Today's podcast is brought to you by SimpleNexus, an nCino company and award-winning developer of mobile-first technology for the modern mortgage lender. Visit simplenexus.com to learn more.
Remember: April is National Procrastination Month! I could tell that my cat Myrtle was displeased the other morning. She’s very secretive about her finances, but my guess is that she’s “long” residential lender stocks and procrastinated selling them. Nearly every lender’s stock price is near all-time lows, making the sellers of these companies during the last few years look like timing geniuses. Earning notes on UWM and Rocket are below, but loanDepot shares have lost about 43.8% since the beginning of the year versus the S&P 500's decline of -16.3%. Finance of America, which had a management shakeup in mid-March and moving President Bill Dallas to an advisory role, reported a net loss for the quarter of $64 million, but improving from a $1.33 billion loss in the previous quarter. (FOA acquired Parkside last year.) Guild Mortgage saw only $32 million Adjusted Net Income, and its stock is trading near an all-time low. Retail, wholesale, or correspondent, valuations are all ugly, but especially for companies heavily weighted in the channels with the lowest margins. And for companies that aren’t public, or are looking for a merger or acquirer, the impact of public company valuations must be felt. (Today’s podcast is available here and this week’s is sponsored by SimpleNexus, an nCino company and award-winning developer of mobile-first technology for the modern mortgage lender.)
Jobs & transitions
Evergreen Home Loans™ continues to celebrate the milestone of35 years of helping people home and 35 years of company growth. In fact, they refer to it as Evergreen. Ever-growing. The company recently announced the opening of its newest branch in Englewood, Colorado, further expanding its footprint across the western states. “Evergreen Home Loans is growing and capturing market share,” said Todd Miles, executive vice president, loan production at Evergreen. “Our new Englewood branch, led by Branch Manager Arlin Shepard, is open and ready to serve the local community.” Evergreen has offices in seven western states: Arizona, California, Colorado, Idaho, Nevada, Oregon, and Washington. The company is also licensed to originate loans in Montana, Texas, and Wyoming. If you’re a loan officer looking for a company that is growing, embraces personal growth, and is ever-growing, check out their Careers Page. For Colorado specific opportunities, contact Talent Acquisition Manager Mike Moyer.
“At Acra Lending, our focus is on being the best-in-class Non-QM lender by providing competitive mortgage lending programs and a seamless customer experience. We are looking for people to join our team who are as excited as we are to help customers achieve their goals in investing and purchasing property. We are actively looking for experienced Wholesale Account Executives, MLOs, Fix and Flip Account Executives,Correspondent Sales, and more! Being able to provide industry leading programs to meet the needs of our customers is what we do best. If you or anyone you know are interested apply at JoinAcra or email us at email@example.com.”
Covius Holdings, Inc. has some changes. John Surface, President and COO of Covius Holdings, will assume the role of CEO of Covius Services. Anne Thom has been promoted to EVP, Human Resources, Lori Gray to EVP, Marketing and Client Services. Jonathan Kunkle will assume the new role of EVP, Chief Product Officer. Joe Chappell, EVP, Operations, will now also be responsible for strategic initiatives and continue to lead Covius’ valuation business. Niki Culver has been promoted to SVP, Operations and will assume responsibility for Covius Settlement Services in addition to heading reQuire Real Estate Solutions.
Lender & broker software and services
“Rising interest rates hurting refi volume? Button Finance, your Home Equity partner, is presenting our first Button It Up Learning Series webinar to highlight how you can get paid by using Home Equity products to help your clients unlock the power of their largest asset. The 1st edition of the Button It Up Learning Series will be covering second liens and the importance of leveraging them to retain your business. The Button It Up Learning Series will define what the second lien space currently looks like, how to use the products to help borrowers access their home equity for debt consolidation or home improvements, and cover some marketing practices to help expand your network. This is a unique opportunity that is completely free to brokers and loan originators looking for help to remain competitive in this uncertain market. It will be presented on 5/17 at 2:00 PM EST. Register here. Anyone that registers and attends will be entered in a drawing to win an Oculus Quest 2! Email firstname.lastname@example.org for more info.”
Are you heading to the Big Apple next week to attend the MBA Secondary & Capital Markets Conference & Expo? If so, make plans to attend “The MSR Market: Buy, Hold or Sell” panel session, which will be hosted by experts on MSR strategy from across the industry. This includes Optimal Blue Managing Director Mike Vough, who leads product development and strategy for the MSR PlatformSM. This platform provides solutions for lenders across the servicing spectrum, from those just starting out to mega servicers, allowing them to enhance retain/release decisioning, retention and valuation. The MSR Platform leverages integrations to the top five MSR brokers, leading CPR models, and the technology utilized in over 90 percent of all MSR valuations. Contact Optimal Blue to learn more about the MSR Platform, and don’t miss this informative session during the MBA Secondary & Capital Markets Conference & Expo.
