Plenty of economists watch builder activity and mood swings as early indicators of future economic health. Builder confidence in the single-family 55+ housing market continued in positive territory in the second quarter of 2018, according to the HMI. We’ve been hearing about skilled labor shortages, lack of buildable land, raw material price volatility, and permit & regulatory costs for years, but aging Baby Boomers are downsizing, many into condominiums. The 55+ multifamily condo HMI is the second-highest reading since the inception of the index in 2008. I bring this up because of the FHA condo announcement yesterday, spelled out below and good news for many.
Lender Products and Services
OpenClose® has added industry technology veteran Allen Pollack as the company’s new VP of Innovation. The move supports OC’s commitment to innovate, empowering lenders and financial institutions to become more efficient and align with the demand of today’s consumer needs. Pollack was previously at Fiserv, where he was responsible for FinTech initiatives within retail banking that leveraged digital mortgage and conversational AI products to transform lending for the operational efficiencies and consumer experiences. Pollack was also a co-founder of NYLX, serving as CTO and later continued as CTO of LoanLogics. OpenClose recently launched a single-source digital mortgage point-of-sale (POS) solution that integrates tightly with its end-to-end multi-channel LOS, which Pollack will continue to enhance. Visit its website for more information.
If you’re thinking about a Renovation Loan, it makes sense to partner with a trusted expert like AFR Wholesale! AFR’s Renovation Portal not only provides AFR’s lending partners with the ability to view loan activity throughout the loan origination cycle, its partners can also view progress on the project even after the loan has closed. It’s easy to see why AFR has been a leader in renovation for more than 20 years, and is the go-to renovation resource for so many brokers & correspondents. AFR would also like to remind everyone of the Simple FHA Refinance: similar to the FHA Streamline with the added ability for eligible borrowers to include closing costs in the new loan. In addition to unique products and services, AFR also provides its business partners with industry-leading technology, professional expertise and continuous educational opportunities. For more information on becoming an AFR partner, email sales@afrwholesale.com, call 1-800-375-6071, or visit www.afrwholesale.com.
Originator News
In the 2018 STRATMOR Originator Census Study, STRATMOR found the top 20 percent of originators closed just over eight loans a month on average. Those same top 20 percent tended to have an average tenure of just over five years. Knowledge is power when it comes to building and maintaining a great sales team. What do you know about your team? Is it time to start recruiting because you have a higher than average age group that may be retiring soon? How many of your originators are reaching the average tenure time this year? Get the answers to these questions and more by participating in the STRATMOR Originator Census fall survey for Retail and Consumer Direct channels. Participants receive a customized summary report comparing their company data to industry averages. Register today as this Originator Census survey closes August 31!
FHA, VA News; Condo-mania
The U.S. Department of Housing and Urban Development (HUD) released updated guidance on FHA-insured condominium financing. The new rules should benefit potential borrowers by allowing more buyers to obtain low down-payment mortgages on affordable housing options. The Federal Housing Administration (FHA) announced the publication of its Condominium (condo) Project Approval Final Rule and new condominium sections of FHA’s Single Family Housing Policy Handbook 4000.1 (SF Handbook in PDF format).
The new rules will extend FHA certifications on condo developments from two years to three years, reducing the compliance burden on condo boards. They will allow for single-unit mortgage approvals (aka spot approvals) which will enable FHA insurance of individual condo units, even if the property does not have FHA approval (including units with HECM loans), and secure additional flexibility in the ratio of investors to owner-occupants allowed for FHA financing in a condo building.
The full guidance will go into effect on October 15, 60 days from publication. The full rule for single-family condo financing is scheduled to be published in the Federal Register on Aug. 15, 2019, and is available online. Recall that the Condominium Project Approval and Processing Guide was originally introduced in Mortgagee Letter 2011-22.
FHA will issue a Mortgagee Letter next week that will outline the process for case number assignments for applications utilizing the Single-Unit Approval process. And in September, FHA will host an industry stakeholder briefing call to assist mortgagees and other interested parties in FHA transactions to better understand the FHA’s condominium project approval requirements. An industry stakeholder training webinar will also be held toward the end of September. The details for both will be communicated later.
