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Mortgage Rates Moving Higher to Start New Week

May 25,2020
by admin

Mortgage rateshit new all-time lows last week. In fact, for many lenders, records were broken on more than one day. That raised the risk of a bounce back this week and if today is any indication, that’s what we’re seeing. The average lender is back in line with last Tuesday’s rate offerings for top tier conventional 30yr fixed scenarios.

All that having been said, rate movement is pretty minimal by normal standards as the bond market (which underlies interest rate momentum) has been relatively calm and sideways after coming to terms with the initial shock of the coronavirus market impact. In many cases, borrowers would see the same note rate they saw last Friday (in those cases, the upfront costs associated with that rates would likely be slightly higher).



Loan Originator Perspective

Bonds regressed slightly Tuesday, which is a moral victory considering stocks’ robust rally. It’ll be interesting to see if May’s end boosts bonds the rest of this week. I’m locking loans when submitted to (or out of) underwriting, our short term pricing is vastly better than longer term locks. Worth asking your lender what his firm’s policy is, if you don’t already know. -Ted Rood, Senior Originator, Bayshore Mortgage

For the last month we’ve been on a serious Road to Sideways. The stock market is having a great day after the long weekend on vaccine test trial news. Bonds have lost some ground but seem to be holding up OK. Locking at these All-Time low rates isn’t a bad idea. Especially if you’re coming from something in the 4’s on your current loan. Will we go lower? Not sure. Will we go up? Not sure. Sideways isn’t a terrible thing for now. Talk to your Loan Officer. If you’re happy with what they’re offering. Take it. -Jeff Anderson, Loan Officer, Salem Five Mortgage, LLC



Ongoing Reminder on Forbearance

Coronavirus has created unprecedented challenges for people and industries. For homeowners facing a big reduction in income due to coronavirus-related hardship, a forbearance can make excellent sense. But for those who have the capacity to continue making mortgage payments, there are downsides to consider. Forbearance itself does not hurt your credit score, but it does show up on your credit report. This will affect your ability to qualify for a loan in the present and near future. It can also result in your other creditors decreasing your available credit balances. This has the unintended effect of increasing your ratio of debt to available credit which is a key component of credit scoring models. Thus, even though forbearance itself is not hurting your credit, it can indirectly lower your credit score and it will absolutely impact your mortgage creditworthiness in the short term.

Broker, eSign, Marketing Products; USDA, FHA, Freddie, Fannie News and Trends

May 25,2020
by admin

I doubt if I have ever pressed “7” or “8” on my microwave oven keypad. Speaking of 7 & 8 (I know, a weak segue), originators are keenly aware of what builders are seeing, economy-wise, and 78 percent of them did not lower their prices in April. Not only that, but 41% of home sales had bidding wars, according to Redfin. “Demand for homes has picked back up after hitting rock bottom in April, and that uptick paired with a lack of supply is a recipe for bidding wars. Homebuyers are getting back out there, searching for more space as they realize using their home as an office and school may become the norm. But sellers are still holding off on listing their homes, partially due to economic uncertainty and concerns of health risks. In some hot neighborhoods, there may only be one or two homes for sale, with multiple homebuyers vying for them.” Heading into the pandemic low inventories and forbearance limited supply, while favorable Millennial demographics and low interest rates boost demand. And job losses from Covid-19 have hit lower-income workers hardest, and they typically rent. People still need a place to live and want to own a home.


Lender Services, Products, and Training Events

Caliber Home Loans is the proud recipient of Fannie Mae’s Servicer Total Achievement and Rewards (STAR) program recognition for excellence in mortgage servicing for 2019. For the 2019 report, the STAR team analyzed Caliber’s servicer capabilities across the fundamental components of people, processes, quality control, reporting and training. As an organization, Caliber’s top priority continues to be focused on delivering a seamless and exceptional experience to their customers. Now, more than ever, Caliber strives to make life easier, by providing options for customers impacted during these challenging times. Caliber extends its deepest thanks to its dedicated team members and remarkable customers! #FannieMaeSTAR #ServicingExcellence.

Check out the latest Clear to Close podcast episode from Maxwell titled, “How Leaders Guide Their Teams through Turmoil” where they sit down with The Mortgage Collaborative COO Rich Swerbinsky to look at what lenders are doing to get the most out of these times and setting themselves up to thrive. Another great episode from the series and this one is definitely worth finding time to listen to. Listen and download here: Apple, Google, Spotify, Browser.

Unemployment is on the rise, the market is contracting, and there are fewer new deals available. So, how do you drive growth? Customer retention. Register for this webinar with Total Expert and Sales Boomerang, hosted by HousingWire, on June 10 at 1 p.m. CT. You’ll walk away with the strategies you need to implement today to optimize the pre-close customer experience, master the post-close journey, and create customers for life. Register now.

Digital lending platform developer Blend has spent years enabling consumers to get pre-approved in one-tap, apply for loans, sign disclosures, and complete follow-ups from any device at any time. Actually closing a mortgage, however, has remained a singularly unpleasant event. Until now. With Blend Close, lenders will be equipped to empower consumers to close how they want. Surface the best possible closing experience for each loan while tapping into new levels of simplicity, efficiency, and ROI. With the launch of Close, Blend will offer a single, integrated closing experience with all of the necessary functionality for eSign, Remote Online Notarization or an in-person notary, eNote solutions, integration to an eVault, and eRecording. Visit the recent Blend Close announcement for a deeper look into an elevated borrower closing experience.

