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Home Price Index Shows Signs of Losing Momentum

May 23,2018
by admin

Home prices in the first quarter of 2018 were 1.7 percent higher than at the end of the fourth quarter of last year. The Federal Housing Finance Agency said its Housing Price Index (HPI) gained 6.9 percent when compared to the level at the end of March 2017. On a monthly basis prices were 0.1 percent higher than in February.

The month over month rate of increase in March was significantly higher than the 0.6 percent gain from January to February, but the annual increase slowed compared to the previous month. The rate of appreciation from February 2017 to February 2018 was 7.2 percent.

“Home prices continue to rise across the U.S. but there are signs of tapering,” said Dr. William Doerner, FHFA’s Senior Economist. “Since housing markets began to rebound in 2012, house price appreciation has been positive because demand has outpaced supply. In the last month, however, some regions reflect a slowing or even flattening of house price growth.”

Home prices were up in all 50 states and the District of Columbia between the first quarter of 2017 and the first quarter of 2018. Nevada, still recovering from the housing crisis, saw prices rise 13.7 percent while there was a 13.1 percent gain in Washington State. The other states in the top five were Idaho at 11.1 percent; Colorado,10.6 percent; and Utah, 9.9 percent.

Each of the 100 largest metro areas also saw annual increases. The degree of appreciation ranged from 0.8 percent in Tulsa to 17.1 percent in the Las Vegas area.

The Pacific was the census division with the greatest gains over four quarters, 9.5 percent and a single quarter increase of 2.6 percent. The weakest region was East South Central, but even there, prices were up 5.3 percent for the four-quarter period.

There were other signs of weakening appreciation. Four of the nine census divisions, Pacific, West South and East South Central, and New England, posted negative monthly numbers.

The FHFA HPI is calculated using home sales price information from mortgages sold to or guaranteed by the GSEs Fannie Mae and Freddie Mac. The HPI was indexed at 100 in January 1991. The current national HPI is 261.7

Existing Home Sales Reverse Course, Down 3%

May 23,2018
by admin

Existing home sales put an end to two straight months of gains, retreating in April on both a monthly and annual basis. The National Association of Realtors® said the sales of single-family homes, townhouses, condos, and cooperative apartments dropped by 2.5 percent from March’s estimate of 5.60 million to a seasonally adjusted annual rate of 5.46 million. That put sales at a 1.4 percent deficit when compared to April 2017. It was the second straight month that sales have lagged on an annual basis.

Economists polled by Econoday were not looking for greatly improved numbers but results even missed that target. Estimates ranged from 5.48 million to 5.64 million. The consensus was for no change from the March 5.60 million number.

Single-family home sales were down by 3.0 percent to a seasonally adjusted annual rate of 4.84 million from 4.99 million in March and are 1.6 percent below the 4.92 million sales pace a year ago. Condo and co-op sales continued their recent strong performance, rising 1.6 percent to 620,000 units, level with sales in April 2017.

What NAR called “staggeringly low inventories” of available homes again got the blame for the disappointing sales volume even though that inventory rose sharply from March. Lawrence Yun, NAR chief economist, says “The root cause of the underperforming sales activity in much of the country so far this year continues to be the utter lack of available listings on the market to meet the strong demand for buying a home,” he said. “Realtors® say the healthy economy and job market are keeping buyers in the market for now even as they face rising mortgage rates. However, inventory shortages are even worse than in recent years, and home prices keep climbing above what many home shoppers are able to afford.”

The median existing-home price for all housing types in April was $257,900, up 5.3 percent from the median of $245,000 a year ago. The increase marks the 74th straight month of year-over-year gains. The median existing single-family home price was $259,900, a 5.5 percent annual increase and condo/coop prices rose 3.4 percent to $242,500.

The much-lamented inventory of available housing stock at the end of April was 1.80 million homes. This was a significant 9.8 percent uptick from March but is still 6.3 percent lower than the 1.92 million homes for sale the previous April. For-sale listings constitute an estimated 4.0-month supply at the current rate of absorption compared to a 4.2 month supply last year. The inventory has fallen year-over-year for 35 consecutive months.

Properties typically stayed on the market for 26 days in April, down from 30 days in March and 29 days a year ago. Fifty-seven percent of homes sold in April were on the market for less than a month.

