Everyone knows Pre-Fund and Post Close QC audits are essential and mandatory. But, with the ever changing agency requirements, many lenders find it challenging to keep up with best practices and are unaware of the proactive steps available to reduce their exposure. MetaSource has published two new whitepapers on Pre-Fund and Post Close QC to assist companies in navigating these waters. Speaking of MetaSource, it acquired Titan Lenders Corp. This union provides MetaSource clients with a unique offering of document management, data reconciliation, analytics and remediation, compliance, and QC solutions.

Few employees ever want to hear that their company is "exploring strategic alternatives." But that is exactly what PHH's employees heard earlier this month - and the stock rallied! - and that the company had retained Credit Suisse Securities and J.P. Morgan as financial advisors "and Cleveland-based mega firm Jones Day as legal advisor to assist in the process, while the board has retained Los Angeles-based Latham & Watkins as its legal advisor." The company has not doing particularly well. It had a $54 million fourth quarter loss, a $145 million loss for 2015 and a $191 million loss in 2014. It finished 2015 with $790 million in net revenues, up from $639 million in 2014, while total assets declined from $4.3 billion to $3.7 billion.

Not only that, but PHH, with the industry's full support behind it, is also fighting a $109 million penalty in federal court imposed this past summer by Consumer Financial Protection Bureau Director Richard Cordray for allegedly taking illegal kickbacks from mortgage insurers, leading to rising costs for borrowers. PHH won a stay in August while it appealed and will be in court against the CFPB on April 12.

Yesterday a general rumor arose that "PHH had shut down 'the retail origination channel' and engaged in widespread layoffs yesterday." There was talk of problems with TRID, poor legacy technology, an LOS that didn't function effectively, and questionable strategic decisions regarding its private label business and Realogy relationship.

Readers should keep in mind that the company is very segmented. In an e-mail to me Dico Akseraylian, the SVP of Marketing and Communications, set things straight: "Within PHH Mortgage's Real Estate business channel, we originate mortgages through PHH Home Loans, a joint venture we maintain with Realogy, and a retail platform, which is outside of the joint venture.  As we stated during our fourth quarter earnings call, PHH continues to focus on driving organic growth through PHH Home Loans; however, we have decided to cease our organic retail expansion efforts outside of the joint venture."

And Fannie & Freddie saw themselves in the headlines again yesterday. No, it was not more talk about CEO pay caps. It was about a new plan approved by the FHFA will permit Fannie and Freddie to cut mortgage balances for some borrowers; however, the program will probably only benefit about 50,000 borrowers, which sounds like a lot but if you divide it by 50 states...

Along those lines FHFA Director Mel Watt made some remarks that are of interest to the mortgage-backed securities market related to principal forgiveness and post-HARP. In regards to the former, he said "I expect to announce a decision within the next 30 days about whether we have been able to find a 'win-win' principal reduction strategy or whether, on the other hand, we will take principal reduction off the table entirely."

As for a replacing HARP after it expires at the end of the year, Watt said that they were working on a permanent high LTV refinance program to take its place. He said the FHFA and GSEs were reaching out to stakeholders to understand the operational impact and feasibility of such a program, and aware of investors' fears, he added that in their outreach discussions they were "reminding industry participants that borrowers who previously completed a HARP refinance will not be eligible to refinance under a new high-LTV program."

For those interested in learning about Fannie Mae Credit Risk Transfers they can go to http://www.fanniemae.com/resources/file/mbs/pdf/mbsenger_031716a.pdf.

Fannie Mae's Quarterly Compass newsletter is now available with news and updates from Q1 2016. This edition includes information on getting ready to deliver the Uniform Loan Delivery Dataset (ULDD) Phase 2 in Loan Delivery, appraisal sharing functionality coming to Collateral Underwriter^TM, Desktop Underwriter® (DU®) Version 10, how to prepare for UCD, and much more. TheCompass Extra on page 2 offers an at-a-glance view of policy and technology happenings in 2016, plus a Fannie Mae resource list and training opportunities.

Flagstar's conventional underwriting guidelines will be updated with the following Fannie Mae changes which are effective immediately. Expansion of guidelines to permit all occupancy types when an age-related resale restriction exists on the property. Second homes must be one-unit properties, and investment properties and principal residences must be one- or two-unit properties.  All other deed restriction guidelines must continue to be met.

As a reminder Fannie Mae has eliminated its Continuity of Obligation policy. The DU messaging referencing continuity of obligation will be updated in a future release and may be disregarded until that time. In reference to solar panels, payments under power purchase agreements where the payment is calculated solely based on the energy produced may be excluded from the DTI ratio.

What is trended credit data and why is it important? This FM Commentary and infographic explain trended credit data and why including trended credit data in DU Version 10.0 will improve the accuracy of Fannie's DU credit risk assessment. Trended data is not considered in currently available credit scores, so consideration in the DU credit risk assessment will be its first widespread use in the mortgage lending industry and will help to support creditworthy borrowers' access to mortgage credit while reducing risk.

Credit Plus is currently testing trended credit data within its platform to meet Fannie Mae requirements and expects the availability of trended credit data reports beginning April 1. Fannie Mae is currently incorporating trended credit data into its DU Version 10.0 and will be implementing it during the weekend of June 25, 2016. Trended credit data is a two-year historical perspective on a consumer's utilization of credit accounts, giving lenders a means to better analyze borrower behavior and extract more meaningful statistics. Lenders will be able to determine if a borrower tends to pay off revolving credit lines each month or if they tend to carry a balance month-to-month while making minimum or other payments. In addition, seasonal and sudden changes in revolving credit behavior will be revealed.

