Yesterday’s commentary mentioned that there were “rumors” of Citi re-entering the correspondent channel. I apologize for any confusion. Readers should understand that Citi has never exited the correspondent channel, and the rumors revolve around Citi beefing up its presence in that area. In addition, the comment about pair off fees was hearsay and certainly not Citi’s company policy. Speaking of banks, under the “damned if you do, damned if you don’t” category, people in their 20s and 30s' desire to under the “damned if you do, damned if you don’t” category, people in their 20s and 30s' desire to aggressively save and retire early could be problematic for the Federal Reserve. Saving is good, right? Others say a generation of vigorous savers could leave less room for future interest rate cuts, undermining monetary policymakers' primary and easy tool for boosting growth in times of economic trouble. And some believe that savings hurt our economy. Are we never satisfied?

Lender Products and Services

HUD’s attempt to prohibit national government DPA was rejected by a federal court in July 2019. But apparently the agency isn’t done trying. In its Regulatory Plan for Fiscal Year 2020, HUD has again proposed to limit where governmental entities like the Chenoa Fund can operate. By limiting the geographic scope of government programs, HUD would create regulatory monopolies. The agency is also proposing to dictate acceptable pricing, even though command and control economic regulations never actually get this right, usually causing more harm to consumers than help. The loss of DPA options for borrowers and competitive pricing provided by programs like Chenoa Fund would disproportionately impact minorities, who have far less inter-generational family wealth than the typical white person. HUD is making the move even as a new study has found that the receipt of down payment assistance does not significantly increase default risk. That study is found here.

Introducing self-service inspections: At #NEXTWinter20, ServiceLink’s EXOS will introduce EXOS Inspect, an innovative self-inspection tool for when traditional appraisal reports are not required. At 1:10 p.m. on 2/24, the EXOS team will demonstrate how consumers can use their own cell phone or tablet to collect the data and images required for an inspection with EXOS Inspect. A supplement to data-only solutions, EXOS Inspect ensures that lenders are aware of any enhancements or damages to properties, supporting their lenders’ risk management strategies while elevating the consumer experience. Schedule a meeting with an EXOS team member today and learn more about how EXOS Inspect can help lenders can close more loans, faster. 

From Service 1st’s CEO, Curtis Knuth, “Income+ saves an average of 40 FTE minutes per file, in part by eliminating the multiple and inconsistent calculation of income from LOs, Processors and Underwriters. Creating a common path of efficiencies, it’s automated and auditable for all mortgages. Income+ leverages data sources already purchased by lenders, and it’s a simple, easy-to-read report. That means a light implementation lift. We encourage your readers to visit www.srv1st.com/promoQ120 for further details on trying Income+ during our promotional program offering unlimited, free 5-day trial. The trial program ends April 30th. 

Borrower Products

What impact do the online tools you offer borrowers have on your potential revenue? According to data from STRATMOR Group’s MortgageSAT Borrower Satisfaction Program, a borrower’s interaction with your online tools can make or break the chance of gaining repeat or referral business. Borrowers who considered their lender’s online tools to be easy to use, as evidenced by a 9-10 rating on a 10-point scale, reflected an NPS of 89, meaning they are highly likely to refer friends and family. In contrast, borrowers who rated the ease of use between 1-6 had a dismal NPS of negative 30, meaning they are more likely to poormouth than recommend the lender. MortgageSAT Director Mike Seminari suggests three steps lenders can take to learn how their revenue is being affected by their online tools in his February MortgageSAT Tip: “The Importance of the Borrower’s Perception of New Technology.”

HomeLight will be first-to-market with its innovative new Cash Close program. HomeLight Cash Close encompasses a suite of products that allow prospective buyers to make an all-cash offer on a new home, even before they sell their existing home. The most game-changing product is HomeLight Trade-in. Homeowners can trade in their existing home for their new home as quickly and easily as trading in a car to a dealership. With HomeLight Cash Offer, another Cash Close product, HomeLight backs qualified clients so they can make cash offers for their new home, even if these clients will be financing the home with a mortgage. HomeLight Cash Close leverages the company’s technology and cash to dramatically simplify the process of simultaneously selling and buying property.

SimpleNexus has released data indicating that, given the choice, many borrowers now prefer a mobile-driven mortgage loan application process. In May 2019, mobile applications submitted via the SimpleNexus app accounted for more than 50% of the 37,157 mortgage applications submitted through the platform. This finding comes as the firm is clocking record loan application submissions and growing at an unprecedented rate. To date, the SimpleNexus platform has connected its 20,000 active loan originators with 1.1 million borrowers and 65,000 realtor partners to produce nearly five million loans totaling over $100 billion in volume. More information is available on the SimpleNexus website.

For any vendors out there looking to raise some doubloons, Brace, a digital mortgage-servicing platform, just raised $10 million.

Recall that Notarize partnered with Ellie Mae on an integration with Encompass empowering lenders to access Notarize’s digital closing platform so every borrower can close online, from hybrid to full remote online closings.