Register for MBA Education’s highly informative webinar, SUCCESSFUL SECONDARY MARKETING STRATEGIES IN VOLATILE TIMES, on Thursday, May 28th at 2:00 PM ET. Featuring industry veterans from Optimal Blue, this webinar will explore the economic and operational incentives when transitioning from a Best Efforts to Mandatory delivery model, counter-party relationships best suited to your business and current market conditions, as well as special risk mitigation strategies correlated to COVID-19 market impacts. For their guests, Optimal Blue has organized complimentary access to this MBA webinar. Please contact sales@optimalblue.com to receive a promo code that will waive your $499 registration fee.

Conquest from UWM. Grow your new business with 30-year fixed rates starting at 2.5%. Just in time for what could be the best purchase season our industry has ever seen, UWM has launched Conquest, a program designed to help brokers win new business by offering competitive rates at the lowest rate ranges on all purchases and on any refinances where the borrower hasn’t closed a loan with UWM in the last 18 months. With 30-year fixed rates ranging from 2.5-3.0% on purchases and rate/term refinances, it’s a great way to add new borrowers to your roster, build new relationships with real estate professionals and wow them all with UWM’s fast turn times, elite service, and groundbreaking technology. Talk to your UWM account executive or sign up today at uwm.com.


USDA, FHA, Fannie, Freddie Changes Continue

As we all wait for Ginnie to come out with its electronic promissory note policy, there is always a lot of focus on what Freddie Mac and Fannie May are up to, and where they should be after government conservatorship ends. The two of them now have $23.5 billion in capital, and the FHFA believes they should hold $240 billion, a high hurdle for raising capital in (probably) 2021. Investment banker Houlihan Lokey is advising the FHFA on recapitalizing the companies. Obviously, these capital standards will require higher pricing across the board and steeper risk-based pricing for higher LTV loans and other products.

Late last week Chris Whalen opined on what post-conservatorship GSEs might look like. And over the weekend Dave Stevens with Mountain Lake Consulting addressed the proposed capital rules and the need for industry to engage.

The GSEs published an announcement inviting lenders who meet eligibility criteria and prerequisites to participate in the Uniform Residential Loan Application (URLA) Limited Production Period (LLP) beginning on Aug. 1. During the LLP, participants will use the redesigned URLA (Fannie Mae Form 1003) and updated Desktop Underwriter (DU) specification to originate loans as part of a controlled implementation. Visit the URLA Pagefor more information. Yes, they are extending the implementation timeline for the redesigned URLA and updated automated underwriting systems (AUS) specifications to support the industry during the COVID-19 pandemic. The new mandate for required use of the redesigned URLA is March 1, 2021. The extension will provide lenders and other stakeholders additional time to prepare and implement the redesigned URLA.

Fannie Mae issued a reminder that June 1 is the effective date for updated ARM notes and riders. The joint GSE notes and riders and Fannie Mae-only ARM notes and riders were previously updated to include new fallback language for closed-end, residential ARMs. Special Feature Code (SFC) 785 is required for delivery of ARM loans closed on the updated documents to indicate the updated documents have been used (note: this will be a fatal edit at delivery).

Fannie Mae updated its Lender Letter 2020-04 with additional temporary guidance, including use of virtual inspections for appraisals and renovation loans, and flexibilities for condominium project reviews. Additionally, we’ve updated information about flexibilities for new construction loans and Homestyle® Renovation loans, as well as other temporary appraisal requirement flexibilities. And don’t forget LL-2020-07regarding COVID-19 Payment Deferral.

In a video message FHA Commissioner Brian Montgomery speaks directly to homeowners with FHA-insured mortgages experiencing financial hardships caused by the COVID-19 emergency. View the video message available in English and English/Spanish captioned.

FHA’s new, web-based platform, FHA Catalyst, provides enhanced digital solutions for stakeholders conducting business with FHA. The platform’s architecture allows FHA to respond quickly with technology solutions for evolving business needs in response to the COVID-19 National Emergency. The platform has two modules available today for mortgagees:

FHA Catalyst: Claims Module, which is now available to all servicers for the submission of forward mortgage supplemental claims. FHA Catalyst: Case Binder Module, which allows lenders to electronically submit case binder documents as an alternative to mailing paper binders. Details can be found in FHA’s Mortgagee Letter (ML) 2020-08.

In Mortgagee Letter 2020-12, FHA published multiple COVID-19 related policy and other updates to its Home Equity Conversion Mortgage (HECM) program. These updates include: Guidance for HECM Claim Type 22 (CT-22) Assignment Claims during the COVID-19 National Emergency. Temporary Partial Waiver for HECM Tax Arrearages during the COVID-19 National Emergency. Webinar: Updated Guidance for HECMs during the COVID-19 National Emergency. Housing Program Specialist Position (HECM) Available in Tulsa, OK.

