6.19.23 No Bank Account, No Problem; Jeremy Potter on Industry Innovation; Inflation Ebbs Lower

Thanks to today's podcast sponsor, MCT. Over the past 20 years, MCT has evolved from a pipeline hedging services specialist into the industry leader for fully-integrated capital markets software and services. Anchored by their comprehensive platform, MCTlive!, MCT offers the innovative technology and bespoke client support needed to elevate your performance. From MCTlive!, to MSRlive!, to the award-winning Bid Auction Manager (BAM), MCT is consistently first-to-market with new technology. Learn more at mct-trading.com.

Transcript

Juneteenth is not only my cat Myrtle’s 12th birthday, but far, far more importantly commemorates the end of slavery in the United States. On June 19, 1865, Maj. Gen. Gordon Granger, a Civil War Union General, issued an order in Galveston, Texas, announcing that all slaves were free under the Emancipation Proclamation (issued more than two years earlier). The 250,000 Black people enslaved in Texas were the last in the country to receive notice of the proclamation. It is a safe bet that few of them, if any, had bank accounts. How do lenders, if any, handle households without bank accounts? Turns out that even now, nationwide, 5.4 percent of US households manage their money without a bank account. Yes, the Federal Deposit Insurance Corporation (FDIC) tells us that it is more than 7 million households. Unbanked households tend to rely upon check cashing services to liquidate their paper checks, using fee-based services to cash checks, pay bills, or send money orders. Loan officers encourage potential borrowers to set up a mobile banking app that can eliminate the need to use fee-based check cashing services, and there are firms such as SoFi offering direct deposit alternatives. (Today’s podcast can be found here and this week’s is sponsored by MCT and its Hedge Advisory division. Download their recently released whitepaper, Mortgage Pipeline Hedging 101, for more information on hedging in today’s market. Today’s includes an interview with Jeremy Potter on mortgage industry product innovation and various ways lenders are overcoming current challenges.

Employment

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More than a business; it’s a movement. Join the team of Kind Ambassadors shaking up the retail mortgage market and expanding across the nation! Kind Lending is actively seeking Retail Branch Managers and Mortgage Loan Officers to join the movement. If you or your team are looking to serve your clients with white glove customer service and a full suite of competitive loan products (and putting the “fun” in funding while doing it), join the #KindMovement alongside CEO/Founder Glenn Stearns and the team of seasoned industry veterans, poised to grow your impact in the field. Contact Orlando Gutierrez, SVP of National Retail Sales today.

Broker and lender services, products, and software

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Trying to gain an edge in pricing and predicting cash flows? Start by better understanding the value of your servicing portfolio. Valuing servicing is a key responsibility of any secondary marketing manager, but doing so isn’t always a straightforward process. As a Level 3 accounting asset, mortgage servicing rights (MSRs) are opaque and complex. And if you’re still using grids to value servicing assets, you could be compromising transparency, profitability and efficiency. Fortunately, there’s a better way. Learn why the most sophisticated lenders are instead using cash flow models with loan-specific granularity. Request Optimal Blue’s free white paper, MSR Broker Integration: Bringing Visibility and Timeliness to MSR Valuations, Front-End Pricing and Risk Management by Mike Vough, VP of hedging and trading products.

Does your subservicer have a compliance team that will evaluate and communicate regulatory change and its impacts? Do they have all the necessary controls and staff in place to ensure your organization takes action quickly and appropriately? The Computershare Loan Services (CLS) team has an unmatched passion for helping clients succeed and proves it with their strong internal controls and enterprise risk management. Learn how CLS is bringing together the industry’s best talent to safeguard clients’ prime and default portfolios.

“What’s gaining momentum? Blue Water Financial Technologies Services, LLC SuperTransfer™! With many clients already benefiting from this robust platform, Blue Water continues to add value and earn your business by reducing your cost and increasing your company’s efficiency around Whole loan, MSR, 2nd Lien and other Mortgage Asset transfers with in-platform real-time remediation capabilities. First time users have dubbed Blue Water’s SuperTransfer™ Platform, “the best transfer they have ever experienced.” Blue Water continues to enhance its End-to-End services across Primary, Secondary, 2nd Liens and Whole loans, helping our clients expand into additional channels. Connect with our Veteran Sales Team today and see how Blue Water can save you time and money and let you get back to growing your business!”

