This week I will spend time in California, Colorado, and Kansas, and expect to hear from many folks about the state of the industry. Unlike Japan, which is now officially in another recession, there are plenty of companies who have confidence that their balance sheet is better than everyone else's, but plenty of smart people are out there wondering what those balance sheets are going to look like after the 4th and 1st quarters coming up - especially if those companies have not been adding production units or making existing units more efficient. Fortunately initial reads on October and November are looking pretty good!

This could be worse than eminent domain, particularly if it's buried in others state laws. Apparently a New Jersey man beat out a foreclosure because it didn't happen within 6 years. Just what the lending industry needs... And as servicers know, there are plenty of borrowers dragging things out. Let's hope this doesn't give them a goal to shoot for.

In the nearby state of New York, Ocwen has signed a mutual termination agreement on the purchase of $39 billion UPB of servicing rights from Wells Fargo. The company will receive its $25 million deposit back. The industry, and especially non-bank servicers, has been waiting for some kind of resolution on this most of the year. The deal had initially been announced in early January and was put on hold in February at the request of the New York Department of Financial Services (DFS). Interestingly, Nationstar's stock price benefited from the news.

Speaking of servicing, here's something "interesting" for Washington and Oregon production since these states have legalized marijuana. When you look at MSR models, prepay speeds are actually slightly slower in those states (4.06 servicing multiple in WA and OR versus 3.88 multiple in CA). That means borrowers those states are a little slower to refinance. Feel free to correlate as you please.

Also out west, the Nevada Division of Insurance often receives questions regarding marketing practices in the title industry that may violate Nevada's rebate and inducement laws. Real estate and mortgage professionals may unknowingly be asking title professionals for items or favors that they are not allowed to provide under Nevada law. Check out the "Unlawful Inducements in the Title Industry". (Thanks Marx Sterbcow!)

In CFPB news, a federal judge forced it to obey the same rules of discovery in civil litigation that apply to everybody else even if government officials are annoyed by them. Judge John E. McDermott rejected a motion by CFPB. As a result, the bureau's officials were required to submit to depositions - cross-examinations of witnesses conducted under oath but outside the courtroom - in a case filed by the bureau.

A "prominent mortgage industry attorney" wrote to me regarding the ruling. "Judge McDermott's decision is an encouraging sign that the judicial branch of our government is beginning to recognize that the CFPB, like other federal regulators, is not free to act without accountability to anyone. This is similar to the recent decision by Judge Leon in Maryland which struck down the regulators' disparate impact theory under the Fair Housing Act. The powers of an administrative agency, such as the CFPB, to make and interpret rules, as well as investigate, prosecute and impose penalties for alleged violations, poses important Constitutional questions for those of us who remember our Civics lessons about 'checks and balances'. These powers, if abused and unchecked by other branches of government can result in fundamentally unfair results that threaten the legitimacy of the agency's actions.  The CFPB, in its early years, has been much more aggressive in its approach to these issues than other agencies in the past, such as the SEC. The CFPB's record in the few instances where its interpretations have been reviewed by the judicial branch reflects that they should reassess their tactics."

The attorney's note continued. "Likewise, the practice of the CFPB to push for numerous Consent Orders in areas where it has extended interpretations of law or regulation is another troubling development.  CFPB defendants generally lack the resources or intestinal fortitude to challenge the CFPB in these matters, instead settling and entering into Consent Orders to avoid potentially crippling fines and the legal expense and burdens of a court challenge. We never hear about investigations that result in no action by the agency to compare against.  Yet, once issued, the CFPB seeks to claim Consent Order interpretations are now valid against everyone even though the facts are not fully disclosed.  Decisions such as Judge McDermott's or Judge Leon's reflect the judicial branch's responsibility to reign in an agency that ultimately needs to be held accountable to the Constitution and the governed."

NAR's Profile of Home Buyers and Sellers annual survey further solidifies the notion that there has been a decline in first time home buyers. In this year's survey, the share of first time home buyers dropped to 33%, representing the lowest stake since 1987. Reasons for the decline include increased rent, student loan debt, limited job prospects and flat wage growth. Nearly half of first time home buyers in the survey indicated that the mortgage application and approval process was more difficult than they had anticipated. More than half (53%) of first- time buyers purchased because of their desire to own a home and 79% of recent buyers said their home was a good investment, with 40% of them believing  their home is a better investment than stocks. Younger buyers were more likely to finance their purchase (97%) than buyers aged 65 years and older (64%). For the young buyers who were able to save up for a down payment, 23% said saving for a down payment was difficult and 57% said student loans hindered saving. Most home buyers searched for a home using the internet (92%) and 87% used a real estate agent. A link to the article can be found here.

The National Reverse Mortgage Lenders Association (NRMLA) is announcing its support for the Federal Housing Administration's new financial assessment rule for home equity conversion mortgages (HECMs). As part of industry-supported changes to the program, the U.S. Department of Housing and Urban Development (HUD) now requires potential borrowers to first go through a financial assessment that ensures they will be able to continue paying property tax and insurance premiums.  Peter Bell, President and CEO of NRMLA, applauded HUD's move to require financial assessments. "At NRMLA, we are always concerned about protecting those aging Americans who cannot afford to meet the responsibilities of reverse mortgage loans," says Bell.  "Financial Assessment will help determine if the product is right for the potential borrower.  By implementing this process, HUD is responsibly making the HECM a safer product."