The trended data will be included on virtually all active trade-lines, not just revolving accounts, and will include credit cards, Home Equity Lines of Credit, student loans, car loans and mortgages. Credit Plus is partnering with Equifax and TransUnion to provide comprehensive trended credit data via highly customizable reports. Lenders will be able to choose from almost 100 attributes. While each of the three national credit bureaus currently offer trended credit data in some format, only TransUnion's CreditVision and Equifax's Dimensions trended credit data sets will be required by Fannie Mae in June.

During the weekend of April 2 Fannie Mae will implement an update to Pricing & Execution - Whole Loan (PE - Whole Loan) primarily focused on its Servicing Execution Tool (SET) and best efforts capabilities. Enhancements in this release include: expanded committing grids available for servicing-released committing in SET; price loans export file available for SET multiple loan pricing with DU system integration; PDF prints for SET commitments; SET Bifurcation default field value changed for SET Browse Pricing and Making Commitments; and Best Efforts and SET import loan file updated. Review the PE - Whole Loan Release Notes for additional information.

Fannie Mae's business updates for its Guides, technology solutions, mortgage products, and more, are now available all in one place. Visit Fannie's newly launched News Center page. You can also use the "search" feature to quickly find previous news articles by topic. FNMA has also refreshed its Single-Family website home page to make it easier to find what you need.

In alignment with Freddie Mac changes to Super Conforming and Standard Balance transactions, 1-unit investment properties, Condo and PUD insurance, Penny Mac has incorporated various changes regarding FHLMC updates. Penny Mac has updated information regarding water contamination in Flint, Michigan to address requirements per VA's recent circular and changes to comply with FNMA Continuity of Obligation and 2015 Tax Transcript requirement have been adjusted accordingly.

Sun West has updated its Conventional High-Balance product guidelines. Investment properties are now offered for high-balance transactions with FICOs greater than 660. Maximum LTV/CLTV has been extended up to 95% for fixed-rate mortgage transactions for single unit principal residences. The requirement of field review of property for loan amounts greater than $625,500 with an LTV, CLTV, or HCLTV ratio greater than 80% has been removed. LTV, CLTV, and HCLTV ratio maximums for high-balance product for borrowers with 5-10 financed properties now aligned with standard product requirements. Non-Occupying borrower's income and liabilities are now considered by Desktop Underwriter (DU) for all principal residence mortgage transactions. Previously, only the credit and assets were considered by DU.

Treasuries moved higher in price, lower in rate after the explosions in Brussels airport and a train station killed dozens of people. But the two didn't really seemed to be linked in terms of movement, although some traders seemed to think that there was a flight to quality. The FHFA Housing Price Index gained 0.5% m/m in January, better than the 0.4% jump in December.

Anyone looking for more market-moving data today will be disappointed. We had the MBA Mortgage Index for the week ending 3/19. (The index dropped about 3% with refis down 5% and purchases down 1%.) Coming up are February New Home Sales - and that is about it. We had a 1.94% close on the 10-year Tuesday and this morning it, and agency MBS prices, are roughly unchanged.

Jobs and Announcements

CrossCountry Mortgage, Inc. is continuing its nationwide expansion and is growing the mortgage operations leadership team. The Company is a FNMA, FHLMC & GNMA Seller/Servicer. "We offer a wide portfolio of home purchase, refinance, and home equity products, are licensed in 49 states, and have been recognized on the Inc. 5000 List of America's Fastest Growing Private Companies four years in a row (2012-2015), as well as the Weatherhead 100 list of Northeast Ohio's Fastest Growing Companies. CrossCountry Mortgage, Inc. is currently recruiting for a Director of Mortgage Operations who will be responsible and directly manage all aspects of the mortgage loan operations including initial disclosures, loan processing/account management, closing, post closing, funding and shipping. Additionally, the individual will have oversight of operations training and some compliance functions. This position is based in Cleveland, Ohio. Please send inquires & resumes to Carmen Scalise, Director of Talent Acquisition (440-262-3290).

Customer satisfaction is critical, and lenders are searching for cost efficient, complete ways to measure it. American Financial Network turned to SocialSurvey. American Financial Network (AFN), after only 27 weeks with the SocialSurvey platform, has amassed over 1,850 Reviews shared online nearly 8,000 times! Most of this activity is fully automated by the SocialSurvey Enterprise Reputation Software. Corey Trujillo, AFN's Vice President of Marketing, describes the impact: "At AFN, getting 5 star reviews is the easy part. The challenge is how to share these reviews across the Internet via social media in an organized and trackable fashion, with SEO links back to the individual LO and Branches. Thanks to SocialSurvey, the process is fully automatic. Even when our people are less engaged than we want, it works on their behalf. We love the added compliance features and Customer Service workflows as well. Sharing our success is easy with SocialSurvey!" Read the full update here or contact Scott Harris at 937-313-4466.

Assurance Financial reports it is still closing loans on time in spite of TRID. The company continues to grow at an aggressive pace with the opening of four new branches already this year, and plans in place to open several more throughout the Southeast and Southwest. Assurance has immediate openings for producing branch managers and loan officers in Colorado, Arizona, New Mexico, Louisiana, Texas, Mississippi, Alabama, Tennessee, Ohio, Florida, Georgia, Arkansas, North Carolina and South Carolina. To find out more, contact Paul Peters, CMB, at 225-239-7948or visit http://www.lendtheway. com/careers.