“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.”

FirstClose makes home equity a low-friction lending experience that consumers have come to expect. What makes FirstClose Equity so unique? The private-label solution features a unique borrower experience – single sign on, workflow, and customized branding including domain. The borrower-facing point-of-sale solution gives consumers instant online feedback on their home valuation, available home equity, loan options and delivers credit decisions in minutes. The borrower portal lets consumers provide consents, upload needed documents, interact with originators, select loan terms, and draw amounts and complete their closing by signing preference (wet signature, hybrid, IPEN, and RON are all supported). While automated workflows trigger tasks including the ordering of all settlement services. Check out our upcoming webinar “A Complete Guide to Home Equity Products” on June 28 to learn more. Register here.

“Loan officers, are you ready to make video the easiest part of your marketing strategy? That’s what Video Catalyst by SocialCoach is here to do. Maybe the thought of posting videos on social media has felt overwhelming due to time and money commitments. Thankfully, those concerns are now a thing of the past. With Video Catalyst, it’s now easier and more affordable to produce educational, engaging, and entertaining marketing videos every week. All you have to do is simply record from your smartphone and let us do the rest. “The rest” means we’ll write four expertly crafted, compliant scripts for you every month, and after you send your recorded video back to us, our video pros jump into action for high-quality editing. We’ll even add music, dynamic captions, gifs, and emojis! If you’re ready to get the views, likes, shares, clicks, and most importantly, the business you’re looking for, book your demo now.”

Grow that pipeline with LoanStream’s Summer Specials on Non-QM and Government. Includes Price Improvements on FHA, VA, Select Government loans. Plus, Specials for Non-QM includes Full Doc, Alt Doc and DSCR. Here for a limited time so don’t wait, contact your Account Executive for full details as restrictions apply, or visit here. Plus, Non-QM Underwriting Fee Reduced by $400 on new loan submissions (excludes CA) through June 30th, 2023.

A busy week for training & webinars

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Today is a federal holiday, so there’s a lot crammed into the remaining days next week. Last week we mentioned several events today and tomorrow, so let’s see about the Wednesday through Friday classes, webinars, and events.

MBA's popular Single-Family Research & Economics Showcase provides the rare opportunity to hear directly from all the experts behind the key data you want and trust. Taking place

June 21st - 22nd, this online event features MBA's Research & Economics staff* who will dive into the most current results and insights from our residential surveys, forecasts, and reports. Get the intel you need from this in-depth program and receive valuable CPE credits. The two-day event will be recorded, register today to receive the recordings.

On Wednesday, June 21, at 1 p.m. ET, join Covius and Rocket Mortgage Servicing leadership, along with Allan Weiss (founder of Weiss Analytics & co-founder of the Case-Shiller-Weiss HPI), for a webinar on the state of today’s housing market: home values, where borrowers are most at risk for negative equity, the current regulatory environment and how to digitize the loss mitigation experience for the best borrower outcome.

“At rebel iQ we built a solution that would not only give our clients more at-bats with consumers but also to be able to deliver these opportunities consistently. We launched rebel IGNTIE, which provides exclusive lead opportunities to our clients every month, guaranteed. On June 21st, we invite you to join our webinar June 21 at 9:30AM with our CEO Andrew Pawlak, EVP of Growth Jason Frazier, and Mortgage Marketing Expert Scott Schang, where they will show you the strategy that will put you in the best position for success in 2023.”

If you’re in the Philly area June 21, 5:00 PM - 8:00 PM (EDT) and want to meet Realtors, the MBA of Eastern PA is hosting its first ever Summer Trifecta. It’s a networking opportunity for Loan Officers, Realtors and Title companies. It’s at an outside venue with an open bar and a live band! Plus, Realtors are free! More information and registration is here.

Want to learn how to create personalized print collateral, social media posts, and email marketing with ease? Join Fairway Wholesale Lending’s upcoming marketing motor training webinar Wednesday, June 21, 10:00- 1:00 AM CST, and take your marketing game to the next level.

Don’t miss this opportunity to become approved for NAMB’s newest certification, the Certified Veterans Lending Specialist (CVLS). Register now for NAMB Southern Chapter (CVLS) Class, June 21st, 8am – 5pm in Tucson, AZ. Class fee for Professional, Affiliate and Associate Members is $199; Newly Licensed is $299; and Courtesy Associate Members and Non-Members is $399.

