Jury trial by Zoom? Leave it to Texas to give it a shot. Michigan and Indiana are now offering the bar exam online for aspiring attorneys. Out of Pennsylvania comes news that Gov. Tom Wolf issued an executive order that allows real estate to open on a statewide basis effective yesterday, subject to certain guidelines. Florida has entered “Phase 1” of re-opening, with gyms, retail stores, and restaurants at 50 percent capacity. California, home to nearly 25% of the residential mortgage production of the United States, has entered “Phase 2” but of great concern to every residential lender is AB 2501 with its draconian penalties. (Here’s an analysis  of the bill which yesterday moved from the Assembly Banking Committee to its Appropriations Committee.) Nationwide, according to a report released by STRATMOR Group this week, 44 percent of borrowers are at least somewhat concerned about their ability to make their mortgage payments in the next 90 days. What’s even more alarming, most of them are unclear where to turn for help. 36 percent of borrowers have no knowledge of government assistance programs while 25 percent are not sure if the government programs apply to them.

Lender Products and Services

Caliber Home Loans, one of the largest mortgage companies and among the fastest growing lenders in America, has partnered with Infutor, the consumer identity management expert. By leveraging Infutor's ID Max solution, Caliber will streamline and speed the application process as part of an ongoing commitment to enhance customer service and simplify data-based decision making. Access to Infutor’s data will help Caliber better understand, route and convert leads, as well as facilitate more personalized customer interactions. “We are delighted to partner with Infutor to improve the quality of our customer leads and deliver a better experience for consumers who wish to purchase or refinance their homes,” said Sanjiv Das, CEO of Caliber.

As a partner of TMS CAREspondent Lending, you are given the opportunity to reach more qualified customers with TMS’ robust product offerings to help fuel the growth of your business even during these unique circumstances. TMS, a Top 15 Correspondent Buyer, has had another record month in April and is still purchasing all loan product types from its lender partners with minimal to no overlays, including 203k, FNMA HomeStyle, Section 184, Manufactured Homes, and all Streamline /IRRRL loans. Not a partner with TMS yet? Sign up here today to join over 500 other lenders who are selling loans to TMS.

United States Appraisals, an innovative provider of residential appraisal management solutions, recently announced the launch of Valuguard Home Inspection. Valuguard was released to address the unique challenges posed by the COVID-19 pandemic and enables lenders, appraisers, and AMCs to obtain timely information from the interior of homes they are not able to inspect physically because of social distancing concerns. Aaron Fowler, United States Appraisals CEO, said, "As Fannie Mae has begun to review completed exterior and desktop appraisal reports, they have advised there is too much reliance upon assumptions about the condition of the interior." He added, "Our release of ValuGuard is timely, as lenders need assurance their loans will be eligible for delivery to the GSE, averting future repurchase requests."  Learn more by visiting www.unitedstatesappraisals.com/valuguard.

“Stearns Lending is focused on supporting the Wholesale community now and in the future. In order to help our clients feel secure and informed during this time, communication is key. All Stearns Brokers and Non-Delegated Correspondent partners have access to a dedicated team of Account Executives and Account Managers via phone, video calls and email. Real-time guidelines are posted in one place and accessible from all mobile devices. In addition, Stearns hosts monthly town halls recapping market updates, the Stearns COVID-19 response and new programs and technology enhancements. If you’re looking for a partner who has supported the mortgage community for 30 years and continues to be a trusted source for your business, please click HERE.”

Citibank, N.A. remains committed to responsibly growing its Correspondent Channel through a client centric approach. “Our industry professionals engage our sellers to unlock execution opportunities and develop lender specific ways to optimize loan delivery. Citi continues to focus on growing our Best Efforts execution, producing extraordinary results for lenders within a period of immense market volatility. Citi does not charge a pair off fee for best efforts locks, making this execution another great tool for lenders to manage pipeline and mitigate risk. This tailored approach for our lenders has been a key factor in fueling Citi Correspondent's growth over the past year, and we continue to strategically add Correspondent Sellers for delegated and non-delegated delivery. Let us support your growth story and find out how Citi can provide solutions for your business model today! Contact our National Client Service team at 1-800-967-2205 or complete the Citi's Prospective Mortgage Correspondent Questionnaire.”

Apps are nice. A True Mobile CRM helps you grow your business. UNIFY CRM offers the first complete Mobile CRM for the Mortgage Industry. Loan originators are busy and not only need a robust CRM, they also need to access it on the go. Now, the most robust CRM in the industry fits easily in the palm of your hand. With the UNIFY Mobile CRM, you can add and view contacts, manage leads, set and receive reminders, view loan details, start marketing campaigns, create flyers, record and send videos, and much, much more. Developed for both Android and IOS platforms, loan originators can now leverage the full power of Unify CRM, wherever they may be. Are you looking for a way to build your business? UNIFY CRM has the features, tools, and experience to be your true partner in the mortgage business. We’ve built UNIFY CRM for the challenges of this business.  Work Smart. Manage Smarter. Sell better. Schedule a Demo today.

