What parent hasn’t heard, “Are we there yet?” from the back seat during a road trip? The same could be said about Fannie Mae and Freddie Mac, the Government Sponsored Enterprises, regarding “GSE reform.” First off, no one in Washington DC is talking about an exit from conservatorship. Second, GSE (Government Sponsored Enterprises, namely Freddie Mac and Fannie Mae, whose programs account for the vast majority of residential lending) reform is a constantly evolving process going on now. We can expect, during the Biden Administration, that the GSEs want to focus on first time home buyers & affordable housing. Given limited time, capital, and other resources, they don’t want to crowd out affordable housing by focusing on investment property loans or 2nd homes. Put another way, wealthy 2nd home and rental owners are not a protected class within the FHFA. But the GSEs rely on income from income on investment and 2nd home lending, so they don’t want to exclude those loans entirely from their product set. Stay tuned! (Today’s audio version of the commentary, which features two RC’s discussing the Western Secondary conference, is available here and this week’s is sponsored by ActiveComply. ActiveComply is a social media monitoring and website archival platform built by the mortgage industry, for the mortgage industry.)

Lender and Broker Products and Services

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The AIME Fuse 2021 Agenda is here! Check out Aime’s fully released agenda which includes two days of exclusive content, speakers, and networking opportunities only available at the nation's largest gathering of independent mortgage professionals in Las Vegas.

Ready to buy local leads that actually pay off? With LendingTree’s new LT Connect app, you’ll find high-intent borrowers who are primed to purchase and looking for loan officers who can help them finance their dream home. Stop spending valuable time and energy following up on leads that go nowhere or connecting with noncommittal borrowers who never convert. Instead, use the app to buy local leads that will help you outpace the competition and help you build a robust pipeline, right in your local market! Our app lets you preview borrowers’ profiles before you buy a single lead. No more throwing spaghetti at the wall and hoping it sticks. Now, build your pipeline with borrowers who are prepared to purchase and come fully-filtered and highly-lendable. Fill out the form to start connecting with high-intent borrowers today.

Arcus Lending, a tech-first mortgage lender, has rebranded under the name InstaMortgage to reflect its commitment to providing accurate, immediate, and reliable mortgages while utilizing AI-powered technology to modernize the mortgage process. Shashank Sekhar, CEO of InstaMortgage said, “We want InstaMortgage to become synonymous with the fastest, most predictable mortgage experience available in the market today.” Lenders are now able to leverage technology to deliver the utmost convenience to consumers and transform the mortgage experience. InstaMortgage is leading this change by implementing new AI technology to deliver a mortgage in record time. InstaMortgage has proven itself as an industry leader and was recently named for the second time in the prestigious Inc. 500 list of fastest-growing private companies in America. With an impressive growth rate of 1,233% over three years (2017-2020), the company ranked No. 394 out of 7 million companies nationally. Please visit InstaMortgage to learn more about the radically different mortgage experience.

Is your origination system delivering the accuracy and efficiency you need to stay competitive in today’s market? Black Knight’s latest integration of its industry-leading Optimal BlueSM product, pricing and eligibility engine and the powerful Black Knight Empower® loan origination system can take your business to the next level. An added Pipeline Monitoring feature synchronizes the data between both systems to streamline pricing and achieve greater pricing accuracy. What’s more, Pipeline Monitoring continuously checks for data changes, while validating pricing and eligibility for each change – steps that would otherwise be completed manually, increasing the potential for loan parameters to be inaccurate or incorrectly priced. Lenders are alerted immediately about how data changes impact the net price, providing the insight needed to appropriately update the rate lock. Learn how this integration and innovative addition can increase efficiencies and lead to a more seamless origination process for your business.

ActiveComply: Love it or hate it, social media is a critically important tool that lenders and servicers must utilize in order to attract new customers and stay on the cutting edge of contemporary marketing strategies. But how does one safely navigate the cluttered tangle of federal mortgage regulations and their ambiguous reach when it comes to the relatively new world of online advertising? There are many federal and state regulations designed to keep the mortgage industry fair for all and recent years have seen current laws fine-tuned to include social media, as well as new regulations specifically created for this brave new world of marketing potential. Read ActiveComply’s most recent article on Mortgage Advertising Regulations and check out its Record Retention Geomap to learn more about archiving requirements. ActiveComply: making social media monitoring simpler, more compliant, and at a lower cost. Request a free compliance report for your company today.

What if lenders played a more central role in the homeownership process? 89% of consumers in a recent Aite Survey said they are interested in using a complete end-to-end homeownership solution offered by a lender. Consumers face obstacles due to a lack of in-depth knowledge about the often-confusing homeownership process. They want an easier, less stressful, and less expensive way to purchase homes. Understanding those pain points is crucial in providing the customer experience that will keep you top of mind when the next big purchase comes along. Explore lender-facilitated solutions and learn more about the homeownership journey. Download the report “Reframing the Homeownership Journey: Consumer-Focused, Lender-Led” and dive into key consumer survey takeaways and how your peers are approaching the challenge.

Purchase Business Primer

For more than a year, the mortgage industry has ridden a wave of profits brought on by a refinance tsunami. But the refi wave is fading, which means worries for lenders of lower loan volume and profit margins in a purchase market, says STRATMOR Senior Partner Garth Graham. In the just-released August issue of STRATMOR’s Insights Report, Graham looks at the clouds on the horizon of the rising purchase market where the competition will be fiercer, volumes lower and profit margins tighter. “Purchase lending is tougher,” says Graham. “Purchase loans are harder to market and convert, harder to process, and generate lower revenues and higher expenses. We can argue about what day the refinances will finally all go away, but smart lenders are preparing to weather the storm that will wash away the lenders who only know how to originate refinance business.” Don’t miss Graham’s article in the new Insights Report: “Prepare Now for the Storms Ahead: Build Your Purchase Business.”

