In bad news, mortgage rates went up about .25% yesterday. In good news, more homes are going up for sale. According to realtor.com there was a September jump of 8% year over year, that's the biggest jump since 2013. Between less deductions and higher rates, anxious sellers may have no other choice but to lower prices. “The Labor Department's data on wages for US workers showed gains higher than expected for hourly wages, and the department's forthcoming consumer-price index is expected to show growth. Some analysts have expressed concerns that the data could indicate accelerating inflation.” Are “analysts” ever happy? Most would say we need wage growth to outpace housing appreciation. There is a lot of economic news pointing to higher rates ahead – more below.

Vendor News – Lots Going On

The MBA has published a Third Party Oversight Resource Guide, a comprehensive resource that is consistent with previous guides released under the MBA Compliance Essentials brand. This guide covers topics such as TPRM Overview, the Regulatory Environment, TPRM Program Components & Life Cycle, Successful Methods for Driving Efficiency in Your Assessment Process, Vendor Management Maturity Model, Applicable Regulations for Third-Party Oversight

Industry Standards and Frameworks for Third-Party Oversight.

How would you like to save 5-10 hours per loan by freeing yourself from the time-consuming responsibilities of collecting borrower documentation and sending loan status notifications?With Floify’s industry-leading mortgage point-of-sale solution, you can! One of the many benefits of incorporating Floify into your mortgage operation is the system’s ability to effortlessly manage cumbersome day-to-day tasks, including collecting supporting documentation and deploying stakeholder communications, on your behalf. As an added time-saving bonus, when borrowers upload documents through your branded Floify portal, images and other common file types are automatically converted to PDFs on-the-fly, which means no more time spent scanning documents or manually converting to a usable format. It’s like having your own personal assistant, at a fraction of the expense! If you’ve been considering a point-of-sale for your lending operation, now is the perfect time to take advantage of this incredible solution. Request a live demo to learn more!

Insellerate believes, given that 75% of borrowers choose their next lender, that all lenders should keep their customers. “Join its upcoming webinar to learn how you can stay in front of borrowers, delight them, and earn their repeat business. The webinar will cover new enhancements to the Insellerate mortgage CRM platform: Prioritized Alerts and the Customer for Life Program. See how you can get LOs working through their leads in a way that is proven to convert with Prioritized Alerts. Put borrowers in the Customer for Life Program to stay connected from pre-application through funded loan and beyond by automating closing gifts, content, and the tracking of buying signals. Learn more and register for the webinar HERE.

Richey May announced that is has acquired two IT consulting firms: Arrow Partnership and Corporate (not “Big” or “Optimal”) Blue. Arrow Partnership, a nationwide provider of management and IT consulting services, and Corporate Blue, a cybersecurity and managed IT services firm, will join the recently launched Richey May Technology Solutions division of Richey May. Arrow Partnership's managing partner and co-founder Chan Pollock will join Richey May as executive director of the firm's technology consulting practice, while senior practice leader Garry Woods will head up the company's governance, risk and controls practice. Mike Wylie, co-founder and CEO of Corporate Blue, will join Richey May as a director in the firm's cybersecurity practice.

Secure Insight has completed work on an API to deliver its risk reports through direct integration with a lenders’ LOS system. The new delivery mechanism allows SI to deliver data reports to lenders on a per-transaction basis with the reports immediately attached to the loan file, instead of indirect web access. Clients can open the Secure Insight search engine within their digital loan processing platform, find the appropriate agent, view and upload the risk report seamlessly. Secure Insight President Andrew Liput stated, “Direct integration allows us to provide a more convenient and efficient closing agent risk report directly into an LOS thereby saving time and permitting us to truly deliver transaction-based results in a manner that can be effectively measured.”     

