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Home Sales Stall; Sellers Need to be Realistic

May 20,2019
by admin

This one might smart a bit. There were big hopes for home sales in April, with interest rates continuing at unexpectedly low levels, unemployment at a 50-year low, and the spring market supposedly in full swing. Analysts polled by Econoday expected that the existing home sales number would jump from the annual rate of 5.210 million sales in March to a consensus of 5.350 million, with some forecasting as high as a 5.400 million rate. Instead, the National Association of Realtors® said existing home sales ticked down even further, adding to the 4.9 percent month-over-month decline in March.

Pre-owned single-family homes, townhomes, condominiums, and cooperative apartments sold at a seasonally adjusted annual rate of 5.19 million in April, down 0.4 percent from March. The year-over-year gap did narrow slightly from the 5.4 percent deficit in March; April sales were down 4.4 percent from the rate of 5.43 million units in April 2018.

Single-family homes sold at a seasonally adjusted annual rate of 4.62 million in April, compared to 4.67 million in March and fell 4.0 percent from sales of 4.81 million a year ago. Existing condominium and co-op sales did rise 5.6 percent from March to a seasonally adjusted annual rate of 570,000 but remained 8.1 percent below their sales level the prior April.

Lawrence Yun, NAR’s chief economist, said he is not overly concerned about the 0.4% dip in sales and expects moderate growth very soon. “First, we are seeing historically low mortgage rates combined with a pent-up demand to buy, so buyers will look to take advantage of these conditions,” he said. “Also, job creation is improving, causing wage growth to align with home price growth, which helps affordability and will help spur more home sales.”

The median existing-home price for all housing types in April was $267,300, an annual increase of 3.6% from $257,900 in April 2018. It was the 86th straight month of year-over-year gains. The median existing single-family home price was 3.7 percent on an annual basis to $269,300 and the median existing condo price of $251,000 represented a 3.4 percent annual gain.

The inventory of available homes increased to 1.83 million from 1.67 million in March and was 1.7 percent higher than the 1.80 million units available a year ago. Unsold inventory is at a 4.2-month supply at the current sales pace, up from 3.8 months in March and 4.0 months in April 2018.

“We see that the inventory totals have steadily improved, and will provide more choices for those looking to buy a home,” Yun said. He notes that sellers have to realize that price growth has moderated. “When placing their home on the market, home sellers need to be very realistic and aware of the current conditions.”

Properties remained on the market for an average of 24 days in April, down from 36 days in March and 26 days a year ago. Fifty-three percent of homes sold in April were on the market for less than a month.

College loan debt continues to hinder millennial home buyers according to Yun. “Given the record high job openings in the construction sector, some may want to take a gap year to work there and save. and thereby lessen the student debt burden,” he suggests.

“I think the market had a bit of a slow start in the Fall, but Realtors® all over the country have been telling me that April was a nice rebound. We’re hopeful and expect that this will continue heading into the summer,” said NAR President John Smaby. “Homes over the last month sold quickly, which is not only a win-win for buyers and sellers, but it’s also great for the real estate industry.”

First-time buyers were responsible for 32 percent of sales in April, down from the 33% reported both last month and one year ago. All-cash sales accounted for 20 percent of transactions in April, down from 21 percent in both March and a year earlier and 16 percent of all sales were to individual investors, who account for many cash sales. Only 3 percent of total sales were considered distressed, the same as in March but down 1 point from the prior April.

The only region to see an increase in sales in April was the West, up 1.8 percent to an annual rate of 1.11 units. Sales in the region however remain down 5.9 percent from one year earlier. The median price in the West was $395,100, up 1.3% from April 2018.

Sales in the Northeast decreased 4.5 percent from both the previous month and from April 2018 to an annual rate of 640,000 units. The median price grew 0.9 percent to $277,700.

Sales in the Midwest were flat at 1.17 million units, a decline of 7.9 percent year-over-year. The median price in the region rose 5.5 percent on an annual basis to $210,500.

Existing-home sales in the South dropped a modest 0.4 percent to an annual rate of 2.27 million in April, down 1.7 percent from a year ago. The median price was $236,800, representing annual appreciation of 4.4 percent.

Fueled by Low Rates, Prepayment Rate Continues to Rise

May 20,2019
by admin

With interest rates remaining at 2019 lows and spring market home sales kicking in, the rate of prepayments continues to rise. Black Knight, in its “first look” at April mortgage performance data, says the rate is up 17.54 percent from March and 17.65 percent year over year. Over the last three months the prepayment rate has increased by an aggregate of 67 percent. The rate in April was 0.99 percent.

The delinquency rate fell by 5.05 percent compared to March and is down 5.41 percent from April 2018. At 3.47 percent of all mortgages in the country, the rate is the lowest in Black Knight’s records dated back to 2000. Loans that were at least 30 days past due but not in foreclosure fell by 91,000 to 1.812 million in April. This was 73,000 fewer delinquencies than a year earlier.

Serious delinquencies – loans 90 or more days past due, but not yet in foreclosure – fell to 474,000, marking a 124,000 year-over-year decline (19,000 fewer than in March) and a 12-year low.