Various groups expressed approval. For example, Scott Olson, Executive Director of the Community Home Lenders Association (CHLA) issued a strong statement of support for HUD publication of the final rule today making changes to rules governing FHA insurance of condominium loans: “The Community Home Lenders Association (CHLA) strongly commends FHA for issuing this final FHA rule which responsibly provides for more flexibility to originate single family condo loans." NAR President John Smaby, enthused, “We are thrilled that (HUD) Secretary (Ben) Carson has taken this much-needed step to put the American dream within reach for thousands of additional families.”
In SEL-2019-034, GNMA issued updates to seasoning requirements.
AmeriHome Mortgage will be accepting the FHA announced changes, effective with new case number assignments on and after 9/1/2019, the maximum LTV/CLTV for Cash-out Refinance Mortgages will be reduced from 85 to 80 percent.
In accordance with the GNMA announcement of additional restrictions for high LTV VA cash-out refinance loans; all loanDepot Wholesale VA cash-out loans greater than 90% LTV must fund by September 30, 2019. NDC VA cash-out loans greater than 90% LTV must be delivered to loanDepot Wholesale by September 23 and purchased by September 30, 2019.
Quorum Federal Credit Union now offers a new source of cash to purchase properties, renovate homes or pay for college. Individuals can borrow up to 80% of an investment property's appraised value. Eligible properties include non-owner occupied 1-4 family homes, condominiums, planned unit developments and townhouses. Under the terms, borrowers can make interest-only payments for the first five years, followed by a 10-year repayment period. There are no pre-payment penalties. Individuals will become a member of the Credit Union as part of the application process. To learn more about Quorum's Interest-Only Investment Property HELOC, visit info.quorumfcu.org/heloc-for-investments or send an email to mortgagesales@quorumfcu.org.
Ditech Correspondent issued an announcement regarding the Ginnie Mae Seasoning Requirements for VA Refinance Loans.
PRMG posted the following information regarding FHA Streamline Products and VA IRRRLs: In Cook County, Illinois, Kane County, Illinois, Peoria County, Illinois and Will County, Illinois Streamline Refinances are not exempt under Illinois law from the requirement to enter applicant income information. The actual income must be provided/estimated by the applicant(s) and listed on the application (1003) and entered in the Illinois Anti-Predatory Lending Database (ILAPLD). It is not acceptable to enter a nominal amount such as $1.00. However, the income will not be considered in the underwriting of the loan.
Waterstone Mortgage introduced its Non-Traditional Credit Program, which allows homebuyers with no credit history to qualify for a home loan based on other payment history indicators. The new program is available with Waterstone Mortgage’s conventional, FHA, USDA, or VA loan options, and is designed to help credit invisible homebuyers achieve their goal of homeownership.
Capital Markets
What a ride it’s been for markets lately, and what a mirage Tuesday’s hope around U.S. / China trade talks was. U.S. stocks suffered one of the biggest sell-offs of the year on Wednesday, with the S&P 500 sinking almost 3 percent, the Dow dropping 800 points, and the yield curve inverting for the first time since 2007, including the 10-year closing -10 bps to 1.58 percent amid ominous signs of a looming recession. Additionally, the 30-year treasury bond hit an all-time low yield of 2.018 percent. There wasn’t much of any good news out there, between President Trump again lashing out at Fed Chair Powell in an attempt to deflect criticism that his trade war with China is harming the U.S. economic outlook, disappointing July growth figures from China, a QoQ contraction in Germany's Q2 GDP, and reports the unrest in Hong Kong is slowing the financial center’s economy. Domestically, import/export prices didn’t show any inflation, confusing markets perspective on the Fed’s perception of inflation trends as that contradicts the Consumer Price Index for July. MBS volume soared, led by short expiries, with swaption volume besting YTD-highs as well as the February 2018 highs.