“What is available for sale is going under contract at a rapid pace,” said Yun. “Since NAR began tracking this data in May 2011, the median days a listing was on the market was at an all-time low in April, and the share of homes sold in less than a month was at an all-time high.”

“With mortgage rates and home prices continuing to climb, an increase in housing supply is absolutely crucial to keeping affordability conditions from further deterioration,” said Yun. “The current pace of price appreciation far above incomes is not sustainable in the long run.”

First-time buyers accounted for 33 percent of sales in April, the highest share since last July, compared to 30 percent in March and 34 percent a year ago. Individual investors bought 15 percent of homes sold, and 21 percent of transactions were all cash. Distressed sales continue to shrink and are now at the lowest level, a 3.5 percent share, since NAR started tracking them in 2008.

Existing home sales were flat or declined in all four regions and three are now running behind their 2017 levels. In the Northeast sales fell 4.4 percent to an annual rate of 650,000, putting them 11.0 percent lower than a year ago. The median price in the Northeast was $275,200, which is 2.8 percent above April 2017.

Sales were unchanged in the Midwest from the prior month at an annual rate of 1.29 million and are 3.0 percent below the previous April. The median price in the Midwest was $202,100, an annual increase of 4.6 percent.

The South posted a 2.9 percent decline in sales to an annual rate of 2.33 million but remained above last year’s number by 2.2 percent. The median price was $227,600, up 3.9 percent from a year ago.

There was a 3.3 percent drop in existing-home sales in the West. The annual rate of 1.19 million was 0.8 percent lower than a year earlier. Still, prices rose on an annual basis by 6.2 percent to a median of $382,100.

Mortgage Rates Drop to Lowest Levels in 2 Weeks

May 22,2018
by admin

This week hadn’t been too traumatic for mortgage rates through yesterday afternoon, but neither had it been positive in any noticeable way. That changed today as rates fell abruptly to the lowest levels since last Monday. Granted, at the time, last Monday’s rates were still pretty close to the worst in 7 years, but the point is that we’ve managed to find our way back from the even higher rates that followed.

Help came chiefly from European political developments where Italy is a day or two away from confirming a government that could end up pushing the country out of the Eurozone. Even though that’s far from guaranteed, the mere risk of such a thing is enough to drive investors toward safer haven bonds like those issued by Germany or the US. In general, excess demand for bonds means rates move lower.

Loan Originator Perspective

Take advantage of the improved pricing and get locked in. Not sure bonds can continue with this rally much further so much more to lose than to gain by floating. – Victor Burek, Churchill Mortgage

The still of the Night can be Scary. Not sure what to make of the flatness of Rates at this time. Still locking at Origination. –Al Hensling

Today’s Most Prevalent Rates

  • 30YR FIXED – 4.75%
  • FHA/VA – 4.5%
  • 15 YEAR FIXED – 4.25%
  • 5 YEAR ARMS – 3.75-4.25% depending on the lender

Ongoing Lock/Float Considerations

  • Rates have been moving higher in a serious way due to headwinds that cannot be quickly defeated. These include the Fed’s increasingly restrictive monetary policy outlook, the increased amount of Treasury issuance to pay for the tax bill (higher bond issuance = higher rates), and the possibility that fiscal stimulus results in higher growth/inflation.

  • While we may see periodic corrections to the broader trend toward higher rates, it’s safer to assume that broader trend can and will continue. Until that changes, it makes much more sense to remain heavily-biased toward locking as opposed to floating.
  • 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: Nice Gains More About Europe Than Fed

May 22,2018
by admin

Bonds surged to significantly stronger levels in the presence of the Fed Minutes today. Any time we see strong gains on a day with a Fed release, chances are the Fed is behind the move. Incidentally, that’s NOT the case today (spoiler in the headline, I know).

So how did Europe trump the Fed in terms of bond market impact?

In short, this is all about Italian political drama. The two anti-Eurozone parties who are forming a coalition government in Italy are waiting for confirmation of their staffing choices from the Italian prime minister (yeah… things work differently over there). One of the picks had previously referred to the Eurozone as a noose around Italy’s neck. It’s not overboard to consider this political regime as potentially pushing Italy away from the Euro. That’s the risk that bond markets have largely benefited from in recent days (unless you’re talking about Italy’s bond market, which has tanked).