Foreclosure starts ticked up 4.28 percent to 41,400 mortgages but are still down more than 16 percent from the previous April. The foreclosure inventory, loans in the process of foreclosure, numbered 259,000 in April, .50 percent of all mortgage loans. This is down by 5,000 units from March and 55,000 year over year.

Non-current loans nationwide, including those in foreclosure, numbered 2.072 million, 127,000 fewer than in April 2018. The highest rate of non-current mortgages was in Mississippi at 9.95 percent, an annual increase of 6.5 percent. Louisiana had the second highest rate at 7.67 percent, also higher than during the previous April. The remaining states at the top of the non-current list were Alabama (6.60 percent), West Virginia (6.13 percent) and Arkansas (5.73 percent).

Black Knight will provide a more in-depth review of this data in its monthly Mortgage Monitor report. The April edition will be available by June 3, 2019.

MBS Day Ahead: Without Help, Bonds Face Uphill Battle

May 20,2019
by admin

In the day just past, bonds weakened moderately amid the lightest volume in more than 3 weeks and a relative absence of market moving data/events. The losses are somewhat logical in the sense that momentum measurements have increasingly suggested this month’s rally momentum was looking tired, not to mention the fact that friendly headlines and events have died down rapidly (i.e. no more daily doses of US/China trade war surprises).

Even if we wanted to say that Huawei news or speculation about the trade war’s effect on companies like Apple were still market movers this week, the impacts there have primarily been an issue for the stock market. Bonds generally shrugged off a rather steep drop in stocks yesterday and then bounced to the weakest levels of the day simply because stocks stopped selling.

In the day ahead, we can expect more of the same unless something new comes along to make a counterargument to the prevailing momentum. In terms economic data, we only have Existing Home Sales. This report CAN be a market mover on occasion, but is also easily overlooked. Basically, it would have to fall very far from the 5.35 million unit forecast to get much attention.

2019-5-21 open

Budgeting, Comp Products; Sales, Government Investigation Webinars

May 20,2019
by admin

What’s the banter, and in the unverified rumor mill, at the MBA’s Secondary Conference? Fannie, Freddie, and FHA are all concerned about being adversely selected against by lenders, and F&F are rumored to be ending pilot programs under FHFA direction. Regarding the QM Patch (expiring 1/10/21), industry insiders are working toward fixing the Ability to Repay Rule, in which case we wouldn’t need the Patch. Every FHA & VA lender should read Ginnie’s report from Friday as that organization is evaluating non-bank issuers. Lots of rumors about Freedom Mortgage purchasing RoundPoint Mortgage Servicing. Many lenders had good Aprils, profit-wise, and wholesale “pricing wars” are subsiding somewhat, but innovation in that sector continuing to push retail and correspondent channels – a good thing. That’s enough for one day – more tomorrow.


Lender Products and Services

Part 2 of the new four-part series, “A Crack in The Foundation?”, from Maxwell was just released. Starting in the 1970s, Part 2 follows the uneasy path of government policy & economic turmoil as we creep towards the end of the century. In this section, we’ll witness the astronomical growth in the secondary market, the mounting government pressure put on Fannie and Freddie to increase their offerings to lower- and moderate-income borrowers, as well as a widespread shift towards deregulation in the market that (spoiler alert) will prove to have disastrous consequences as the new millennium begins. No form or download required, it’s 100% free and a must-read for all mortgage professionals. Read Part 2 here. (If you missed Part 1 yesterday, start from the beginning here!)

FirstBank Mortgage replaced spreadsheets with LBA Ware’s CompenSafe for LO comp processing — and is boasting tremendous results. After adopting CompenSafe to optimize the execution of incentive compensation plans, the Tennessee-based lender has cut the time it takes to calculate loan compensation by 75%. Through CompenSafe’s direct integration with Encompass, FirstBank Mortgage’s sales force sees how much they are getting paid — and how their compensation was calculated — as soon as loans fund. As Director of Retail Mortgage Banking Lee Townsend described, “Out of all the technologies we have out there, the return on CompenSafe is by far the best. It’s more than a process improver; it’s a repository of HR insights, payroll insights and performance insights all in one place.”

Unlock opportunity in a growing market with Loan Product Advisor® asset and income modeler (AIM) for self-employed borrowers. AIM for self-employed is Freddie Mac’s solution to automate the manual lender process of assessing borrower income using tax return data. It’s also the industry’s only AUS-integrated self-employed borrower income calculation solution. AIM for self-employed makes it easier to do more business, close loans faster and get immediate income rep and warranty relief related to certain borrower employment income. Freddie Mac has teamed up with third-party service provider, LoanBeam®, in leveraging their expertise and powerful optical character recognition (OCR) technology to supply qualifying income for any applicant. Freddie Mac’s broad release of AIM for self-employed on March 6 is the next step in their journey to provide AIM for self-employed borrowers … and get YOUR edge.

Do you have enough staff for busy season? How do you know? Are you relying on previous year’s performance and past experience to set staffing levels, despite different market conditions? Richey May Technology Solutions’ flexible Budgeting and Forecasting tool connects to your LOS and HR Information System via API to help you model different staffing mixes and see their true costs all in one place. Don’t spend another season making your best staffing guesses; read Richey May’s latest blog post to learn how a robust Budgeting and Forecasting tool can solve this annual business challenge.


