Merry 420, which coincidentally was the yield on the 2-year Treasury note early today. Data and lawsuits about data… What’s in your wallet? Or maybe I should say, “Who’s in your wallet?” A Consumer Financial Protection Bureau (CFPB) employee (sent) confidential consumer data on roughly 256,000 people to their personal email account in what the agency described as a “major incident.” The data, which the CFPB says the former employee had authorized access to, included personally identifiable information, such as names and transaction-specific account numbers, of consumers of seven institutions.” As industry vet Brian B. asks, “Didn’t Richard Cordray assure us that personal information isn’t handled by the CFPB?” Speaking of big data, Big Brother, and privacy, if you’re a Facebook member, there’s a class action lawsuit entitling people to a “piece of the pie.” (If you just want the claim form web page, here ya go.) Today’s podcast can be found here and is sponsored by Candor. Candor’s patented automated underwriting decision engine, CogniTech™, is a state-of-the-art, 100 percent machine platform that can handle infinite loan scenarios. Today’s has an interview with Realtor Justin Rossi on how buyers’ agents can best work with mortgage companies.

Lender and Broker Services, Products, and Software

Momentifi launched its personally branded Spring 2023 Homebuyer Education Content in English and Spanish this week to help loan officers and mortgage companies attract clients and educate them about today's housing market. "Many homebuyers are under the mistaken assumption that home prices will collapse or that we're in a housing bubble," says Gibran Nicholas, CEO of Momentifi. "This content helps loan officers to educate homebuyers and referral partners and overcome their objections about today's market." The content package includes 150 personally branded articles that loan officers can post to social media or email to clients and referral sources. Many loan officers use the content as scripts to record short videos that they post up on their social media sites. Momentifi also offers an enterprise-level plan for banks and mortgage companies who want a company-wide content license. Click here to learn more or subscribe.

Real Data. Real Knowledge. Real Wealth. Looking to impress your clients with financial knowledge and provide them with the tools they need to succeed in real estate? Realfinity.io is now offering its private-label platform, HomeDashboard to lenders, allowing them to deliver property data and mortgage products throughout the entire real estate lifecycle. The question isn't whether your clients will get a platform to manage their home's finances. The question is who will give it to them. HomeDashboard allows lenders to partner with real estate agents and solve one of the industry’s biggest problems: its inability to move past a transactional value proposition. Realfinity.io already has hundreds of loan advisors using its platform and is currently onboarding additional lenders at no setup cost. After the onboarding process of an IMB, all LOs have the option to use the platform as an elective service and are billed directly by RF. Let’s chat about what Realfinity can do for you!

Use a Service 1st pre-qual credit report and generate 32 percent savings on your monthly origination credit reporting invoice! An originator with 500 monthly origination credit reports and a 45 percent fallout rate would realize 32 percent savings over peers accessing a full origination tri-merge, or a savings of $9K+ per month with S1. Eliminate hard inquiries for your customers. Efficiently evaluate your applicant’s credit profile and prudently upgrade as warranted. Help your credit-challenged clients with tools from CreditXpert®. There are many reasons we’re Service 1st! Let’s re-imagine your credit reporting strategy today. Contact S1 for a no-obligation proposal.

Need to cut loan costs and do more with fewer resources? Matic is an embedded home insurance platform that helps mortgage leaders reduce friction for their processors (no more chasing down insurance documentation!), speed up loan closings, and improve the customer experience by keeping borrowers within their own ecosystems. Plus, mortgage enterprises can earn revenue from home insurance with little to no lift. Want to learn more? Book a demo to see how easy it is to integrate insurance into your existing processes.

“FundingShield, the market leader in wire & title fraud risk management and closing-agent compliance, released its Q1-2023 Wire & Title Fraud Report showing 51.6 percent of transactions were at high risk. Ike Suri, CEO shared, “Risk spiked with bank failures causing increased BEC & phishing attacks, social engineering utilizing fake bank web-domains played on market fears. Large banks have highlighted concerns to us about closing-agent solvency and financial distress. A Utah Based Title Agent was charged with defalcating with client funds. our clients were protected avoiding losses. FBI’s 2022-IC3 report showed year-over-year growth in reported real estate fraud complaints while transaction volumes shrank. It is important to leverage real-time source-data driven solutions when combatting cybersecurity threats and fraud such as FundingShield’s plug ’n’ play solutions. Solutions that offer ‘Real-time access’ to stale information or data entry validation of unverified bank account ownership do not prevent wire-fraud.” Contact us for free 90-day trials.”

