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The start of the New Year has already proven to be an eventful one for the mortgage industry. With increasing rates, upcoming fee announcements, and new borrowing limits, it’s more important than ever to stay updated with the latest information. Let’s get started with this week’s Mortgage Monday update!

Rates Update

The first week of 2022 brought expected rate increases that will likely continue into the New Year. On January 6, Freddie Mac reported “the highest level [of mortgage rates] since May 2020” with significant increases for both 30-Year and 15-Year options. This is the result of growing inflation and increased economic activity – even in the face of continued Omicron developments.

Despite all of this, mortgage rates are still relatively low; how much longer they will remain low, however, is up in the air. This much of an increase this early into the year should be taken as an indicator of more rate growth to come, so contact your Total Mortgage loan officer today if you’ve been considering a new home purchase or refinance.

FHFA Announces Upfront Fee Adjustments for High-Balance Loans

Last Wednesday, the Federal Housing Finance Agency (FHFA) announced upcoming fee increases for certain Fannie Mae and Freddie Mac home loans. Effective April 1, 2022, upfront fees for these options will have the following increases:

  • Upfront fees for high-balance loans will increase between 0.25 and 0.75 percent.
  • Upfront costs for second home loans (non-primary residence) will increase between 1.125 and 3.875 percent.

These increases will ultimately depend on each product’s loan-to-value ratio. “High-balance” loans qualify as any that go above the conforming baseline limit newly introduced on January 1 – more information on that below.

The main takeaway from this announcement: if you’re in the market for a higher-than-usual home loan or financing for a second property, now is the time to act. With mortgage rates increasing and updated fees coming in April, securing a home loan sooner than later will save you money in the long run. Contact your Total Mortgage loan officer to get started.

Now In Effect: New Borrowing Limits for Conventional and FHA Options

At long last, the 2022 borrowing limits for Conventional and FHA loan options are now in effect. These changes were originally proposed in late 2021 with the intention of combating rising market prices – and as of January 1, they’ll be offering more spending power than ever to borrowers everywhere. The conforming limit for single-unit home loans is now $647,200 – an 18.05 percent increase from last year’s limit.

Federal Housing Administration (FHA) loans also received some attention with updated borrowing amounts for 2022. See below for a full breakdown of your new options and contact your Total Mortgage loan officer if you have any questions.

In Closing

Even with just one week now in the books for 2022, we already have plenty of news to keep in mind and industry variables to monitor. If you’ve been considering a new home purchase, now may be the time; mortgage rates have remained low in recent months but are now following the upward trend experts have been anticipating.

For now, enjoy the rest of your Monday and contact us if you have any questions. Thanks for reading!

Source: totalmortgage.com

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Weakening economic outlook, high inflation and affordability challenges took a toll on buyer demand, leading to a drop in both purchase and refi applications last week, according to the Mortgage Bankers Association (MBA).

The market composite index, a measure of mortgage loan application volume, declined 6.3% for the week ending July 15, the MBA said. The refinance index dipped 4% from the previous week, falling to a 22-year low, and the purchase index decreased 7%.

“Mortgage applications declined for the third week in a row, reaching the lowest level since 2000,” Joel Kan, associate vice president of economic and industry forecasting at MBA. “The decline in recent purchase applications aligns with slower homebuilding activity due to reduced buyer traffic and ongoing building material shortages and higher costs.”

New U.S. home building activity fell 2% to a seasonally adjusted annual rate of 1.56 million units in June, marking a nine-month low since September 2021, according to the U.S. Department of Commerce. Permits for future homebuilding fell 0.6%, to a rate of 1.69 million units, also the lowest since September. 

While the refinance share of all mortgage activity slightly increased from 30.8% the previous week to 31.4% of total applications, the refi index was 80% lower than the same week a year ago.

“With most mortgage rates more than two percentage points higher than a year ago, demand for refinances continues to plummet,” Kan said.

What lenders should know about today’s economic climate

Between navigating a post-pandemic world, rate hikes and the threat of a recession, mortgage lenders across the country are managing a volatile housing market. Learn how updating your mortgage technology stack can help you get ahead in today’s unpredictable lending environment.

Presented by: Polly

Mortgage rates have been volatile in recent weeks, following the Federal Reserve‘s interest rate hike of 75 basis points last month. After falling 40 bps two weeks ago to 5.30%, purchase mortgage rates climbed back last week to 5.5%, according to the latest Freddie Mac PMMS. A year ago at this time, 30-year fixed-rate purchase rates were at 2.88%.  

The trade group estimates the average contract 30-year fixed-rate mortgage for conforming loans ($647,200 or less) rose to 5.82%, from the previous week’s 5.74%. Jumbo mortgage loans (greater than $647,200) also increased to 5.31% from 5.25%. 