Events and Training

On May 23, Weiner Brodsky Kider PC offers a webinar on “Government Investigations” from 1-2 pm ET. Government regulators have been busy recently, issuing administrative subpoenas at the federal level and creating new consumer protection divisions at the state level. WBK’s Government Investigations webinar is designed to walk you through the process of government investigations and enforcement actions, including discussions of Civil Investigative Demands and administrative subpoenas, as well as enforcement actions. We will cover state and federal agencies, and discuss the general administrative process followed by most federal and state agencies. Join WBK attorneys Mitch Kider, Michael Kieval, and AJ Dhaliwal as they discuss the latest issues and trends in government investigations and how they may affect your company. SIGN UP TODAY!

For any lenders, servicers, or vendors doing residential business in California, the California MBA is offering three great incentives to “Start a Conversation” and join in May: 50% off first year dues, double the value of their 3Under35 program, and $1,000 off on sponsoring either 2019/2020’s Mortgage Innovators Conference. Click here to find out more.

Come enjoy a FREE Lunch & Learn with CoAMP and discover all you will need to know about Credit Reports on May 23rd. Register now.

Join MBA’s exclusive webinar series, Tuesday, May 28th from 2:00-3:00 ET;”D&I (Organizational): Learn from the Leaders Part II”. Learn how PNC implemented their Men as Allies program- an initiative specifically developed and designed to increase diversity and inclusion at their organization. The panel will discuss the importance of implementing D&I initiatives and share related successes and lessons learned. This webinar is complimentary to MBA members.

AMT Campus with Marve Stockert is offering two opportunities to attend an early CE in-class course. Avoid the rush and complete it early. Wednesday, June 5th in Grand Rapids, MI Click Here or Saturday, June 8th, Lombard, IL Click Here. Approved NMLS course that meets your 8 Hour CE requirements.

June 9-11 is NYMBA’s 5th Annual Convention in Albany. Sponsors & Exhibitors are encouraged to sign-up early. Guest speakers include MBA Chair Chris George, mPower’s Marcia Davies, Economist Marina Walsh, Mike McAuley, and Jack Konyk. Register TODAY. On the menu: API, CEO Roundtable, Compliance, Marketing to Millennials and Beyond, review of Affordable Housing Programs with Fannie Mae, Freddie Mac, SONYMA, USDA; NYS DFS Deputy Superintendent and more.

On June 12th from 7:30AM-5:30PM, AIME is coming to ACNJ at the Hard Rock Hotel & Casino with a special edition of its mortgage expert workshop “Broker All-Stars”. This is an opportunity to learn from top originators during their ‘Lightning Talks’ where they will present on select topics including: Social media marketing, Realtor business development, Customer retention, Recruiting, Specialty lending and Scaling.

Are you interested in the banking of cryptocurrencies, but unsure about the regulatory compliance considerations? CLA is offering a complimentary webinar on Thursday, June 13th

To introduce cryptocurrencies, an overview of the different cryptocurrency consumers that might approach a financial institution for services, the compliance considerations in opening and maintaining accounts for cryptocurrency consumers, the risks associated with banking cryptocurrency accounts, and what we see on the regulatory horizon.

The 2019 National Settlement Services Summit (NS3) is taking place June 18-20 in Phoenix at the Arizona Biltmore, a Waldorf Astoria resort. NS3 offers professionals across the real estate transaction empowering education as well as entertaining networking opportunities. Hear from regulators including Keynote Speaker Brian Montgomery, HUD Acting Deputy Secretary and Federal Housing Commissioner, the FTC, and representatives from state governments. Learn about the collaboration between industry partners from Consumer Bankers Association President Richard Hunt, Wells Fargo, Bank of America and First Choice Loan Services Inc.

The MBA of Florida announced the 16th Annual Eastern Secondary Market Conference and the 66th Annual Convention scheduled for June 18th-20th, Back to Back, are now open for registration. Information on exhibits, sponsorship, brochures with all programs and speakers including their bios are available now.


Capital Markets

Volumes were very light yesterday with the MBA National Secondary Market Conference partially to blame, and the U.S. 10-year closed at 2.42% in a mundane day for Treasuries as markets were without any progress in the trade dispute between the United States and China. In fact, talks may have regressed, as the Trump administration barred American companies like Broadcom, Intel, and Qualcomm from doing business with the Chinese telecom giant. Google’s Android operating system might be pulled from Huawei’s mobile phones.

Additionally, China’s President Xi Jinping visited a rare element mining company, leading to speculation that China could limit or stop exports of rare earth elements to the U.S. Also garnering some attention yesterday were the afternoon comments from FHFA head Calabria before the MBA conference, when he laid out a timeline that would end the dividend sweep and have the GSEs begin raising private capital at the start of next year, which is good for Fannie and Freddie. International data included Japan’s Industrial Production decreasing, but beating expectations in March, the country’s Q1 GDP growing well above expectations, and Italy’s Deputy Prime Minister Matteo Salvini lobbied for tax cuts to spur growth and lower the country’s debt burden. We probably won’t see much movement in Treasuries today with the FOMC minutes looming tomorrow.