Oscar Meyer recently transformed its iconic Weinermobile into a wedding chapel. Surely the ceremonies featuring a wiener whistle quartet were memorable, but only time will tell if they will last. To make the most out of their relationships, lenders should trust market data first and foremost. ‘Ketchup’ on the latest sources of borrower demand with TrustEngine’s Q1 2023 Mortgage Market Opportunities Report. Using deep analysis of TrustEngine’s Sales Boomerang borrower intelligence alerts, the report uncovers which market trends and opportunities lenders should prioritize in Q2. Once you’ve got a handle on which loans to go after, give homebuyers an experience they’ll truly relish by equipping them with interactive Total Cost Analyses that guide better home financing decisions. See how TrustEngine can fill the missing link in your tech stack.

Top leaders in the mortgage space, like Jodi Hall (NMB) and Kevin Peranio (PRMG), are using Capacity to bring automation to their teams. Let’s face it, manually searching contracts, bank statements, loan applications, and guidelines is, well, inefficient. You need a secure platform that’ll give you instant, actionable answers. Enter Capacity. Capacity’s automation cuts the time you spend logging into countless systems and serves up the information you need in a safe, compliant way. If you’d like to see inside the system for yourself, try it for free now!

Will interest rates go down? Are home prices going to drop? Will inflation go down? MCT’s latest blog post, Housing Market Predictions 2023: Will Housing Prices Drop?, reviews topics such as inflation and mortgage rates. This new post also offers industry survey results from experts on when the next recession will begin. Read the post to learn more about MCT’s latest housing market predictions. MCT also recently released a new whitepaper on Mortgage Pipeline Hedging 101. The whitepaper reviews information on moving to mandatory, the strategy of hedging, the benefits of hedging, and how to determine if you are ready. Read the whitepaper to learn how you can use hedging as a tactic to mitigate risk and optimize profitability when selling mortgage loans.

Sleepy Credit Industry is Now Grabbing Headlines

As noted in the Commentary yesterday, H.R. 2656 has been introduced which would amend the Fair Credit Reporting Act to prohibit the creation and sale of trigger leads, and for other purposes. “This legislation would end the dangerous practice of trigger leads which hurts consumers and damages the overall mortgage marketplace” as introduced by Representative Richie Torres of New York.

Know that the FTC deemed selling leads, thus creating “trigger leads,” beneficial for the borrower as it allows for competition and different lenders to provide options. (More below on the FTC’s stance.) NAMB quickly got behind the proposed law, publicizing its support, as did lenders whose clients are subject to being contacted “out of the blue” by competitors. Not so much credit bureaus and lenders who buy those leads. I have yet to see anything from the MBA, which obviously has members who value trigger leads.

The industry took note of UWM’s credit-related announcement yesterday that it has enhanced its Safe Check tool to allow “mortgage brokers to use a soft tri-merge credit check for conventional loans, up until the loan is ready to be cleared to close, at which point a hard credit report would be required… this tool (allows) mortgage brokers to decide when they want to pull the hard credit report, and further alleviates the risk of a borrower being inundated by credit or insurance solicitations throughout the loan process.”

Credit folks will tell you that what UWM is offering is not unique to them, and that others are formally or informally thinking or doing exactly what UWM is doing. It will be interesting to see how the bureaus react. Many believe that the credit reporting agencies’ agreements with the credit bureaus specify that a firm offer cannot be given to the borrower based on a soft tri-merge report.

For clarification I learned from a credit compliance expert, “That is correct. A loan is not supposed to be initiated or underwritten based upon a soft pull credit report. I am not surprised, however, that this is what some companies like UWM are doing. With trigger programs proliferating the marketplace, and the advent of Fannie and Freddie prequal programs that allow prequal reports to be submitted for initial underwriting, everything points to lenders following this approach. Enforcement may be tough which is why they held a tight leash on prequal for so long.”

The Federal Trade Commission, the nation’s consumer protection agency, notifies borrowers that an application for a mortgage may trigger competing offers, how a borrower can use them to their benefit, and how to stop getting them if that’s their choice.

The FTC says consumers can benefit. “Prescreened offers can highlight other available products and make it easier to compare costs while you carefully check out the terms and conditions of any offers you might consider.

“Still, some people may prefer not to receive prescreened offers of credit and insurance at all. Here’s how to stop them: 1. Call 1-888-5-OPTOUT (1-888-567-8688) or visit www.optoutprescreen.com. When you call this toll-free number or visit the website, you will be asked to provide certain personal information, including your home telephone number, name, Social Security number, and date of birth. The information you provide is confidential and will be used only to process your request to opt out. Don’t enter any personal information until you have checked for indicators that the site is secure: a lock icon on your browser or a web address that begins https.