USDA Rural Development issued an announcement to inform lenders of updated loan status reporting requirements for borrowers impacted by the Presidentially declared COVID-19 National Emergency, addressing how lenders report loan statuses to the Agency via Electronic Status Reporting (ESR) and does not address reporting to credit repositories. Lenders should start reporting the status reason code of 010- Neighborhood Problem and a status code of 06- Formal Forbearance. If any other forbearance code was previously reported for Borrowers affected by the COVID-19 National Emergency, stop reporting that status code and begin reporting with status code 06 – Formal Forbearance. The same default status date should be used as the date the borrower was approved for the forbearance if changing the status code. If the loan was not previously in default, the status code 42 must be reported first to open the default event and then Status Code 06 – Formal Forbearance can be reported in the following months.

USDA extended its temporary exceptions pertaining to appraisals, repair inspections and income verifications for SFHGLP until June 30, 2020. These temporary exceptions apply to the requirements in the program handbook HB-1-3555 for new loans. Additional guidance related to these exceptions on origination and servicing of USDA single family housing guaranteed loans is now available. Check out FAQs in the USDA LINC Training and Resource Library. Additionally, USDA has extended its 60-day foreclosure and eviction moratorium until June 30, 2020.


Capital Markets

Looking at all of last week, April’s data continues to confirm the severity of the economic downturn resulting from the stay at home orders in response to Covid-19. The Leading Economic Index declined 4.4 percent, the fifth decline in the last seven months. Housing starts plummeted 30 percent in April to an 891,000-unit annual rate with single family starts down to a 660,000-unit rate, and sales of existing homes fell 18 percent to the slowest annual rate since July 2011. Despite the drop in sales, home prices were up 7 percent year-over-year and are not expected to drop significantly due to the tight supply. Mortgage purchase apps were up for the fifth week in a row increasing 6.4 percent for the week ending May 15 although they are still 12.3 percent below 2019’s pace. The low interest rate environment, however, has led refinance apps to increase 3x from a year ago. New claims for unemployment insurance declined for the seventh consecutive week after hitting a record 6.9 million with 2.4 million new people filing for the week ending May 16.

Bond marketwise, the end of last week saw a quiet trading day ahead of the holiday weekend, though the Treasury yield curve flattened amid nervous risk sentiment following increased tensions between the U.S. and China. It was reported that the National People’s Congress will vote on the Hong Kong National Security Law this Thursday, confirming fears about China’s intent to strengthen its grip over the city. The U.S. condemned Beijing’s plan to enact national security legislation in Hong Kong, with Secretary of State Pompeo saying the proposal would be a “death knell” for the city-state’s autonomy. The 10-year yield closed the week yielding .66 percent, nearly unchanged for the week.

With bond and equity markets closed for Memorial Day yesterday, this week’s economic calendar begins shortly with the March S&P Case-Shiller Home Price Index and May FHFA Housing Price Index. Later this morning brings April New Home Sales and May Consumer Confidence, as well as the Dallas Fed Texas Manufacturing Index for May and remarks from Minneapolis Fed President Kashkari. Tomorrow sees just the Weekly MBA Mortgage Index before Thursday brings Jobless Claims, April Durable Orders, the second estimate of Q1 GDP figures, and April Pending Home Sales. The week closes with April Personal Income and Spending, PCE Prices, Core PCE Prices, April Advance Indicators, May Chicago PMI, and Final May Michigan Consumer Sentiment. As far as MBS purchases go, the NY Fed will continue its two daily FedTrade purchase operations. Today’s purchases will total up to $4.230 billion starting with $1.260 billion UMBS15 2 percent and 2.5 percent followed by up to $2.970 billion UMBS30 2 percent through 3 percent. We begin the week with Agency MBS prices worse/down nearly .125 versus Friday and the 10-year yielding .69.

Employment

Summit Valuation Solutions, a leading nationwide real estate property valuation company is expanding its sales force. Summit Valuation Solutions is looking for a Vice President of National Sales. The ideal candidate will have experience working in the Capital Markets or Loan Servicing space. Responsibilities include representing the firm regarding customized valuation solutions that support those in the secondary acquisition/sale space as well as those in the default loan servicing space. Professionalism and a commitment to a strong work ethic are a must. Experience in high end sales efforts is desirable. Resumes can be confidentially submitted to sales@summitvaluationsolutions.com.

Surprise and Delight. At Primary Residential Mortgage, Inc. (PRMI), we strive to surprise and delight our borrowers and referral partners in each interaction; and we strive to surprise and delight each other. Providing service that stands out like a pair of red shoes creates an unpaid salesforce of delighted customers and referral sources who are PRMI’s biggest champions. We also know that you’re only able to provide your best service when your own needs are met. This is why exceptional service isn’t just something we offer customers—it’s deeply ingrained in our culture. We’re committed to providing exceptional service to each other at every turn so that we can all serve our customers better. Join us in our efforts to surprise and delight our customers and each other with red shoes service at every turn. Visit branchpartner.com or contact Amy Gallow, VP of Business Development to learn more.

MBS Week Ahead: Beatings Can Continue Until Market Morale Deteriorates

May 25,2020
by admin

No need to overcomplicate the current narrative: the overall financial market is attempting to balance the reopening of the economy with the risk of COVID resurgence, all the while receiving a boost from massive global stimulus efforts. No matter how pessimistic anyone wants to be about the longer-term economic damage associated with coronavirus, the Fed and Treasury are throwing so much money and accommodation at the problem that markets are chanting the age-old mantra “don’t fight the Fed.” And that can be extrapolated to include the world’s other major central banks.