Need some Zen-like simplicity in your life? Zenly, the newest cloud-based origination platform from Calyx, is designed for mortgage brokers who want simplicity, convenience, and speed for their borrowers & themselves. Zenly cuts through the clutter to give originators the tools they need to originate and deliver loans fast. Engage with prospects using the built-in POS, pull credit, verify employment and assets online and complete and upload applications, all from one easy to use platform. And best of all, Zenly can be purchased and up and running in just 15 minutes! Schedule a demo today to see how Zenly can work for you.

Freddie and Fannie Continue to set the Pace

Before we plunge into yesterday’s news, remember that the Mortgage Bankers Association’s latest Forbearance and Call Volume Survey showed that the pace of forbearance requests continued to slow in the second week of May, but the share of loans in forbearance increased. The total number of loans now in forbearance increased from 7.91 percent of servicers’ portfolio volume in the prior week to 8.16 percent as of May 10. According to MBA’s estimate, 4.1 million homeowners are now in forbearance plans. Mortgages backed by Ginnie Mae again had the largest overall share of loans in forbearance by investor type (11.26 percent). The number of loans in forbearance for depository servicers rose to 8.99 percent, while the number of loans in forbearance for independent mortgage bank servicers increased to 7.85 percent.

Every third email in my inbox yesterday was someone’s take on the FHFA’s announcement, and thus Freddie Mac’s and Fannie Mae’s, addressing the confusion over forbearance policies. (What would the industry do without guidance from F&F?) For conventional conforming loans, there is no wait to buy a home or refinance if your client is in a forbearance plan but continued making payments. There is a 3-month waiting period if your client didn’t make payments while in a forbearance plan. Those who paused payments must make 3 consecutive monthly mortgage payments after forbearance ends to be eligible for a new home loan. It appears there will be a three-month waiting period to get a mortgage after forbearance ends, assuming your client didn’t make payments during that time.

Fannie Mae had its bulletin, as did Freddie Mac. Also updated was Fannie’s LL-2020-06, “Selling Loans in Forbearance Due to COVID-19,” to extend the eligible note date to June 30 and delivery date to Aug. 31. The letter clarifies that loans in forbearance with an acceptable payment history are eligible for representation and warranty enforcement relief.

It is always good to clear up uncertainty. The bulletins provided temporary purchase and refinance eligibility requirements for Borrowers with existing Mortgages, an update to representation and warranty framework requirements related to Mortgages subject to forbearance agreements, and an extension of temporary requirements for purchase of Mortgages in forbearance. Don’t forget that there are additional resources, including Freddie’s Selling FAQs related to COVID-19, updated often. 4 pages chock full of information. 

There are clever people out there, and will they take advantage of the situation? Sure. What if the government institutes a low-doc HARP program. Originators can already see borrowers taking forbearance, request that the servicer tack the missed payments onto the principal, and then do a no-appraisal refi after they make 3 payments.

Oh, and if yesterday’s Agency news wasn’t enough, Fannie Mae and Freddie Mac said they are looking for financial advisors to underwrite what is likely to be the largest public share offering in U.S. history. Yes, but can they get back the 10 basis points of gfee that both have been paying to the U.S. government to fund that payroll tax plan several years ago?

What? End their 12 years of operating under conservatorship? We were just getting to know each other! Each has announced they are about to issue a request for proposals (RFP) to secure a financial advisor to facilitate that move and whoever is selected will advise on a range of issues, from capital considerations to the company's business plan, and may ultimately play a role in any potential recapitalization transactions in the future. Remember when Freddie Mac was placed with the Federal Home Loan Bank System, which was owned by the S&L industry?

Non-QM

With the CFPB not expected to put out its proposal defining QM versus non-QM until mid-June, there are signs of life. Recall that on Thursday, March 19, the non-QM segment nearly vanished from sight when investors seized up given liquidity concerns as the focus turned to making sure government-backed residential programs were preserved. Is it coming back?

Yesterday Sprout Mortgage launched its Premier Jumbo mortgage for purchase or refinance of higher-end properties, with loan amounts up to $3 million. “The new Sprout Premier Jumbo program features loan-to-value ratios up to 90%, minimum qualifying credit score of 660, up to 43% debt-to-income ratio, and loan amounts up to $3 million. And borrowers are not required to obtain private mortgage insurance.”

Angel Oak Mortgage Solutions has its Investor Cash Flow product which “qualifies them on cash flow and no tax returns or employment information is required. Up to 70% LTV, can close in LLC, non-warrantable condos okay, 30-year fixed rates. And AOMS spread the word among brokers of “major enhancements” to its Bank Statement Program: Rates lowered across all LTV buckets (as much as 1.375%!), LTVs now as high as 80%, expense ratios can be down to 30%, reduced reserve requirements, and now offering Cash-Outs! Here you go: Non-QM QuickQuote.