Let's take a look at some upcoming events!

Recent enforcement activity surrounding MSAs has the world of RESPA on edge. Are you prepared? Join RESPA News on Tuesday, November 18th for an exclusive 90-minute webinar featuring top compliance attorneys Phil Schulman of K&L Gates, Marx Sterbcow of The Sterbcow Law Group and Chuck Cain of WFG National Title Insurance Company as they guide you in the assessment of your current and prospective Marketing Services Agreements (MSAs) to help you remain compliant and avoid the bite of the CFPB. "Together they will provide expert insights into RESPA provisions impacting MSAs compliance, the CFPB's enforcement and policy posture, and what companies should be looking for as they review their MSAs and work to ensure compliant conduct."

AllRegs is conducting a Webinar on December 4^th addressing The CFPB Targeting of Mini Correspondent Lending practices discussing implementation of operational changes to reduce risks in originating and purchasing mini correspondent loans. To register, click here.

Fannie Mae's new HFI InDepth Page offers a full calendar of classes available. To view, click here.

Mortgage Bankers Association of Greater Kansas City (MBAKC) is hosting its Membership Luncheon on November 20^th. The topic of discussion is What the Industry can expect in the First Half of 2015 Without Making Forecasts with Guest Speaker Rob Chrisman. For more information, click here.

Plaza Home Mortgage is providing Webinars on various aspects of Reverse Mortgage. November 18^th topic is on Reverse Mortgage Basics, for information, click here. How to Use the Reverse Mortgage to Purchase a Home is available in November 19^th. To register, click here. November 20^th webinar will discuss How to Present a Reverse Mortgage, to sign up, click here.

Before I forget, the Intercontinental Exchange (ICE) said it would discount license fees for financial institutions that use LIBOR as a pricing benchmark on loans or other contracts. ICE said banks with assets less than $1.5B can use LIBOR at no charge, while those between $1.5B and $10B would have to pay $2,000 per year and those above $10B would have to pay $16,000 annually. Impacted banks should note that the fee is retroactive to July 2014, when ICE took over managing LIBOR.

Turning to the markets, unlike last week when we hardly had any interest rate-moving news, this week we have quite a bit here in the United States. Let's jump in. Today we'll have the Empire Manufacturing number and Industrial Production & Capacity Utilization duo. Tomorrow is the NAHB house price index and Producer Price Index (a measure of the change in the average price of goods received by domestic producers of goods and services), Wednesday is Housing Starts (the number of starts for new buildings intended as a residential building) & Building Permits, and the FOMC Minutes (insights into how Fed officials came to their decisions). On Thursday 11/20 we have Jobless Claims, the Consumer Price Index, Philly Fed, and Existing Home Sales will tally the number of previously constructed homes that sold in the previous month. People need to be confident in the economy to drop some serious cash on homes, existing home sales provides insights into how the economy is faring.

As an indication of the general bond market, the 10-yr closed Friday with a yield of 2.32% and this morning we're at 2.30% with agency MBS prices a shade better.

Jobs

On the jobs front, PHH Mortgage is searching for a Regional Director of Business Development for a newly formed Regional Financial Institutions channel. The desired applicant will have a strong background working with regional banks and credit unions, and the ability to work with C-suite level prospects while promoting PHH's multiple outsourcing executions including marketing agreements, co-branding, and private label services. The position is open to any location across the continental US. Interested candidates may send their resumes & questions to Recruitment Manager Wendi Snyder, Len Patton, SVP CL/RFI, or visit PHHJobs to view the full job description.

Ann Arbor's Gold Star Mortgage Financial Group, Corp, one of the fastest growing companies and top 50 lenders in the nation, is rapidly growing from coast-to-coast.  Currently expanding its footprint in CO, OH, OR, TX, TN, and WA, Gold Star is interested in creating career growth opportunities for the industry's finest LOs and industry-leading branches in these states. Founded in 2000, and now operating in 23 states, Gold Star supports its growth strategy with a superior operations and underwriting infrastructure, a commitment to relationship-based service and cutting-edge technology. Recognized as an Inc. 500/5000 company, a Top Workplace by the Detroit Free Press and one of the nation's Top Tech-Savvy Lenders by Mortgage Technology Magazine, Gold Star is committed to excellence. To find out more about Gold Star's opportunities and vibrant culture, contact Tina Jablonski.

On the wholesale side, out west First Century Bank, N. A. an FDIC bank, is looking to hire Account Executives in territories including Southern California, Colorado, Washington, Oregon, Nevada, Utah and Arizona with a complete menu of products. Management is looking for experienced AEs to help continue to grow the business and work with a winning operations team. They have combined experience of 50+ years in the business, dedication to superior customer service and have an excellent system platform. Please send resumes to wholesalesupport@myfirstcenturybank. com.