Bonds are realistic. They know there is massive economic damage that can’t be immediately healed by stimulus efforts. That’s why the 10yr yield is trading around 0.7% despite a massive glut of supply. Yes, Fed bond buying helps keeps yields low, buteven without the Fed, yields would still be lower than at any other time before coronavirus. Thus, it was an easy call to move to extreme lows when the outlook was arguably the darkest in mid-April. Ever since then, bonds have grudgingly been trending higher.

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At some point–perhaps “any day now”–traders will be ready to look for healing cues in the economic data. The more timely the data, the better the odds. That makes reports like Tuesday’s Consumer Confidence survey, Wednesday’s weekly mortgage apps, Thursday’s Jobless Claims, and Friday’s Chicago PMI (all either weekly releases or for the month of May) potentially more interesting/relevant compared to standbys like Thursday’s Durable Goods (an April report).

Data aside, if stocks feel like they have what they need to continue pressing back toward a full erasure of coronavirus weakness, bonds should continue to feel the pressure. That was certainly the case in the overnight session that kicked the week off. Bottom line: bonds can continue to suffer until broader market morale deteriorates.

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Home Prices Still Moved Higher in March

May 25,2020
by admin

Even as the COVID-19 pandemic began to hobble home sales in many locations, home prices continued to increase. the Federal Housing Finance Agency’s (FHFA’s) House Price Index (HPI) held to its 5.7 percent gains the prior month while the S&P CoreLogic Case-Shiller U.S. Home Price Indices posted larger annual increases in March than in February.

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 4.4 percent annual gain in March, up from 4.2 percent the previous month. The 10-City Composite’s annual increase came in at 3.4 percent, up from 3.0 percent and the 20-City Composite rose from a 3.5 percent growth in February to 3.9 percent.

The National Index posted a 0.8 percent month-over-month increase, while the 10-City and 20-City

Composites were up 1.0 percent and 1.1 percent respectively before seasonal adjustment. After seasonal adjustment, both the National Index and the 20-City Composite rose 0.5 percent and the 10-City Composite was up 0.4 percent.

Because of office closings in due to the pandemic in Michigan, sales transaction data in Wayne County, the most populous county in the Detroit metro area, has not been accounted for and Case-Shiller says it is not able to generate a valid March 2020 update for the area. Excluding Detroit, however, the remaining 19 cities reported price increases for March both before and after seasonal adjustment.

Phoenix, Seattle, and Charlotte had the highest year-over-year gains among the 19 cities. Phoenix led the way with an 8.2 percent followed by Seattle with a 6.9 percent increase and Charlotte, up 5.8 percent. Growth was larger in 17 of the 19 cities for the year ending March 2020 versus the year ending February 2020.

“March’s data witnessed the first impact of the COVID-19 pandemic on the S&P CoreLogic Case-Shiller Indices,” says Craig J. Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P Dow Jones Indices. “We have data from only 19 cities this month, since transactions records for Wayne County, Michigan were unavailable.

“That said, housing prices continue to be remarkably stable. The National Composite Index rose by 4.4 percent in March 2020, with comparable growth in the 10- and 20-City Composites (up 3.4 percent and 3.9 percent, respectively). In all three cases, March’s year-over-year gains were ahead of February’s, continuing a trend of gently accelerating home prices that began last autumn. March results were broad-based. Prices rose in each of the 19 cities for which we have reported data, and price increases accelerated in 17 cities.

“At a regional level, Phoenix retains the top spot for the tenth consecutive month, with a gain of 8.2 percent for March. Home prices in Seattle rose by 6.9 percent, followed by increases in Charlotte (5.8 percent) and Tampa (5.7 percent). Prices were particularly strong in the West and Southeast, and comparatively weak in the Midwest and Northeast.

“Importantly, today’s report covers real estate transactions closed during the month of March. Housing prices have not yet registered any adverse effects from the governmental suppression of economic activity in response to the COVID-19 pandemic. As much of the U.S. economy remained shuttered in

April, next month’s data may show a more noticeable impact.”

Home prices on the National Index are now 16.4 percent higher than at the previous peak in July 2006. The 10-City Composite has exceeded its previous high by 3.8 percent and the 20-City is 7.6 percent higher.

The S&P CoreLogic Case-Shiller Home Price Indices are constructed to accurately track the price path of typical single-family home pairs for thousands of individual houses from the available universe of arms-length sales data. The National U.S. Home Price Index tracks the value of single-family housing within the United States. The indices have a base value of 100 in January 2000; thus, for example, a current index value of 150 translates to a 50 percent appreciation rate since January 2000 for a typical home located within the subject market.

As of January 2020, the National Index was at 214.96 compared to 213.16 in February. The 10- and 20-City Composites had readings of 234.83 and 222.21 respectively, compared to 233.32 and 219.75 the prior month. Los Angeles has the highest index reading at 293.957 and Cleveland (absent data on Detroit) the lowest at 128.43.

The FHFA HPI report for March is also a quarterly summary and the index for that period was up 1.7 percent in the second quarter of 2020 compared to the first quarter. For the month of March, prices were 0.1 percent higher than in February.

FHFA, however, appended a big caveat to their March numbers. They cautioned that the data is unlikely to reflect the economic impact of the crisis as price movements are estimated from closings through March 31st, but, because of the time delay between when a contract is signed and a loan closes, purchase data from March largely reflect prices that were set in late-January and throughout February and reflect prices agreed upon before broad stay-at-home orders were issued.