The Federal Housing Administration‘s (FHA) share of total applications rose to 12.4% from the previous week’s 11.7%. The United States Department of Agriculture‘s (USDA) share also increased to 0.6% from the week prior’s 0.5%. Meanwhile, the Veterans Affairs‘ (VA) share of total applications fell to 10.6% from 11.2%.

The share of adjustable-rate mortgages (ARM) applications also declined, accounting for 9.5%. According to the MBA, the average interest rate for a 5/1 ARM decreased to 4.6% from 4.71% a week prior. 

The survey, conducted weekly since 1990, covers 75% of all U.S. retail residential mortgage applications.

Source: housingwire.com

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If your appraisal is so low that you owe more on the house than you could sell it for, there are several options for you to consider.

The 30-year fixed mortgage rate keeps getting lower and lower, making it a great time to refinance your mortgage and cut your monthly payment. But as Pat Esswein, associate editor of Kiplinger’s Personal Finance magazine, reports, homeowners have to clear a few hurdles before they can refinance.

One of those hurdles is the appraisal, which determines the value the bank will assign to your home.

That’s an important number because it determines your refinancing options and affects your monthly payment and interest rate. For example, if your home value drops and your loan-to-value is higher than your lender allows, typically 80 percent, you have to either increase your equity with cash or pay for mortgage insurance.

I recently spoke with Esswein about ways to get the highest possible value before the appraisal, and what to do if your appraisal comes in low.

What to Do Before an Appraisal to Get a Higher Home Value

There are a few things you can do to get highest possible appraisal possible.

First, consider researching the appraisal company. “This may be a little bit of a stretch, but when looking for a lender, ask what appraisal management company they order appraisals from,” says Esswein.

What you want is an experienced appraiser who really knows your local market, and you’re most likely to find that kind of appraiser at “a smaller, local appraisal management company that probably pays more and therefore attracts the best appraisers,” says Esswein. “Some companies go for the cheapest hires who also are willing to travel really far, so that means they’re inexperienced and they don’t know your area very well.”

Second, get your home in shape. “Make your house show well,” says Esswein. “Clean, declutter and fix things that need to be fixed so that when the appraiser comes, they’ll note that your house is in the best condition it can be.”

While you’re at it, create a house file for the appraiser that documents any upgrades or recent repairs, such as the new roof you installed two years ago. “When the appraiser actually comes to your home, have the file ready for them and walk around with them to point out the upgrades,” says Esswein.

Third, research recent comparable home sales. “Even though you may feel that prices are rising in your market, and in many markets they have, the appraiser still has to find comparable recent sales to support the value,” says Esswein. “One recent comp doesn’t make a trend, and appraisers may be adjusting prices more slowly than you wish.”

Instead of hoping the appraiser will pull a complete list of comps, Esswein suggests contacting a real estate agent to ask for a list of recent comparable sales, which you can add to your house file. “An experienced real estate agent will know what’s most comparable to your house,” she says.

What to Do If Your Appraisal is Low

So what happens if your appraisal is lower than expected? Is it possible to get another appraisal from a different company?

Esswein says you could shell out $250-$350 for a second opinion, then appeal to your loan officer with the new appraisal. “But before you do that, you should ask your loan officer if they’ll even consider the second appraisal,” says Esswein.

It’s more likely that the first appraisal will stick, but you still have options for refinancing.

Let’s say your home is appraised for $180,000. You still owe $162,000 on the mortgage, which is 90 percent of the value of the home. What are your options?

When it comes to maximum allowable loan-to-value, 80 percent is usually the magic number, so there are three things you can do if you aren’t at 80 percent.

Option one: Bring more cash to closing. If you can afford to put in an additional $18,000 in cash, you’d reduce the loan balance to 80 percent of the value of your home.

“Keep in mind that even if you anted up that money, you still have to have enough money in your reserves to satisfy any lender requirements for adequate savings, which is usually two months’ worth of mortgage payments, but can be more,” says Esswein.

Option two: Refinance into an FHA loan. An FHA loan is a Federal Housing Administration-backed mortgage loan.

Although an FHA loan requires just 3.5 percent equity, “with recent increases in FHA’s upfront mortgage insurance and monthly premiums, private mortgage insurance (PMI) could be cheaper,” says Esswein. Which brings us to…

Option three: Pay for PMI. PMI protects the lender if you stop making payments. “Because home values have fallen, many homeowners who didn’t need PMI when they bought their home will need it when they refinance,” says Esswein.

If you opt to refinance and need PMI, there are two ways you can pay for it.

