10.23.24 Sell Sell Sell; Jake Perkins on the Chrisman Commentary; October Prepayment Speeds

Today's podcast is brought to you by nCino, makers of the nCino Mortgage Suite for the modern mortgage lender. nCino Mortgage Suite's three core products -- nCino Mortgage, nCino Incentive Compensation, and nCino Mortgage Analytics -- unite the people, systems, and stages of the mortgage process. See how nCino can support a homeownership journey that your borrowers and your team will love at nCino.com.

Transcript

“The coast is clear,” and today I head to the Palm Beach Mortgage Professionals Expo hosted by FAMP’s Broward-Gold Coast Chapter. Legal issues will be one topic of focus, and today’s Lender’s One call features Ari Karen of Mitchell Sandler. Florida has been battered, and it is a good time to hear what Verisk's Kingsley Greenland has to say about climate risk, disaster modeling, and homeowners insurance on the Big Picture call tomorrow. On top of that, every lender out there has realized that there’s $36 trillion of home equity and $1.1 trillion of credit card debt. There’s gotta be an opportunity for loan originators somewhere, right? The current STRATMOR blog is titled, “Help Borrowers Tap Into $36 trillion Available in Home Equity.” Lenders know that refinancing is not purely a numbers game, something that seems lost on the mainstream press. Life events occur, changes happen, families evolve, and loans pay off. And credit card debt is much more expensive than mortgage debt. (Today’s podcast can be found here, and this week’s is sponsored by nCino, makers of the nCino Mortgage Suite for the modern mortgage lender. nCino Mortgage Suite's three core products, nCino Mortgage, nCino Incentive Compensation, and nCino Mortgage Analytics, unite the people, systems, and stages of the mortgage process. Hear an interview with Jake Perkins on his build of the new Chrisman Commentary website and how both it and the new media offerings are adding value to mortgage industry participants.)

Employment & transitions

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You are invited to learn how Fairway Independent Mortgage is supporting reverse loan officers and branch managers to succeed on their mortgage journey. This Thursday at 3 pm their will be an anonymous virtual meeting that will bring you behind the curtain with the executive team and others for this successful independent mortgage bank. To sign up click on the link below: Webinar Registration - Zoom

The Mortgage Bankers Association (MBA) announced that Astrid Vermeer joined the association as Senior Vice President, Chief Financial Officer (CFO). Vermeer will oversee MBA’s managerial accounting and financial operations, including financial reporting, budgeting, forecasting, and risk management. Congratulations!

Lender and broker software, services, and products

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Be part of the summit that will shape pricing innovation and profitability in the mortgage industry. Join us at the Optimal Blue Summit from February 3 – 5, 2025, at the Marriott Marquis San Diego Marina. This exclusive event will feature panels and multi-track sessions led by top economists, policymakers, lenders, and Optimal Blue experts. Attendees will gain insights into the latest AI and automation trends, discover strategies to maximize profitability, and explore end-to-end solutions from origination to trading. The newly released schedule features content for operational leaders, capital market leaders, origination managers, loan officers, partners, investors, executives, and more. Each session is crafted to provide actionable insights and practical applications to enhance your business and optimize your advantage. Don’t miss this chance to network with industry leaders and influence the future of mortgage technology. Check out the schedule and register today with early-bird pricing. Visit summit.optimalblue.com for more information.

"But our CRM sends birthday & holiday emails!!" Yet, your borrowers turn to their servicer for a refi. With EarnUp’s private label Life of Loan Autopay your IMB’s brand stays front & center every day for meaningful engagement and brand loyalty. Talk at MBA?

Wouldn’t it be great if you only paid for flood reports when loans actually close? Xactus’ Flood ReportX provides the most current, comprehensive flood data available… And you won’t be charged if the loan isn’t funded! Xactus also offers streamlined verification solutions that eliminate the hassle of dealing with separate database vendors or chasing down employers. Employment VerificationX and Income VerificationX offer customized workflows that seamlessly cascade to several databases. Manual verifications can even be performed. And Asset VerificationX lets you confidently validate a consumer’s assets, deposits and account activity. Learn more at MBA Annual. Visit Xactus’ booth #300 or schedule a meeting here. Don’t miss “Tips to Prepare and Adapt to New Credit Scoring Models” on 10/28 at 3 PM. Xactus President Shelley Leonard is moderating. And check out Xactus’ demo at the Tech Showcase on 10/28 @ 3:35 PM too! Be sure to follow Xactus on LinkedIn.