“Home price growth in the first quarter outpaced annual growth from the same period a year ago as falling interest rates and shrinking inventories for sale led prices higher just prior to the crisis. Prices in the Mountain Division, encompassing the top four states by growth, grew by 8 percent on a year over year basis,” said Dr. Lynn Fisher, Deputy Director of the Division of Research and Statistics at FHFA. “Because of the lag between contract signing and sale closing when our data are recorded, we judge the first quarter’s housing statistics were relatively unaffected by the COVID-19 outbreak. However, we are unable to account for any modifications or cancellations of sales later in March.

The top five states for annual appreciation were: 1) Idaho 12.6 percent; 2) Montana 10.2 percent; 3) Wyoming 9.9 percent; 4) Utah 9.0 percent; and 5) Hawaii 8.8 percent. Prices were up in all of the top 100 metro areas but were the greatest in Boise City at 13.1 percent. While the West was the strongest region, the West South Central Division was the weakest with a 4.3 percent annual increase. House prices have risen for 35 consecutive quarters, or since September 2011.

FHFA’s House Price Index is based on the sales prices of homes purchased with Fannie Mae or Freddie Mac financing. The index was benchmarked at 100 in January 1991. The current reading is 287.9.

April New Home Sales Crush Forecasts

May 25,2020
by admin

New home sales, rather than dropping like a rock, rose 0.6 percent in April according to the U.S. Census Bureau and the Department of Housing and Urban Development. Part of the gain is due to a revision of the March sales numbers from an original estimate of 627,000 seasonally adjusted annual units to 619,000. This added to the month’s 15.4 percent decline from February. While April’s sales of newly constructed homes were down 6.2 percent from a year earlier, the April estimate of 623,000 units is totally unexpected.

The consensus of analysts polled by Econoday was for an annual pace of 495,000 units with the highest estimate at 592,000 units. They weren’t alone; the consensus from MarketWatch was 480,000 units while Trading Economics expected a decline of 21.9 percent.

While sales estimates for existing homes are counted at closing and so reflect to a certain extent contracts and economic factors from as much as two months earlier, new home sales are tallied at contract signing, which would put the April data squarely in the middle of COVID-19 shelter orders.

On an unadjusted basis, sales for the month totaled 59,000 newly constructed homes, down from 60,000 in March. For the year-to-date, sales are still up 1.4 percent from the same period in 2019, 241,000 units to 238,000.

Sales held up well on a monthly basis in three of the four regions, increasing 8.7 percent in the Northeast and 2.4 percent in both the Midwest and the South. The West posted a 6.3 percent decline.

The year-over-year numbers were much worse, down 26.5 percent in the Northeast and the Midwest and 33.5 percent in the West. The South managed a gain; sales increased 4.7 percent.

Robert Dietz, an economist for the National Association of Home Builders, thinks it is reasonable to expect the April data to be revised downward next month, given the persistent weakness in the labor market. Nonetheless, mortgage application data and anecdotal reporting from builders indicates that housing demand picked up in recent weeks, and he says,.”Overall, the data lend evidence to the NAHB forecast that housing will be a leading sector in an eventual economic recovery.”

The inventory of homes for sale at the end of April ticked down from 331,000 in March to 325,000. This represented a 6.3-month supply at the current rate of sales compared to 6.4 months in March.

The median sales price of a home sold during the month was $309,900, much lower than the median a year earlier at $339,000. The average sales price also fell, from $385,400 in April 2019 to $364,500.

Have You Invested in TREPAC?

May 25,2020
by admin

Did you know you can manage your TREPAC Investment online? You can sign up for reoccurring or one-time investments through the Members Only Portal at www.har.com/trepac.

Watch this video and see how easy it is to invest in TREPAC!

Source: Houston Association of REALTORS®

Business Broker Training

May 25,2020
by admin

Analyzing & Recasting Financials for Small to Midsize Businesses– A focus on how to read and analyze financial statements for small to midsize businesses and determine the discretionary earnings, tangible and intangible assets that will be transferred with a sale of a business. Business financial statements and tax returns are prepared to minimize taxable income. To sell a business you will learn to recast or adjust those financial statements to show the business’s actual financial capability.

Approved for 8 hours CE (TREC Provider #0291) and 8 hours credit towards TABB Board Certified Broker designation

Date: June 4

Time: 8 a.m. – 5 p.m.

Location: Online (Live)

Investment: $295

Register HERE today!

Source: Houston Association of REALTORS®

LO Jobs; CRM, Marketing, Lending Products; Tools for Borrowers; Rates: a Global Snapshot

May 21,2020
by admin

The Friday before a three-day weekend (honoring the men and women who died while serving in the U.S. military)! Can’t you just feel that anxiousness to go and hike, to have a meal out, to see people, to sit in a restaurant? No one can argue that social distancing has increased the rate of infection, right? Many are “chomping at the bit,” weighing statements from scientists & politicians, especially as news continues to come out from people about catching COVID supposedly having never left their house. Or statistics, like as of May 17, about 91,000 lives have been lost to the coronavirus but those aged 65 or older accounted for 80 percent of these deaths, and residents or employees of long-term care facilities accounting for one third of all deaths. And so many working from home… When you put in some work, you expect to be compensated, you know, receive a little something for the effort. More on programs to help borrowers below.


