I still receive questions about HMDA. It’s good to know about the 2018 edition of A Guide to HMDA Reporting: Getting it Right! (the Guide). Developed by the Federal Financial Institutions Examination Council, it provides a summary of certain key requirements of the Home Mortgage Disclosure Act (HMDA). Features include “Where to Look” hints, and the complete Consumer Financial Protection Bureau’s (CFPB) Small Entity Compliance Guide in Appendix B. Copies of the previously published resources, such as the CFPB’s Reportable HMDA Data: A Regulatory and Reporting Overview Reference Chart are also included as sections of The Guide.
Lender Products and Services
Don’t let the changing landscape or current market conditions inflate your loan origination costs. Get “fixed” with Equilibrium Mortgage Solutions. Equilibrium Mortgage Solutions allow small and mid-size mortgage firms to have end-to-end loan fulfillment at a bundled price of $895 per loan without institutional headcount. You can also pick “a la carte” service for those labor intense functions. Equilibrium provides Opening, Underwriting, Closing, Post Closing and Post Fund Quality Control Audits along with daily Client Status Reports. Equilibrium is a top-notch outsourcing solutions game changer with an outstanding price point. We are backed by years of experience and expertise. Put Equilibrium in your 2019 Strategic Plan! Contact Paul Campbell (760-774-7704).
Lenders, CUT 80% off your essential LOS/PPE tech spend. The ReadyPrice RETAIL & WHOLESALE enterprise-strength LOS with an embedded multi-investor PPE and proprietary “error trapping” tech is the answer for any sized lender (or brokers wanting to become bankers). The ReadyPrice all-in-one RETAIL AND WHOLESALE platforms are fully configured out of the box, are up to 80% less expensive than heavy, “mature” competitors, come complete with D1C, deep Fannie DU, EarlyCheck, etc., integrations and can be stood-up in a couple of weeks. Or, you can easily and inexpensively customize/configure her to easily fund thousands of loans per month from thousands of MLO’s or brokers, for example. The ReadyPrice LOS/PPE has funded over 300k units for $70 BILLION and is leading the way forward for today’s mortgage bankers as we utilize essential mortgage tech. Call them at (408) 357–0931 or email hello@readyprice.com to get a free demo today.
The MBA just released data revealing that independent mortgage banks reported a meager net gain of $480 per loan on average in 3Q2018, down from $580 per loan in the 2Q2018 and $929 a year ago. “3 Steps to Profitable Growth” is a timely read in this challenging environment, providing key focus areas for lending managers to drive profitability in a tough, purchase-heavy market. A must-read for all mortgage managers: Download your free copy here!
What if you could dramatically cut your mortgage quality control turn time and prevent against loan defects? Join two technology innovators, Fiserv and TRK Connection, on December 13 to learn how to leverage document classification, data extraction and data comparisons to improve loan quality and automate QC. Register for “Maximize QC due diligence reviews with OCR and Defect Management Technology” web seminar today.
We’re making a list and checking it twice, and we’ll find out if your subservicer has been naughty or nice. Subsequent QC (MQMR’s servicing-focused sister firm) will begin conducting its annual on-site reviews of all the major subservicers in early 2019. SQC’s subservicer reviews are designed to meet all master servicer requirements, including those in Fannie Mae’s Servicer Self-Assessment checklist. The list was recently updated in September 2018 and specifically calls out a requirement for master servicers to perform an “annual onsite visit.” Unlike other firms that just “check the box,” SQC uses a holistic approach to deliver audits that not only mitigate risk, but also uncover opportunities for subservicers to deliver unmatched customer service – resulting in what we call The SQC Difference. First up on our annual rotation is Dovenmuehle in 1Q 2019. Reach out to info@mqmresearch.comto join and/or see when we’ll be visiting your subservicer.