(Secure Insight is also poised to launch its new RE-Direct Database on November 1st. This database will place enhanced closing agent profiles, with risk and performance ratings but also with information such as an agent’s photo, website, languages spoken, and other professional skills and experiences, in front of 1.2 million real estate agents nationwide. Liput commented on this development saying, “I always wanted to give the best agents a platform to market themselves to real estate agents and consumers in a meaningful way. This project offers what I call an enhanced agent profile that goes well beyond a risk and performance rating dataset, as we offer now to lenders, and turns it into a super marketing platform to help low risk agents, realtors and consumers meet digitally together with confidence and ease. Think of it as a mash-up of Angie’s List, Linked-In and Facebook. Early registration by interested professionals has been off the charts.”)

DocMagic announced Freddie Mac has implemented its SaaS-based eVault technology providing a secure electronic repository for storing documents and performing automated eNote certification to Freddie Mac eMortgage lenders via Loan Selling Advisor®. “By automating the eNote certification process, Freddie Mac will speed the funding process, thereby improving liquidity in the mortgage markets and reducing lender’s warehouse line costs. eVault provides safe and secure storage for sensitive loan documents. It also automatically parses and validates data in a SmartDoc eNote against data in the user’s core system of record.”

Ellie Mae announced that since the launch of its new solution Encompass Consumer Connect™ in July 2018, over 1,000 unique lender sites have been established and more than 6,000 unique borrowers have created accounts to complete home loans. “This momentum in the Consumer Engagement Suite highlights the need for digital mortgage solutions to help create interest, engage leads and convert opportunities. With more than 60% of homebuyers in America now applying for and completing their home loan application completely online, Encompass Consumer Connect gives Ellie Mae Encompass™ lenders the ability to offer a state-of-the-art, completely customizable, branded and engaging digital mortgage experience for homebuyers.”

Capital Markets

Yesterday selling begat selling, and volatility, long dormant, shot up. The bond sell-off (prices down, rates up) is a function of many of the same themes we’ve seen for months: strong economic growth, rising inflation pressures, and deteriorating US fiscal deficits. Most investors pointed the finger at improving economic prospects after the Institute of Supply Management’s services gauge logged its second highest reading in its history, potentially raising expectations for gross domestic product growth in the third and fourth quarters. Higher rates haven’t dampened the U.S. economy – yet. The news yesterday, and recently, is a very positive report across a wide spectrum of factors, consistent with the recent characterization of the economy as “extraordinary” mirroring Federal Reserve Chairman Jerome Powell’s recent remarks describing the current state of the economy.

Positive economic developments have also reinforced expectations the Federal Reserve will stick to program of steady, gradual rate increases. Stronger data now are unlikely to shift the Fed’s thinking on the number of rate increases next year, but analysts say the sharp rise in the inflation-adjusted yield could mean investors are demanding more compensation for holding long-dated debt amid growing uncertainty over the central bank’s decision-making as its benchmark lending rate approaches the neutral rate, the level of monetary policy that neither stimulates nor slows down the economy.

We certainly saw the yield curve steepen, quieting those who were thinking the curve would invert – what some believe is indicative of a recession. A steeper yield curve refers to a wider gap between short- and long-dated yields. Some traders report that the long-end of the bond market has lost its backstop as price-insensitive buyers like pension funds and insurance companies step away, despite the higher yields on offer. Such institutional investors often scoop up longer-dated bonds to match their equally lengthy liabilities.

The U.S. 10-year rose 10bps to close yesterday at 3.16%, its highest level since 2011, as it reacted to a report that the Italian government will lower its deficit targets for 2020 (to 2.2%) and 2021 (to 2.0%). Worries abounded that the 2.4% deficit target for 2019 would be followed by higher deficits in the future, causing a jump in the Euro. On a positive note, we did receive very strong economic releases, with the ISM Non-Manufacturing Index beating expectations by over 3% for September, the highest reading for the Non-Manufacturing Index since its inception in 2008. Additionally, the ADP Employment Change report beat expectations for payrolls by roughly 30k in September, an increase of 50k from August.