Lender Services and Products

The story of DocProbe going from a disruptive startup helping solve lenders’ trailing docs headache to growing into a document digitalization trailblazer, is one of entrepreneurial spirit and transformational vision. As lenders from around the country came on board at a growth rate of 300% since 2017, the “DocProbe secret” was out of the bag and quickly revolutionized the industry. The people, process, and technology that worked on a small scale, has developed over multiple iterations on all fronts to become a seamless go-to solution for lenders and investors. No cutting corners meant hiring at a rate of 10X over that same period to keep up with demand. 400% document intake growth inspired the writing and rewriting of the internal software code from Versions 1 to 4, and continuously breaking down and streamlining the overall Trailing Docs process for peak efficiency and rapid turn-around time. The trust and strong relationships that investors and lenders have shown in our service further fueled the exponential growth in loan volume and has kept the ball rolling. Catch the DocProbe wave at www.docprobe.net or contact Nick Erlanger for more information.

Check out this FREE Live Workshop on June 3 – Experts Alex Kutsishin, Co-Found and CEO of Sales Boomerang, and Paul Harrington, Business Development Director for Usherpa, explain how Loan Officers can provide value to their Realtor partners and build mutually-beneficial relationships by utilizing authentic data intelligence. Authentic intelligence linked to powerful CRM and Marketing systems give Loan Officers the opportunity to share actionable buyer data that Realtors can use to grow their business. By providing value to Realtors, LOs can cultivate crucial professional relationships and establish rock-solid referral pipelines. It’s a win, win, win. LOs win, Realtors win, and borrowers win. Register Now: The Holy Grail- Send Realtors Buyers

In Saturday’s edition, STRATMOR’s Garth Graham weighed in on the topic of CRM selection, writing that lenders should clearly identify what they need from a CRM before evaluating and choosing a solution. Take TexasLending.com, whichneeded a way to provide white-glove communication to every borrower during a time of unprecedented volume. It selected Top of Mind’s SurefireCRM for the platform’s ability to automatically deploy dynamic “in-process” videos that keep clients updated on loan progress and talk them through gathering paperwork, disclosures, processing, underwriting and more. TexasLending.com has seen a 400% open rate for in-process videos, meaning customers find the content so valuable they are re-watching or sharing it with others. Read more about their experience here.

Grow your new business with rates starting at 2.5%. Conquest from UWM. Just in time for what could be the best purchase season our industry has ever seen, UWM is launching Conquest, a program designed to help brokers win new business by offering significantly better pricing to any borrower who hasn’t recently (within the last 18 months) closed a purchase or refinance through UWM. With rates starting at 2.5% on conventional purchases and rate/term refinances, it’s a great way to add new borrowers to your roster, build new relationships with real estate professionals and wow them all with UWM’s fast turn times, elite service, and groundbreaking technology. Talk to your UWM account executive or sign up today.

HomeBinder: Stay connected post-close, just 10 days left to save 10%. Grow your business with a HomeBinder that keeps you connected with homeowners post-close. Drive agent referrals by co-branding HomeBinder with the real estate partners you work with. Integration with Encompass® automates the entire process (including loan docs!) Exclusive 10% off HomeBinder for loan officers (ends May 31st). Learn more today.


Helping Borrowers is the Goal, Right?

Mortgage pricing is a result of supply and demand, as is, to some extent, volatility. What will lending look like when Freddie and Fannie come out of conservatorship?R.C. Whalen of Whalen Global Advisors LLC opined on how that might look. With the Fed supplying the primary demand for MBS, and quieting down to some steady level of buying billions a day of Agency MBS, lenders can focus on programs to help their borrowers. This can be tough with some types of borrowers.

Rates are not an issue for loan originators. (You’re going to argue over an eighth because of “the guy up the street”? Really?) Aggregators have come “back into the market,” helping pricing. Program-wise, there are sources to help originators, or anyone. For example, you can enter the state and then the program and hit “go” at Mortgage Elements.

Lenders with low- to moderate-income homebuyers who are creditworthy, but who lack sufficient cash for a down payment or closing costs, have an option. Remember to refer them to their state housing finance agency to see if one of the many available down payment assistance (DPA) programs available from state HFAs may be able to help. All state HFAs are ready to take reservations for your homebuyers with DPAs specially tailored to meet the needs within their state, even as they work to alleviate the effects of COVID-19 on the renters and homeowners, too.

Down Payment Resource (DPR) is closely monitoring the impact on down payment assistance programs and first-time homebuyers as a result of COVID-19 on its new resource page. DPR reports most programs are funded and available with only about 1.5% of programs temporarily suspended. HFAs continue to react to COVID-related agency and master servicer policy changes, several HFAs announced reduced interest rates, and 2020 income and purchase price limits are rolling out fast across most markets. DPR tracks eligibility and benefit details for approximately 2,400 DPA programs across the U.S. and provides tools for lender enterprises and individual LOs.


Capital Markets

Recall last week learning that April and May economic data have shown the full impact of social distancing and shelter in place policies throughout the world. In the UK, consumer spending fell by a record amount percent from April 2019. In the US, retail sales also dropped a record amount from March and were down nearly 22 percent from one year ago. Every category saw law drops in spending with the exception on non-store retailers. With many factories closed, motor vehicle production fell over 70 percent in March which helped pull total manufacturing down 11 percent for the month. Capacity utilization fell from 73.2 percent in March to 64.9 percent in April. Unemployment continues to increase as initial unemployment insurance claims rose another 3.2 million for the week ending May 9 bringing total new claims to near 36 million over the last two months. Applications for home purchase rose 10.6 percent for the week ending May 8th, their fourth consecutive weekly gain as the home purchase market shows some resilience.