Today’s calendar brings the Philadelphia Fed Nonmanufacturing Index for May (28.1) and April existing home sales. This morning also contains a hearing from the House Financial Services Committee on “Housing in America: Oversight of the U.S. Department of Housing and Urban Development” with HUD Secretary Ben Carson scheduled to testify. Also today, we have Chicago Fed President Evans and Boston Fed President Rosengren delivering remarks. Out the gate, Agency MBS prices are worse a few ticks versus Monday’s close and the 10-year yielding 2.43%.


Employment, Promotions, and Layoffs

There’s more excitement from the expanding and dynamic leadership team of Pinnacle Home Loans in Northern California. “Paul Gigliotti is joining our team as COO, and we could not be happier,” said Nevin Miller, President of Pinnacle. “Paul has a demonstrated track record of efficiently managing growing lending platforms and streamlining internal and external operational processes with meticulous precision”, said Nevin. When asked about the change, Paul said “Margin compression is changing the face of our industry, and Pinnacle is out in front of the issue. Their forward-thinking combination of low pricing, innovation, and superior loan officer support, is the new model today’s loan originator is seeking and deserves, and I couldn’t be more excited to be part of this change.” Branch operators and loan advisors interested in a confidential interview are encouraged to contact Peter Schwartz, EVP of Business Development. “Onwards and upwards” said Nevin.

Mortgage Investors Group unveiled an updated logo and fresh tagline to mark its 30th anniversary. The brand refresh also coincides with Mortgage Investors Group’s efforts to expand its retail presence in select markets across the Southeast, including Alabama, Florida, Georgia, North Carolina and South Carolina. The new modern, simple and sophisticated logo boasts a brighter green, while other aspects of the updated brand will guide the company in its growth into new markets. The design team ensured the updated brand remained recognizable to MIG’s loyal clients, Realtors and other community partners, while connecting with new borrowers and industry professionals. A brand refresh site, www.brandmig.com, helps tell the story, and will serve as a resource to its clients, employees and partners. Since opening its doors in 1989, MIG has served more than 125,000 clients in excess of $20 billion. The firm has nearly 400 employees in 26 branch locations from Memphis to the Tri-Cities, and has also been the THDA top lender for 16 successive years and the #1 TN USDA Lender for the past 5 years.

Freddie Mac Multifamily announced that it has named four vice presidents. Geri Borger Urgo is now VP, Production & Sales, overseeing the Southeast and Northeast regions, Michael Case is now VP, multifamily capital markets, overseeing all multifamily loan pricing functions, Catherine Evans is now VP, Small Balance Loan (SBL) underwriting, overseeing the SBL underwriting team, and Amanda Nunnink is now VP, Multifamily investor relations, leading the team that markets the multifamily securities platform.

Regarding reports that Ellie Mae cut 10% of its workforce, I received this note. “Last week we completed a restructuring of our team so that we can ensure Ellie Mae will continue to grow and achieve our goal of automating the residential real estate finance industry. Since the Thoma Bravo acquisition announcement in February, our leaders have been working on a plan with Thoma Bravo that enables us to continue to execute our strategy and maintain our leadership position in the market. To do this, we need to focus on our key priorities and deliver on a combination of both growth and profitability. While our strategy is the same, we now move forward as a private company, which required some restructuring in order to both achieve our financial goals, as well as to improve our ability to deliver on all of these critical initiatives. As part of this restructuring, we have made a very difficult decision to inform a little over 10% of our population from across the company that they will no longer be Ellie Mae teammates. These are not changes we take lightly. We will ensure our impacted teammates are treated with dignity and respect and they will be offered a package to assist them through this transition.”

Mortgage Rates Mostly Hold Near Lows, But Things Could Change Tomorrow

May 19,2019
by admin

Mortgage rates moved microscopically higher today, depending on the lender. In terms of underlying movement in the bond market, however, rates should have risen a bit more than they did. This has to do with the timing of the bond market weakness and the amount of movement lenders typically want to see before changing their mortgage rate offerings for the day. Simply put, weaker bonds suggest higher rates, but bonds didn’t weaken fast enough for most lenders to see their “re-price” threshold.

All of the above means that most lenders continued to offer rates that were very close to the lowest levels in more than a year. Only a handful of days have been any better, and all of them have occurred in the past 2 months.

Much of the credit for the recent drop in rates goes to the well-publicized trade tensions between the US and China. As the cycle of inflammatory headlines dies down, so too does the motivation for interest rates to remain as low as they have been. Granted, this is far from the only source of inspiration for interest rate movement, but it has probably been the biggest motivation over the past 2 weeks. Unless trade tensions flare up unexpectedly, or unless something else captivates markets in a similar way, there’s a risk that rates will continue to rise in the short term.