Lenders can’t offer products to borrowers unless there is investor demand for both the asset and the servicing, whether Agency product or non-agency. Perhaps the non-agency securitization market is opening up again, as CoreVest American Finance (owned by Redwood Trust starting in October) is preparing to issue a $234.2 million single-family rental securitization. The deal will be the first in the sector since mid-March, and is filled with loans seasoned for an average of 3.1 months compared to 2.4 months in the prior transaction.

Capital Markets

In general, consumer prices have fallen as the sudden shutdown of much of the global economy has reduced demand much faster than suppliers could adjust. Prices for many items have eased, especially energy related items such as gasoline and jet fuel although high demand grocery items like toilet paper, ground beef, and chicken have seen their prices increase. Last week we learned that April’s consumer and producer prices fell solidly with the expectation that prices will continue to decline in the coming months. While there has been talk of sustained deflation taking hold in some economies it is not widely expected to occur in the US despite the price declines in the current environment. Keep in mind that deflation is a central banker’s biggest fear and Fed chair Jerome Powell made the case for more fiscal policy support in a televised appearance last week. The markets continue to watch for signs of recovery as states reopen and major assembly plants come back online. The prevailing opinion is that the economic recovery from Covid-19 will be gradual as demand remains low and the global supply chain struggles with disruptions.

After all that COVID-vaccine optimism to open the week, the bond markets acted in a bit of a rubber band-fashion yesterday. U.S. Treasuries & MBS rallied by the close. There were two main headlines: a back and forth on a European recovery fund, and a mixed April Housing Starts (missed expectations) and Building Permits (beat expectations) report, which pointed to a continuation of the slowdown in the single-family home market. The 10-year Treasury yield ended the day yielding 0.71 percent.

Fed Chair Powell and Treasury Secretary Mnuchin’s virtual appearance before the Senate Banking Committee was optimistic on the whole. The Fed Chair sought to maintain neutrality in the debate over whether Congress should commit to further bailout funding. He reiterated his stance that more fiscal aid may be needed (pleasing Democrats who have pushed a new $3 trillion bill through the House) but stopped short of a full endorsement (pleasing Republicans who are urging a slower approach). Steven Mnuchin said he plans to use all $500 billion the Treasury was allocated to help the economy.

Today’s economic calendar is already underway. Mortgage applications decreased 2.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending May 15, 2020. Later this morning, we have two Fed presidents speaking, Atlanta’s Bostic and St. Louis’ Bullard. In the afternoon, Treasury will auction $20 billion 20-year bonds, which is the first such auction since 1986. Finally the minutes from the April 28/29 FOMC meeting will be released at 2:00pm ET. After the Desk purchases the maximum for the ninth time in 10 sessions yesterday, the NY Fed will conduct two FedTrade purchase operations today totaling up to $4.545 billion. We begin the day with Agency MBS prices roughly unchanged from Tuesday’s close and the 10-year yielding .69 percent.

Employment and Transitions

A profitable, well-capitalized and fast-growing top-100 retail mortgage company headquartered in Northern California is looking for opportunities to acquire $100 million to $2 billion packages of retail servicing assets from companies with demonstrated record of success in retail production while maintaining loan quality. “We are a Freddie Mac, Fannie Mae, and Ginnie Mae servicer. Third party advisors are welcome. All inquiries will be completely confidential,” please send them to Chrisman LLC’s Anjelica Nixt. 

“National Lender, NewRez, is looking for growth-minded, results-driven, Licensed Loan Officers to join our Direct to Consumer business channel in the following regions: Tempe, AZ, Jacksonville, FL, Columbia, MD, Fort Washington, PA, and more! At NewRez, you’ll receive unlimited company-provided leads and the benefits of a multi-billion-dollar servicing portfolio, supported by best-in-class technology and operations – allowing you to deliver for your customers! Great training program for new LO’s and fast-track program for seasoned LO’s for national licensing to get you earning quickly! Generous compensation package. To hear more about any of our current sales openings or to submit your resume, contact Elisa Morgado. Click here for a full list of our open opportunities nationwide.”

Northpointe Bank, a top-performing bank in the nation, appoints Brian Kuelbs as EVP, Chief Financial Officer and Chief Investment Officer. In this senior leadership role, Mr. Kuelbs leads the bank’s corporate financial strategy for its nation-wide residential lending and retail banking businesses. Prior to Northpointe Bank, Mr. Kuelbs’ served as CFO and Chief Investment Officer for public and privately held depository institutions, private equity backed ventures. Most recently he served as CFO with Impac Mortgage Holdings, Inc. Before that he held senior positions with The Banc of California, Home Point Financial Corporation, Aurora Bank FSB, and was managing director of capital markets with Countrywide Financial Corporation and CFO with GMAC Bank. Mr. Kuelbs holds a Master of Business Administration with a specialization in Finance from the University of Notre Dame, and a Bachelor of Business Administration from the University of Wisconsin-Madison with majors in Mathematics, Quantitative Analysis, and Finance.

Top of Mind Networks hired business-to-business sales leader Nick Belenky as EVP of sales to direct Top of Mind’s sales operations with a focus on client success and new customer acquisition.