One way is to simply pay for PMI yourself, which typically costs 0.5 percent to 1.5 percent of your loan amount per year. “Your lender will add the cost of PMI into your monthly mortgage payment,” says Esswein. “You would continue to have to pay the extra premium each month until you have 20 percent equity, at which point you can contact the lender and ask them to cancel PMI. Otherwise, when loan-to-value reaches 78 percent, they have to drop PMI automatically.”

The other way you can pay for PMI is lender-paid mortgage insurance. With lender-paid mortgage insurance, the cost of PMI is folded into your interest rate. The less equity you have, the higher your rate. “The higher rate applies for as long as you have the loan, so this option makes sense only if you don’t plan to own your home for the long term,” says Esswein. “You’re going to have to pay the higher rate for as long as you have that loan, it’s not going to fall away when you reach 20 percent equity.”

Before you decide to take lender-paid mortgage insurance, Esswein says to calculate your monthly payments and the total interest you’ll pay over the life of the loan, based how long you plan to keep loan.

So if you have to take on PMI, is it worth it to refinance? After all, you’re trying to lower your payments, not add extra fees!

Esswein says that as long as you’re saving money, it’s worth it. “PMI is a tool you can use if you need it, and if you’re still reducing payments and saving on interest, then it makes sense,” says Esswein.

And even if you have enough cash to bring your loan-to-value to 80 percent, you might think twice about spending it. “Before you bring cash to the table, decide what else you might want to spend that cash on,” says Esswein. “Don’t drain your emergency fund to avoid PMI.”

Finally, if your appraisal is so low that you owe more on the house than you could sell it for, you have options, too. Esswein recommends makinghomeaffordable.gov, which highlights home loan programs and refinance options for people who are underwater on their homes.

Source: getrichslowly.org

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With mortgage rates continuing to rise this year, it’s more important than ever to stay informed with the latest industry news. Let’s get right into this week’s update!

Rates Update

2022 continues to be on track with earlier predictions of a return to pre-pandemic markets. Last week’s mortgage rate shift reflected as much with increases across the board for multiple loan products, as reported by Freddie Mac. For the most part, this is the continued result of record-high inflation, rising house prices, optimistic consumer spending, and more. One concern of note is that all of these things could affect the general affordability of homeownership; if you’d like to lock in a rate while they’re still low and enjoy the benefits of long-term savings, contact your Total Mortgage loan officer today.

Our prediction: mortgage rates will continue to increase. In the past month, they’ve neared levels not seen since the start of the pandemic. This may seem scary, but it’s important to remember that despite everything, rates are still relatively low. Contact us to secure financing now before they continue to rise.

Older, but Still Important News

Let’s cover some of the most significant industry news that has affected buyers since the start of this year.

  • At the start of February, the Federal Housing Finance Agency (FHFA) lifted its restrictions on borrowers with self-employment income. These were originally put in place in response to the pandemic but have since been removed, offering borrowers greater opportunities in an already competitive market. The same credit and income requirements may apply, but home financing is now generally more accessible for the self-employed.
  • The Federal Housing Finance Agency (FHFA) announced upcoming fee increases (effective April 1, 2022) for certain Fannie Mae and Freddie Mac home loans. These increases will ultimately depend on each product’s loan-to-value ratio. “High-balance” loans qualify as any that go above the conforming baseline limit introduced on January 1 – more information on that below.
  • At the start of the year, the borrowing limits for Conventional and Federal Housing Administration (FHA) loan options saw significant increases to help buyers combat rising market prices. The conforming limit for single-unit home loans is now $647,200 – an 18.05 percent increase from last year’s limit.

To learn more about any of these recent developments, get in touch with your Total Mortgage loan officer. Our goal is to educate and inform all of our borrowers, so we’d be happy to meet with you!

In Closing

As always, our door is always open if you have any questions about financing a home or exploring the benefits of homeownership. The market may be changing and mortgage rate increases may seem intimidating, but opportunities to buy are still available for borrowers everywhere. In the months to come, it’ll be important for borrowers to act decisively and purchase sooner than later – especially as the market returns to its pre-pandemic self.

We’ll continue to monitor the news and provide updates as they come. Find your mortgage banker if you have any questions and enjoy the rest of your week!

Source: totalmortgage.com

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Editor’s note: This is a recurring post, regularly updated with new information.

As a traveler, I am firmly team carry-on and will very rarely check a bag, while some of my colleagues prefer to always check a bag.

Even if you insist on checking a bag, certain items should always go in your carry-on.

Here are 10 items to never check, according to our TPG travel team.

Identification documents

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This one should go without saying since your identifying documents, such as a passport or valid driver’s license, are among the most important items for a traveler to keep close, especially if you’re traveling abroad.

If you’re traveling domestically and don’t need a passport, all travelers age 18 and older still need a driver’s license or other state photo identification card from their state’s Department of Motor Vehicles (or equivalent) to pass through security at U.S. airports. A full list of Transportation Security Administration-accepted forms of identification is available here.

