The Realtor and mortgage profession work force is aging, and we just lost another potential employee.

And companies continue to add staff, some times to replace lost staff, but many times because they are expanding. On Q Financial, Inc. is hiring for positions as it is further expanding its originations presence on the east coast by opening a new sales and operations center in Atlanta, GA and will also be expanding into other Southeast markets. On Q is a retail-only independent mortgage banker founded in 2005. Based in Scottsdale, AZ, it currently has 30 offices in AZ, CA, WA, CO, TX, NC, and GA, is approved to lend in a total of 21 states, and is a Fannie Mae approved seller/servicer. On Q will fund nearly $2 billion in residential mortgages in 2012 and is seeking experienced mortgage professionals to join their team. Martha Simmons Scott is the new SVP of Sales and Business Development, Southeast Region and David Rapson is the new SVP, Southeast Region Operations Manager - all interested individuals should send an e-mail to Martha.Scott@onqfinancial .com or David.Rapson@onqfinancial .com. Learn more about the company at onqfinancial .com.

Perhaps it will pick up some Citigroup folks, as that company announced it will slash 11,000 jobs worldwide in its "continuing battle against high operating costs and persistently sluggish markets." It is unknown (by me, at least, and others I asked) what the impact of this will be on the mortgage channel - many of the cuts are in its global consumer banking business (6,200, there, 1,900 from capital markets, 2,600 from back office operations). The figure represents only 4% of its total workforce and will bring the headcount down to 250,000, down by a third since 2007. The market liked it: the stock rallied 6% yesterday. And it is not alone: Swiss bank UBS, British bank HSBC, Bank of America (in the process of slashing 30,000 jobs companywide and eliminating 750 branches).

While we're discussing big banks, how much is not enough? There is no answer to that question, but apparently there are questions whether or not Bank of America has set aside enough for the Countrywide book of loans.

And while we're on the buyback topic, no, buybacks have not gone away. (Wouldn't that be nice?) In fact, buybacks may be increasing. "U.S. Bancorp Says Freddie Stepping Up Mortgage Repurchase Demands - Freddie advised U.S. Bancorp it is expanding potential putbacks to mortgages made in 2004 and 2005." And we all know those will go from U.S. Bancorp back to the original originator - here is some of the nitty-gritty.

The conversation regarding "High Cost Loans" versus "Higher Priced Loans" continues, and I received a few good notes on it. Not that I want this to turn into a compliance manual, but think it is important to keep things straight.  "I believe the threshold that was initially described applies to "Higher Priced Mortgage Loans" addressed in section 35.  While restrictions do apply on higher priced mortgage loans they are not as severe as high cost loans. Section 1026.32   Requirements for certain closed-end home mortgages. (a) Coverage. (1) Except as provided in paragraph (a)(2) of this section, the requirements of this section apply to a consumer credit transaction that is secured by the consumer's principal dwelling, and in which either: (i) The annual percentage rate at consummation will exceed by more than 8 percentage points for first-lien loans, or by more than 10 percentage points for subordinate-lien loans, the yield on Treasury securities having comparable periods of maturity to the loan maturity as of the fifteenth day of the month immediately preceding the month in which the application for the extension of credit is received by the creditor; or (ii) The total points and fees payable by the consumer at or before loan closing will exceed the greater of 8 percent of the total loan amount, or $400; the $400 figure shall be adjusted annually on January 1 by the annual percentage change in the Consumer Price Index that was reported on the preceding June 1. § 1026.35   Prohibited acts or practices in connection with higher-priced mortgage loans. (a) Higher-priced mortgage loans. (1) For purposes of this section, except as provided in paragraph (b)(3)(v) of this section, a higher-priced mortgage loan is a consumer credit transaction secured by the consumer's principal dwelling with an annual percentage rate that exceeds the average prime offer rate for a comparable transaction as of the date the interest rate is set by 1.5 or more percentage points for loans secured by a first lien on a dwelling, or by 3.5 or more percentage points for loans secured by a subordinate lien on a dwelling. (2) "Average prime offer rate" means an annual percentage rate that is derived from average interest rates, points, and other loan pricing terms currently offered to consumers by a representative sample of creditors for mortgage transactions that have low-risk pricing characteristics. The Bureau publishes average prime offer rates for a broad range of types of transactions in a table updated at least weekly as well as the methodology the Bureau uses to derive these rates. (3) Notwithstanding paragraph (a)(1) of this section, the term "higher-priced mortgage loan" does not include a transaction to finance the initial construction of a dwelling, a temporary or "bridge" loan with a term of twelve months or less, such as a loan to purchase a new dwelling where the consumer plans to sell a current dwelling within twelve months, a reverse-mortgage transaction subject to § 1026.33, or a home equity line of credit subject to § 1026.40."

Concerning the CFPB and whether or not it's focus is on saving the consumer ducats, Jeremy Potter with Norcom writes, "In response to TR's comment about the CFPB's interest in FHFA's handling of MIP, I often tell our staff at Norcom, our brokers and anyone who will listen that CFPB never claims to make things cheaper.  Many members of our industry seem to think that part of consumer protection is keeping prices down and we sarcastically say 'don't they realize that they are making everything more expensive.'  The truth is that I don't think they care.  They were tasked to protect the consumer and the market. To their credit (I guess), I've never heard them claim that that meant making it cheaper to get a loan. In fact, CFPB seems to operate on the 'make the lender pay' idea in many areas without regard for where/how those costs might get passed on. We should stop hoping that CFPB turns their attention to consumer cost because it doesn't look like it's gonna happen."