European volatility drove big overnight gains in US Treasuries and that move accounts for most of today’s gains. All this having been said, the Fed Minutes didn’t hurt bonds either! While Fed policy is largely a ‘known known,’ and while today didn’t really change that fact, The Minutes nonetheless came off as moderately bond friendly. The Fed approached the topic of inflation in such a way that reassured markets about their willingness to maintain an accommodative stance even if inflation moves above 2.0%. Concern was also expressed for the wide variety of outcomes associated with trade policy changes–most of them negative for growth and inflation (and thus positive for bonds/rates).

By the end of the day, 10yr yields were moving back and forth across the 3.0% barrier. More importantly, they’d convincingly broken below the 3.055% technical level. If that can be held tomorrow, it would bode well for near-term momentum with the caveat being that the positive shift is based on something as flighty as European politics.

Refinance Applications Near 18-Year Low

May 22,2018
by admin

Mortgage rates surged significantly during the week ended May 18, sending mortgage activity skidding for the fifth straight week. The Mortgage Bankers Association (MBA) says its Market Composite Index, a measure of mortgage loan application volume, dropped by 2.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis there was a 3 percent decline.

The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week but remained 3 percent higher than the same week in 2017.

Refinance activity hit a near 18-year low. The Refinance Index declined another 4 percent compared to the previous week, to its lowest level since December 2000. Refinancing also continues to lose market share, accounting for 35.7 percent of applications during the week, down from 35.9 percent the previous week.

Refi Index vs 30yr Fixed

Purchase Index vs 30yr Fixed

There was an unusual half-point drop in the share of VA mortgage applications, from 10.3 percent the previous week to 9.8 percent. FHA and USDA participation were unchanged at 10.3 percent and 0.8 percent respectively.

All loan types tracked by MBA had higher interest rates with most rising on both a contract and an effective basis. All established new multi-year highs. The average contract interest rate for 30-year fixed-rate mortgages (FRM) with balances fitting into the conforming limit of $453,100 increased to the highest level since April 2011, 4.86 percent, from 4.77 percent. Points increased to 0.52 from 0.50.

The contract rate for jumbo 30-year FRM, loans with balances greater than the conforming limit, was the highest since September 2013, 4.81 percent, up from 4.73 percent. Points rose to 0.42 from 0.35.

There was an increase of 12 basis points in the contract rate for 30-year FHA-backed FRM, bringing it to its highest level since May 2011, 4.90 percent. Points rose to 0.85 from 0.76.

The average contract interest rate for 15-year FRM increased to its highest level since February 2011, rising to 4.31 percent with 0.56 point from 4.20 percent with 0.53 point.

The share of applications for adjustable rate mortgages (ARMs) increased to 6.8 percent from 6.5 percent even as the interest rate for 5/1 ARMs hit the highest level in the history of MBA’s survey, 4.12 percent. The prior week the rate was 4.09 percent. A decline points from 0.56 to 0.46 points however left the effective rate unchanged.

MBA’s Weekly Mortgage Applications Survey has been conducted since 1990 and covers over 75 percent of all U.S. retail residential mortgage applications. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100 and interest rate information is based on loans with an 80 percent loan-to-value ratio and points that include the origination fee.

MBS Day Ahead: Italian Impact Continues, Helping Bonds Start Strong

May 22,2018
by admin

I woke up this morning to an automated alert from MBS Live letting me know I’d need to hustle to the desk and explain whatever it was that caused the friendly spike more than 6bps lower in 10yr yields (all the way down to 3.0%). The safest bet was that it was something to do with Italy, and my chart of Italian spreads vs German Bunds didn’t disappoint. Equities markets happened to be playing ball as well. It’s been a good morning to be a safe-haven US Treasury bond (especially longer duration bonds like 10 and 30yr securities).

2018-5-23 open

The net effect on the bigger picture for the US bond market is that it sets us up to challenge the important 3.05-3.06% floor (obviously). In fact, it gives us a huge head start for the day. Remember the lessons from bonds 2-3 weeks ago though. As we attempted to break below 2.95%, there was at least one day where we were this far below our target. But bonds were never able to close below 2.95% for 2 consecutive days. In other words, we still need to hold below 3.05% tomorrow in order to confirm the shift.