Once you’ve reached your destination, you’ll likely need to show some form of ID to check into a hotel or rent a car. If traveling abroad, we recommend carrying a picture of your passport with you while keeping your passport (and other valuables) securely locked in your room (in a hotel safe, if available).

Additionally, consider printing your travel itinerary and other important documents in case something happens to your phone or you can’t access Wi-Fi, says Erica Silverstein, TPG senior cruise editor.

Phone and charger

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A phone is among the most helpful tools when traveling, especially if you have a plan that allows you to use your data internationally.

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From navigating and figuring out directions in a new place to visiting cities you’ve visited before, your phone can be a lifeline when traveling. This also means frequently having to charge your phone, which is only possible if you’ve brought the right charger and any converters to be able to use the plugs (if applicable).

Keep all of your electronics and chargers in a carry-on for easy access on the plane, where you can also use the in-seat charging portal. Charging inflight ensures your phone is fully charged before exiting the plane, minimizing the chance of a dead battery en route to your hotel or other accommodations since your room may or may not be available for check-in when you arrive.

This is also helpful if you have a lengthy layover between flights since you can’t guarantee you’ll find access to a charging station at an airport.

As a female traveler who sometimes travels solo, a working phone is crucial. All travelers, solo or not, should pack a portable charger in their carry-on and always bring that with them when they go out and about.

Headphones and electronics

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In addition to your phone, some travel with other Apple products, such as an iPad and Apple Watch, requiring separate chargers. If you’re like me, you’ll never travel without two sets of headphones (one wireless and one not) since wireless ones may run out of battery.

This is also courteous for your fellow passengers since most airlines prohibit flyers from listening to shows or music out loud while also potentially providing you with headphones, depending on the airline and route.

Keep your headphones and AirPods within easy reach at all times.

If you happen to travel with a suitcase with a battery pack for charging, such as those from Away, remember that these must be carried on per TSA rules.

A change of clothes

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Per my earlier comment, the last time I checked a bag, it was a huge mistake. I missed my connecting flight due to inclement weather and my luggage was sent without me to my final destination. That left me spending the night in an airport hotel in Miami with just my backpack and the clothing I had been wearing for almost an entire day.

I’m not alone in this experience.

“I always keep at least one change of clothes for myself and each of my kids in my carry-on, even if I am checking a bag,” said Tarah Chieffi, TPG travel news reporter. “If our checked luggage is delayed or lost, or if inflight accidents occur, we always have a fresh change of clothes.”

This scenario is exactly why it’s important to pack at least one spare outfit in your carry-on item.

She also recommends throwing in a grocery bag or large zip-close bag for dirty clothes in your suitcase. Some suitcases even come with a reusable laundry bag.

You’ll likely appreciate having a fresh change of clothes, especially on long-haul flights and those with long layovers. You might even be able to access an airport lounge or an aircraft with showers, which is even better for freshening up.

Even if your flight is short and direct, it’s still helpful to pack a change of clothes in your carry-on in case your baggage gets delayed.

Reusable water bottle

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Another item we recommend traveling with is a reusable water bottle. Just make sure the bottle is empty before you pass through airport security since most airports limit the number of liquids you can take through security.

Once you head to your gate in the post-security area, you’ll likely find free water refill stations where you can fill up your reusable bottle, including some with filtered water.

During your flight, request water and then pour that water into your bottle so it’s full at all times. Just remember to take your water bottle (along with your other items) off the plane when you disembark. I’ve lost two Hydro Flasks this way.

Also, flying can dehydrate you, especially if you’re drinking alcohol. It’s important to pay attention to your water consumption on travel days and make sure you are getting enough.

Considering how much airport stores charge for water and other items, bringing your own water bottle saves money — and eliminates single-use plastic.

Snacks

Not unlike the water, don’t rely on the airport or inflight snacks since food options when traveling may not be available or open when you need them.

“I always bring snacks, which are especially helpful if your flight is unexpectedly delayed while you’re on the plane with no option to get off,” said Senitra Horbrook, TPG credit cards editor.

Prescriptions and other medications

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If you take medication daily, it’s wise to pack any prescriptions into your carry-on luggage along with any over-the-counter medications you take frequently or might need, such as pain relievers or allergy medicine.

For example, I always bring several days’ worth of Tylenol, Benadryl, vitamins, probiotics, etc., as well as a few extra supplements of my daily medicine in case I end up staying longer than anticipated.

I also pack a few extra pairs of contact lenses. I wear dailies and prefer them over wearing my glasses, though I bring my glasses as a backup. I also bring adhesive bandages, just in case.

