"A husband is someone who, after taking the trash out, gives the impression that he just cleaned the whole house." I think that quote is pretty funny, but it does have a correlation with the mortgage industry.

I have heard repeatedly that in the current environment, brokers are doing three times the work for one third the pay compared to past years. Say what you want about this being justified or not, but you might see some names that you recognize on a nationally published list of top originators. The Scotsman Guide has ranked the nation's top-producing mortgage professionals HERE

Who says that protesters aren't organized? Protestors at Syracuse are planning on greeting JPMorgan Chase's Jamie Dimon, who is speaking there. And protesters have an actual website for activities at the Wells Fargo shareholders meeting, complete with entertainment, food, the groups involved, etc. READ MORE

At Bank of America, just like at JPMorgan Chase, credit and income is improving! Bank of America Corporation reported first-quarter net income of $3.2 billion compared with a net loss of $194 million in the fourth quarter and net income of $4.2 billion a year earlier. The company earned $0.28 per diluted share in the first quarter, up from a loss of $0.60 per share in the fourth quarter and earnings of $0.44 per share in the first quarter of 2009. All in all, analysts were pleased with the results, and the stock has improved on the news in pre-market trading. Interestingly, according to BofA's president, core loan demand from consumers is slow - smaller companies are not hiring yet. Banks have money to lend, and are willing to do so, but certainly are not loosening up their underwriting criteria.

Here's a quiz: "Lender B originates a loan using an appraisal transferred from Lender A, who provided Lender B with written assurances that the appraisal was obtained in a manner consistent with the Code. Will Fannie Mae hold Lender B liable for remedies if it is discovered after the transfer that Lender A committed a Code violation?" You may not care about the answer, but the HVCC topic is still critical for lenders. Recently Fannie released a revised set of "Frequently Asked Questions" on the subject. HERE is the bulletin

There are a new set of HUD Frequently Asked Questions (FAQs) that address issues surrounding Appraisal Management Companies, reasonable and customary fees and appraisal turnaround times posted on FHA's Lenders webpage and Roster Appraisers page. To read the new FAQs please visit: HUD GUIDANCE

Do you want some input in financial reform? There are many ways to do this, and here is another. The public will have the opportunity to submit written responses to seven questions that will be published in the federal register online at www.regulations.gov. The administration also plans a series of public forums across the country on housing finance reform.

The questions are:

  1. How should federal housing finance objectives be prioritized in the context of the broader objectives of housing policy?
  2. What role should the federal government play in supporting a stable, well-functioning housing finance system and what risks, if any, should the federal government bear in meeting its housing finance objectives?
  3. Should the government approach differ across different segments of the market, and if so, how?
  4. How should the current organization of the housing finance system be improved?
  5. How should the housing finance system support sound market practices?
  6. What is the best way for the housing finance system to help ensure consumers are protected from unfair, abusive or deceptive practices?
  7. Do housing finance systems in other countries offer insights that can help inform US reform choices?

One discussion has already begun HERE

Investors, and housing market analysts, are concerned about the numbers for the Making Home Affordable Program (HAMP). HAMP numbers improved substantially during March according to the Treasury Department. Designed to decrease the foreclosure rate by HUD and the Treasury Department, HAMP has not been the huge success for which some had hoped. During March, however, over 60,000 homeowners enrolled in the three month trial period required by the program were converted into permanent modifications. This brings the cumulative total of permanent loan modifications to 230,801, a 3.5-fold rise in permanent modifications since the first of the year. Analysts believe, however, that HAMP "trials started" continue to slump due to a shift in program requirements that require more paperwork to get a trial started and the fact that servicers have already run through the most likely mod candidates.

Reports show that the average LTV in HAMP modifications actually increases, from 135% to 143%, due to capitalization of arrears and escrow requirements. According to Congressional testimony, in only 28% of cases is this mitigated by principal forbearance; for these, the average principal forborne was $67 K. On top of that, average post-modification DTI's for borrowers range from 61% to 70%, so these borrowers are already struggling with debt levels that are above current guidelines. CHARTS AND MORE COLOR ON HAMP

Wells Fargo, for example, has modified 523,336 mortgages as of March 31st, and has made modifications of about 380,000 under its own private programs since the beginning of 2009. Wells, like other lenders, use HAMP as the starting point, but also implement other workout options when a customer is not eligible for HAMP.

The Treasury released its "International Capital" report yesterday, nicknamed TIC. China continues to be the largest owner of debt of the United States, although their holdings fell by over $11 billion to $877 billion. Overall, foreigners were net buyers of long-term U.S. financial assets in February.

If an agent or company is having trouble originating loans in this interest rate environment, the rest of the year might not be much better. We've been in a 45 basis point range in the 10-year Treasury for nearly 4 months (3.54-3.99%), and mortgage prices have also been in a narrow range. It seems that a 4% yield on the 10-yr gets us about a 5.25% 30-yr mortgage rate. Does anyone believe that rates are going to drop? The Fed, however, certainly has no reason to raise short term rates, given the current job, housing, and inflation situation here in the US - so don't look for too much of a move toward the upside.

Thursday we had the Philly Fed (up from 18.9 to 20.2), Industrial Production (+.9%) and Capacity Utilization after the Initial Jobless Claims number. The reports were mixed, though the back months saw nice upward revisions and Capacity Utilization, a traditional Fed barometer, did well at +0.2% to 73.2%.

Today had New Home Construction and will have the University of Michigan Sentiment Survey. Housing Starts for March were better than expected, up 1.6%.  March Building Permits were up 7.5% from 637,000 to 685,000 on an annualized rate. It is nice to see the economic activity associated with housing, but don't we already have a pretty good inventory of existing housing stock in many locales? After these housing stats the 10-yr is at 3.80% and mortgage prices are better by .125-.250.

A young monk arrives at the monastery. He is assigned to helping the other monks in copying the old canons and laws of the church by hand. He notices, however, that all of the monks are copying from copies, not from the original manuscript.

So, the new monk goes to the head abbot to question this, pointing out that if someone made even a small error in the first copy, it would never be picked up! In fact, that error would be continued in all the subsequent copies.

The head monk, says, "We have been copying from the copies for centuries, but you make a good point, my son."

He goes down into the dark caves underneath the monastery where the original manuscripts are held as archives in a locked vault that hasn't been opened for hundreds of years.

Hours and hours pass and nobody sees the old abbot.

So, the young monk gets worried and goes down to look for him. He sees him banging his head against the wall and wailing!!!

"We missed the R. We missed the R!!! We missed the R!!!!!!!!!"

His forehead is bloody and bruised and he is crying uncontrollably.

The young monk asks the abbot, "What's wrong, father?"

With a choking voice, the old abbot replies, "The word was 'CELEBRATE'!!!!"