If we’ve learned anything in the last ten years, it’s rarely a good thing when a lender is the focus of a story in the mainstream press, and this is no exception: “CashCall stopped making loans, but its founder, targeted by regulators, is still in the business” states the headline in a story about John Paul Reddam’s business interests. There’s always LoanMe, right? Uh, not so fast states the article. Other lenders are not in the headlines, and continue to eke out every basis point and look at expanding their product lines. Many of these are very interested in what is happening with affordable lending and here is a primer on the topic for a basic grasp of the topic.

Lender Tax News

CHLA submitted this comment letter on whether independent mortgage bankers (IMBs) are eligible for the 20% tax deduction for small business passthrough entities. The draft rule explicitly makes banks organized with passthrough ownership eligible for the deduction - but does not explicitly make IMBs (and their activities) eligible. The CHLA letter lays out the legal and policy arguments behind this request - including that the core activity of IMBs is making (originating a loan) and is therefore not a disqualifying "Financial Service." It also seeks clarification that the exclusion applies for originating federal guaranteed loans and that the securitization of loans does not constitute a disqualifying "securities activity."

Vendor Bytes

SafeChain, involved in wire fraud prevention software for land title, announced that it has successfully facilitated the sale of 36 forfeiture properties via blockchain. The transactions, which were completed in partnership with the auditor’s office in Franklin County, Ohio, marks the first instance in the U.S. of a state government using blockchain to legally record the transfer of property deeds. The recorded properties were sold at auction by the auditor’s office. After the deeds are awarded to the winning bidders, all relevant property information is transferred to blockchain and assigned a barcode, which is then attached to the deed so that the property’s information can be accessed via blockchain.

Ellie Mae announced that TD Bank has deployed its initial rollout of the Encompass digital mortgage solution, continuing Ellie Mae's push upmarket into the largest lenders and banks in the United States. “TD Bank is leveraging Encompass to streamline origination and call center vendor integrations onto one platform, speed up deployment of new online products, and significantly reduce the bank's loan cycle time. TD Bank selected the Encompass platform because of their desire to improve the customer experience by leveraging an all-in-one system that will consolidate processes on a single, efficient, and easy-to-manage ecosystem.”

Compass Analytics, today at their User Conference, announced CompassPoint™ now offers commitment integration with Freddie Mac’s Loan Selling Advisor application. (More below in capital markets section.)

A while back AmeriSave Mortgage Corporation realized a 15 percent improvement in mortgage origination efficiency through Equifax’s The Work Number for verification of employment and income (VOE/VOI). This process accelerates the path to closing by an average of five days – valuable time that enables borrowers to move into their homes quicker and more importantly, provides faster access to cash for home equity and refinance borrowers.

As mentioned last week, Optimal Blue has completed its integration with Freddie Mac’s Loan Selling Advisor application programming interface. “By connecting the two platforms in real-time, OB has enabled significant workflow efficiencies for its clients by fully automating the process of pricing Freddie Mac loans and securing Freddie Mac commitments.”

Capital Markets

Compass Analytics, today at their User Conference, announced CompassPoint™ now offers commitment integration with Freddie Mac’s Loan Selling Advisor application. This integration adds to CompassPoint™’s continuously expanding library of application programming interfaces (“APIs”), and allows for a bi-directional flow of data that enables CompassPoint™ users to take out mandatory whole loan commitments directly with Freddie, greatly streamlining the commitment and best execution process. Fremont Bank leverages the CompassPoint™ platform to fulfill their strategic goals of achieving best execution, increasing capital markets efficiency, and reducing time spent on manual processes. Mike Schlesinger, VP of Secondary Marketing at Fremont Bank, stated “Fremont Bank puts emphasis on tools that allow our team to focus on strategy and reduce risk. This integration reduces the number of manual touch points in our loan sale process, increasing pricing accuracy and saving time.”  For more information, please contact marketing@compass-analytics.com.

Rates moved higher yesterday with the yield on the U.S. 10-year closing +5bps at 2.90%. Why? The headlines revolved around Canada being left out of the latest iteration of NAFTA and the ISM Index for August hitting a 14-year high, signaling the strength of the U.S. economy. The other release of note showed total construction spending increased 0.1% in July after decreasing in June as weakness in nonresidential private sector.

Today’s calendar sees four Fed Presidents speaking, starting with St. Louis' Bullard, followed by New York's Williams, Minneapolis' Kashkari, and Atlanta's Bostic. Prior to any of the Fed speakers, we’ve had the MBA weekly mortgage applications for the week ending August 31 (roughly unchanged) and the July trade balance (widened to $50.1 billion). Later today the Redbook Weekly Same-Stores Index for the week ending September 1 and the ISM-New York Index and NY Business conditions. Finally, a House Financial Services subcommittee will hold a hearing on "The Cost of Regulation on Affordable Multifamily Development.” Rates are a smidge lower versus last night with the 10-year starting Wednesday yielding 2.88% and agency MBS prices better a few ticks.