Today contains the busiest economic release schedule of the week. With all eyes on trade & tariffs, do the numbers matter? We’ve had July retail sales (+.7%), Empire State Manufacturing for August (“4.8”), initial jobless claims for the week ending August 10 (+9k to 220k), Philadelphia Fed Manufacturing for August (down to “16.8”), and Q2 productivity and unit labor costs (+2.3% and +2.4%, respectively). Later this morning brings July industrial production and capacity utilization, June business inventories, and the NAHB Housing Market Index for August. In terms of central banks, both Norway and Mexico will be out with their latest monetary policy decisions. We begin the day with agency MBS prices worse a few ticks (32nds) from Wednesday afternoon and the 10-year yielding 1.58%.
Jobs
Two of America’s most storied mortgage companies, American Mortgage Service Co. and Eustis Mortgage, have agreed to join forces to form the nation’s premier mortgage banker. Together the two companies have a combined 110 years of mortgage lending and operations and possess similar characteristics in how they approach the mortgage business for their clients and their general appreciation for the employee family. The new company will launch towards the end of the year, and will combine the state-of-the-art technology platform that Eustis Mortgage has adopted, along with American Mortgage Services long history of operational excellence. Opportunities for interested mortgage professionals looking to expand their business should contact the following individuals who are in charge of growth: Rich Phillips at American Mortgage Service or Stephen Barton at Eustis Mortgage.
Top 50 Mortgage Lender, On Q Financial, is continuing its expansion across the country with the addition of Regional Vice President, Paul Sinnett in Missouri and Area Manager, Pamela Robichaud in Delaware. Together, Robichaud and Sinnett have over 50 years of experience in the industry leading multiple teams, recruiting, and creating the dream of home ownership for families across the nation. "Their energy, diligence, and dedication have already made an impact to On Q and our plans to grow our brand and bring the dream of home ownership to countless families," Shane Miller, Senior Vice President, added. If you're a passionate and driven individual that thrives in a fast-paced environment and you're interested in joining the team at On Q, please contact Nick Suwanvichit or visit On Q Financial Careers.
U.S. Bank Home Mortgage is growing in the Texas, Central Coastal, CA and Central Valley, CA communities! “We’re hiring Managers and Loan Originators with Builder/CRA/Traditional experience. We’re seeking stellar talent to build a dynamic growing team to help navigate important milestones and strengthen futures together in the communities we live and work. At U.S. Bank, you'll get the incentives, tools, resources and personal support you need to pursue your professional dreams and cultivate meaningful relationships with the people and communities you support. We offer a comprehensive benefits package, including a pension plan and matching 401k plan!” Please contact Christina Saucedo, U.S. Bank Recruiter, at 651 325-0984 or Region Manager, Phil Deol at 949 538-4066.
Actions speak louder than words. At Citizens Bank, we not only speak to our commitment to building a diverse and inclusive workforce, we put it into action by supporting community events focused on celebrating our differences. Each year we sponsor Pride festivals in our Boston and Providence communities, with Citizens colleagues volunteering at all events. We also set up internal Business Resource Groups (BRGs) made up of our colleagues, dedicated to women, LGBTQ, multicultural colleagues and veterans. These BRGs help us weave a more effective diversity and inclusion mind set into everything we do. Join us as we strengthen our culture of inclusion. If that is the kind of company you want to build your future with, apply here. For questions, please email Home Mortgage Recruiting.
Recently, we learned that Rushmore has agreed to purchase the Correspondent channel from First Bank. Now, comes news that the new Rushmore Correspondent Lending Services is looking to expand its Capital Markets capabilities and looking for a trader in the Nashville TN location. The Trader will be responsible for bidding bulk tapes, hedging, and delivering loans to FNMA, FHLMC, and GNMA. Nashville is a pretty nice place to live, and Rushmore has big plans for growing Correspondent. Please send resumes to Patrick Reese.
Take Three Technologies (Take3™) announced its hiring of Ruth Lee as the organization’s EVP to lead the startup’s efforts to expand adoption of its proprietary software, TheRuleTool™. This SaaS solution provides originators with on-demand access to guidelines using a simple online and mobile-friendly interface, improving efficiency and reducing operational drag early in the process for mortgage banking operations and executives.
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