Loan Originator Perspective

Looks to be a short, slow week in bond markets, with scant data and the looming extended Memorial Day weekend break. Bond markets were trending lower as of early Monday PM. I don’t see much reason to float this week, for loans closing within 30 days. –Ted Rood, Senior Originator

I continue to advise clients to lock once within 30 days of funding. Going to take some major news or bad data for investors to drive rates lower than current levels. I see more upside risk to rates then downside improvement. –Victor Burek, Churchill Mortgage


Today’s Most Prevalent Rates

  • 30YR FIXED – 4.0-4.125
  • FHA/VA – 4.0%
  • 15 YEAR FIXED – 3.875%
  • 5 YEAR ARMS – 3.875-4.25% depending on the lender



Ongoing Lock/Float Considerations

  • Early 2019 saw a rapid reevaluation of big-picture trends in rates and in markets in general

  • The Federal Reserve has been a key player, and while they aren’t the ones pulling the global economic strings, their response to the economy has helped rates fall more quickly than they otherwise might.

  • Based on the Fed’s laundry list of concerns, the bond market (which determines rates) will be watching economic data closely, both at home and abroad. The stronger the data, the more rates could rise, while weaker data could lead to new long-term lows.
  • Rates discussed refer to the most frequently-quoted, conforming, conventional 30yr fixed rate for top tier borrowers among average to well-priced lenders. The rates generally assume little-to-no origination or discount except as noted when applicable. Rates appearing on this page are “effective rates” that take day-to-day changes in upfront costs into consideration.

MBS RECAP: Bonds Skittish After Stocks Find Bottom

May 19,2019
by admin

Both stocks and bonds have been edging back into less panicked territory after trade war drama fizzled out last week. In other words, stock prices and bond yields were moving higher together. To be fair, bonds got one last rally push from Italy/EU drama mid-week (stocks didn’t care as much about that one). Either way, by the end of last week the worst of the “risk-off” momentum appeared to be over and momentum looked to be shifting back in the other direction.

Overnight weakness in equities markets threatened to push bond yields back down and create a green day for rates as opposed to modest weakness implied by the recent trend. But stocks were only ever looking panicked in the overnight and early morning hours. As soon as the 9:30am NYSE session got underway, stocks found their footing, and bonds left the party.

10yr yields rose from roughly 2.39 to nearly 2.42% in short order and then leveled off in the afternoon.

Fannie 3.5 MBS fell fairly steadily throughout the day, ultimately losing just over an eighth of a point.

There were no significant economic reports, but several big corporate bond offerings may have added to the general sense of pressure on bonds. Perhaps even more important was the fact that today’s volume was the lowest since April 29th. Thus, some of the weakness could purely be a factor of iilliquidity.

The EDGE: Week Of May 20, 2019

May 19,2019
by admin

In This Week’s “The EDGE”

  • Houston Unemployment Nears Record Low
  • Get the Facts on Flooding
  • Earn Your Global Certification
  • Embrace the Three Rs

For your convenience, this presentation was saved in two different formats. Click the icons to download in .pdf (Acrobat) or .ppt (PowerPoint)

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Source: Houston Association of REALTORS®

Training, Reno, Appraisal Products; Compliance Warning; FHFA, Fannie, Freddie News

May 19,2019
by admin

Tony H. sent, “A conference is a gathering of people who singly can do nothing, but together can decide that nothing can be done.” Not at this MBA event, right!? Here in New York there’s a lot to talk about. Ellie Mae laying off 10% of its workforce, for example. MERS reporting 19,000 eNotes added to the MERS eRegistry during the first quarter of 2019, more than in all of 2018. At the MBA’s Secondary Conference one topic being batted about is the LTV ratio. Yes, the “lender to vendor” ratio has been sinking over the years as the number of vendors has increased. One-month bank statement programs? Yup, there’re out there. Chase Advantage reminding capital markets folks of 2006 programs & pricing through “access to the private MBS market?” Yup. Love that high balance product with no Agency G-Fees. The ability of MI companies’ black boxes to give different borrowers in different areas different prices? Yup.


Lender Products and Services

Come meet NewRez Correspondent at the MBA Secondary to learn how we can expand your capacity with speed and ease! “We continue to add new technology to our lender platform to enhance and streamline the correspondent lending process,” says Lisa Schreiber, SVP Correspondent Division. “We are proud to announce the recent integration of Ellie Mae’s Encompass Investor Connect system-to-system workflow which accelerates purchase times and enhances efficiency for all products we offer. It is an exciting time at NewRez with much more to come in the Non-QM space as well, including a newly-branded AUS coming soon!” Send Lisa a note to set up an appointment at the MBA Secondary and to learn more about how NewRez is committed to helping grow your business.

“Part one of a new four-part series titled, “A Crack in The Foundation?” from Maxwell was released this AM; it examines the roots of the American mortgage beginning in the 1930s and traces the establishment of the Federal Housing Administration (FHA), as well as the birth of Fannie, Freddie, and Ginnie, to look at the inception of the modern mortgage and its impact on home ownership. The series as a whole examines the evolution of the mortgage industry and homeownership in America, with an eye on government policies and how GSEs can promote (or prohibit) periods of economic growth. We have to know where we came from to understand where we’re going, and this series uses our past to speculate on where our industry can go in the future. No form or download required, and it’s 100% free. Read Part I here, and don’t miss Part II debuting here tomorrow morning.”

