My notes from the MBA’s conference this week continue, including talk about new home sales being +4.1 percent for the month (+11 percent year over year, bringing a smile to builders everywhere). Although most of the focus of the conference was on the secondary markets (although let’s face it, there isn’t a plethora of new investors or products), the primary markets continue to be a discussion topic. Some lenders have seen LOs move into the broker world, some have seen them come back. The transition to being a broker is not always “rainbows and unicorns.” It appears to have better “top line” revenue but what about the “bottom line” when a shop has to pay for their own benefits, marketing, IT support, etc. (STRATMOR has a fine write up on the subject below.) Lenders continue to examine the branch model, whether it is traditional or P&L (revenue) based. The MBA defines an “expense management” branch. These have a high upside, as long as they’re compliant, and hire whoever they want. But cutting back is tough, and management has to do a good job of setting expectations. (Today’s podcast can be found here and this week’s is sponsored by Black Knight. From point-of-sale through post-closing, the company’s trusted loan origination system, Empower, as well as its integrated, end-to-end origination solutions deliver unmatched capabilities, functionality, and support to increase processing efficiencies and lower operational costs for lenders. Hear an interview with Aidium’s Spencer Dusebout on CRM differentiators and ROI.)

Lender and Broker Products, Software, and Services

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ACES Quality Management unveils ACES PROTECT® Mortgage Compliance Testing Module. Historically, regulatory compliance checks have been complex and cumbersome, making it challenging to perform them quickly and accurately. With the introduction of the first fully integrated compliance engine within a quality control software solution, ACES PROTECT ensures compliance on more loans in less time. With this fully transparent and configurable tool, you will increase productivity while saving time, only pay for the compliance tests you need, and benefit from trusted independent verification, because transparency and accuracy matter. Learn more.

Rocket Mortgage and Rocket Pro TPO have introduced ONE+ by Rocket Mortgage, an exciting new 1% down home loan program that will dramatically increase access to homeownership for millions of Americans. ONE+ is available for qualifying homebuyers whose income is equal to or less than 80% of their area median income (AMI) for single-family homes, including manufactured homes, potentially saving more than 90 million Americans thousands of dollars. Plus, Rocket Mortgage provides a 2% grant towards the down payment! The best part? ONE+ completely covers the expensive monthly mortgage insurance fee for the client, saving up to an estimated $245 per month. Want to learn more about ONE+? Partner with Rocket Pro TPO to take advantage of ONE+ today!

“Turn fixed costs into variable costs on a dime. When the market zigs, lenders need the flexibility to zag. Richey May Advisory brings the mortgage industry expertise and agility you need to convert fixed costs into variable costs. Our difference maker is your ability to outsource services to highly trained experts in a model that fits your needs. Whether that means loan-level accounting, advisory, business intelligence, compliance support, cyber services, internal audits or underwriting automation, we have the tools, knowledge, and experience to deliver value and improve your financial performance unlike any competitor, anywhere. You’ll feel it almost immediately in your day-to-day operations. Even better, you’ll notice the difference in your bottom line. Reach out or visit our website to learn more about how we can help your operation pivot to a better place, no matter which direction the market goes.”

STRATMOR on Brokers

Retail originators, do you find yourself wondering if now is the time to become a broker? Mortgage brokers, are you wondering if you are better off working for a retail lender? Originators scrambling to generate new business with refinances all but gone and purchase volumes down may be considering a change. And lenders in search of additional revenue and cash flows may find the idea of entering the wholesale channel appealing. In the just-released May Insights Report from STRATMOR Group, Senior Partner Jim Cameron digs into the specifics for the wholesale channel. Cameron analyzes trends and offers guidance to lenders considering expansion into the channel and to originators looking at which model is best for them: retail loan officer, corporate or P&L branch manager or maybe becoming a broker. Don’t miss Cameron’s article, “Thinking About Wholesale? Considerations for Mortgage Originators and Lenders” in the May Insights Report.