Primary Residential Mortgage now offers eClose services in 49 states and the District of Columbia. eClose, the process of electronically signing some or all mortgage closing documents, is the next digital innovation streamlining the mortgage process and empowering borrowers, and PRMI is one of the few lenders to offer it. PRMI is educating settlement agents directly to help make the eClose process available to more borrowers. The process is simple, secure and reduces the closing time for all parties.

Plaza is making it easier for broker’s borrowers to sign a 4506-T form. Plaza will now send the borrower an electronic signature request that they can complete all online. Once they submit their digital signature, everything else works the same. Share Plaza’s Consumer Guide with the borrowers if they have any questions on electronically signing the 4506-T.

Capital Markets

Agency MBS tagged along for the ride yesterday as yields on the U.S. 10-year note and the 30-year bond dipped to fresh lows for the year in what was a volatile session (the 10-year briefly flirted with going below 1.50 percent before closing the day -5 bps to 1.53 percent). Economic releases took a backseat: no one cared that the Philadelphia Fed Survey doubled its January reading or that the Conference Board's Leading Economic Index beat expectations to post a solid increase in January from almost all components.

Apple's surprise update this week that it wouldn't hit its revenue target has put investors on edge, and despite the number of companies lowering their guidance on profits for Q1 still being in line with past years, Goldman Sachs told clients this week that a near-term correction, in which the market slides at least 10 percent from a recent peak, "is looking much more probable." Interestingly enough, though President Trump takes credit for a stellar stock market and a growing economy, Trump’s administration admitted that his trade war on China has damaged American economic growth.

Goldman’s thinking is that equity markets look "increasingly exposed" to disappointing earnings growth due to the new coronavirus outbreak. The bank noted that the global economy is expected to keep growing, and the U.S. is too, despite already having experienced the longest economic expansion in 150 years. But the bank is concerned that earnings expectations could still be too rosy, especially given the exposure of global companies to the Chinese economy.

Ah yes, the coronavirus. For the second time in about a week, China changed its criteria for confirming cases of the virus, making it increasingly difficult for public health experts to track the outbreak. The government said yesterday that it would now differentiate between “suspected” and “confirmed” cases, only qualifying for the latter after genetic testing, which is difficult to conduct and whose results are often wrong.

Today’s light U.S. economic calendar has only January Existing Home Sales and the preliminary February Markit PMIs. There is a full slate of Fed speakers today: Dallas Fed President Kaplan, Fed Governor Brainard, Fed Vice Chair Clarida, Atlanta President Bostic, and Cleveland President Mester are all on stage. We begin today with Agency MBS prices better by .125 and the 10-year yielding 1.48 percent on renewed thinking that the coronavirus will hit economies around the world.

Jobs and Promotions

What’s the difference? A 100% employee-owned approach and collaborative culture continues to ignite growth and opportunity for this mortgage company headquartered in the Pacific Northwest. No employee is left behind as all employees are owners. With a companywide ownership mentality combined with leading edge tools and technology, competitive compensation, and industry leading fulfillment, there is no question why so many have explored the difference and are flocking to this platform. The company is expanding and seeking new Branch Operators, Production Teams, and seasoned Originators throughout Washington State with a focus in Western Washington and the South Puget Sound. For a confidential look behind the curtain email all inquiries to Chrisman LLC's Anjelica Nixt for forwarding; specify opportunity.

To support continued growth, an industry-leading subservicing firm is further expanding its business development team with an excellent opportunity for a senior sales executive to manage an assigned territory. Prior experience in mortgage technology sales and/or B2B financial services sales at the C-suite level required. Undergraduate degree required with graduate degree preferred. Excellent career prospects. Please contact Chrisman LLC’s Anjelica Nixt confidentially and specify the opportunity.

Turning out a record setting 2019, non-QM lender Angel Oak Mortgage Solutions added to its impressive roster of Account Executives in February. Glenn Hodge came on board in Cincinnati, Jerry Canon in Milwaukee, Jim Slowik in Chicago and Jonathan Halperin in New Jersey. These AEs have gone through the first round of training and have been teaching brokers and correspondents how easy it is to work with Angel Oak. And Angel Oak is not done yet as it is continuing to add Account Executives in many additional markets including Jacksonville, FL, Oklahoma City, OK and Riverside, CA. To learn more, view the Careers Page or email National Business Development Manager, Andy Looker. 

“Following record growth, Home State Bank is seeking to further expand our retail presence in Wisconsin and Florida. Partnering directly with Senior Management, the ideal candidate(s) will be responsible for directing the growth in these markets, while having a voice in the operation of the overall mortgage division. These are P&L level positions, that will have the opportunity to share in the financial success of the organization and the markets being developed. Please send your resume to Jim Sorenson for confidential consideration.”

Freddie Mac named Donna Corley EVP and head of the company’s Single-Family business. Jungle drums tell me that, after 25 years in the biz, the promotion is well deserved given her expertise in risk management, capital markets and pricing. (Donna was named interim head of the Single-Family division in October 2019.) And Mark Grier has been elected to its Board of Directors effective February 18. Grier served as Vice Chairman and a Member of the Board of Directors of Prudential Financial, Inc. until his retirement in 2019.