Calling all Marketing Managers: How difficult is it to produce compliant marketing that is targeted, localized, and customizable, while meeting your Loan Officer’s deadlines? Usherpa’s Launch Pad Custom Email Wizard was designed for corporate marketing teams and allows marketers to create materials that align with your unique company vision and brand strategies. Why switch between multiple systems to build content on demand when you can seamlessly design email campaigns within Usherpa CRM? Launch Pad is your one-stop shop to getting the right messages out at the right time— whether it’s a Lunch and Learn invitation for an individual LO, a companywide, targeted drip campaign, or internal messaging. Effortlessly build a library of collateral that is directly linked to Loan Officers’ databases and Loan Origination System. Don’t hesitate, learn how Usherpa’s HTML email wizard leverages your efforts while saving an impressive amount of time.

Reggora, a leading appraisal technology company, has doubled down on its efforts to fully automate the residential appraisal process for mortgage lenders and appraisers. Following significant investment from premier venture capital firms including early investors in Twitter, Wayfair, and Slack, Reggora has integrated with leading loan origination systems including Ellie Mae’s Encompass and Byte Software. These integrations and new partnerships with lenders across the country have fueled Reggora’s growth over the past few months. Reggora offers lenders an automated all-in-one appraisal platform that uses an “Uber-style” approach to streamline the appraisal process from A to Z. Through advanced and customizable workflows, Reggora’s core features include payment processing, algorithmic ordering, automatic rule-based reviews, appraisal delivery, status updates, and more. Lenders using Reggora today experience significantly reduced turn times, lower internal overhead, and an improved buyer experience. Learn more about how Reggora’s unique system can improve your appraisal process by emailing Pablo Aabir Das at pablo@reggora.com.

Have you seen the new Calyx®? That’s right, today, after almost 30 years in business, Calyx unveiled a new brand identity, website, and enhanced service options for customers. The updates more closely align with the characteristics Calyx customers associate with the Calyx name: easy-to-use, accessible, reliable and customer focused. The new logo gives a nod to the Calyx name and symbolizes the company’s commitment to its customers’ growth. The company’s product suite—which includes Point®, its flagship LOS; Path®, its cloud-based LOS; Zip™ its point-of-sale solution; and others in development—will adopt the Calyx logo with their own name and designated color palette. The company also introduced a new online tool that will enable customers to access training materials, register for webinars, and download product resources in a centralized portal. See what all the buzz is about at www.calyxsoftware.com.

Are you looking for real-time reporting, access to call recordings and proactive communication with your borrowers? TMS Subservicing provides you the perfect combination of high tech and high touch servicing. SIME is TMS’s spectacular web-based servicing platform. It provides full transparency into your loan portfolio while providing tools for oversight that you can rely on. Watch this video to get a quick overview.

The mortgage industry is in flux. Fluctuating interest rates. Shrinking inventories. Changing borrower needs. Wouldn’t it be nice to have some consistency– especially from your automated underwriting system? Freddie Mac Loan Product Advisor® delivers reliable eligibility findings that foster responsible lending and give you confidence that you’re originating quality loans.Its innovative capabilities were developed in collaboration with lenders, providing automation and insights that help reduce costs and increase efficiency. What does it all mean for you? Greater opportunity for business growth and an edge on the competition– The Freddie EdgeSM. Learn more about ACE and AIM, available exclusively through Loan Product Advisor®.

Renovating is becoming an increasingly popular strategy in today’s high-cost, tight inventory housing environment and Plaza Home Mortgage is making it easier for correspondents to participate in this market. Plaza’s renovation mortgage program includes FHA 203(k), Fannie Mae® HomeStyle® and VA Renovation options. Plaza’s flexible delivery options include Best-Efforts, Single Loan Mandatory, Bulk, Direct Trade and Assignment of Trade (AOT) through its Mandatory trade desk. Plaza has a department of dedicated renovation specialists to answer all specific correspondent renovation loan questions that can be reached here.

Like it or not, we are back on the seasonality train in the mortgage industry, and the ride is about to get interesting. The XINNIX Performance Training, Accountability and Coaching Programs are filling up fast with loan officers focused on elevating their performance to take advantage of an extremely busy summer homebuying season ahead. The XINNIX System’s proven methodology increases experienced Loan Officer production an average 40% and produces new loan officers that average 4.6 loan applications in their first 30 days in the market! Why wait to Elevate your production? XINNIX is offering a special 10% discount on all of its award-winning programs. The offer expires at the end of May, so visit XINNIX online today and enter promo code ELEVATE2019.


Compliance Warning

Secure Insight has recently sent a notice to title underwriters nationwide regarding a surge in E&O policies offered to attorneys and title agents mirroring traditional insurance but actually offering non-insurance shared-risk coverage. There is concern because the “coverage policies” are not filed, not subject to insurance department oversight, based offshore outside of the jurisdiction of US courts, and are not subject to audit to verify financial viability. Title underwriters require agents to have insurance coverage, as do many states such as Florida and Virginia, and attorneys and title agents who purchase these policies may think they are meeting contractual and licensing requirements in error as these policies, often 1/10th of the annual cost of traditional insurance, may not be compliant. Andrew Liput, CEO of Secure Insight, stated, “It appears many attorneys and others are being misled into believing that they can actually receive $2 million in aggregate insurance coverage for $400 annually rather than $4,000 annually, and they will meet their own risk needs and those of their counter-parties in the mortgage industry. We will not be accepting these policies in lieu of actual insurance so that we may assure that our lender clients have a real source to offset potential losses and not one that looks like insurance but is really something else.”