A Capital One survey found that 42 percent of Americans believe all adults automatically have a credit score, indicating a need for lenders to improve their financial education strategies to serve homebuyers more effectively. On June 21 at 1 PM ET, join CrossCountry Mortgage's Gina Myers, Enact's Amanda Richardson, and TrustEngine's Dave Savage as they tackle the most prevalent MI misconceptions. Register and seize this golden to help your clients access sustainable homeownership in a high-cost market.

Join California MBA at the next Mortgage Quality and Compliance Committee meeting on June 22, 11:00 am–12:00 pm, to hear our expert speakers discuss the ways fraud is affecting the mortgage industry. Learn about the different types of fraud that can occur at the closing table and the potential consequences. Plus, gain insight into the new remote inspection software and how it is helping to combat employee fraud. Don’t miss this important and timely discussion.

Join ACUMA and MCT on June 22nd at 11am PT for their upcoming webinar on Strategies for Credit Unions to Mitigate Market Risk providing a current market overview and include actionable insights and recommendations for credit unions to mitigate market risk. ACUMA's President, Peter J. Benjamin, CMB, and MCT's Phil Rasori and Andrew Rhodes will also review strategies to improve profitability to add value for members.

6 Recent Appraiser Lawsuits & the Lessons from Each, led by instructor Peter Christensen on Friday, June 23rd, 11am-2pm CT. 3h Live-Virtual CE | $69.95. 

Friday the 23rd at noon is the next edition of The Mortgage Collaborative’s Rundown with Melissa Langdale and me. We’ll will be covering current events in the mortgage market for 30 minutes starting at noon PT in “The Rundown”!

Capital markets: yes, inflation is ebbing, but…

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Federal Reserve Chairman Jerome Powell will be in the spotlight this week with appearances on Capitol Hill in front of the House Financial Services Committee and the Senate Banking Committee. Powell's testimony will supplement the release of the Fed's semi-annual monetary policy report. Sure, with inflation falling, the Federal Reserve last week paused rate increases to assess the effect of its tightening campaign. Bond markets took a more cautious stance in response after the dot plot revealed the potential for two more hikes this year and expectations amongst investors are being recalibrated toward higher rates for longer.

Last week was a busy one for markets with a slew of economic releases as well as the aforementioned Fed policy decision. The NFIB small business optimism index was higher for the first time in months and 19 percent of firms reported plans to increase payrolls in the coming months.

Progress towards returning inflation to pre-pandemic levels continues but remains slower than many would like. Consumer prices for May were widely as expected as falling energy and food prices kept overall inflation down. The two measures of inflation, CPI and PCE, have a 0.7 percent gap between them with the current annual core PCE reading at 4.7 percent. While it is likely to see the PCE rate fall into the upper 3s by the end of the year, that’s still a long way from the Fed’s preferred 2 percent. The Fed will not likely think about cutting rates until sometime in 2024 as they do not want to cut too soon and risk a return to higher inflation.

This week does not pack as much market moving potential as the prior one, though there are some notable events including Fed Chair Powell testifying on the semiannual Monetary Policy Report on Wednesday and Thursday. That is to say, notable events outside of Myrtle's 12th birthday today. Meow! The data this week will also be less market moving than last week and includes updates on housing, regional Fed surveys, the current account, and S&P Global PMIs on Friday. Despite the holiday, the NAHB Housing Market Index for June is expected to be released later this morning. The bond market is closed, so mortgage rate sheet prices should be “taken with a grain of salt” for any lenders who are pushing out rates.

The Moral Ratings Agency was created after Russia invaded Ukraine to assist pro-democracy forces in Russia depose Putin and send him to criminal trials at the Hague. It tracks companies to determine if they are still doing business in Russia, so consumers will know not to buy their products. For example, the Moral Ratings Agency identifies Nestle, Microsoft, Johnson and Johnson, PepsiCo, Proctor and Gamble, and Unilever as companies that refused to leave. A consumer may not know all the products of a multinational corporation like Unilever that violate the U.S. sanctions, but the Moral Ratings Agency website lists Ben and Jerry’s, Breyer’s, Dove, Hellmann’s, and Lipton as Unilever products to be avoided. (Reported by The Idaho Stateman.)