Not only are houses becoming smaller, but the lots are smaller also. Trulia tells us that houses built since 2015 occupy, on average, 25 percent of the land they were built on. That figure was only 13.9 percent in 1975. And according to Capital Economics Ltd., the size of an American home has decreased for the first time in 30 years to 2,420 sq. ft. after peaking in 2015 at 2,520 sq. ft. This is attributed to the shrinking of homebuilder margins due to a shortage of labor and land. And lastly, my guess is that the huge rental companies are chomping at the bit over this news: Houston is seeing homes sold for 40 cents on the $1 after the flood. An estimated 1.8mm homes suffered uninsured losses, according to CoreLogic Inc.

New Products From Lenders and Vendors

This week, Informative Research launched Txt2Qual - a new automated, mobile-based tool that helps lenders prequalify applicants within a minute. Txt2Qual instantly shows lenders an applicant's prequalification status and, since it posts a soft inquiry, lenders get a full credit profile and FICO scores without impacting the credit score or triggering competition - a feature not found anywhere else on the market. Partnering with Experian, Informative Research will have a demo at booth 427 at MBA 2017 where lenders can personally experience how they can reach more qualified borrowers. "The market is in transition right now and lenders are in need for better lead-generating solutions," explained Renae Sherman, Informative Research's VP of Business Development and Innovation. "We've responded to this demand and created a new tool that automates one of the most difficult steps in the loan process. So, make sure to stop by and experience it for yourself!"

AmeriHome Correspondent is also pleased to announce for Fannie Mae, Freddie Mac, FHA and VA loans delivered on and after November 1, 2017, tax and W-2 transcripts will no longer be required when all borrower qualifying income is W-2 income. For more information, please contact your AmeriHome Correspondent Sales Representative, or email CLsales@amerihome.com.

A PWC report states that 50% of borrowers will not use a lender again or will discourage others from using that lender if they have a negative experience. This behavior forces loan officers and lending teams to think hard about their borrower experience and how it compares to the competition. As the borrower continues to change, the experience they expect continues to evolve as well. A recent eBook, "4 Keys to the Ultimate Borrower Experience" guides mortgage professionals on how they can continue to exceed borrower expectations with examples from customer service experts in various industries. Download your free copy here.

"SocialSurvey wants to thank all of the attendees of its recent partner summit. We had a blast while developing a new social media monitoring tool together. It was and awesome collaboration between industry leaders. Special thanks to our friends at New American Funding, Envoy, Freedom Mortgage, Mason McDuffie, Embrace Homeloans, The Mortgage Firm, Diamond Residential Mortgage, Summit Funding, Michigan Mutual, and American Financial Network.  As Jason Frazier of Mason McDuffie said, 'The mortgage lending space is highly competitive. Never at any level, at any conference or the like, have I seen an open collaboration with competitors like the one I experienced.' We couldn't agree more! Thanks again to everyone."

Capital Markets

I first entered capital markets over 30 years ago. (Back when capital markets training consisted of this.) Capital markets, and hedging, have evolved tremendously.

Mortgage Capital Trading, Inc. (MCT) announced that its Bulk Acquisition Manager (BAM) technology has achieved complete adoption by the investor aggregator community. Unveiled in July, BAM centralizes and streamlines the entire process of packaging and securely transferring whole loan information and bids. BAM is accessed by investors and lenders via an easy-to-use web interface that draws on functionality within the MCTlive! capital markets software platform. Phil Rasori, MCT's COO and architect of BAM, stated: "We developed BAM to address the Nonpublic Personal Information (NPI) security risk associated with transmission of bulk bid tapes via email, but efficiency gains and improved market color for both counterparties drove rapid adoption. MCT represents 30-40% of approved sellers for the average correspondent investor with about 1,200 bid tapes flowing through BAM every day." "Learn more about how BAM is raising the bar for bid tape management solutions and improving the industry's loan sale practices."

Are you in need of secondary expertise? Perhaps your company is ready to make the move from a Best Effort execution to mandatory execution to increase price competitiveness and or margin? Or, is your organization ready to take an existing secondary team to a higher level of execution, strategy and process improvement? A seasoned mortgage veteran in Secondary/Capital markets is seeking a new fulltime opportunity to lead a mortgage banker in fulfilling those possibilities. All institution sizes and varying locations will be considered. Meeting times are available at the upcoming National MBA conference in Denver, CO. Please send inquiries to me for forwarding.

Yes, JPMorgan Chase isn't doing much in the way of FHA lending, but someone out there is churning out those loans. Ginnie Mae, which handles (but doesn't buy!) the vast majority of FHA & VA loans, announced that its mortgage back securities (MBS) issuance totaled $504.6 billion for FY17, which is an all-time annual issuance record. Issuance in FY16 totaled $466.6 billion. MBS issuance in September totaled $41.6 billion, a decrease from August issuance of $44.1 billion. A breakdown of September's issuance includes $39.6 billion of Ginnie Mae II MBS and $2 billion of Ginnie Mae I MBS, which provided access to $40.3 billion in capital for single family home loans and $1.3 billion for multifamily home loans. Ginnie Mae total outstanding unpaid principal balance increased to $1.9 trillion, which is up from $1.9 trillion in August 2016. The total principal balance is up year over year from $1.728 trillion at the end of FY16.

Turning to rates, and what drives them, most participants expected wage increases to pick up over time as the market further strengthens. They also cautioned that a broader acceleration in wages may already have begun, consistent with already-tight labor market conditions - an admission toward the economy being at (or beyond) full employment.