Fannie, Freddie, and FHFA News

As the Agencies make great strides toward the Uniform Mortgage Backed Security and the Common Securitization Platform, there is plenty going on behind the scenes. Craig Phillips, a veteran Wall Street mortgage trader who joined the Treasury Department as a top aide to Secretary Steven Mnuchin in 2017, is heading back to the “private sector.” His mandate was to help overhaul Fannie and Freddie. Up the government food chain, on Friday President Trump said “freeing” F&F from government control is a “pretty urgent problem” that his administration plans to work with Congress to address and that they’re discussing ideas for fixing Fannie and Freddie with “some incredible talent from Wall Street.” Given the Agencies have paid the government $105 billion more than they received makes the issue not so urgent with Congress.

Last week Federal Housing Finance Agency Director Mark Calabria spoke at NAR’s Regulatory Issues Forum. The former NAR economist spoke about his vision for the future of Fannie Mae and Freddie Mac, along with a host of other policy issues in front of him at the FHFA. Specifically, he outlined his priorities for ensuring the GSEs can appropriately move away from conservatorship. “I would not feel comfortable having [the GSEs] exit conservatorship until I’m comfortable knowing that we never go back to the old days, pre-crisis, and that we have a Fannie and Freddie that are responsible, good corporate citizens that don’t have the arrogance we saw before the crisis,” he said.

Freddie MacGuide Bulletin 2019-10 announces it will no longer purchase LIBOR-indexed ARMs with Freddie Mac settlement dates more than six months after the note date. This change is effective immediately and is being implemented in consultation with the Federal Housing Finance Agency.

Freddie Mac has provided a follow up to clarify the delivery of Closing Cost and Down Payment data points, among other updates, under the Uniform Loan Delivery Dataset (ULDD) Phase 3. Additionally, the ULDD Phase 3 specification was updated to provide guidance for mapping certain Uniform Loan Application Dataset (ULAD) data elements to ULDD, which may be used as of July 1, 2019 when the new Uniform Residential Loan Application (URLA) is optionally available for use. Lastly, new enumerations (credit score providers) were added to ULDD Phase 3 to provide more Seller options to retrieve merged credit. Read the full announcement for details.

Fannie Mae’srecently updated Servicing Guide clarifies its policy regarding mortgage insurance (MI) termination solicitations, simplify our policies by removing references to designated document custodians, and more.

On May 20th, Fannie Mae’s EarlyCheck™ Version 5.8.2 will change the severity of ULDD Phase 3 edits from Warning-to-Fatal to Fatal. This aligns with the planned ULDD Phase 3 edit severity changes in Loan Delivery.

In her recent executive perspective, Helping Homeowners When They Need it the Most, Yvette Gilmore, VP of Servicer Relationship and Performance Management at Freddie Mac, talks about the important role that Servicers have from the lens of a homeowner. Delving into how difficult it can be for homeowners to get the answers they need when they need it, Yvette takes this opportunity to reveal how Freddie Mac is making great strides to change the landscape of servicing in three key areas: technology, data, and process.


Capital Markets

U.S. Treasuries ended the week in a slight curve-flattening fashion, including the 10-year closing at 2.39%, during a session which featured few indications that the U.S.-China trade conflict is heading for a speedy resolution. Right. On other trade fronts, the U.S. will remove tariffs on metal imports from Canada and Mexico in exchange for establishing a mechanism to ensure that Chinese steel is not being shipped to the U.S. through Canada or Mexico. Additionally, the White House announced the implementation of tariffs on auto imports will be delayed by six months. Domestic data revealed in-line Leading Indicators for April and a much better than expected preliminary reading of the Michigan Sentiment Survey for May. The Survey was driven by positive attitudes about the outlook, although the results were tabulated before the recent setback in trade negotiations with China and implementation of new tariff rates on both sides, which raises the prospect of a downward revision with the final report for May.

Turning to this week, the highlight is likely Wednesday’s minutes from the Apr 30 / May 1 FOMC meeting. SIFMA also recommends an early close on Friday ahead of the long Memorial Day weekend. Today the MBA Secondary Market Conference & Expo is in full swing and continues into Wednesday in midtown Manhattan. The Chicago Fed National Activity Index is the only news, hardly a market mover. The markets do have a lot of Fed speakers to digest, with Atlanta’s Bostic, Philadelphia’s Harker, New York Fed President Williams, Vice Chair Clarida, and finally Fed Chair Powell all take the stage throughout the day. Tomorrow brings only April Existing Home Sales before things pick back up Wednesday with the Weekly MBA Mortgage Index; and May FOMC Minutes. Thursday sees April New Home Sales before we close the light week with April Durable Orders. We begin today with Agency MBS Prices a shade better versus Friday and the 10-year is yielding 2.38%.