Webinars and Training

On Wednesday, 5/31, at 11AM Pacific, is a treat for loan originators. James Cameron sold the original Terminator script for just one dollar, a costly mistake that he has regretted ever since. Dave Savage and Todd Bookspan understands the value of foolproof scripts for loan officers, and, unlike Cameron, has no regrets about bringing these conversation frameworks to you completely FREE at SCRIPT-A-PALOOZA 2023. Join top mortgage professionals to learn the best scripts from industry leaders who closed billions in volume last year. Hosted by TrustEngine’s Dave Savage and Win by Noon’s Todd Bookspan plus featuring advice from bestselling author Phil M. Jones, this live event will give you the winning words to close more loans, win referrals and overcome market challenges. Register and say "hasta la vista, baby," to tired, unproductive interactions!

Join MCT on June 1st at 10am PT for its upcoming webinar discussing Strategies to Improve Profitability in the Current Market. In this webinar, MCT’s Phil Rasori and Paul Yarbrough will provide a current market overview and include actionable insights to improve profitability for lenders. Attendees will receive key hedging, trading, best execution, and MSR recommendations, as well as how to leverage technology to improve profitability and efficiency. 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.

Class is back in session, June 1, noon ET, for lenders who want to understand more about mortgage servicing rights (MSR) assets. Optimal Blue industry experts are hosting a complimentary webinar, MSR 201: The Impact of Interest Rate Moves on Servicing Valuations, on June 1. This session will focus on how interest rates impact the valuation of servicing and how you can measure the sensitivity of servicing to moves in interest rates.

Make sure your business advertising is compliant at the MMLA Thursday, June 1 luncheon 11:30 a.m. – 1:00 pm at the Traverse City Country Club. The cost is $35 per member and $40 per non-member. Melissa Bridges, Attorney at Bodman, will discuss compliance rules for advertising, social media posts, gifts, and other promotional items.

Class is back in session for lenders who want to understand more about mortgage servicing rights (MSR) assets. Optimal Blue industry experts are hosting a complimentary webinar, MSR 201: The Impact of Interest Rate Moves on Servicing Valuations, Thursday, June 1, 9-10AM PT. This session will focus on how interest rates impact the valuation of servicing and how you can measure the sensitivity of servicing to moves in interest rates. Today more than ever, it’s critical to understand the drivers of servicing profitability and how the current state of the rate market impacts that valuation. Understanding the sensitivity of your portfolio can help arm decision makers at your organization with the right intel to make the right decisions.

IMN’s Annual Non-QM & Non-Agency Mortgage Forum is June 1-2 at the Waldorf Astoria Monarch Beach, in Dana Point, CA. This forum will be constructed from both the loan origination and investor perspectives, diving deep into the critical issues facing the industry. At this event, you will meet senior professionals in the market consisting of Correspondents, Wholesale Originators, Investors/Capital Market Leaders, Servicers, Brokers, and many more at this two-day event. Check out a sample of panel topics of past registered companies, view The 4th Annual Non-QM & Non-Agency Mortgage Forum.

Capital Markets

The Fed Funds futures market, like oddsmakers in Las Vegas, are now saying there’s a 38 percent chance of another 25-basis point (.25 percent) hike in June as employment continues to be strong, banking issues quiet down, and inflation continues to be relatively high. Speaking of which, home prices peaked around June of last year, so we should start seeing the decline in prices percolate through to the yearly inflation indices. Investors were also focused on the FOMC Meeting Minutes from May yesterday, which showed that policymakers believe that there is an upside risk to the baseline inflation forecast and there is an expectation among officials that a "mild" recession will begin later this year. Throwing a curveball in the mix were hawkish comments from Fed Governor Waller, who indicated that the Fed could pause at the June meeting only to re-start in July should inflation continue to come down slower than expected.