2018-5-23 open

Depending on the source of the information, the Italian President is set to confirm the new Italian government as early as today or as late as tomorrow. There are serious questions about the qualifications of the nominee for Prime Minister, and no questions about his populism. In other words, if he’s confirmed, Italy would be seen as moving another step closer to being a legitimately ticking time bomb for the Eurozone.

Given Italy’s level of Euro area financial integration, and Italian Eurozone exit would make Brexit look tame by comparison. That’s really the risk that bond markets are beginning to trade. It’s a long way from materializing, but the confirmation of this government is seen as the first step in that potential process. If an Italian exit were imminent, the safe haven demand for German Bunds and US Treasuries would likely have yields well into 2017’s levels.

All that to say that if it seems like a little bit of Italian political news is moving bonds by a surprising amount, it’s because the endgame implies much bigger moves.

As for the rest of the day, we don’t have any top tier economic data to digest, but we will get the week’s most important Treasury auction at 1pm, followed by the FOMC Minutes at 2pm (a more detailed recap of the conversation behind the Fed Announcement from 3 weeks ago).

Lender Products; Congress’ Take on TILA, PACE Loans, and MLO Licensing

May 22,2018
by admin

Every vendor here at the MBA conference suggests they can help clients close more loans faster, more efficiently and compliantly. If only all these lenders had more loans in their pipelines to close! But lenders here in NY are an optimistic bunch.

Lender Products

Yesterday at the MBA Secondary conference in New York, Mortgage Coach and Optimal Blue announced an enhanced integration that avails access to accurate pricing within the Mortgage Coach platform. Now every Mortgage Coach-powered loan originator can include real-time product and pricing data within the Total Cost Analysis – in seconds without ever leaving the Mortgage Coach app – giving their borrowers the transparent and accurate loan options they need to make a confident mortgage decision faster. “Combining the sophisticated product and pricing data at the heart of every mortgage transaction with a compelling user experience — and doing so whenever, wherever it matters most — is a game changer for the industry.” explained Bob Brandt, Vice President of Marketing & Strategic Alliances for Optimal Blue. Executives interested in learning exactly how to increase production with this new integration can contact Jim Wrigley.

Get alerted when a customer is shopping for a mortgage right on your mobile device! Advantage Credit, Inc., a leading provider of credit reporting services and the developer of Monitoring Advantage which is the premier client retention and lead generation tool has announced an integration partnership with SimpleNexus. SimpleNexus is an enterprise digital mortgage platform enabling lenders to originate and process loans from anywhere and now to automatically receive notifications to their smartphone of immediate prospect opportunities. This integration with Monitoring Advantage and SimpleNexus may be used whether the client is a credit customer of Advantage Credit, or any other CRA. For more information, please contact the Advantage Credit sales team at

Caliber Home Loans, Inc. announces its partnership with Ellie Mae, the leading cloud-based platform provider for the mortgage industry. Caliber will leverage Ellie Mae’s delivery solution – Encompass Investor Connect – to bring its correspondent lending partners the benefits of a true digital mortgage experience. Encompass Investor Connect’s solution supports the needs of lenders and investors, by removing the manual loan package delivery process and delivering it directly from Ellie Mae’s Loan Origination System to the investor. The solution provides one centralized system of record that results in improved purchase times, while enhancing accuracy and compliance. “Caliber’s pleased to partner with Ellie Mae on this initiative because of the efficiencies it brings to the market,” said Patricia Shumate, Caliber EVP of Correspondent Lending.” It’ll increase the accuracy of data transfer, decrease turn times and reduce the costs associated with the sale and purchase of closed loans. Ultimately, this will result in a better experience for the borrower.”

The “1003” should be called the “1030” because it’s missing at least 27 very important pieces of information at a minimum. PerfectLO completes the 1003 and asks the other 27-100 questions. We all know that a completed “1003” is quite useless even when completed. The real pain in your operation begins and ends with a perfect loan interview and thorough doc checklist. So why wouldn’t you have your borrowers click on your link and answer ALL the questions that you need the first time? And why not add a solution that builds a perfect Doc Checklist? That’s just what PerfectLO does. Sign up for a free trial and demo PerfectLO’s online questionnaire takes a logical and systematic approach while creating a dynamic document checklist based off their answers. PerfectLO is a multi-language, mobile friendly, cloud-based, white-labeled, software solution that talks to all LOSs.