Assistance items

For senior travelers or those who require assistance, do not keep any assistive/medical device item, such as a walking stick or handicapped placard, out of reach.

A good rule of thumb — if it’s anything you can’t live without for half a day or more, put it in your carry-on, says Erica.

Hand sanitizer, wipes, paper towels and tissues

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Since the COVID-19 pandemic, many travel with hand sanitizer and sanitary wipes to wipe off seats, tray tables, seat belts, etc., upon boarding.

These items are small and can easily fit in your carry-on item. Just ensure your hand sanitizer does not exceed 12 ounces, which is an allowance specifically for hand sanitizer that the TSA implemented during the pandemic. All other liquids must still meet the 3.4 ounces or 100-milliliter size requirement.

Other items to consider bringing in your carry-on are paper towels and a washcloth in case of spills or other situations where you need to dry your hands.

You might be able to find tissues and band-aids at airports and on planes, though they’re likely not going to be great quality. Tissues are small enough to pack a few in your carry-on in case of unforeseen circumstances, from the sniffles to a paper cut.

Valuables

Beyond your phone and important travel documents such as your passport, keep your most important items close to you while traveling, including jewelry.

These items would fall under the “hard to replace if not irreplaceable” category, depending on how sentimental they are to you.

Bottom line

Once you’ve decided on the items most essential for your carry-on, be sure to decide what carry-on item makes the most sense for them to go in.

For example, if you have two carry-on bags, one smaller one that fits underneath the seat in front of you or one suitable for the overhead bin, think about what items you might need most often throughout the flight and position those in your smaller bag.

For everything else, you can always get up and retrieve items from your larger bag from the overhead bin.

Related reading:

Additional reporting by Ben Smithson.

Source: thepointsguy.com

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Reverse Point-of-Sale, Marketing and PR, TPO Products; Random TPO News; Ugly Insurance and Water News

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Reverse Point-of-Sale, Marketing and PR, TPO Products; Random TPO News; Ugly Insurance and Water News

By:
Rob Chrisman

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While lenders are grappling with steadily increasing Agency repurchase requests, it’s National Donut Day! Someone had better offer those folks at State Farm Insurance a donut… maybe they’ll change their mind about cutting off insuring properties in California. Three thousand miles away, I wonder if Florida home owners should be happy of even having insurance despite it being four times cost of the national average. And good luck insuring anything built near the coast prior to 1992’s Hurricane Andrew. While we’re on the topic of Mother Nature and economics, it’s fine for the Biden Administration, or any politician, to call for more affordable housing, but what about where’s there’s no land or a community limiting development due to running out of water like in Phoenix!? (Today’s podcast can be found here and this week’s is sponsored by Lenders One, one of the largest mortgage co-ops in the country with a diverse mix of 250+ member companies and providers of an end-to-end solution independent mortgage professionals trust to drive profitability and growth. Listen to an interview with nCino’s Ali Maquet and Brett Dooies on why experience-driven automation should matter to financial institutions.)

Lender and Broker Products, Software, and Services

It’s time to schedule your firm’s 2023 MERS Annual Review and e-Annual Report with TENA! Every MERS member is required to complete a MERS Annual Review. If on March 31, 2023, your firm’s count of active MINs was 1,000 or more, then the 2023 MERS Annual Review for your firm must be completed by an independent third party, with the results submitted to MERS not later than December 31st. For significant savings, sign up early for a MERS Annual Review and provide TENA with all of the necessary documentation by August 31st. Avoid the last-minute rush! To ensure that your firm is in compliance, contact TENA today to initiate your firm’s 2023 MERS Annual Review. TENA also offers a full range of MERS reviews, including MERS Data Reconciliation and MERS Document Reviews. TENA Companies, Inc. has been the mortgage industry’s trusted source for Mortgage Quality Control Audit Services and Software since 1982.

“Experience for yourself what NexBank’s Wholesale, Non-Delegated Correspondent, and Delegated Correspondent clients have to say: ‘Everyone from AE to Underwriter and in between is amazing to work with all around.” and “I have been doing this a long time and have done a ton of loans and I finally feel like I found a team that cares about my clients as much as I do.’ NexBank’s goal is to make our TPO clients successful as we continue to roll out new, competitive products –> Announcing NEW pricing improvements on low loan balances to further promote affordable homeownership (< $275K) by introducing a Loan Balance Adjuster on Agency Conforming 30- & 25-year products, with certain restrictions. Plus, Escrow Holdbacks are now Eligible with Conforming Conventional, Mortgage Connect Full Doc and Non-QM, allowing our clients to close more loans in a timely manner. Contact us today. Member FDIC, Equal Housing Lender, NMLS 672886.”