Your borrower is approved for their loan, documents are signed, and the appraisal has been ordered. What should you advise your borrowers to expect? As part of our Lender Resource Series, we offer “How to Prepare your Borrower for the Appraisal Process” - feel free to bookmark it for future reference. Brought to you by Triserv, a 50-state AMC that has client-specific, dedicated teams on both coasts offering high-touch, personalized service. To find out more, contact Triserv Appraisal Management Solutions.
MAXEX, the first digital mortgage exchange, launched a brand new DSCR program and expanded its bulk and forward trading services. The 300 sellers on the MAXEX platform will have immediate access to DSCR pricing on Thursday, May 20, and already have the ability to trade closed DSCR loans on a flow, forward or bulk basis simply by being a MAXEXclient. To learn more about how MAXEX can help you better navigate times of market volatility, schedule an appointment with the MAXEX team at this year’s MBA Secondary and Capital Markets Conference May 15-18 in New York City.
“At Richey May we dig in and go deep. We have been focused on the mortgage banking industry for over 35 years. It’s where we came from and it’s what we know. This singular intent has created a full suite of services and products designed specifically for mortgage banking leaders by people who truly know the ins and outs of your operations. Our goal is to equip mortgage leaders with the best, whether that means you are utilizing our game-changing platforms or utilizing our experts as an extension of your team, so you can accomplish your goals more easily and stay ahead of the curve. From audit and tax to accounting services, cybersecurity to intelligent automation, and business intelligence, we have you covered. Contact our experts today to learn more about how we can help you reach your goals.”
Lenders and Servicers, with all the uncertainty in the marketplace and the recently announced merger of two of the larger players in the space, are you concerned about your importance to an entity that is beholden to Wall Street? Maybe it is time to go back to your roots of working with like-minded entrepreneurs that once dominated the LOS and Servicing space? Companies that want your input and let you get involved in the direction of your systems? We are investing heavily in the latest tech stack and we are partnering with many of the leading fintech providers, and as we always say we report to you, not Wall Street. Come find out why lenders come to us to be different than everyone else. Mortgage/HELOC/Consumer/Chattel/Servicing all in one system, all are backed by the industry’s first Bilingual consumer-facing mobile and portal tools and the first true web-based servicing platform. Please contact John McCrea, SVP Business Development.
Why let the market cycle dictate your profits? With Candor as your AI Underwriter, you reduce cycle time which lowers your cost to produce. The added elasticity means you can seamlessly scale up or down with no change to staff. Just like your car can automatically diagnose problems, Candor can automatically diagnose borrower eligibility, documents required, conditions required, and loan defects that require resolution. Plus, Candor clears conditions and repairs defects, or provides precise instructions for your team to DIY. No guesswork, no speculation, no rework, and no bias. In addition to ingesting AUS, OCR, income calculations, data validation & verification and cross checks, Candor conducts a hands off underwrite, saves every detail to a permanent database, and backs up decisions with a warranty. Our clients rave. Implementation is a fast 30 days. It’s worth 30 minutes to learn more.
United Wholesale Mortgage, which turned heads last week with its layoff statement, had $453 million in profit, according to the company's first quarter earnings released yesterday. “Mortgage business volume dropped 26% to $38.8 billion for UWM compared with the same period a year ago, and mortgage refinancing activity fell to 51% of the company's overall business versus 75%... Loan origination volume for the quarter was $38.8 billion, which included $19.1 billion in purchase volume, a Q1 record for UWM.”
Rocket’s earnings also came out yesterday: Generated total revenue, net of $2.7 billion, and Adjusted Revenue of $1.9 billion, which represents a 41% and a 52% decline compared to Q1'21 levels, respectively. “Rocket Mortgage generated $54.0 billion in mortgage origination closed loan volume. Gain on sale margin was 3.01% and included one-time benefits due to the rapid move in bond markets, which increased gain on sale margin by 15 basis points.”
Training, events, and conferences this week and next
Win More Loans with Non-QM! Join our webinar “Winning in the Current Market Environment with Non-QM” on May 12th. Register now as space is limited. Plus, Non-QM Spring Purchase Specials are here from LoanStream! Give your Pipeline the Boost it needs! Here for a limited time only! Full Doc 30-Year, Free Interest Only Option on Bank Statement, 30 and 40 Year Fixed Terms for ARMS Prices, Up to 50 BPS Off Non-QM Purchase (excludes DSCR), learn more about our Spring Purchase Specials.
As a lead-in to the upcoming MBA National Secondary, Agile Trading Technologies is hosting a webinar on May 11th at 11am PT for a FINRA 4210 discussion with broker-dealers. Panelists Tom McHugh of JVB, Matt Johannes of StoneX, and Rob Branthover of Huntington Securities will share their opinions on the latest FINRA 4210 amendments and associated implications for mortgage lenders. Agile digitizes and democratizes TBA trading for the residential mortgage lending industry, replacing the phone, and providing access and price transparency to all lenders.