Tech

The Mortgage Collaborative (TMC), the nation's largest independent cooperative network serving the mortgage industry, announced today that the TMC Emerging Technology Fund LP recently led a pre-Series A investment round in Home Lending Pal, a technology-enabled marketplace that focuses on fair lending practices by using artificial intelligence and distributed ledger technology to turn a complex home research and origination process into an easy online shopping experience for both qualified and unqualified borrowers. “Home Lending Pal’s platform assists consumers, particularly minorities and millennials, to assess their financial ability to take on a mortgage. It also guides them to take actions to improve their access to mortgage financing and select mortgage originators with whom they want to share their application information based on an AI algorithm that predicts probability to close.”

Capital Markets

Why do those in the mortgage space watch the 10-year U.S. Treasury note? Historically, the 10-year U.S. Treasury yield has been considered a key benchmark for mortgage rates. Mortgage rates, however, are not actually based on the 10-year U.S. Treasury note (as is commonly believed). MCT recently released a blog, "How the 10-Year U.S. Treasury Note Impacts Mortgage Rates" that serves as an excellent primer for how mortgage interest rates respond to moves of the benchmark U.S. Treasury note. The piece discusses why mortgage rates and Treasury yields move together and how bonds are influenced by Treasury yields. With a trusted capital markets partner like MCT, you can rest assured that you will be notified of how economic trends could have the potential to impact your business. Sign up for MCT’s newsletter to receive educational articles like this one and learn more about variables that impact mortgage rates.

Sometimes there’s a lot going on with bonds, and therefore rates, sometimes not. Although bond prices sank and rates slid higher, yesterday was a quiet day of trading in the bond market yesterday ahead of the Kansas City Fed-sponsored virtual Jackson Hole gathering. Durable goods orders fell 0.1 percent last month, though excluding transportation, they rose 0.7 percent. Orders are expected to wane in the coming months as consumers pull back on goods spending and the auto sector contends with supply problems. The day's $61 billion 5-year note auction was met with weaker demand than what was seen at Tuesday's 2-year note offering, but still moved Treasuries. By the end of the day, Treasuries had pulled back while the MBS basis ended wider, not a good combination for rate sheets.

Don’t expect much of a different narrative today, as the bond market is preoccupied with potential tapering comments from Fed Chair Powell during his speech tomorrow. The economic calendar is already out of the gate with the second look at Q2 GDP (now +6.6 percent) and the PCE deflator (slightly softer than expected). We’ve also received the latest weekly jobless claims (353k, about as expected, continuing claims were 2.862 million). Later this morning brings Freddie Mac’s Primary Mortgage Market Survey, Kansas City Fed manufacturing for August, and a Treasury auction of $62 billion 7-year notes. The NY Fed Desk will conduct the last two operations on the current schedule before releasing a new schedule covering the August 27 to September 14 period in the afternoon. We begin the day with Agency MBS prices unchanged from Wednesday night and the 10-year yielding 1.35 after closing yesterday at 1.34 percent.

Jobs

“Every once in a while, a partnership comes along that just makes complete sense. Take for instance this week’s exciting news about New Residential’s finalized acquisition of Caliber Home Loans. The combination of these two incredible, complimentary platforms, now ranks us among the Top-5 non-bank lenders in the U.S. ‘We are excited to finally be joining the New Residential Family,’ said Caliber Home Loans CEO Sanjiv Das. ‘Our combination of platforms and strategies will allow us to accelerate our leading position in purchase lending, grow our direct-to-consumer and broker initiatives, and further propel our retail franchises.’ This also means now is the perfect time to join the team focused on expanding products and capabilities that make homeownership a reality for even more Americans. If you’d like to join the team that’s focused on growth and understands the value of exceptional talent, email James Hecht for Sales positions.  

“Impac Wholesale is transforming the Non-QM playing field with game-changing guidelines featuring lower FICOs across the board (down to 600), DTIs up to 55%, DSCRs < 1.00, and unlimited cash-out. We’ll even qualify I/O borrowers using the I/O payment with our redesigned Investor program. Want more? Our 21 & Done program also rewards borrowers with a $500 credit when their loan closes in 21 days or less. It’s full steam ahead here at Impac and we’re looking for high-performing Wholesale Account Executives to grow alongside us. These remote positions provide highly competitive compensation, generous territories, comprehensive training, and impressive benefits. Here’s your opportunity for real career growth! Email your resume to Lisa Livingston for immediate and confidential consideration.”

Track record of long employee tenure = Assurance Financial, a profitable and well-capitalized full- service mortgage banker offering an entrepreneurial, customer-focused sales support environment, FNMA/FHLMC/GNMA direct status, and well-positioned to compete for more growth with state-of-the- art operations/support technology. Best tech stack in the mortgage marketplace = Assurance Financial. Exemplary record of servicing purchase money market MLOs = Assurance Financial. Incredible entrepreneurial branch manager business and compensation model = Assurance Financial. Community-service oriented in all markets with St. Jude as our philanthropy partner = Assurance Financial. Founded in 2001, licensed in 43 states, not controlled by private equity, and growing in all markets. If you are an aggressive producing branch manager, or senior mortgage loan officer considering a step up in your career, contact Paul Peters, CMB to discuss a mutual opportunity or visit AssuranceMortgageLO.com to learn more!