Looking for Marketing and PR Assistance? The Seroka team has you covered! Seroka Brand Development, the mortgage industry’s leading marketing and PR firm, is here to provide the extra resources you need. With over 30 years of industry experience and strong media relationships, Seroka offers a complete turnkey solution to support your marketing and PR efforts. Whether you need project work, a new campaign, or to outsource your whole marketing department, Seroka can help. Seroka’s specialties include content marketing, digital marketing, social media, strategic planning, public relations, and campaign measurement. Its goals are to optimize your marketing spending and drive the best ROI. Seroka excels in boosting SEO, improving engagement, and generating more leads from your target audiences. If you’re stretched thin and need to achieve more with fewer resources, let Seroka Brand Development assist. Contact Seroka today to schedule a call and explore how their team can help you!

“Lenderful Solutions is excited to announce our latest release, with the support of Joe Rinner at Watermark Capital Reverse, a POS Solution specifically to guide borrowers interested in a Reverse Mortgage. This solution gives convenience and control to borrowers interested. A borrower can learn about their options, shop displayed calculate benefits based on their situation, determine their preferred payment options, and apply for a reverse mortgage in minutes. Data is delivered to lenders reverse mortgage LOS systems. Lenderful Solutions adding to our ability to digitize the process, so Loan Officers can continue to humanize the experience. Use automation tools like AVM, VOE, VOA, VOI, and Credit Pull to offer borrowers insurance for Home or Auto… without ever leaving your website. Our strong lineup of solutions including Mortgage with PreQual Express, Home Equity/HELOC, HE Turbo, Construction, Commercial, Consumer and more… clicking here or contacting us at (313) 910-3070.”

Wholesale and TPO News

Sometimes news from third party investors falls into neat categories, like conventional conforming changes, or government (FHA &VA & USDA) updates. Sometimes the news doesn’t, so with that in mind, let’s see who is doing what regarding policy and procedure changes.

United Wholesale Mortgage (UWM) announced PA+, a service that offers an additional level of loan processing support when needed. When an LO or processor orders PA+, they’ll get a dedicated UWM Loan Coordinator who will work with them and their borrower to help ease some of the most time-consuming parts of the loan process, from import to closing. UWM also announced UWM Portal, a bi-directional API that lets independent mortgage brokers who work with UWM seamlessly link their Loan Origination System (LOS) platform to UWM’s EASE system, further helping to streamline the entire loan process. This will allow brokers to sync their data to their LOS and eliminate the need to manually reconcile information during the loan.

On 5/25/2023, with Amendment No. 3 to DR-4699, FEMA granted individual assistance to Butte County impacted by California flooding.

After a thorough review of the most common reasons for the IRS rejection of the new Form 4506-C, AmeriHome provides some best practices and tips for successfully executing the new IRS Form 4506-C as another resource for its Sellers. See AmeriHome Product Announcement 20230503-CL for details.

Brokers, Kind Lending has extended CalHFA loan options to California homebuyers. Kind Lending offers CalHFA Conventional, Government and MyHome Assistance.

Rocket Pro TPO Partners have its new Home Equity Loan1 (HEL) product, helping clients achieve their financial goals. Clients can tap into their home equity without adjusting their first mortgage structure. Compare a Home Equity Loan to a cash-out refi with our HEL vs Cash-Out Calculators on PathfinderSM by Rocket.

Leverage another great tool from Rocket Pro TPO to win more business and potentially save clients thousands on their mortgage. Credit Upgrade, Rocket Pro’s free rapid rescore program, really works. In the first quarter of 2023, Credit Upgrade saved clients over $4 million on mortgage payments.

United Wholesale Mortgage (UWM) announced the roll out of Six Fixed-Rate Jumbo Products. Brokers now have access to more competitive jumbo pricing, along with transparent investor guidelines and loan qualifications. Additionally, UWM expanded its Conventional 1 percent Down product to 80 percent AMI. UWM supports independent mortgage brokers with industry-leading training, technology, and service.

Pennymac Correspondent Group posted three new announcements: Announcement 23-37: Navigating Form 4506-C: Insights and Tips for Completing, and Announcement 23-38: Fannie Mae SEL 2023-02 Required Use of Condo Project Manager.

Citi Correspondent Lending implemented changes to the CRA Schedule, effective for Best Effort locks completed on/after Tuesday, May 23, 2023. Two changes are being made related to MSA 35004 – Nassau. Agency LMICT premium is increasing to 1.50 from 1.00. MSA 35004 is being added to the Non-Agency Best Efforts grid.

Capital Markets

We had a massive amount of data for markets to digest yesterday, which, along with news that the House and Senate passed the bill to raise the debt ceiling, pushed investor sentiment and ultimately price movement toward the third consecutive day of gains (rates down) in the bond markets. That comes as a welcomed relief considering that mortgage rates jumped again last week to hit new year-to-date highs, according to the latest Primary Mortgage Market Survey from Freddie Mac.