Re-Branding
National mortgage lender New Penn Financial, LLC today announced that the company will be rebranded as NewRez at the beginning of 2019. New Penn was acquired by New Residential Investment Corp. (NYSE: NRZ; “New Residential”) in July. The NewRez name and the decision to rebrand reflect New Penn’s close alignment with its parent company, as well as the combined organization’s commitment to bringing value to its customer relationships and strategic partnerships. “We are very excited to announce the rebrand and for the growth opportunities it signals,” said Kevin Harrigan, President and CEO of New Penn. “NewRez combines the strength and experience of the New Penn and New Residential brands under one umbrella, and we look forward to the benefits we will collectively bring to borrowers through all of our business channels.” More information will be communicated in the coming weeks, including transition timelines and more details of the NewRez brand.
Capital Markets
This morning the stock market’s tumble is grabbing the attention, and rates continue to fall. Are world economies really slowing, or is this a knee-jerk reaction to Trump headlines? Morgan Stanley, for one, believes that yield curves will flatten in the US (2s5s and 2s10s), and that the Fed will deliver only two hikes in 2019 (March and June) and cease balance sheet normalization in September. “The year ahead should see the global economic expansion continue, but the rate of expansion moderate to just above trend with a slightly softer outlook for 2020. Our economists expect a pause in the Fed's policy tightening cycle. The world still faces slower growth, higher inflation and tighter policy. But 2019 should see a turning point in this narrative, specifically in US growth, inflation and policy relative to the rest of the world.”
The last data on the consumer price index showed that inflation is more or less in line with the Fed’s target of 2 percent. Even with the recent drop in oil prices, the energy index rose 2.4 percent in October. Core inflation increased 0.19 percent, and core goods prices saw their largest monthly increase since January. Inflation is expected to trend higher through the rest of the year as tariffs and the labor market push production costs higher. That trend likely means the Fed will continue to gradually increase short term rates. Retail sales remain strong and were up 0.8 percent in October. Holiday sales are expected to increase from 2017 with spending moderating after the New Year. Manufacturing activity increased 0.3 percent in October and September’s figures were revised higher with most major categories showing expansion. The rising dollar and trade issues, however, remain concerns for this sector moving forward.
Real gross domestic product increased at a 3.5 percent annualized rate in the third quarter, according to the advance estimate from the Bureau of Economic Analysis, following a 4.2 percent increase in the second quarter. While market participants were expecting a smaller increase from Q2 to Q3, the headline gain was more than expected. The main driver of this quarter’s increase was consumer spending, the largest component of GDP, growing at a 4.0 percent annualize rate fueled by high consumer confidence and a strong labor market.
Consumer spending has increased on both durable and nondurable goods as well as services. A weak spot in the report was business fixed investment which grew at 0.8 percent after posting two strong quarters earlier this year as spending on structures, equipment and intellectual property slowed. Residential investment was another weak area, declining to a -4.0 percent annualized rate as that market cools. The trade component of GDP brought down the headline number by 1.8 percentage points as net imports increased. Finally, federal government spending increased at a 3.3 percent annualized rate and state and local government spending increased to a 3.2 percent annualized rate. Together, they added 0.6 percentage points to Q3 real GDP.
Recent economic data is pointing towards sustained slowing momentum in the housing market. The National Association of Homebuilders Index fell 8 points to 60 and is down from a recent high of 74 in December 2017. As with other 0 – 100 indices a reading above 50 indicates favorable conditions. The expected buyer traffic index fell from 53 to 45. Additionally, single family housing starts dropped 1.8 percent from September to October and are down 2.6 percent from a year ago, according to the Census Bureau. Single family permits also declined and are running below starts, suggesting that single family housing construction may be subdued in the coming months. Existing home sales managed to rebound from September’s decline and increased 1.4 percent in October, led by a 5.3 percent increase in condo/co-op sales. Consumer sentiment continues remain positive as incomes continue to slowly creep up, however rising mortgage rates continue to put pressure on affordability in some of the hotter housing markets in the country.
As stocks fall, as do rates, the calendar today is even busier than usual, with some of yesterday’s usual scheduled releases being moved back a day. Housing and jobs move the economy, and today & tomorrow are focused on jobs: job cuts from Challenger (53k), ADP employment (+179k, lower than expected), initial jobless claims for the week ending December 1 (-4k to 231k), Q3 (final) Productivity (2.3%) and unit labor costs (+.9%), the October trade deficit ($55.5 billion), Markit Services PMI, ISM nonmanufacturing PMI, and October factory orders before Atlanta Fed President Bostic, NY Fed President Williams, and Fed Chair Powell all take the stage. The day begins with the 10-year yielding 2.89% and agency MBS prices better nearly .125 versus Tuesday’s close.