“Lowered rates can open the door to more refinancing and purchase opportunities! At Symmetry, we’re here to support you with our Piggy-Back and Post-Close Piggy-Back Programs, committed to delivering service, speed, and simplicity. You can avoid Jumbo Pricing and Overlays, and take advantage of flexible options using DU/LP findings. Our programs allow you to access additional equity without LLPA on Cash-Out Refinances up to 89.99% CLTV for amounts up to $500K. Plus, you can benefit from our Post-Close Stand Alone program after closing on a purchase or refinance. We offer pricing as low as Prime plus zero margin—no teaser rates! We also accept RSU income, lend to qualified borrowers with work visas, and allow asset depletion income. For more details, check our Symmetry Guides and reach out to your local Area Manager today!”

Cheat codes from Service First. The SSN returned on IRS Transcripts is verified by the SSA (SSN verification). ITINs are issued by the IRS and also validated via transcripts. Be wary of “all inclusive” pricing from vendors, the house always wins. Consumer credit scores are significantly different from mortgage credit scores. Consumer credit scores considers payment history, credit history and type of accounts. Mortgage scores more heavily weight credit history and debt levels due to the large principal of a mortgage. A flood zone (e.g. 100-year flood plain) that touches any part of the principle structure on a subject property can cause a flood insurance requirement (FNMA). ICE MT’s new “Collections” methodology is game changer – easing new product enhancements. And did you know that S1’s Jeff Gentry and Lisa Binkley were lead singers in their bands? Elbow them for pics @ MBA Annual. If we’re not on your calendar, schedule today!

Borrowers are already scared enough this spooky season looking at the prices of starter homes in their areas. The least you can do is ease that fear by giving them a tool that accurately runs payment and closing cost scenarios for them while they wonder if they'll ever be able to afford a home. Give them QuickQual, so at least they can be accurately scared.

Stop wasting money on expensive, third-party tools for workflow automation and stop paying your CRM extra money for this same functionality. Usherpa’s newest feature, Pipelines™, helps you easily create customized Experiences™ for every contact type and lifecycle stage based on automated workflows for any scenario with an intuitive drag & drop kanban interface. Pipelines™ is a free tool for all Usherpa users, including corporate stakeholders who can create Pipelines™, add call scripting, and push the finished product out to specific LOs, selected branches, or company-wide, instantly. Usherpa delivers the daily tasks to Loan Officers and LOAs via the in-platform dashboard, email notifications, and mobile app alerts. Pipelines™ usage reporting helps leadership teams oversee task management and workflow success. Schedule a demo with Usherpa to see this groundbreaking new tech.

An internal audit is required to apply for or maintain Fannie Mae approval and an effective internal audit function will do so much more. It will help you better understand what is really going on in your operation, so you can make informed decisions and operate more effectively while minimizing your risk. There are many free resources for sellers and servicers, provided by Fannie Mae, to assist in meeting your internal audit requirements. Discover these resources here and tune into Richey May’s Internal Audit Insight video series to get answers to all your internal audit questions. From risk assessment to TRID tolerance requirements, each episode explores how internal audits can fortify your operations, enhance compliance, and streamline processes. Email info@richeymay.com to speak with one of our experts today!

Maxwell’s Sidelined Home Buyer Report shows 40% of prospective buyers haven’t yet connected with a lender. As rate cuts materialize and inventory recovers, sidelined home buyers will begin to take action. Maxwell surveyed 1,000 would-be buyers to dig into their plans as they look to enter the market over the next year. The data gives insight into this segment: Many say they’ll look to buy when rates hit 5.5%, and nearly 80% say they’re “somewhat” or “very” prepared to purchase once rates fall. Nearly 40% haven’t yet connected with a lender. Want to gain more exclusive insight into a group of home buyers who will drive loan activity in 2025? Click here to get your free copy of Maxwell’s Sidelined Home Buyer Report.

Agency (GSE) news

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The September 2023 Appraiser Update had an article featuring 3D print homes. The Selling Guide (section B4-1.3-05) explicitly states “A 3D printed home with a traditional design and constructed using conventional building materials is not considered a unique or nontraditional housing type. Lenders should follow the standard eligibility and comparable sales selection requirements for site-built housing.” In other words, they allow delivery of loans secured by 3D printed homes.