In terms of economic data, the May ISM Manufacturing Index fell further into contractionary territory, the seventh consecutive month of general contraction in manufacturing activity. The Production Index climbed back into expansionary territory, giving some hope for an improvement in the coming months. The ADP Employment Change Report for May showed an estimated 278k jobs were added to private-sector payrolls, well above 160k expectations on the heels of a downwardly revised 291k in April. Job growth is still strong, but pay growth is slowing. The weekly initial jobless and continuing claims report both corroborated the ongoing strength in the labor market as businesses overall remain reluctant to cut staff size in large numbers, leaving the level of initial jobless claims well below what is typically seen in a recession environment.

The Revised Q1 Productivity and Unit Labor Cost report showed productivity was weak in the first quarter (declining 2.1 percent, better than expected), and unit labor costs were up 4.2 percent versus the advance estimate of up 6.3 percent. Total construction spending increased 1.2 percent month-over-month in April, better than expected after increasing 0.3 percent in March. Continued weakness in new single-family construction was overshadowed by strength in private and public nonresidential spending. On a year-over-year basis, total construction spending was up 7.2 percent.

We are 50 percent through the Signature and Silicon Valley Bank portfolio liquidations, at least in specified pools, and according to BofA’s Bill Bekery, by nearly every metric these have been “a resounding success in terms of execution, clearing level, and both dealer and customer participation. Given the performance and execution of the last ‘reverse inquiry’ auction, we would expect that an announcement is imminent for round two of reverse inquiry, which will further bring us closer to the end date of this sell program. 20-year pools have stood out to us as a standout performer, with payups outperforming. There has been strong customer demand for pools such as 100 percent Florida, Texas, and low FICO pools.

However, many other specified sectors are trading less well: REIT demand generally has underwhelmed as of late, and $200-275k balance pools as well as FICO/LTV/investor have struggled to find footing in production coupons. Loan balance 6.5 percent pools remain somewhat of a no-mans-land sector. 70 percent of Agency MBS outstanding is held by the Fed and banks, both of which are net selling. That continues to be an area of concern for mortgages, as does impatience by monetary policymakers regarding the lagged effects of 500 basis points of rate hikes and/or a resumption of the banking crisis resulting in additional bank portfolio liquidations.”

Today brings the all-important May jobs report. Nonfarm Payrolls increased by 339k versus expectations of +230k, up from the prior month of +253k, while the unemployment rate jumped from 3.4 to 3.7 percent when it was seen ticking up to 3.5 percent. Hourly earnings were +.3 percent, as expected, year over year +4.3 percent. There are no other economic releases of note scheduled for today. Despite yesterday’s rally to open June, the 2-year U.S. Treasury yield increased by 33 basis points over the month of May and the 10-year yield increased by 19 basis points. After the solid employment data we begin the day with Agency MBS prices worse about .125, the 10-year yielding 3.64 after closing yesterday at 3.61 percent, and the 2-year up at 4.40.

Employment and Transitions

“Equity Resources is independent and family-owned mortgage banker that is very proudly celebrating our 30th anniversary this year! While many lenders are reducing staff and are uncertain about their future, we are creating opportunities for our award-winning loan officer team! We are actively seeking career-focused loan officers throughout our footprint states. Equity Resources is currently licensed in 19 states along the east coast and mid-west. We are an agency direct lender that offers an exceptional marketing platform for our loan officers, including a media and video production team. We offer a full suite of loan products and programs (including several specialty lending programs.) If you are frustrated with the direction of your mortgage banking career and not getting the support you deserve; or simply would like to have a conversation about “Why Equity Resources”, please contact Tom Piecenski, Executive Vice President of Sales and Development (614.327.5353).”

A Louisiana based full-service, independent mortgage banker averaging $1 billion in production annually is searching for a proven retail sales leader to run all business development initiatives. The Sales, Recruiting, and Marketing departments will report directly to this head of business development role, and the role will report directly to the CEO. The ideal candidate will have a demonstrated track record of hiring and managing multiple production offices across several states. The IMB is well capitalized, has agency direct approvals, offers niche products, significant technology advancements and a world-class operations team with experienced, tenured sales and fulfillment employees. For confidential consideration, please email confidential resume to Chrisman LLC’s Anjelica Nixt.

The Loan Store, Inc. announced that Phil Shoemaker has assumed the role of chief executive officer. Shoemaker was named incoming CEO on April 7 when it was announced that The Loan Store had entered into a definitive agreement to acquire certain assets of Homepoint’s wholesale originations channel. Mark Lefanowicz, who has served as The Loan Store’s president and CEO since 2019, will continue as chairman of the board.