More Technology and Vendor Updates

Vendors are a clever bunch, individually. Unfortunately, many lenders I spoke to here at the conference are confused about which vendor does exactly what, who is partnered with who, how expensive they are, and so on. Let’s take a random sample of who is doing what in the vendor arena, some new products some less recent.

Recently Digital Risk LLC, an Mphasis company, a leading End to End Origination, risk, compliance, and technology services company providing differentiated solutions to the mortgage, consumer lending, and other regulated industries, announced CitiMortgage as a marquee client for its digital mortgage platform, LoanFx. “LoanFx, designed for self-service, will be integrated in all of CitiMortgage’s digital channels, including mobile and tablet interfaces. Citi clients will now benefit by becoming verifiers, instead of suppliers of information. LoanFx will also provide real-time updates throughout the process to Citi loan officers, their clients, and their realtors for increased transparency.”

Tavant, a digital products and solutions company for the consumer lending industry, is collaborating with Freddie Mac to launch a one-click submission of loan data to Loan Product Advisor®, providing lenders a means to improve loan functionality and best execution without sacrificing operational efficiency. This solution uses machine learning and process automation techniques to submit loan-data via a single click to both Freddie Mac and Fannie Mae, enabling lenders to see the full view of options available to their borrowers and ultimately leading to an improved borrower experience. Tavant will begin piloting this solution with four selected lenders leveraging the partnership to achieve best execution goals.

Ephesoft Inc., rolled out its Ephesoft Transact for Mortgage. This marks the first time Ephesoft will offer a vertical-specific product and the first SaaS cloud solution for mortgage processing. To process a mortgage loan, more than 600 different document types need to be classified, which makes this industry ideally suited for document capture innovation. This product can be implemented into loan origination systems in a matter of days to dramatically improve speed and accuracy to process loans quicker.

DocMagic’s eMortgage services, announced that Deutsche Bank has successfully implemented and is actively utilizing its proprietary eVault technology. Deutsche Bank’s document custody group is now empowered to take full possession of electronically originated assets for clients as the loan market continues to transition to a paperless process. DocMagic establishes a legally compliant method to securely move original electronic files from one custodian to another, while preserving unique authoritative digital ownership.

ACES Risk Management (ARMCO), the leading provider of financial risk mitigation and compliance solutions, announced that it has launched The Compliance NewsHub, the mortgage industry’s first free comprehensive searchable online resource for regulation-related news and information. The Compliance NewsHub provides mortgage lenders with fast and easy access to the most comprehensive source of current information on a full range of regulation-related topics—from investor guidelines to state law and CFPB mandates. ARMCO’s Compliance NewsHub provides the latest compliance news and announcements, categorized according to the following segments: federal legislation, legal, industry, agency/GSE and state. Visitors can also sign up to receive The Compliance NewsHub Bulletin to stay informed with news alerts.

Quovo, a data platform that provides connectivity to consumer financial accounts, announced two new products to streamline processes across the mortgage lending value chain. The new products include Income + Expense, a tool that analyzes and summarizes income and expense streams, and Balance Estimator, a tool to predict future account balances up to 30 days in advance based on historical cash flows.

Factual Data, providers of credit and validation services to the mortgage lending industry, is teaming with MortgageHippo to provide a modern approach to the digital mortgage process.

The integration of consumer credit reports from Factual Data with MortgageHippo’s customizable point-of-sale digital lending solution will allow loan officers and lenders to maximize time and efficiency by receiving industry-proven credit data within the borrower profile generated from MortgageHippo’s mobile-ready online application.

Approved, a digital mortgage platform for independent lenders and brokers, has partnered with LendingQB, a provider of SaaS loan origination technology solutions, to launch its digital mortgage experience and wholesale submission platform for lenders and their broker networks. The Approved platform is available now. With this integration, leads through to submissions can all take place through the same point of sale a broker is using to manage their borrowers and process loan packages.