Today kicked off with job cuts from Challenger, Gray and Christmas (+44% to 55,285, with plenty from Wells Fargo). Weekly jobless claims for last week came in at 207k. Scheduled out is August factory orders (seen rising 2.0% MoM). Rates have continued their upward move overnight, and we find the 10-year yielding 3.19% and agency MBS prices worse nearly .125 from Wednesday’s close.

Lender Products and Services

What do the MBA president, a former NFL player, the nation’s top mortgage executives, and a top producing rookie all have in common? They’ve been on Inside the Mortgage Mind, the industry’s most exciting new podcast series. Produced by XINNIX, Inside the Mortgage Mind brings you conversations with the nation’s most successful professionals at every stage of their careers, from new LO’s to CEO’s. You’ll be inspired and motivated to elevate your own business as you hear them share industry trends, best practices, and everything top of mind for today’s mortgage professional. CLICK HERE to listen to the latest episodes and be sure to subscribe on your favorite podcast app!

Ameris Bank Warehouse Lending is continuously looking for opportunities to help reduce our customers costs relating to their warehouse funding needs.  That is why we are offering multiple incentive pricing options to lower costs for our customers. Our customers can take advantage of Deposit Incentive Pricing.  Ameris Bank offers a competitive array of Treasury Management products and when our customers take advantage of those products, they earn rate incentives to further reduce costs.  Customers can also take advantage of our Volume Incentive Pricing that allows our customers to set utilization tiers they are comfortable meeting with rate incentives that reduce their costs.  We also offer MSR Financing from $10MM to $250MM; this helps our customers grow their servicing portfolio for long-term profitability. Ameris Bank is committed to building strong relationships with our customers and providing the service you need most.  If you are interested in learning more about Ameris Bank Warehouse Lending please contact Jill Gainer, SVP, Warehouse Lending Managing Director or Jessica Lapresi, National Account Executive.

Planet Home Lending’s correspondent team has products to increase your margins, replace lost volumes, and generate builder and REALTOR® business. Get the details when you meet with us during MBA’s national convention in Washington, D.C. at the Cambria Hotel just one block north (uphill) of the Convention Center at 899 O St NW. To make the connection to great loans and schedule your appointment, contact Jim Loving (414)270-0027!

In an era of cost reduction, how can Accenture help you achieve greater business value? Through supporting your end to end or component based residential mortgage needs. “As a Trusted Provider we activate innovation at scale to help clients accelerate business outcomes and help them grow in a disruptive market. We help transform business operations through automation, data management, analytics, and agile workforce models. Our deep credit domain expertise and processing capabilities help lift significant pressures on the credit industry from internal operational challenges.” Accenture helps lenders increase their ability to focus on the customer experience and improve customer satisfaction, reduce costs to originate and service loans, improve compliance and management oversight, and enhance their operational efficiencies.

Jobs and Promotions

A thriving independent mortgage banker with a dynamic platform, excellent support, diverse product offerings, and exceptional, engaged leadership, is looking to expand in to the Colorado Springs market. The ideal candidate will be a seasoned Branch Manager with a minimum of five years’ experience in mortgage banking. Excellent leadership and recruiting skills a must. Contact me with confidential notes/resumes of interest for forwarding.

“Close more loans with the same amount of effort.” That’s what Assurance Financial has been offering branch managers and top producing loan originators for 17 years. If you feel stuck and don’t have the service environment you are promised, maybe it’s time you consider a change. Assurance Financial is a growing private residential mortgage banker with offices throughout the South, East Coast, and Midwest US, and we may be just what you’re looking for. Contact Paul M. Peters, CMB (225-939-6353) for a confidential discussion today.

Congrats to John Forlines who is the new SVP and Chief Risk Officer for Fannie Mae. “Forlines will report to the Chief Executive Officer and will manage Enterprise Risk Management (ERM), strengthening the company’s governance and strategy for global risk management. He has been interim CRO since March 2018.” (Fannie has job listings here.)