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Source: mortgagenewsdaily.com

Apache is functioning normally

Applications to buy new construction homes dropped 12% year over year in June due to higher mortgage rates and economic uncertainty, according to the latest builder application survey from the Mortgage Bankers Association (MBA). Month over month, application volume dipped by 10%. 

New residential construction and permitting activity weakened from March through May, which reduced the number of homes available for home buyers, according to survey results.

MBA estimates about 620,000 new single-family homes were sold in June at a seasonally adjusted annual rate, marking a 15% drop, or more than 100,000 homes, compared to May. 

“Higher mortgage rates and heightened economic uncertainty cooled borrower demand in June, leading to new-home purchase applications declining to the lowest level since April 2020,” said Joel Kan, associate vice president of economic and industry forecasting at the MBA.

Mortgage rates have been volatile in recent weeks, following the Federal Reserve‘s interest rate hike of 75 basis points last month. After falling 40 bps two weeks ago to 5.30%, purchase mortgage rates climbed back last week to 5.5%, according to the latest Freddie Mac PMMS.

The average loan size dropped to $426,966 in June from May’s $430,855, MBA said. 

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Conventional loans accounted for 73.7% of loan applications. Federal Housing Administration (FHA) loans made up 15%, Veterans Affairs (VA) loans were 10.7% of total applications and Rural Housing Service (RHS) and United States Department of Agriculture (USDA) loans contributed 0.5%. 

The survey tracks application volume from mortgage subsidiaries of homebuilders across the country. Using this data, MBA provides an early estimate of new home sales volumes at the national, state and metro level. 

Source: housingwire.com

Apache is functioning normally

The Federal Housing Administration has introduced a new loss-mitigation concept to add to the set of temporary innovations that have emerged from the pandemic.

The payment supplement partial claim is aimed at allowing servicers to help borrowers who meet certain criteria and can’t reduce their payments through other methods like modifying at current rates that in many cases have become higher than what borrowers had at origination.

“The struggle is that in the rising rate environment, if you want to recast a mortgage, someone might go from maybe around 3%, to a rate of 6% or more, and they really wouldn’t see any reduction in their monthly payment,” said Peter Idziak, senior associate, Polunsky Beitel Green.

The draft concept appears to provide a mechanism through which the mortgage can stay at its original rate and the payment can be supplemented by a second lien loan that’s applied to monthly principal for three to five years, after it absorbs any arrearages. 

This would allow borrowers with reduced incomes to pay reduced amounts during the three-to-five year period, according to the FHA, which is an arm of the Department of Housing and Urban Development. The payment returns to normal afterwards, potentially with an ease-in period.

The FHA currently plans to test drive its existing set of post-pandemic loss mitigation options through at least October 30, 2024 and the innovation will likely have the same end date if it moves forward.

Servicers would get $1,000 for implementing the new type of partial claim as a one-time incentive. How that measures up to expenses related to the work they’ll need to do to manage the PSPC and the related reimbursement process remains to be seen.

A worksheet the FHA is floating with the draft concept asks servicers how their costs and liquidity might be affected.

Ginnie Mae, an agency which insures securitizations of FHA and other government-backed loans, had not responded to an inquiry from this publication at deadline about how or whether it might accommodate the innovation.

FHA is accepting comments on its draft notice for the payment supplement partial claim through June 30.

The FHA has been slowly introducing increasing amounts of flexibility into its loss mitigation tool set.

Prior to the introduction of the PSPC, it added a standalone 40-year modification. However, even with that innovation, borrowers with longer-term reductions in income found it difficult to reduce their original payments with a market-rate mod.

It also remains to be seen whether politicians that have been increasingly sensitive to public expenditures amid debt ceiling negotiations and the official end to the pandemic will receive the PSPC as a concept.

While it keeps borrowers on the hook for their original mortgage obligation, it does essentially give them a 0% loan from the government for a three-to-five year period to account for a temporary loss of income during that time.

The real test of PSPC’s effectiveness would likely be borrowers’ uptake and reperformance rates. When borrowers are able to resume payments it tends to maximize the market value of a formerly distressed loan and losses to the industry and HUD.

However, borrowers whose financial distress is too great or who ultimately do not recover their original incomes within three to five years may not be able to resume payments. In that case, the borrower might be best served by finding cheaper housing and returning their mortgaged property to the market, which has been a limited supply of affordable inventory for new buyers.

These are the types of considerations that will be likely taken into account when it comes to determining how and whether the concept becomes adopted for permanent use, Idziak said.

“Homeownership is obviously promoted as the American dream and an important aspect of wealth building. A foreclosure, being forced to sell and move, is definitely a traumatic event. So hopefully this program is something that will help qualifying borrowers out,” said Idziak.

Source: nationalmortgagenews.com