Based on recent remarks, Federal Reserve policy makers are now more inclined to raise interest rates to contain the effects of record stock and asset prices. Central bankers have long argued that they weren't equipped to spot bubbles and the best approach was to let them burst and then clean up afterwards. The last two recessions (2001 tech stocks; 2007 housing) were due to financial imbalances rather than accelerating inflation, and officials have now admitted as much.

Regardless of who is chosen to be the Fed Chair, investors don't anticipate a material change in the near-term policy outlook - balance sheet normalization is underway, and the Fed has guided for four hikes between now and the end of '18 (at this point most think the chances are higher for <3 instead of >3 hikes next year).

Looking at the actual bond markets, fixed-income securities (U.S. Treasuries & MBS) ended Thursday higher, though down from morning highs. Aside from job claims and the Philly Fed Index, the Conference Board's leading Economic Index decreased 0.2% in September following an unrevised 0.4% increase in August. The downturn in September marked the first decline in the index in over a year, as hurricanes were primarily responsible. 

The Federal Reserve Bank of New York released its Agency MBS Transaction Summary for October 12 to 18. Gross, and net, purchases totaled $5 billion for those five days. This $1 billion a day ($4-5 billion a day at its peak) will soon be phased out.

Data out today is limited to September Existing Home Sales at 8AM Denver time, though we do have some "Fed speak": Cleveland Fed President Loretta Mester, a FOMC Voter, speaks this afternoon, while Fed Chair Janet Yellen speaks tonight after her meeting with President Trump yesterday. We start Friday with rates higher than Thursday's close: the 10-year is yielding 2.36% and agency MBS prices are worse .250 since the Senate passed a budget blueprint that was key in the Republican plan to rewrite the tax code. Though expected, investors see this as positive for economic growth and earnings, which in turn promote higher rates.

Employment, Promotions, and Announcements

Altisource, a provider of end-to-end services and technologies to the mortgage and real estate industries, is seeking an energetic, creative, and motivated national Client Relationship Manager to join its rapidly growing Origination Solutions team. "The Origination Solutions group delivers best-in-class products and services that help mortgage originators and investors operate, scale and protect their business. As a national Client Relationship Manager, you will combine your world-class relationship management and industry thought leadership skills to provide an unforgettable customer experience to Altisource's rapidly-growing book of Origination Solutions clients. You'll also help identify account expansion opportunities that can be fulfilled by Altisource's Originations Solutions platform and partner with sales experts on expansion strategies. If you are ready for an exciting challenge with huge growth upside and you have an impressive account management background within the mortgage industry, the Altisource team has a home for you.

As a full-service mortgage banker, Assurance Financial is seeking motivated, experienced Branch Managers and MLOs who want to take their career to the next level. As seen in Scotsman Guide, leaders who join our team enjoy our reputation of closing loans on time, with great back-office support, ready-to-use marketing and advertising tools, and a state-of-the-art CRM. Close more loans, fill your pipeline, and enjoy your career with Assurance Financial. Contact Sales Recruiting Manager Paul Peters, CMB at 225-239-7948 or visit LendTheWay.com/Careers.

New America Financial Corporation announced today that it will be changing its corporate name on November 1st, 2017 to HOMESPIRE MORTGAGE. The corporate name change is part of the company's overall rebranding strategy to more closely align its name and corporate mission as it continues to expand across new markets. "The company's record-setting growth and expansion called for a corporate name and identity that evokes our vision. The name Homespire Mortgage acknowledges the significant progress we have made over the years and signals our commitment to making the aspiration of 'home' a reality by opening the doors of homeownership for our clients.  We've always been inspired to make home a reality - and as Homespire Mortgage - our name now reflects it," said Michael Rappaport, President. 

Silvergate Bank continues to expand its Non-QM correspondent lending team with the addition of Tom Van Auken and Anthony Galiano. Tom and Anthony are both seasoned mortgage veterans with over 19 years of mortgage experience, and join Todd Lautzenheiser as Sales Directors focusing on business development for the bank's Non-QM products. "While Todd continues to handle business development in the West, Tom and Anthony will focus on business development in the eastern part of the US. For more information on Silvergate Bank's Non-QM correspondent programs please contact Tom Van Auken, Anthony Galiano, or Todd Lautzenheiser. We are pleased to have these two on our team!"

Congrats to John Stevens. Earlier this week NAMB, an association that represents the interests of individual mortgage loan originators and small to mid-size mortgage businesses, announced that he has been appointed to the role of president. Stevens will be "spearheading NAMB's overall strategies to grow the organization's reach by expanding its membership and enhancing the opportunities it makes available to members, homeowners and the mortgage industry's community of individual loan originators and small to midsize businesses."

Out of New Jersey comes word that Princeton Mortgage, a full-service residential mortgage banker, has launched a new Wholesale division, Princeton Mortgage Wholesale, expected to crank up business this month. Led by Matthew Joy, the company will be headquartered in Pittsburgh, PA and will initially originate and market its mortgage lending services to mortgage brokers in Colorado, New Jersey and Pennsylvania. Near term expansion to other states include: Delaware, Florida, Georgia, Maryland and Virginia to start. Princeton Mortgage was founded in 1983 as a licensed mortgage banker and is backed by a 100-year old multi-faceted real estate services organization.

For those in a festive mood at the end of the MBA's National Conference in Denver, the annual Ski Trip Reunion party will be held in downtown's Howl at the Moon (the 1700 block of 19th St., near Coors Field) Tuesday night at 9PM."Since we misbehaved just enough, the bartenders and managers of the Howl at the Moon in Boston connected with their colleagues in Denver and extolled the virtues of our accumulated tabs and tips left. They insisted on hosting...RSVP to Dave (301-365-0407), Jeff (303-493-3383), or Nolan (646-709-7611)."