Looking at the bond market yesterday, yields were mostly unchanged on the day though that wasn’t for a lack of explosive headlines. If a global pandemic wasn’t a bad enough start to 2020, it seems increasingly likely the U.S. and China are heading for a Cold War. From the virus, supply chains, and visas, to cyberspace and Taiwan, the two countries are escalating disputes that had quieted after the phase one trade deal was signed in January. President Trump suggested Chinese President Xi is behind a disinformation and propaganda attack on the U.S. and Europe.

China responded to those accusations from President Trump, warning that it will safeguard its sovereignty, security, and interests. Hong Kong’s status as an international financial center is reportedly in jeopardy after China announced dramatic plans to crush dissent by writing a new national security law into the city’s charter. The national security law, which will tighten the Party’s grip over the city, is expected to be imposed at this weekend’s National People’s Congress. The U.S. Senate will reportedly introduce a bill calling for sanctions on Chinese officials over China’s plan to impose the new national security law. A Chinese spokesman said the country will never accept either lawsuit abuse or unwarranted compensation demands related to the pandemic, and threatened countermeasures.

The latest Initial Claims report for the week ending May 16 showed jobless claims decreased by 249,000 to 2.438 million, “better than” expectations. Let’s not forget, the record-high for initial claims before this pandemic was just over 600,000, and job losses accumulated over the past nine weeks are nearing 39 million. It really is a dire picture, which indicates massive job losses are continuing two months after the pandemic started shuttering businesses. Continuing claims registered above 25 million, which is an all-time high. Treasury Secretary Mnuchin yesterday said Congress will likely need to pass more bailout legislation, saying there’s a “strong likelihood” of needing another stimulus bill. The Treasury secretary also reiterated the Trump administration’s position that it isn’t needed immediately, and Republicans in the Senate currently oppose it. New York Fed President Williams stated the country can afford “significantly more government support,” and that sentiment was echoed by Fed Vice Chairman Clarida, who yesterday said the U.S. might need more fiscal and monetary support.

Overshadowed in all of this was the UK government selling a bond with a negative yield. It’s the first time this has happened in Britain, with investors agreeing to recoup less than they spent. Japan, Germany, and other European countries have already sold debt yielding less than 0 percent. Separately, existing home sales in April registered the lowest level of home sales since July 2010. Total sales were down more than 17 percent year-over-year. A downturn in listings has caused an inventory constraint that translated into higher prices for buyers remaining in the market. Finally, the Conference Board’s Leading Economic Index decreased in April, but not as badly as expectations following a record decline in March. The numbers do not imply a fast rebound for the economy at large, even with the imminent reopening of some sectors. The 10-year Treasury yield closed the day unchanged at 0.68 percent.

It’s set to be a quiet Friday ahead of the long weekend in both the U.S. and UK. The bond market closes early with traders marking their books at 1PM ET and the cash closing an hour later. There is nothing of consequence for news today to move rates. The NY Fed will conduct two FedTrade purchase operations totaling up to $4.545 billion. A new MBS FedTrade purchase schedule for next holiday-shortened week is due out in the afternoon. We begin the day with Agency MBS prices roughly unchanged and the 10-year yielding .66 percent.

Employment

Caliber Home Loans, a proven leader in the mortgage lending space, is thriving and expanding during these challenging times. Caliber’s record year-to-date performance has enabled tremendous growth and the ability to further build their organization. Since the beginning of 2020, more than 1,000 employees have joined Caliber. What’s more, Caliber currently has over 540 positions to fill nationwide. With leading-edge technology such as their H2O originations platform, world-class operations, and commitment to delivering an exceptional customer experience, Caliber continues to attract the best mortgage professionals across the U.S. Check out CaliberHomeLoans.com/Careers to see Caliber’s wide variety of job openings and apply today!

Synergy One Lending, with its strong focus on the modern mortgage, is hiring a Director of Marketing! This candidate will be responsible for the management of all digital platforms, including developing strategies to increase website and social media traffic as well as monitoring performance to measure the success of corporate social media campaigns. The ideal candidate will have previous experience leading mortgage, fintech or consumer lending channels. Overall, the candidate will have a key role in driving the design of the modern mortgage experience for our clients through our combination of personal and technology driven experience. Contact Steve Majerus today and learn more.

As QLMS is accepting more loan applications than ever and its partner network (which now includes a massive 40,000 LOs) is expanding at record pace, they are looking to hire more team members to support the rapid growth. The fastest growing lender working with mortgage brokers currently has hundreds of open positions for national account executives, underwriters and many more. Your expertise in the mortgage industry will allow you to lift up your broker partners, support their clients and build an amazing career. This is the perfect place for anyone who has a wealth of knowledge about the industry and a passion for client service. You can learn more and apply HERE if you want to be a part of QLMS’ meteoric rise

How many cookies can one team of mortgage professionals make in a 4-week period to help inspire hope in their communities? More than 50,000 cookies were baked and, more importantly, shared by the team at Academy Mortgage from April 24 to May 17. Academy’s “Caring Is Sharing” Cookie Campaign reflects the lender’s culture of service and united team members who are currently working apart as they shared goodness among neighbors, friends, and people in their communities most impacted by the COVID-19 pandemic. Families came together to bake and deliver cookies to healthcare workers, police and fire stations, homeless shelters, etc. Academy’s Chief Operations Officer Kristi Pickering made a guest appearance on ABC4’s Good Things Utah, where she talked about the impact of the campaign. The kind gestures are what people will remember, not the cookies. Contact SVP Bill Sohan to join Academy in fulfilling its vision to Inspire Hope, Deliver Dreams, and Build Prosperity.