“Opting out of prescreened offers does not affect your ability to apply for credit or to get it. Your opt out request will be processed within five days, but it may take up to 60 days before the prescreened offers stop coming. If you have a joint mortgage, both parties need to opt out to stop the prescreened offers. If or when you want to opt back in, use the same telephone number or website.

“2. Put your phone number on the federal government’s National Do Not Call Registry to reduce the telemarketing calls you get at home. To register your phone number or to get information about the registry, visit www.donotcall.gov, or call 1-888-382-1222 from the phone number you want to register. You will get fewer telemarketing calls within 31 days of registering your number. Your number stays on the registry for five years, until it is disconnected, or until you take it off the registry.”

Capital Markets

Despite no top tier data yesterday, mortgage rates once again trended higher, with much of the bond markets’ focus on the debt ceiling, the Fed’s Beige Book, and the existing MBS supply hitting the market. House Speaker McCarthy announced a plan to increase the debt ceiling by $1.5 billion or until March 31, 2024, whichever comes first, in exchange for some spending cuts. This plan, however, is not expected to make it through the Senate, which sets the stage for a political blame game between political parties.

Separately, the Fed released its April Beige Book, which reported little change in activity since the March release. There are twelve Districts in the Federal Reserve System: nine Fed Districts reported essentially no change while three reported modest growth. Consumer spending was flat to down slightly while auto sales remained stable. Tourism improved across most Districts while manufacturing activity was unchanged or down. Freight volumes were also flat or down modestly. There was no significant change in residential real estate sales while lending volumes and loan demand decreased. The pace of employment growth slowed while price levels rose moderately.

Today’s busy calendar kicked off with Philadelphia Fed manufacturing for April (-31.3, down from -23.2) and weekly jobless claims (245k, up from 240k; continuing at 1.865 million). The FDIC, via BlackRock, is expected to release another agency MBS sales list in the $200 million to $300 million range from the failed SVB and Signature Bank portfolios at 9:00am ET to trade closer to 11:00am ET.

Other economic releases include existing home sales for March, leading indicators for March, and Freddie Mac’s Primary Mortgage Markets Survey. Treasury then announces the month-end supply consisting of $42 billion 2-year, $43 billion 5-year, and $35 billion 7-year notes followed by an auction of $21 billion 5-year TIPS. No less than six Fed speakers are scheduled: Governor Waller, Cleveland President Mester, Dallas President Logan, Governor Bowman, Atlanta President Bostic, and Philadelphia President Harker. We begin 420 with Agency MBS prices about .125-.250 better than Wednesday’s close and the 10-year yielding 3.53 after closing yesterday at 3.60 percent.

Employment

“At Planet Home Lending, our mission is your mortgage career! Increase purchase volume with niche products targeting today’s market challenges. Bridge loans let borrowers buy while they live in and sell their current property. Cash 4 Homes gives buyers cash-offer power. Bank statement loans reach gig economy and self-employed workers. Construction loans give dream-home seekers one-time close. Manufactured housing and ADU home loans deliver affordability. Build your business! Reach out to Planet’s VP Talent Acquisition Peter Briggs (435-709-6278) to find out more about working for Planet, because when you’re here, you’re home.”

“PrimeLending Demo Day is back by popular demand! Don't miss this unique opportunity to get an anonymous insider's look at the game-changing technology tools our loan officers use to dominate the competition. Join us on Thursday, May 4, at 1 p.m. EST for an exclusive showcase of our cutting-edge tech-stack that’s designed to help LOs like you close more loans. With senior leadership insights, tips from a top-performing branch manager, and loads of game-changing technology, you'll discover why PrimeLending is an industry leader with the strength and stability to keep you ahead of the curve. Say goodbye to outdated processes and hello to a faster, easier, and more rewarding way of doing business. Contact Nic Hartke to save your spot or for more information. Don't settle for average, be extraordinary with PrimeLending!”

“The top 3 reasons mortgage sales professionals change companies: 1) Poor service levels compromising relationships with clients and referral partners. 2) Inadequate sales and marketing support. 3) No chance for advancement or opportunity to take their business to the next level. The top 3 reasons mortgage sales professionals join radius: 1) Nimble and proactive IMB that’s right sized to meet today’s changing demands. 2) Takes the guesswork out of marketing with their marketing team. 3) Allows you to your own mortgage dream team or take advantage of theirs. At radius financial group, the focus is on YOU! Empowering you to build and run your business, your way. We give you the tools to help you strengthen relationships and you can build your own mortgage dream team or take advantage of ours. Either way, you’re an actual shareholder in everyone’s success! For confidential inquires please contact Carla Herrera.”