Lender Products, Events, and Services

Are you among the countless LOs improving your application process by incorporating Floify’s recently-released 1003? If not, what are you waiting for? Floify’s groundbreaking, “interview-style” 1003 has not only been delivering a beautifully simple and secure application experience for borrowers, but also providing tons of useful automations and integrations that help reduce cycle times by jumpstarting the origination workflow. Powerful business logic gets document collection up and running immediately by automatically generating specific needs-lists and granting borrowers access to their personal point-of-sale for secure uploading. Configurable fields, design elements, and business rules are just a handful of the productivity features you can access with this fully embeddable loan application. Now, if you’re considering upgrading your mortgage workflow to include an end-to-end point-of-sale system, now is the perfect time to take advantage of Floify’s incredible solution and industry-leading 1003. To learn more, request a live demo today – plans start at only $29/month!

Leverage your community of leads and referrals to combat the consumer direct giants that you’re competing with. TheREsource.tv and Ryan Hills explains how competition from consumer direct giants and significant changes to major lead generation resources are changing the real estate lending landscape. With HomeScout® lenders and agents can create a more sustainable business, by providing a centralized location to capture community leads and referrals, then monitor their activities until they’re ready to purchase; keeping them off public search sites where they are sold to the competition. HomeScout helps lenders keep the customers they have by engaging them in real estate search and the ability to communicate with them at every stage of the transaction.Never lose another lead or preapproved buyer to these industry giants by introducing them to HomeScout. Find out more by contacting them HERE  and scheduling a demo or give them a call at 952-831-0623.

On Saturday, October 20, more than 1,500 independent mortgage brokers, loan originators and processors will join at the AIME Fuse 2018 National Conference to learn from industry experts about how they can access the best technology, originate more loans each month and become a marketing expert for their own business. AIME Fuse will unite the nation’s most passionate mortgage professionals around a singular focus: to celebrate and enhance the value of independent mortgage brokers. This is the inaugural national event for the Association of Independent Mortgage Experts (AIME) and will be held at Bellagio Las Vegas. Register for AIME Fuse 2018 here.

When you hear the term "Millennial," does your mind conjure up an image of an alien with a smartphone at the end of their wrist instead of a hand? Do you assume that the only way to reach a Millennial is through social media and sort of shudder at the thought of having to possibly alter the way you currently do business to attract these creatures? Well, Sierra Pacific Mortgage is offering a webinar on How to Understand and Sell to the Millennial Homebuyer on September 11th at 10:00 am PST

Jobs and New Positions

ClearEdge Lending is happy to announce it has approved its first brokers and is actively recruiting regionally located account executives and Orange County based operations, and credit staff. The lender offers non-QM products with an array of industry leading, simplified and competitively priced loan products aimed at helping mortgage brokers build and scale their non-QM volumes. "With agency originations and margins declining, mortgage brokers are looking for new avenues of business," says ClearEdge CEO Steve Skolnik. "Backed by our local full-service branch business model and end-investor driven capital, ClearEdge's easy-to-follow and competitively priced loan programs are an excellent way for brokers to expand into non-QM lending." The company has a solid foundation built on substantial investment capital, having acquired over $1 billion in non-QM loans since 2015 and has completed four non-QM securitizations over the past two years. Those interested in a growth-oriented career with ClearEdge Lending should email Matt Shaw for outside and inside sales positions and Kelly Blackburn for account management, disclosure specialist, underwriters and closer/funder positions. Accepting new brokers: ClearEdge Lending team.

Research suggests that over 90% of consumers read Online Reviews before visiting a business and 88% of consumers trust online reviews more than personal recommendations. Cornerstone Home Lending, based in Texas with 175 offices in 23 states, has been the recipient of thousands of positive reviews and recommendations of clients propelling Cornerstone as the Ratings Leader amongst top mortgage companies in the country with a Zillow rating of 4.98, a Google rating of 4.8 and a Glassdoor rating of 4.7 stars out of five stars on each site.  To join a team that excels in every aspect of the home lending business, contact Cornerstone’s Tom Lott.

“Want to make more money from your current production? Are you losing deals over pricing? Great news for LOs/Branch Managers: lower rates + better pricing = a pay raise for you! Increase your compensation AND offer lower rates to your customers. Check this out: We recently signed up a Branch Manager from Georgia who was able to improve his overall comp by 117BPS by making the move to Mortgage Right. Here’s how he split the winnings up: He gave himself a 50BPS pay raise, and he’s passing the remaining 67BPS on to his clients, giving them a 1/8th better RATE than his competitors! He’s winning more deals AND he’s making more money! It only takes 10 minutes to see how much extra you could be getting paid off your current production. Run the calculator on our site that shows how much money you’re leaving on the table! Give us a call at (866) 228-7703 or visit our site at www.branchright.com.”

Congrats to Brenda Clem who Pavaso announced is its EVP of capital markets. “Clem is a mortgage industry veteran with over 30 years' experience in operations and secondary markets. At Pavaso, her focus is on education and increasing awareness in the mortgage industry on how to improve residential lending through technology. Clem has long been an industry advocate for eNote, eMortgage and eWarehouse adoption in the secondary market to build integrity and transparency in the mortgage transactions process.”