There seems to be a bit of a baby boom going on out there. Prospective home buyers who need a place for a growing family quickly find out that residential lending isn’t without its share of tears. Next time you’re dealing with an upset borrower or loan officer, here’s something you can try. “We are committed to solving the rental crisis in Australia. By providing high quality prefabricated homes, available for immediate hire or purchase, we fight the rental crisis one portable cabin at a time!” But combined, Australia and New Zealand’s population is only 31 million, about the same as Texas. In the States, Utah Gov. Spencer Cox and Lt. Gov. Deidre Henderson shared their goal of building 35,000 new starter homes by 2028. It seems that every house I see being constructed uses 2x4’s and the same materials I used when doing that in summer jobs. But here’s something: The world’s biggest 3D printer can a make a house in under 80 hours! Perhaps builders will take note. (Found here, this week’s podcasts are sponsored by Calque. With The Trade-In Mortgage powered by Calque, homeowners can buy before they sell, make non-contingent offers, and tap their home equity to fund the down payment on their next home.)

Lender and Broker Products, Software, and Services

Rocket Pro TPO helps its partners be stronger purchase pros. Its range of affordable products, including Purchase Plus, empowers brokers to find new opportunities. Purchase Plus helps expand reach to assist first-time homebuyers in underserved communities by offering credits towards their down payment or closing costs. With Rocket’s Product Compare tool, brokers can efficiently navigate all their affordable product options to identify the ideal fit for their clients. This level of service builds trust between brokers and their clients, reinforcing their expertise as Purchase Pros. Want to see it in action? Catch the demo in Rocket Pro TPO’s IGNITE Live replay. Rocket shares this and other innovative solutions to help brokers make the most of this purchase season. For more information, contact Rocket Pro TPO today!

How much potential revenue is sitting in the pre-qualified stage of your team’s pipeline? What are you doing to convert them? Those warm leads are money left on the table if you aren’t keeping them in your ecosystem. Instead of sending borrowers off with a PDF, you should send them a QuickQual. QuickQual by LenderLogix provides borrowers with instant answers as they are looking for houses. With access to a customized mortgage calculator based on their financials, borrowers can run hyper-accurate payment and closing cost scenarios, and update letters on the fly. Get a sample sent to your phone to check it out!

Take your accounting department from “Cost Center” to Revenue Generator” with Loan Vision & LV-PAM. Loan Vision customers report a 10 percent reduction in loan fallout, 30 percent+ decrease in days to close the books, and 20 percent+ reduction in accounting headcount. Interested in learning how Loan Vision can reduce internal costs and help you gain a competitive edge? Contact Carl Wooloff to schedule a call today.

“Falcon Capital Advisors is excited to share that we are among the first MISMO Certified Consulting firms. This certification recognizes Falcon’s experience and expertise in a multitude of mortgage industry domains including origination, servicing, and secondary market, both in the residential and multifamily contexts. The certification demonstrates Falcon's proficiency with MISMO standards and our commitment to supporting the MISMO community. As a full-service consulting firm, Falcon helps private and public sector clients develop strategy and execute on their eMortgage, business transformation, data analytics, public policy, loan operations, regulatory and MERS compliance, CDFI, and affordable housing program initiatives. Ready to take your organization to new heights? Contact us here to schedule a consultation.”

“Join Planet Loan Servicing at the IMN SFR Forum East May 20-22. Explore our expert blend of technology, service, and cost-efficiency, enhancing Single-Family Rental investments. Managing $105B+ in total assets, Planet provides top-tier expertise and savings-focused strategies. Enjoy complimentary access to our proprietary tools and discover how we create lasting value. Let’s connect and unlock the full potential of your investments. To schedule your meeting now email LetsConnect@PlanetLoanServicing.com.”

