome Correspondent 20220801-CL Disaster Announcement. Additionally, with Amendment No. 3. to DR-4663, FEMA declared federal disaster aid with individual assistance has been made available to 1 additional county affected by severe storms, flooding, landslides, and mudslides from 7/26/2022, and continuing. See AmeriHome Correspondent 20220803-CL Disaster Announcement for inspection requirements.
FEMA declared Kentucky counties of Breathitt, Clay, Knott, Letcher, and Perry as major disaster area beginning 07/26/2022 and continuing. For loans submitted with an appraisal dated on or before the incident period end date or for those submitted without an appraisal, Sun West will require an interior and exterior inspection prior-to-funding or purchase of any loans with subject properties that are determined to be at risk. The inspection must verify that the property is sound, habitable and in the same condition as when it was appraised. For more details, Sun West Partners can access the Sun West Seller Guide under the HELP section in sunsoft.
Mountain West Financial® posted an update that FEMA has issued an incident period end date of July 23, 2022, for the following declared disaster area counties in New Mexico due to wildfires and straight-line winds: Colfax, Lincoln, Mora, San Miguel, and Valencia.
Capital Markets
Like pieces of the economic puzzle, the markets received a couple data points yesterday ahead of today’s latest inflation reading, headlined by a wider than expected decrease in preliminary Q2 productivity (-4.6 percent), coupled with a larger than expected increase in unit labor costs (10.8 percent). The decrease in nonfarm business sector labor productivity from the same quarter a year ago was the largest decline in labor productivity from the same quarter a year ago since that data series began in the first quarter of 1948. Low productivity corresponds to a recession. The U.S. Treasury sold $42 billion in 3-year notes to good demand thanks to strong interest from direct bidders and international investors. Today brought the all-important July CPI report (flat, month over month, a major drop, core +.3 percent, year over year 8.5 percent, core year over year +5.9 percent). Expectations were for increases of 0.5 percent and 0.3 percent month-over-month in the headline and core and 8.7 percent and 6.0 percent year-over-year compared with 9.1 percent and 5.9 percent previously. Separately, as mortgage rates remained volatile last week, mortgage applications increased 0.2 percent from one week earlier, according to data from the MBA Weekly Mortgage Applications Survey. Ahead are wholesale inventories and sales, a Treasury auction of $35 billion 10-year notes, and remarks from Chicago Fed President Evans and Minneapolis Fed President Kashkari. Today’s MBS purchase operation sees the Desk in UMBS30s for up to $840 million 4 percent through 5 percent. We begin the day with Agency MBS prices are roughly .5 better from Tuesday afternoon and the 10-year yielding 2.69 after closing yesterday at 2.80 percent after the better-than-expected inflation numbers.
Employment
Are you a Loan Officer looking to make a move to advance your pipeline? Caliber Home Loans, Inc. may be the perfect fit. Ranked in the top 10 for New Builder Business by Zonda/Metrostudy in 2021, Caliber can offer you an experienced team to grow alongside of while expanding your own builder-focused knowledge and experience. With unique products and offerings like Lock & Shop/Sell, self-employed SMART series, extended rate options, and My Pipeline Connect portal for builders’ loan inventory status, you’ll have everything you need to keep your borrowers and builders satisfied and excited to refer. Ready to make a move? Apply now or contact Brent Lubahn.
“2020 and 2022 were record-setting for companies and originators, but will you be able to continue at that pace? Is your current company prepared for the next decade? Is your company having layoffs or making sweeping changes? Will you be able to retire at your current company? “Success can lead to complacency, and complacency is the greatest enemy of success.” (Brian Tracy.) Sometimes the best path forward is the one you haven’t considered. We focus on our managers continued growth; we don’t focus on their prior successes. We’re prepared for today’s market as well as the next decade. Our transition plan is simple and easy to execute. Whether rates go up or down there is a way to continue to grow and be one step ahead of your competition. Contact Chrisman LLC’s Anjelica Nixt to forward your note and schedule a confidential conversation and find out how we help leaders grow.”
“Do you have summer travel plans? We do! IMPAC is heading to Las Vegas next week for Originator Connect, booth #265. Register using code IMPACFREE. Stop by our booth to learn about our latest program updates and 24-hour underwriting turn times! Going to Orlando instead? Visit us at the FAMP Annual, booth #520. Wherever you'll be, our knowledgeable Account Executives can help answer any questions and show how NQM is in our DNA™. Also, Impac is hiring Wholesale Account Executives. We offer open territories, excellent compensation, a seasoned Ops team, Impac’s exclusive 21 & Done™ loan program (loan closings in 21 days or less; see here for details), and a solid leadership team with decades of experience in the mortgage and alternative credit industries. Reach out to Lisa Livingston, Talent Acquisition Manager, for more information. Equal opportunity employer.”
E Mortgage Capital (EMC), one of the largest independent mortgage platforms in the country, is pleased to share that over 100 mortgage professionals have joined EMC to help them take their business to the next level this year. EMC has built a platform that provides Branch Managers and Loan Officers with daily coaching, business planning and marketing resources to develop purchase production and provide better support to their strategic partners. "We have recently rolled out a daily curriculum to help coach and train loan officers to thrive in current market conditions. Through these daily initiatives, mortgage professionals have access to premium sales coaching and marketing technology that helps create a better experience for borrowers throughout the transaction" says Joe Shalaby, CEO of E Mortgage Capital. EMC is actively hiring Branch Managers and Loan Officers across the country with comp plans up to 500 BPS. If you are a licensed Mortgage Loan Originator looking to explore the E Mortgage Capital platform, please contact Joe Shalaby.
Flock Homes is searching for someone in capital markets.
The Money Store announced that Jeff Carter will join the company as the Chief Operating Officer. As the new COO, Carter will be responsible for the Disclosure Desk, Opening, Processing, Underwriting and Closing.
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