Yes, rates have gone up, but residential applications have been up for three straight weeks. There is little denying that employment, housing, and the overall economy is doing well. (Yes, Toys R Us is closing 182 stores, but supposedly due to the shift in retail preferences.) And there is no denying that, despite all the smiles and congeniality at conferences, residential lending is a competitive business. Your success can result in another’s failure. The same environment exists in camel beauty contests in Saudi Arabia, which apparently have been wracked with a Botox cheating scandal. (You can’t make this stuff up.)

CFPB and Regulatory Trends

The Consumer Financial Protection Bureau, now led by the anti-CFPB ex-congressman Mick Mulvaney, has put a hold on regulations restricting high-interest rate loans from payday lenders. The agency also dropped a lawsuit against internet lenders charging 900 percent interest rates.

And in a one week span the House Financial Services Committee has advanced a total of 15 reform bills to the full House. Of course, they were all lost in the shuffle of the shutdown, but Committee Chairman Jeb Hensarling, R-Texas, said Congress "must do more to reduce the burdensome and often unnecessary red tape that prevents companies from growing and creating more and better jobs."

A kinder CFPB? Perhaps. The Consumer Financial Protection Bureau plans to review practices and policies in enforcement, supervision, rulemaking, market monitoring and education. "Moving forward, the bureau will consistently seek out constructive feedback and welcome ideas for improvement," said acting Director Mick Mulvaney.

A leaked e-mail reportedly sent by Mick Mulvaney, Acting Director of the Consumer Financial Protection Bureau (CFPB), to the staff of the agency previewed a new and less litigious approach to regulating the financial services industry. "When it comes to enforcement, we will be focusing on quantifiable and unavoidable harm to the consumer," Mulvaney wrote. "If we find that it exists, you can count on us to vigorously pursue the appropriate remedies. If it doesn’t, we won’t go looking for excuses to bring lawsuits." The memo was leaked and released by the investigative journalism outlet ProPublica. The Wall Street Journal published an adapted version as an op-ed written by Mulvaney. "Simply put, the days of aggressively 'pushing the envelope' of the law in the name of the 'mission' are over," Mulvaney said.

Capital Markets

Today we have the usual Thursday initial jobless claims. The prime-age population, those persons 25 through 54, number 125 million, of which 100 million are in the labor force. As economist Elliot Eisenberg points out, since 2000 the number of employed over age 54 has risen from 18.5 million to 35.5 million, sucking up the entire block of 17 million net new jobs that were created. And plenty of them are buying homes are refinancing.

As was reported yesterday, the MBA’s index for the prior week was up for the 3rd straight week. Despite higher rates, purchase applications gained by 6.0%, hitting its best app level in 8 years! But refinances are holding their own and are still nearly 50% of overall activity. As has been said for several years now, they probably won’t increase as rates rise.

We also learned that December existing home sales eased 3.6 percent to a seasonally adjusted annual rate of 5.57 million as the year came to an end. But 2017 saw an increase of 1.1 to a 5.51 million pace according to the National Association of Realtors - the highest yearly sales since 6.48 million at the height of the housing bubble in 2006. Existing home sales with prices less than or equal to $750,000 accounted for 95% of all sales. The report also reiterated the lack of overall housing supply, which was 10.3 percent lower than one year ago, as well as affordability pressures, and unsold inventory is at the lowest level (3.2-month supply) since tracking commenced in 1999. Even with strong job creation and rising incomes home prices increased 5.8 percent nationally; double the pace of income growth. 32% of sales were to first-time home buyers, up from 29 percent in December. All cash sales averaged 21 percent for the year, down from 23 percent in 2016.

Turning to the markets, Treasuries reversed course, giving back Tuesday’s gains and the 10-year note finished the day yielding 2.65%. US Treasury Secretary Steven Mnuchin spoke about the benefits of a weaker US dollar while in Davos and touted the government’s commitment to 3 percent GDP growth. The FHFA House Price Index showed prices increased 0.4 percent in November and 6.5 for the year; lower than expected, but still showing health home price appreciation. Oil continues to creep up after another decline in weekly inventories and talk that OPEC will continue to limit production.

Today’s calendar began with the European Central Bank policy statement and press conference from ECB President Draghi. Jobless claims (233k, +17k), December leading economic indicators, new home sales, Freddie Mac’s Primary Market Mortgage Survey, and the Kansas City Fed Manufacturing Survey round out this morning’s releases. The 10-year is currently yielding 2.64% and agency MBS prices are better a shade versus Wednesday’s close.