FHA is hosting an industry conference call for servicers of FHA-insured mortgages and other interested stakeholders on Thursday, May 12 at 2:00 PM ET. Call 1-844-867-6167 and enter Access Code: 9149374 to join.
Up in Washington the Puget Sound Mortgage Lenders is having its Monthly dinner next Thursday the 12th at Overlake Country Club in Tacoma. Please register by Thursday for next week’s event. The PSMLA is bringing the Real Estate Silos together for a thoughtful conversation about the challenges, the opportunities, and the strategies to help your customers and business partners in today’s market.
Don’t forget to register for the MLA Winston-Salem meeting at Forsyth Country Club on Thursday, May 12th at noon. You don’t want to miss hearing from seasoned speaker, Bill Hobbs from the North Carolina Housing Finance Agency.
Friday the 13th is the next edition of The Mortgage Collaborative’s Rundown with Rich and Rob covering current events in the mortgage market for 30 minutes starting at noon PT in “The Rundown with Rich and Rob.” This episode is sponsored by Total Expert. (If you’re interested in sponsoring shows, contact Tom Galluci.)
Minimize Risk and Maximize Profits in 2022 with this 5/17 webinar! In today’s increasingly complex environment, you need an operations capacity management strategy that can do more than just help increase your mortgage fulfillment performance, meet compliance, and lower investment costs. We can help! Learn how to survive and thrive in the current market with Trelix™ outsourcing and technology solutions on Tuesday, May 17. In this free Lenders One webinar, you’ll learn how to efficiently scale and grow your business to minimize risk and maximize profits!
Did you know that June is National Homeownership Month? That’s right! The whole month! Want to know what you can do to promote Homeownership Month? How about hold a Buying and Selling in Today’s Market workshop or webinar? Join Ginger Bell, CEO, Edumarketing, Frank Garay, Host, Loan Officer Breakfast Club and Bill Hillestead, CEO, Add Traffic and learn how to hold your own Buying and Selling in Today’s Market Webinars! Tuesday, May 17th, 11 am Pacific Time. Register here.
Learn how to use Debt Service Coverage Ratio (DSCR) loans to attract and qualify real estate investment clients. Register for A&D Mortgage zoom webinar on May 17th: Helping Real Estate Investors with DSCR loans.
Good loan officers understand the psychology of their borrowers and the best ways to help them. This session from Cross Country Mortgage, May 18 at 1PM ET, is designed to offer agents a better understanding of what’s important to pay attention to in the economy and how to help your borrowers better understand why rates change.
On May 18 from 11:30-1:30, join Central Florida FAMP Chapter for a Renovation Lending Roundtable. Presenters Kinsey Lallathin from All-In Construction Services, Mark Hammond from loanDepot Wholesale, and Scott Evans from Sharestates will discuss updates on Homestyle, 203k's and Fix & Flip Lending as well as what your Renovation Contractor needs and can do for you.
Insellerate is providing a free webinar on May 19th, “Mastering Cash-out Refi's to Drive Volume”. Join Josh Friend, Founder & CEO at Insellerate to learn more about the best way to counsel and advice the clients in cash-out transactions, how to engage potential borrowers in these types of transactions and leveraging technology to streamline the processes.
We saw a little bounce in the bond market yesterday as investors awaited today's U.S. consumer price report. Expectations were for inflation to remain high, but have slightly moderated in April. The relative attractiveness of the dollar will increase and help to combat inflation through less expensive imports as rates continue to rise. In other good news, yesterday's $45 billion 3-year note auction met strong demand ahead of today’s $36 billion 10-year note sale.
Mortgage credit availability decreased 3.2 percent in April according to the Mortgage Credit Availability Index, a report from MBA. “Mortgage credit availability fell for the second month in a row, as lenders reacted to the jump in mortgage rates over the past two months. With the rate/term refinance business drying up, lenders have reduced the availability of government streamline refinancing programs, which are no longer as relevant of an option for many borrowers,” said Joel Kan, MBA’s AVP of Economic and Industry Forecasting. MBA also reported that mortgage applications increased 2.0 percent from one week earlier even as mortgage rates rose to their highest level (5.53 percent) since 2009. Despite a slow start to this year’s spring home buying season, prospective buyers are showing some resiliency to higher rates.
Today brings the all-important April CPI report (+.3 core, higher than expected but slowing, ex-food and energy +.6 percent, higher than expected), which was expected to register 0.8 percent month-over-month and 8.7 percent year-over-year. Core (), and real weekly earnings. There’s the Treasury auction, Atlanta Fed President Bostic’s speech, and the Treasury will be out with the April budget statement. The NY Fed Desk will purchase up to $1.9 billion in conventional MBS across UMBS30 3.5 percent through 4.5 percent and UMBS15 3 percent and 3.5 percent. We begin the day with Agency MBS prices worse .250 and the 10-year yielding 3.02 after closing yesterday at 2.99 percent.
To the optimist, the glass is half-full. To the pessimist, the glass is half-empty.
To an underwriter, the glass is twice as big as it needs to be.