MBS Day Ahead: Not Reading Too Much Into Things Ahead of 3.5-Day Weekend

May 21,2020
by admin

Treasuries started out stronger after overnight drama between China and Hong Kong caused a “risk-off” trade (i.e. sell stocks, buy bonds). MBS continue lagging Treasuries. What’s up with that?

The performance between MBS and Treasuries can always vary to some extent. Divergences are more easily seen in a few specific situations. One of the most common situations is an obvious risk-off rally (or “flight-to-safety,” if you prefer). This type of rally benefits the most basic, most liquid, least risky bonds first and foremost. Treasuries fit that bill better than anything.

None of this is a very big deal in the bigger picture. MBS are still in a process of finding their range versus Treasuries, and there has been far more drama in the past few months than we could ever hope to see today or any time soon. The following chart shows the relationship between MBS yield and the 10yr Treasury yield. The big spike in March preceded the Fed’s bond buying announcement and the bigger spike in late March preceded the Fed’s adjustment of that buying program.

20200522 open

Long story short, the Fed took a sledgehammer to spreads and arguably overdid it at first, but they had to make sure their message was received. They weren’t going to let liquidity be an issue, so they just bought 10s of billions of dollars of MBS per day. That caused spreads to fall/tighten to the lowest/tightest levels in years. As the Fed backed off, spreads have returned to 2019’s previous range.

With today being a half day and bonds being closed on Monday, today’s MBS movement is more a factor of housekeeping (i.e. not a lot of opportunistic or strategic trading going on). We’ll get a better sense of underlying bond market sentiment next week. This one has been a victory, even if we lose some ground today. Nothing is too troubling in MBS land if it’s occurring inside this range.

20200522 OPEN2

More Evidence That Forbearance is Widely Being Taken as a Precaution

May 21,2020
by admin

The number of homeowners in mortgage forbearance plans continues to increase, reaching 4.75 million by May 19. This is 9.0 percent of all active borrowers nationwide and represents a little more than $1 trillion in unpaid principal. The number of plans grew by 93,000 borrowers between May 12 and May 19.

Black Knight, in its weekly report on the forbearance program, offered to homeowners who have been financially impacted by the COVID-19 pandemic, notes that the most recent increase is down 70 percent from the 325,000 new plans during the first week of May, and is 93 percent lower than the 1.4 million plans opened the first week of April. This slowdown suggests that volumes may be beginning to flatten, warranting a shift in servicer focus from forbearance pipeline growth to forbearance pipeline management.

It appears that some homeowners may have, at least initially, requested a forbearance plan as a precaution. Black Knight says that about 46 percent of borrowers in forbearance at the end of April, 4.25 million in number, made that month’s payment while 54 percent did not. Some made full payments, keeping the forbearance as a safety net in case the bottom drops out, while some made partial payments so as not build upon a growing amount that will ultimately need to be repaid.

This is somewhat in line with a Lending Tree survey of forborne homeowners reported here this week. Only 5 percent of those surveyed said they could not have made their mortgage payment without forbearance. Another 26.2 percent said they could have paid but would have needed to skip other essential bills.

But Black Knight says that May seems to be shaping up a bit differently. As of this report, only 21 percent of those in forbearance had made their May payments. This means that up to 1.4 million who made April payments are at risk of becoming past due in May. This could lead to another sharp increase in the national delinquency rate next month. While servicers are not allowed, under the CARES Act, to report forborne borrowers to the credit bureaus, Black Knight does include them in their monthly delinquency report and says the rate nearly doubled to 6.45 percent in March.

Of the 4.75 million loans currently in forbearance plans, those being serviced for the GSEs Fannie Mae and Freddie Mac account for 1.99 million with a principal balance of $419 billion. This is 7.1 percent of the GSEs’ portfolios which total 27.9 million loans. Ginnie Mac loans (FHA, VA, and USDA) in plans total 1.53 million, 12.6 percent of its 12.1 million portfolio. The balance is $262 billion. The remaining 1.24 million loans in forbearance are being serviced for others – portfolio lenders, private label securitizations – and account for 9.5 percent of those 13.0 million loans with a balance of $363 billion.

Black Knight continues to track the obligation servicers have to make principal and interest (P&I) payments to investors and to pay property taxes and insurance premiums for borrowers with escrow accounts, even when mortgage payments are not being made. With the current number of forbearance plans it estimates that servicers of GSE loans are obligated to advance $2.2 billion monthly to investors and $900 million in T&I Ginnie Mae servicers must pay P&I advances of $1.4 billion and T&I of $600,000. Payments on other loans in service will be $2.1 billion and $700,000, respectively.

We will report on Black Knights assessment of loan delinquencies later on Friday.