Blend announced the launch of Blend Marketplace with two of its upcoming partners, LendingTree and Total Expert, later this year. Blend Marketplace will serve as a hub for ecosystem partners to build on Blend, generate new business, and work together to reimagine lending from end to end. For lenders, this means lower costs, greater transparency, and a more sustainable industry. “We partnered with Blend to take advantage of their speed and infrastructure,” said Joe Welu, founder and CEO of Total Expert. “We knew it made sense for us to work with a leading technology company that builds a digital lending platform that aligns with our focus on bringing the most modern technology to lenders across the country.”

Matic, a digital insurance agency whose technology enables borrowers to purchase homeowner’s insurance during the mortgage transaction announced an integration with mortgage lender RoundPoint that includes Matic’s one-click “get quote” button. Homeowners whose mortgages are serviced by RoundPoint will be notified by Matic when they could save money by switching to a different A-rated homeowner’s insurance carrier. Homeowners will also be alerted if there’s an opportunity to get more coverage without an increase in premium.

Regulatory Relief Bill – Why Should LOs Care?

Yes, underwriting, compliance, and regulation are in flux. Yesterday the House passed the regulatory relief bill (S.2155) by a vote of 258 to 159. It includes a ratcheting upward of the $50 billion bank asset threshold to $250 billion within 18 months, a capital simplification off-ramp for banks with less than $10 billion in assets, the QM portfolio lending proposal, and another increase to the Small Bank Holding Company Policy Statement. The bill will now head to the president for his signature, which is expected as early as this week. Lenders and banks are interested in the help it gives M&A deals, loan officers are particularly interested in the QM changes.

The bill will provide Qualified Mortgage designation for most mortgages held in portfolio by banks with less than $10 billion in assets. It raises the threshold for designation as a systemically important financial institution from $50 billion in assets and will apply principles of tailored supervision to larger banks. It ends mandated stress tests for banks with under $100 billion in assets and will simplify capital calculations for community banks. Look for relief from appraisal requirements for smaller mortgages, longer exam cycles for community banks, charter flexibility for federal thrifts with less than $20 billion in assets, and relief from the Volcker Rule for most community banks.

Lenders should also know it has SAFE Act amendments to provide 120 days of transitional authority for MLOs to originate when leaving a depository to join a sponsoring non-bank (or when crossing state lines). It will apply TILA consumer protections to PACE/energy efficiency mortgage products. The Bill has modest relief for certain small lenders from HMDA (500 loans per year), and language to address problems with TRID which will eliminate CD re-disclosure when rates go down and direct the BCFP to provide written guidance in other areas of confusion and uncertainty. It has added safeguards to protect veterans, surviving spouses and service members who utilize the VA Home Loan program’s IRRRL refinancing product, offers an improved, more workable regulatory regime for the eligibility of High Volatility Commercial Real Estate (HVCRE) construction loans, and has partial TRID and HMDA relief. Thus FHA & VA prices were helped since there are further changes to the VA Housing Loan Program which should limit churning and other improprieties.

Capital Markets

In terms of yesterday’s bond market price movement and therefore interest rates, it was a snoozer – rates haven’t changed much all week. There wasn’t any news of substance in the U.S., and overseas attention was focused on China which said it will cut tariffs for autos and auto parts. Ginnie Mae security prices were helped by S. 2155 passing which includes further changes to the VA Housing Loan Program which should limit churning. Both the 5-year and 10-year notes closed unchanged (the 10-year yielding 3.06%).

This morning we’ve seen last week’s application data from the MBA (-2.6%, refis are now 36% of apps and are the lowest they’ve been since 2000). Coming up are New Home Sales, the U.S. Treasury selling $16 billion of 2-year notes and $36 billion of 5-year notes, and the release of the minutes of the May 1/ 2 FOMC meeting. In the very early going the 10-year yield is down to 3.01% so look for some improvement in MBS prices.