Ready to experience next-level service? TMS Correspondent and Servbank subservicing teams will be attending MBA Secondary and Capital Markets Conference in New York City from May 19–22. Discover how TMS' CAREspondent team can boost your loan closures with our agency direct credit box, DPA programs, and comprehensive renovation options. Learn about expanding your builder business through our builder forwards and extended lock program. Find out how Servbank’s subservicing delivers a superior borrower experience with their 99 percent customer satisfaction rate, 91 percent first-call resolution rate, and 86 percent Net Prompter Score. Benefit from unmatched transparency with our proprietary award-winning SIME platform, offering real-time and complete portfolio surveillance. Schedule a meeting with us by emailing Servbank: subsales@servbank.com, TMS: carespondent@themoneysource.com.

Wholesale News

The saga of United Wholesale Mortgage and Hunterbrook continues. “Hunterbrook Media has learned that a UWM executive set up a shell company that in 2019 was used to purchase and establish UMortgage, a Philadelphia-based mortgage company that brands itself as independent, according to corporate records, some obtained through Freedom of Information Act, or FOIA, requests. UMortgage is run by Anthony Casa, a close ally of UWM CEO Mat Ishbia. The financing via the shell company, which was owned by UWM Chief Strategy Officer Alex Elezaj until at least 2020, enabled Casa to buy UMortgage and become its CEO just two years after he exited personal bankruptcy. The nature of that financing relationship previously had been unknown.”

Yes, yesterday the “hedge-funded media company” published its latest report, “UWM’s Shell Game: How United Wholesale Mortgage Executives Helped Create An ‘Independent’ Company That Has Sent UWM An Estimated $1.9 Billion In Loans,” alleging UWM’s Chief Strategy Officer Alex Elezaj set up a shell company used to purchase and establish UMortgage in 2019.

The financing via the shell company, which Elezaj owned until at least 2020, allowed Anthony Casa to buy UMortgage and become its CEO two years after he exited personal bankruptcy.

Hunterbrook claims that UMortgage, which operates in 48 states and the District of Columbia, acted as a “reliable funnel of loans to UWM,” the report read. “Elezaj appeared on UMortgage filings until 2020, when it appears he transferred his stake to Casa, just before UWM’s public listing through a SPAC transaction.”

Via rate sheet manipulation, “In the last three years, UMortgage sent UWM an estimated 77 percent of its loans, totaling an estimated $1.9 billion, according to Hunterbrook Media’s analysis of 2021, 2022, and 2023 county and federal-level mortgage data.”

Anyone with questions about the story should contact UWM. One wholesale vet wrote to me, saying, “Rob, the back story of UMortgage isn’t new, but this is more detailed than I have seen before. Other wholesalers’ leadership have managed to stay out of the muck and are in much higher regard in the industry and financial world: most competitors view other wholesalers as okay, friendly competition. Given all the issues facing the world and the industry, is this a ‘tempest in a teapot’?”

Another vet wrote, after reading the story, “There is a lot the authors have not touched on. For example, the rumored Ponzi Scheme where they have recruited and lied to originators to buy into ‘UShares’ at a company with no value (UMortgage) and massive conflicts… losing it all- so far stealing app. $15M from families. Being recruited and giving UMortgage personal savings to ‘buy into’ the company is an open discussion topic among brokers and branches. If true, one would expect the SEC and regulators to take a hard look at it.”

As I mentioned, any questions should be addressed to the principals after reading the piece.

If Borrowers Opt Out of DU and LP…?

California, which accounts for 20-25 percent of residential lending in the U.S. is considering AB 2930, basically giving consumers the right to “opt out” of automated underwriting tools. It could massively disrupt lending because of the ubiquitous use of DU/LP. California MBA CEO Susan Milazzo writes, “California MBA has concerns with AB 2930 (Bauer-Kahan), a bill that would require lenders to perform impact assessments related to automated decision tools (ADT), provide borrowers disclosure notices on the use of ADTs, and provide alternative manual underwriting options to consumers upon request. The bill would disrupt the availability of credit for California residents by imposing potentially conflicting regulations upon lenders who are already highly regulated by existing federal and state consumer protection laws, and are subject to regulatory oversight for identifying, monitoring, and controlling the risk of discrimination or bias. (Reach out to Susan with questions or to lend support defeating it.)