Professions and Promotions
Newfi Lending is expanding its Non-QM Correspondent channel and seeking an experienced sales leader. Newfi is uniquely positioned in the market with proprietary products, make sense underwriting approach and live scenario desk. Ideal candidates not only have established relationships, but the ambition to lead growing sales team. Newfi Lending is a Warburg Pincus portfolio company based the San Francisco Bay Area. Please contact Steve Abreu for information on the position.
A results-oriented mortgage banking professional with extensive capital markets, secondary marketing, and product management experience is searching for a new position. The Candidate is highly skilled in investor/vendor relations and operational management, while maintaining a strong risks & controls environment and is adept at marketing awareness/demand strategies, product development, and building strategic relationships. They’ve also managed mortgage volume planning and reporting, as well as, associated PTI, revenue/expenses. Directed all aspects of trading & hedging, best ex, portfolio retention, mortgage rate and fee pricing, including margin management/optimization. Guided the Fannie Mae, Freddie Mac, Ginnie Mae, FHA/VA, and private investor relationships, and led or sponsored numerous complex, multi-million-dollar real estate initiatives including trading & hedging system conversions, mortgage servicing transfers, portfolio sales, loan origination system conversions, and M&A integrations. Interested company should send me a note of interest me for forwarding.
One of the fastest-growing wholesale lenders, Lakeview Wholesale, has added two new Account Executives to their seasoned team: Eva Sharma of San Diego and Tiffanie Lande of Orlando. Lakeview’s commitment to being a premier wholesale lender is evident through the continued growth of their sales team, and their launch of the new TPO Connect broker portal, designed to radically improve user experience. By focusing on a faster, easier, and more efficient process, Lakeview provides clients with a user friendly interface to utilize innovative products such as the aggressively priced No MI Platinum. Interested in joining this talented team? Contact John Pater and learn about open positions with large territories in Florida, Texas, Georgia, North Carolina and South Carolina.
Verity Search a well-known search firm in the industry, helps lenders hire the best talent. President Jim Boghos believes times are changing and search firms must also now evolve. “Lenders fuel our business and as margin compression has affected them, recruiting firms must also now adapt alongside them. Announcing POP, (Partner Origination Platform) by Verity Search. “We are proud to offer this advanced concept in mortgage production building. Recruiter and Lender objectives are now finally aligned” said Boghos. Verity’s POP Program claims to build production teams without charging the exorbitant up-front placement fees. The shared risk model has already seen tremendous early success. "POP ensures the lender investment associated with opening new branches. The failure rate is eliminated while guaranteeing the volume growth. Verity now becomes your trusted partner” Boghos added. For more info contact Jim Boghos (407-725-7085).
“Who thinks the decreasing LO Compensation is the solution to market compression? [Crickets chirping.] Shouldn’t there more discussion about trimming the fat from bloated retail shops who employ too many layers of middle management at corporate? There are too many people involved in the loan process and we’re all using outdated tech layered on top of slow LOS. Here’s a solution that shows how Canopy Mortgage is trimming the fat from retail, keeping LO comp intact, and creating unheard of efficiencies with proprietary tech that allowed ONE loan officer to close over 100 loans in one month. Do you believe there’s a better way to do home loans?” Canopy is NOW Hiring a National base of seasoned LOs. Reach out to Josh Neumarker, Director of Business Development, at Canopy Mortgage (888-696-9076).
American Advisors Group (AAG), announced that Joe Stephenson has been named SVP of Operations where he will oversee all facets of operations for AAG’s sales channels, including the retail call center, national field sales division and wholesale division. He will report jointly to Paul Fiore, AAG Chief Retail Sales and Operations Officer and Jesse Allen, AAG EVP of Alternative Distribution.
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