Even with some intraday volatility yesterday, bond prices dropped by the close as debt ceiling negotiations continued to dominate headlines. We are one day closer to the June 1st deadline Treasury Secretary Yellen identified as the date when the U.S. Treasury would potentially run out of money.

The second look at Q1 GDP (+1.3 percent, up from +1.1 percent; +4.2 percent annually, stronger growth than forecast; core PCE +5.0 percent annually) and weekly initial jobless claims (229k, up 4k from a revised 225k) led off today’s calendar. GDP was expected to increase 1.0 percent versus 1.1 percent previously, with the core PCE deflator unchanged at 4.9 percent year-over-year. Later today brings the Pending Home Sales Index for April, KC Fed manufacturing for May, and a Treasury auction of $35 billion 7-year notes. Two Fed Presidents are also scheduled to speak, Richmond’s Barkin and Boston’s Collins. We begin the day with Agency MBS prices worse a solid .125 and the 10-year yielding 3.75 after closing yesterday at 3.72 percent; the 2-year is up 50 basis points in 10 days to 4.39 percent!

Employment

A well-capitalized bank is searching for a mortgage banking shell with Agency approval that has had no, or minimal, residential production, over the last three years. Confidential inquiries can be sent to me for forwarding.

A Title Insurance Agency located in a prestigious office building in Melville, Long Island, with a staff of 12 has an empty corner office with additional desk space in the main area. Any individual or individuals looking for a satellite office or primary space will have access to all employees as well as all the office equipment. Let’s discuss an arrangement that will benefit all parties. If interested, please reach out to Anjelica Nixt and specify this opportunity.

A regional independent mortgage banker, based in the Midwest, is looking for a compliance officer. The lender has Fannie, Freddie, and Ginnie tickets, servicing, and a full suite of products including bridge loans, DPA, and renovation. The perfect candidate will have at least ten years’ experience working at a multi-billion dollar IMB, including Disclosures, QC, Vendor Management, Exams, and State/Federal reporting. If you are interested, please send your confidential resume to Chrisman LLC’s Anjelica Nixt for forwarding.

Are you a loan officer or mortgage banker frustrated with the constraints of retail lending? Tired of competing against lower rates, fees and closing costs? Then now’s the time to take control of your pipeline and career by making the switch to wholesale lending as an independent mortgage broker. Whether you’re looking to open your own brokerage or join a team as a loan officer, you can get up and running without missing a beat with support from the team at BeAMortgageBroker.com. You have nothing to lose and only clients, greater flexibility and compensation to gain.

“Things are heating up and we are adding to our team. At AFR Wholesale®, we are looking to expand our Account Executive teams for both our Wholesale and Correspondent Divisions! We have been streamlining procedures, developing more communication channels, and overall speeding up our loan processes. Now we need more hands-on deck to join our family! We like to offer a close community that feels like home to thrive and make dreams become a reality. We are looking for experienced candidates because at AFR, we recognize that some scenarios can be challenging, and we want to provide a home for all possible circumstances. That is why we do what we do. At the end of the day, it’s about being proud, we made it possible to turn a house into a home. AFR is an equal opportunity employer. APPLY NOW! Contact AFR by going here, email us or call 1-800-375-6071.”

“PrimeLending delivers LOs award-winning support from day one and beyond. Just last week, our national training team struck gold two times at the Association for Talent Development Annual Axis Awards, winning first place for programs designed to help LOs gain the skills needed to excel in today’s marketplace. Our training team won the Technology Application award for revolutionizing remote learning with innovative tech like NovoEd, and the Performance Improvement award for demonstrating the positive impact training programs have on production. What does that mean for LOs? Easier onboarding. Faster productivity. Better efficiency. More confidence. Our training team understands the unique challenges and opportunities in the industry, ensuring loan officers stay ahead of the curve. For your professional growth and achievement, reach out to Nic Hartke today and discover how PrimeLending can pave the way to success.”