In MI job news, “Are you looking to join an organization with great history, culture, and opportunity? If so, MGIC, a founder of the private mortgage insurance industry, has a great opportunity for an ambitious sales professional to cover the State of Alabama, as well as the Florida Panhandle. Customer base includes Mortgage Bankers, Banks, Credit Unions, etc. As an Account Manager, you will develop and maintain strong, long lasting client relationships as well as grow business by identifying new business opportunities. The ideal candidate must have strong presentation and communication skills, and the ability to occasionally travel overnight. This person will report directly to Steve Cox, Sales Manager. If you are interested in joining a company with 60 years of industry leadership and legacy, please send your resume to Nancy Vang-Lee, Senior Talent Acquisition Partner.

Freddie Mac to Address Origination Barriers for Young Buyers

May 22,2018
by admin

Reams of data have been gathered about what appear to be significant changes in the profile of younger homebuyers and consequently mortgage borrowers. This usually means the Millennial generation, but recently Gen Z, those born in 1995 and later have begun moving into homeownership as well. A recent report by Freddie Mac says the Millennials came of age after the housing crisis and since home prices bottomed out, rents have increased an average of 20 percent. “It’s not easy to save up for a down payment when you’re pouring you money into rapidly escalating rents.”

And even those who do have savings, may have difficulty convincing a bank they have the necessary income to qualify for a loan: Increasingly, millennials don’t have only one on-payroll job and a W-2 to show income. Add to that the fact that millennials change jobs more than three times faster than people in previous generations did.

Being aware of these problems is only half the battle so the company has announced the launch of its “Borrower of the Future” program. It is designed to help mortgage originators work with the evolving needs of these consumers who will be driving housing demand.

In making the announcement Freddie Mac noted those unique obstacles today’s homebuyers face in qualifying for a mortgage and making a down payment. The program hopes to use increased understanding of the data to help borrowers overcome these financial challenges.

The company plans to produce a series of white papers, reports, and articles that will look at how key trends such as demographic and behavioral changes, digital technologies, changes in work patterns and self-employment will affect various buyer segments. The goal is to apply what has been learned about generational changes to the industry as a whole and improve the housing finance system.

“The increase in self-employed and the rise of the sharing economy and digitally-driven lifestyles are having a tremendous impact and leading to shifts in behavioral, economic and societal factors,” said Chris Boyle, Chief Client Officer at Freddie Mac. “Collectively, the industry must now take into account these dynamics as we think about how to effectively help the next generation find the home of their dreams. We’re excited to serve in this important role to help the industry better understand the Borrower of the Future, and then drive the conversation on how to apply these insights to make the mortgage process more efficient and affordable.”

One aspect of the program is the company’s partnership with Arun Sundararajan, from NYU’s Stern School of Business. He is expected to use his research into digital technologies and the dynamics of homeownership to further advance the initiative’s efforts. Sundararajan is also affiliated with NYU’s Center for Data Science and Center for Urban Science & Progress.

“I’m delighted to be collaborating with Freddie Mac on such a forward-looking initiative,” said Professor Sundararajan. “As digital forces transform varied aspects of business and life, industries across the spectrum will need to adapt. Our collaboration will shed light on the demographic, economic, technological and cultural factors reshaping the needs and preferences of the future homebuyer, enabling the industry to evolve efficiently and effectively to address new market realities.”

New Home Sales Continue to Improve on Annual Basis

May 22,2018
by admin

New home sales dipped in April, a reversal that was expected by many analysts. The U.S. Census Bureau and the Department of Housing and Urban Development said sales of newly constructed homes during the month were at a seasonally adjusted annual rate of 662,000 units. This is 1.5 percent below the revised rate of 672,000 units in March. The March estimate was revised down from 694,000 units, erasing much of that month’s reported 4 percent gain.

Despite the downturn, sales are now running 11.6 percent above the April 2017 estimate of 593,000 sales. In March the year-over-year gain was reported at 8.8 percent.

Analysts polled by Econoday had expected sales to be in the 650,000 to 692,000 range. The consensus was 677,000.

On a non-seasonally adjusted basis there were 64,000 new homes sold in April compared to 65,000 in March. The unadjusted total in April 2017 was 56,000 units.

For the year-to-date through the end of April there have been 231,000 new homes sold compared to 213,000 during the same period last year. This is a gain of 8.4 percent.

The median price of a new home sold during the month was $312,400 and the average was $407,300. The respective numbers in April 2017 were 311,100 and $365,800.