Employment, Business Opportunities, Events, and Promotions

SettlementOne, a leading provider of Valuation and Credit services to the mortgage industry, is proud to announce the additions of Tom Hurst as Chief Executive Officer and Kelly Taylor as Chief Revenue Officer. Previously, the two founded and scaled StreetLinks to an industry leader before their exits and the company’s eventual acquisition by Assurant. Hurst and Taylor have now teamed up at SettlementOne to once again disrupt the AMC space. SettlementOne plans to rapidly expand its service footprint throughout the United States and is looking for multiple National Account Representatives to help fuel this expansion. Ideally, these hires will be experienced in the Valuation space, have a desire to change the industry and want to be part of a team that will come to be remembered for their astonishing growth. To apply, simply visit this link here and complete the steps.

An independent mortgage company is seeking to acquire an existing company with HUD Full Eagle approval and VA approval. The lender should be in excellent standing. This acquisition would be for HUD and VA licensing purposes. Interested parties may contact me directly to forward their note; please specify opportunity.

GSF Mortgage Corp. is seeking to acquire small to mid-sized lenders who are considering a transition of their firm. As an alternative to a large box lender or regulatory intense bank, GSF will work with the owner on a transition that preserves the culture, staff and legacy of the company. GSF is a direct seller/servicer with Fannie Mae, Freddie Mac and a Ginnie Mae Issuer. We retain most of our loan originations and are well capitalized. GSF has access to resources, technology and pricing power of the large lenders, along with the ability to adapt your existing business plan to our platform. As an owner, you can be assured that your teams will be set up for long-term success and growth. All conversations are confidential. Please reach out to Rich Obermeier to set up an informal discovery call.

Centennial Lending Group, LLC, headquartered in Maple Glen PA, is excited to announce the addition of Michael Paul, CMB, as Senior Vice President. Prior to CLG, Michael was Managing Partner at Direct Mortgage Loans. As an assertive, highly focused and seasoned mortgage executive, Michael brings expertise to navigate the constantly changing landscape of this industry. With strength in sales, operations, compliance, and accounting, Michael will coordinate all departments of CLG to help further expand their footprint. Sue Meitner, President, and CEO stated “The entire staff at CLG is beyond excited for Michael to join our growing team. We are set up for an amazing 2018!” Michael is a graduate of East Carolina University – College of Business. He lives in Hunt Valley, MD with his wife and three children. Founded in 2010, CLG is a privately held, award-winning, full-service residential mortgage lender.  For additional information, please contact CLG at info@clg-llc.com.

Want to know how many homebuyers could have taken advantage of DPAs and other affordable lending programs in 2016? Down Payment Resource and Freddie Mac commissioned the Urban Institute's Housing Finance Policy Center to report on credit access and affordability. The Barriers to Homeownership: Down Payments, Credit Access, and Affordability report provides the answer along with data and commentary on three significant barriers to homeownership: saving for a down payment, accessing mortgage credit and housing affordability. The report also offers information about down payment assistance programs which can help borrowers overcome that barrier. It includes an interactive map of the U.S. which allows users to compare 16 housing market factors, including homeownership programs, between states. Contact info@downpaymentresource.com for more information.

Congrats to Paul Thomas who Phoenix Capital, Inc. has brought on as EVP of Trading & Operations to the Phoenix companies. Brett Schaffer, CEO & Founder, stated, "Building on our steadfast focus to provide comprehensive MSR and whole loan market insight and industry leading valuation services to our clients, we are pleased to have Paul join our Executive Leadership team. Given Paul's senior leadership roles at large financial institutions, including Private Equity, over the last 20 years, Paul brings broad and deep Capital Markets and Operational expertise to our whole loan and MSR Trading/Analytics teams. Paul's addition complements our comprehensive growth strategy in providing premier Trading, Mortgage Services, and Analytics expertise as we embark on our third decade of delivering innovative Client solutions."

loanDepot is starting 2018 full speed, with CEO Anthony Hsieh being the first ever lending CEO to take the stage at Inman Connect in New York, the nation’s largest real estate industry conference. On Wednesday, Anthony will explain how technology is making not just lending but many other areas of home owner’s journey easier. These large technological shifts are commonly called “disruption” because they disrupt whole industries to better serve consumers. But unlike other industries, this financial and real estate technology trend doesn’t displace local pros giving local advice. It makes it easier and faster for local loan consultants to connect with the people in their communities who need their services most. If you’re attending Inman Connect, loanDepot will be available in their hub lounge experience, where you can connect for refreshments, and learn more about everything in the loanDepot universe. To learn more, check out or contact Shane Stanton.