Jobs and Transitions

The Mortgage Firm has been recently recognized for their customer service levels and ranked as one of the top workplaces for mortgage professionals by Social Survey and Mortgage Professional Magazine, respectively. With over 11,000 surveys to date, The Mortgage Firm placed as the #1 mid-sized Lender in customer satisfaction with an average score of 4.92 out of 5.0 stars. Also recognized were 15 of their Loan Originators for ranking in the top 250 out of 30,000 mortgage professionals nationwide. Mortgage Professional Magazine recognized The Mortgage Firm as the fourth ranked mid-sized Mortgage Banking firms to work for. Mickey Schilling, Director of Strategic Growth, says “Our unique flat management structure and elimination of unnecessary layers allows our branch managers to have autonomy at the branch level”. If you’re a producing Branch Manager or top Loan Originator who is tired of the corporate structure and would like to align themselves with a company that is doing things right, contact her today.

Secure Insight announced that it has expanded its sales force with the hiring of Jim Reynolds (as National Sales Director), former Senior Managing Director at RiskSpan and former SVP at CoreLogic, and Bill Young as East Coast Regional Sales Manager. “These new hires are the first in a series of moves by the company to expand its sales force geographically to capture a larger share of the national vendor management/closing table risk market.”

MBS Day Ahead: Holiday-Shortened Trading Week Promises Little Inspiration

May 19,2019
by admin

In the week just past, bonds managed to extend the already unexpected gains that began on May 6th following a sharp escalation in US/China trade war rhetoric. Trade-related news continued to be a market mover throughout that two week period, and markets remain susceptible to “aftershock” headlines. Last Wednesday saw a flare-up in Italy/EU tensions revolving around the country’s decision to violate EU budget rules. In general, risks to EU monetary stability are good for the bond market. There was limited economic data throughout the week, but logical reactions in general. That said, the size of the reactions was muted by the market’s focus on geopolitical issues.

In the week ahead, data will once again be limited with new and existing homes sales reports being the only notable inclusions during the first 4 days. Friday brings what would normally be the week’s most significant report in the form of Durable Goods Orders, but its impact may be lessened by the fact that markets close early for Memorial Day weekend. In general, trading runs the risk of becoming increasingly idiosyncratic the closer we get 3.5-day weekends. This is most easily ascribed to the fact that trader participation quickly begins to dwindle. Just as in a scientific study, where a lower sample size leads to less conclusive results, so too does a smaller trader population lead to trading levels that may not necessarily be indicative of the broader consensus.

In the bigger-picture technical perspective, bonds are at risk of exiting the 2-week trend of unexpected gains. The blue/red and green/teal lines in the chart below are both suggesting momentum is overbought in short and medium-term time frames respectively. Granted, technical studies are not reliable ways to predict the future, but they are telling us that bonds will face at least some technical pressure, all other things being equal.

2019-5-20 open

New Data Prompts Freddie Mac to Upgrade Their Forecast

May 19,2019
by admin

Freddie Mac’s May Forecast continues to look for a downward trending interest on the 30-year fixed-rate mortgage. The company’s economists are project an average rate of 4.3 percent this year with a small increase to 4.5 percent in 2020. Coupled with a strong labor market, low unemployment, and “modest” wage growth, this should mean a steadily growing housing market this year.

The forecast is for total housing sales, both new and existing, to slightly best the 2018 number of 5.96 million units, rising to 5.98 million. Existing home sales will account for 5.35 million of the total and new home sales for 630,000 units. Sales in 2020 are expected to be even better, at 6.14 million overall.

Housing starts will be flat this year, with single-family starts gaining 0.01 million units to 0.88 million and multifamily declining by the same amount to 0.37 million. Single-family starts are projected to take off in 2020 however, jumping to 0.98 million units while multifamily starts tail off to 0.35 million.

Home price growth in the first quarter was slightly higher than forecasts anticipated so Freddie Mac has revised its expectations for the year’s growth from April’s 3.5 percent to 3.6 percent. However, they are holding to the earlier 2020 home price forecast for a2.6 percent increase.

The declining interest rates are expected to provoke a recovery from the 2018 slump in mortgage originations, providing an impetus to first-time homebuyers and to those homeowners looking to refinance. The total originations volume in 2018 of $1.636 trillion will grow to $1.733 trillion this year then level off to $1.701 trillion in 2020.

The company is revising the composition of its forecasts for residential mortgage debt. They have previously included multifamily mortgages but will now forecast the growth rate for single-family residential debt of households and nonprofit organizations. That new forecast is for the rate of growth in outstanding debt to b 2.9 percent both this year and next.

Freddie Mac’s April Forecast was written before the first estimate of the first quarter’s growth in Real Gross Domestic Product was released. That number far exceeded expectations at 3.2 percent. This month’s Forecast attributes the unexpected growth to “transitory” factors like private inventory investment that are unlikely to persist throughout the year. However, given the growth rate, Freddie Mac has revised its 2019 GDP projection from 2.0 percent to 2.3 percent. The forecast for 2020 remains at 1.8 percent.

The April Jobs Situation report from the Bureau of Labor Statistics included an estimate of the unemployment rate at 3.6 percent, a 50-year low. Freddie’s economists have lowered their unemployment rate forecast accordingly to 3.7 percent. Overall, they expect the rates to be 3.8% and 3.9% in 2019 and 2020, respectively.