And now for some ever-present investor, lender, and conference news...

Shares of Ocwen ("NewCo" spelled backwards) sold off after an article in the Wall Street Journal noted that regulators could delay the closing of the Homeward and ResCap transactions. Later in the day, OCN entered into a consent order with the NY Department of Financial Services requiring it to hire an independent monitor. Investment bank KBW announced, "We are not changing out outlook for the deals. Given the upside to our $40 PT, we upgrade OCN to Outperform from MP."

American International Group (AIG) shuffled the management of its mortgage insurance unit for the second time this year, naming a new chief executive for United Guaranty (UG) and moving the prior CEO to a senior underwriting position. Donna DeMaio would become CEO of UG, "which has become a core unit for the company in the wake of its post-bailout restructuring." DeMaio joined UG earlier this year as COO after seven years as chief executive of MetLife Bank. Kim Garland, who had run UG since last February, will become chief underwriting officer for the global consumer business in AIG's property insurance unit.

The Texas Mortgage Bankers Association will be hosting its annual Southern Secondary Market Conference in Woodlands, TX from February 12-14, 2013.  Interested parties should register by January 11th.  Sponsorship opportunities are available as well.

As part of the changes made to its FHA product guidelines, Stonegate Mortgage is requiring that all FHA loans with credit scores between 620-639 will require a DU Approve/Eligible or LP Accept/Eligible.  The minimum credit score for FHA Streamline refinances has been reduced from 640 to 620; however, loans with scores between 620-639 will require reasonable income, a Verbal Verification of Employment, and verification of non-employment income where applicable.  Streamline refinance loans with credit scores over 640 aren't subject to the income verification requirements and the DTI SMC overlays will no longer apply.  The changes go into effect on December 3rd.

The FHA has published the necessary protocol for reporting delinquent loans in areas affected by Hurricane Sandy on the Single Family Default Monitoring System, the full details of which are available in Chapter 14 of the HUD Handbook.  This includes how to input loans that were already scheduled to be reported before the disaster, loans about to go into foreclosure, and loans in the midst of foreclosure; current loans shouldn't be reported in SFDMS.  As a reminder, a 90-day moratorium has been imposed on foreclosures in affected areas, and mortgagees are responsible for consulting FEMA to determine whether properties are in designated disaster areas and to obtain disaster declaration dates.

The USDA has revised guidance for determining if Rural Housing program applicants are able to secure a conventional loan with an RD guarantee and now makes a distinction between traditional conventional credit and non-traditional conventional credit.  For a full list of the traditional credit criteria, see RD Administrative Notice 4687, Definition of Conventional Credit.

There was a fair amount of news yesterday. ADP Private Payrolls added 118,000 workers in November, slightly lower than the projected median forecast of a 125,000 rise, but still pretty close. And we learned that Productivity increased 2.9% in 3rd quarter 2012 (annual rate) and unit labor costs fell 1.9%  In manufacturing, productivity fell 0.7% and unit labor costs increased 3.2%.

But the more interesting news for our biz was that the Mortgage Bankers Association report that applications rose for the Nov. 30 week by +4.5% after prior drop of -0.9%. The refi Index rose by 6% while purchases gained by +0.1% as the average 30 year rate fell to 3.52% which matches the lowest in history of the survey. The Purchase Index has been mostly flat for two years but it has increased in nine of the past eleven weeks to the highest level since 2010 when tax credits raised activity. This trend would seem to confirm that, while still weak on historical basis, the sector is gaining strength. Refi share of applications gained to 83% from 81%. The HARP share of refinance applications increased to 27%, and the ARM share decreased to 3% of total applications. Harp refinancings have increased more than 77 per cent in the first nine months of this year compared with the whole of 2011, and investors and originators are very aware that early repayment rates within agency MBS have been running at an annualized rate of 30% according to monthly data from eMBS, the research group.

Digging a little deeper, we learn that the rise in prepays has taken its toll most sharply on pre-crisis MBS paying coupons of 5.5-6%,, whose previous high prices reflected investors' confidence that the underlying loans could never be refinanced. And the recent sell-off of these MBS was exacerbated by the US election, which increased the likelihood that Edward DeMarco would be replaced by President Obama as acting director of the FHFA with someone more open to permit more radical policies to aid refinancing, such as forgiving mortgage debt. And a new FHFA regime might allow homeowners to "re-Harp". Harp is currently only applicable to loans created before mid-2009, and although the originators themselves are not calling for the date to be changed since there is so much business, that may change as refi business ebbs.

Returning to the temporal markets, yesterday the 10-yr ended rallied in price and the yield sank to 1.59%, and stocks rallied at the same time. Today we'll have Initial Jobless Claims (for the week ending 12/1) which is expected to decline to 380k from 393k, along with some auction news for next week and some MBS purchase stats and prepayment reports.

Christmas is fast approaching, and gents, don't mess it up.