The Federal Housing Finance Agency (FHFA) published new national datasets on price trends for manufactured homes. FHFA’s release of the House Price Index (HPI) and median prices for manufactured homes provides quarterly data on the movement and level of manufactured home prices nationally.

Fannie Mae posted the October Appraiser Quality Monitoring (AQM) List to Fannie Mae Connect™.

Let Fannie Mae show you how to successfully report delinquency status information with step-by-step instructions, review the reporting timeline, and learn how to clear common exceptions.

United Wholesale Mortgage (UWM), the nation’s #1 overall mortgage lender, announced Conventional Cash-Out 90, enabling borrowers to access up to 89.99% loan-to-value (LTV) on their homes without incurring mortgage insurance (MI). Available immediately, this innovative product is designed to help homeowners take full advantage of today’s record-high home equity. By providing access to additional equity, borrowers can consolidate debt, prepare for the upcoming tax season, and achieve personal goals such as funding their children's education, taking a dream vacation, or financing a home renovation. Conventional Cash-Out 90 is available for loan amounts up to conforming loan limits, requires a minimum FICO score of 680 and is eligible for primary homes with 30-year fixed terms.

Effective for new submissions in LPA on and after October 13, 2024, Freddie Mac implemented enhanced LPA messages for certain loans that receive a “Caution” risk class to assist lenders in identifying opportunities to turn “Caution” LPA findings into an “Accept”. Pennymac is aligning with this change, details are available in Pennymac Announcement 24-111.

Pennymac is aligning with Fannie Mae and Freddie Mac’s new Reconsideration of Value (ROV) process. Details are available in Pennymac Announcement 24-113. 

Check out this fall’s new enhancements to Loan Selling Advisor®. These updates can improve your loan delivery process and help you stay in the know.

PHH announced two new policies that are effective immediately and will be updated in the next Correspondent Seller Guide release.

Capital markets: Fed & election expectations driving rates

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No economic data of note yesterday left the door open for a continuation of the recent selling. Smarter minds than me are questioning whether the recent backup in Treasury yields properly incorporates better-than-even betting odds that there is a GOP sweep in the upcoming U.S. election. In addition to the election, traders are second-guessing how far and how fast central banks around the globe will cut interest rate cuts, suggesting the recent slump in bonds may be far from done. Bond prices fell again yesterday after more Federal Reserve officials said they favor more modest reductions in borrowing costs. While the size of cuts may slow, most Fed members have said publicly that there is no reason to stop easing.

IFR released an updated look at October prepayments where increases in prepayment speeds were slightly reduced versus the preliminary outlook. Speeds for FN30s and GNIIs are now expected to jump 11 percent on average, versus 13 percent and 12 percent, respectively in September, with FN15 speeds increasing 12 percent versus 13 percent previously. Month-to-date gross issuance sits at $84.6 billion and is on pace to exceed $100 billion for the third straight month following last month’s $101.1 billion.

Mortgage applications from MBA kicked off today’s calendar, decreasing 6.7 percent from one week earlier. Later today brings existing home sales for September (expected at 3.90 million versus 3.86 million previously), several Treasury auctions that will be headlined by $13 billion reopened 20-year bonds and a buyback in 7.5- to 30-year TIPS for up to $500 million, remarks from Fed Governor Bowman and Richmond President Barkin, and the Beige Book will be released in the afternoon ahead of the November 6/7 FOMC meeting. We begin the day with Agency MBS prices slightly worse than Tuesday’s close, the 10-year yielding 4.23 after closing yesterday at 4.20 percent, and the 2-year at 4.05.

We’re approaching Halloween and the weather is turning cold here in Nevada and Northern California. People on foot are exposed to the elements.

So, the other day I picked up a hitchhiker. He seemed like a nice guy.

After a few miles on Highway 80, I asked him if he wasn’t afraid that I might be a serial killer?

He told me that the odds of two serial killers being in the same car were extremely small.

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current STRATMOR blog is titled, “Help Borrowers Tap Into $36 trillion Available in Home Equity.” The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2024 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman. The views and opinions in this newsletter are mine alone unless otherwise specifically stated herein.)