STRATMOR on Decision Making

Mortgage lenders looking for a leg up in this market: it’s time to channel your inner owl. The owl’s extraordinary night vision illuminates what humans can’t see without the aid of technology. That’s the point and purpose of STRATMOR Group’s latest InFocus article. Impactful business decisions are based on good information. When leaders can “see” their company performance through a magnified lens, informed decisions are made. In “Amplify Your Vision to Illuminate Business Opportunities and Risks,” STRATMOR Senior Partner Nicole Yung discusses what it takes to make sense of the data lenders have at their disposal and what additional information they need to consistently make informed decisions that advance the success of their organizations. Read the full April Insights Report here.

The MBA, AI, and MISMO

Artificial Intelligence (AI) is already changing the way the mortgage industry operates, and companies across the country are launching innovative products and discussing ideas that will impact our business practices for the better. Join MBA and MISMO for the one-day event, Artificial Intelligence & Mortgage: The Art of the Possible, on June 3 in San Francisco. There are dozens of speakers, including Jason Bressler, EVP and Chief Technology Officer, United Wholesale Mortgage, Keith Canter, CEO of First Community Mortgage, Josh Friend, CEO and Founder of Insellerate, Amy Gromowski, Executive Science and Analytics, CoreLogic… Don't miss this opportunity to connect with thought leaders and learn about some of the latest technologies in AI. Early Bird Registration ends on May 3.

Capital Markets

Markets are bracing for more insight into inflation today after data yesterday caused markets to further push back expectations of an initial Fed rate cut. First quarter GDP growth fell short of expectations, with a modest increase of 1.6 percent compared to the anticipated 2.3 percent. Slower GDP growth, coupled with unexpectedly high core PCE inflation, doesn’t quite suggest stagflation, but is concerning nonetheless. The Fed seems more and more likely to delay any rate cuts until the fourth quarter of this year in response to persistent inflationary pressures.

On the housing front, pending home sales increased 3.4 percent in March, according to NAR. Month over month, contract signings rose in the Northeast, South and West but dropped in the Midwest. Compared to one year ago, pending home sales declined in the Northeast and South while the Midwest and West improved.

Fed favorite inflation gauge Personal Consumption Expenditure kicked off today’s calendar: +2.8 percent annualized with spending +.8 percent. Expectations were for increases of 0.6 percent and 0.5 percent in income and spending, with the Core PCE Price Index increasing 0.3 percent month-over-month and 2.7 percent year-over-year, little changed versus 0.3 percent and 2.8 percent previously. Later today brings Michigan sentiment. After this latest inflation reading we begin the day with Agency MBS prices slightly better than Thursday evening, the 10-year yielding 4.66 after closing yesterday at 4.71 percent, and the 2-year is at 4.97.

Employment

A mid-sized, Mid-West lender is looking for a Retail Regional Manager to join its leadership team to be a key contributor to the growth of the organization through the recruitment and management of retail branches. If you’re looking for a role with a seat at the table and the ability to be heard and make a difference, this position may be for you! Interested parties should contact Chrisman LLC’s Anjelica Nixt to forward your resume.

In the Northwest and California, Banner Bank is searching for Mortgage Loan Officers looking to create lasting Realtor and builder relationships at a bank focused on the market today. Banner has opportunities for lenders looking for local decision making with FHA, VA, USDA, state bond and true Portfolio lending opportunities along with servicing retained Fannie and Freddie loans to assist in client retention. Additional highlighted products cover CRA lending with private label no payment down payment assistance to help assist all borrowers with the right opportunity. Banner is the right fit for an established team, or the individual looking to grow their business and take the next step in their career. Please send resumes to Aaron Miller.