Sales in the Northeast rose 11.1 percent in April, only partially recovering from a 54.8 percent nosedive in March. Numbers in that region are now up 5.3 percent year-over-year but down 0.8 percent year-to-date. There was no change in sales numbers in the Midwest, but April did post a healthy 26.4 percent annual increase and are up 14.1 percent for the first four months of the year.

The South saw sales inch up 0.3 percent to an annual gain of 6.0 percent and a 5 percent year-to-date improvement. In the West there was a 7.9 percent decline in sales compared to March, but results were 18.9 percent higher on an annual basis and 15.1 percent higher thus far in 2018.

There were 300,000 homes available for sale at the end of the reporting period, an estimated 5.4-month supply at the current rate of sales. The median time on the market after completion was 3.8 months.

Houses Passes S2155, Unwinds Less of Dodd-Frank Than Hoped

May 22,2018
by admin

The House of Representatives passed a sweeping overhaul of regulations included in the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act on Tuesday. Senate Bill 2155, which passed the upper house in March, received a 258 to 259 vote in the House. It now goes to the White House for what is expected to be certain presidential approval.

The bill did not go nearly as far as the House had hoped in rolling back Dodd-Frank. Leadership agreed to vote on the compromise bill negotiated in the Senate between Republicans and Democrats only after a promise of a vote latter this year on other changes House members, especially House Financial Services Chair Jeb Hensarling (R-TX) were demanding.

According to Bloomberg, the legislation gives smaller banks relief from post-crisis rules that they’ve decried as burdensome and costly and the higher ceiling required to subject banks to stricter Federal Reserve oversight would free companies such as American Express and SunTrust Banks from higher compliance costs associated with being considered too big to fail.

While the full measure of the final bill will not be known until new rules are formulated and while there were probably some changes from Senate version, the Congressional Research Services has outlined the bill’s changes to mortgage related regulations.

Most of those impact Dodd-Frank’s Title XIV. Title I of the new law contains 10 sections that would amend rules that affect relatively small segments of the mortgage market. In some cases, the analysis says, the bill would remove perceived regulatory barriers to the efficient functioning of specific segments of the mortgage market. Other provisions attempt to balance safety and soundness concerns with concerns about access to credit.

Under Dodd-Frank, small institutions have a Small Creditor Portfolio Option that allows them different pathways for creating a Qualified Mortgage (QM) under Consumer Financial Protection Bureau rules. That exemption applies to mortgages originated and held in portfolio by institutions with less than $2 billion in assets and originating fewer than 2,000 mortgages each year.

Section 101 of the new law raises the ceiling to $10 billion and eliminates origination limits but also restricts the new option to insured depositories rather than to both depository and non-depository lenders. Eligible lenders must hold the loans in portfolio for the loan’s lifetime rather than for three years. Lenders would still have to comply with product-feature restrictions, but they would be less stringent than under current rules. S. 2155 would relax also the prescriptive guidance regarding documentation of borrower qualifications.

The bill attempts to address recent allegations of serious shortages of qualified appraisers, especially in rural areas. Section 103 sets criteria for waiving certain appraisal requirements for federally related loans where this is a problem.

Section 104 would exempt banks and credit unions from certain Home Mortgage and Disclosure Act (HMDA) reporting requirements, generally those that were imposed by Dodd-Frank after the original HMDA was enacted. The exemption will apply to institutions that originated fewer than 500 open-end lines of credit in each of the preceding two years and achieve certain Community Reinvestment Act compliance scores.

Section 106 of S 2155 would allow certain state-licensed mortgage loan originators (MLOs) who are licensed in one state to temporarily work in another state while waiting for the new state to approve their license. It also would grant MLOs who move from a depository institution (where loan officers do not need to be state licensed) to a non-depository institution (where they do need to be state licensed) a grace period to complete the necessary licensing.

Other changes incorporated into S 2155 include exempting more securities exchanges from state regulation, exclusion of certain defaulted student loan debts from credit reports, exemption of banks with under $10 billion in assets from the Volcker Rule and certain other small banks from existing risk-based capital ratio and leverage ratio requirements.

There are also provisions subjecting credit reporting agencies to additional requirements and relieving banks with assets between $100 billion and $250 billion from enhanced prudential regulation.