Source: cityam.com

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Accounting, Digital, Broker Comp Tools; FHA, VA, USDA Developments; Why Rates are Stubborn

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Accounting, Digital, Broker Comp Tools; FHA, VA, USDA Developments; Why Rates are Stubborn

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4 Hours, 13 Min ago

Imagine my surprise at finding tag (like on the playground) is an organized sport. Imagine my surprise at finding two gas stations at the same intersection yesterday in Truckee, California with two different prices for unleaded! Rather than wait for the CFPB to tell me that I could save money by going to the cheapest station, as it did by paying for a study on how different lenders have different mortgage prices, I actually reasoned, all by myself, that I could, and did, buy the least expensive gasoline. Switching gears, but continuing on with the thinking vein, a lot of reasoning went into determining that a) the earth is round, and b) globes are not some newly invented conspiracy theory. Someone needs to let Georgia’s current GOP district chair Kandiss Taylor know globes are globes. What the heck am I missing by subscribing to the round earth concept? And how about this for sensationalist headlines from Auction.com: One-Third of Buyers Expect Home Prices to Decline. Really? “Despite rising expectations for a home price correction in 2023, 87% of buyers said they planned to increase or keep the same their property acquisitions for the year, up slightly from 86% in 2022.” (Today’s podcast can be found here and this week’s is sponsored by Built Technologies. Join Built Technologies on June 20th at 12 PM CST for an exclusive webinar that will dive into proactive portfolio monitoring as Built’s experts share best practices for achieving greater visibility into your construction portfolio.)

Broker and Lender Services and Software

Quorum Federal Credit Union has upgraded its Borrower Paid Broker Compensation Program. The program offers partners the opportunity to earn up to 2.00 percent borrower paid broker compensation on the entire line amount, up to $5,000, for all HELOC products. Primary and Second Home HELOCs offer no minimum draws, no early termination fees, and no annual fees. With minimum loan amounts at $25,000, Quorum offers financing up to $350,000. Investment Property HELOCs also offer no minimum draws and no early termination fees with minimum loan amounts at $50,000 and financing up to $250,000. Contact your Account Executive, visit the Quorum Partner Portal or email [email protected] for more information.

“Unite your mortgage process with an end-to-end digital closing solution. Initially, American Federal implemented the Mortgage Suite without Blend Close, but later realized our digital closing solution aligned with their growth strategy. Find out how they were able to speed up the borrower’s journey, close loans faster, and save more time. Dive into their case study.”

For independent mortgage banks coping with shrinking production volumes and rising costs per loan, outsourcing accounting is an elegant solution to what’s become a very common challenge. Whether you have no accounting expertise in-house or you have a new team with no mortgage experience, you can tap the Richey May Client Accounting and Advisory Services (CAAS) team for the support you need. This team is stacked with mortgage industry experts who can tailor your solution to meet your most pressing needs in a volatile time, with no training needed. Need help transitioning to loan level accounting? Need a fully outsourced function? You got it! Need industry training for your controller? We can do that. In this article, Richey May’s expert Kim Dittmer answers all your most frequently asked questions around outsourced accounting as a mortgage bank.

Ginnie, USDA, FHA, and VA Updates

The industry’s applications include about 25 percent VA, FHA, and USDA. These products continue to garner the lion’s share of production for underserved and, let’s face it, low-quality borrowers. These are the borrowers targeted by the Biden Administration. Freddie and Fannie (the GSEs) ask seller-servicers for these “mission loans” but LOs know that there are few cases where a lender could or should advise a consumer to take out a conventional loan versus FHA/VA. Let’s see what’s going on out there.

Anyone making a living on refinancing FHA or VA loans is in for a rough road. Overall, roughly 33% of all American homeowners wrapped into 30-year agency mortgage bonds are paying 3% or less on their home loans. Chris Maloney with BOKF writes, “Breaking that down across the three segments for how much of the universe is paying 3% or less on their mortgages as of the end of May, for conventional 30-year borrowers that comes to 32%, for FHA 30-year borrowers 21.9% and for VA borrowers 50.7%. And using the Optimal Blue lending rates as a guide, the amount of the 30-year universe that is out-of-the-money (defined as not having at least 50 basis points of incentive) finds 99.6% of the conventional 30-year and FHA borrowers in that state while for the VA borrowers it’s 99.5%.”

FHA posted a draft of Mortgagee Letter (ML), Payment Supplement Partial Claim, on its Single-Family Housing Drafting Table (Drafting Table) for public feedback. The draft ML proposes a new loss mitigation option, the Payment Supplement Partial Claim (Payment Supplement PC), to assist struggling borrowers that are delinquent on their mortgage payments and are unable to obtain a significant payment reduction with other available loss mitigation options. This option will be particularly useful for borrowers who have below market interest rates. View the FHA Press Release for details.

Don’t forget that the FHA is seeking comments on its proposed HECM Mortgagee Default Requirements. FHA recently posted a draft Mortgagee Letter (draft ML) that would expand FHA’s processes related to actual or anticipated mortgagee default on obligations to a borrower under Home Equity Conversion Mortgages (HECMs) insured by FHA.

At the end of May, The Community Home Lenders of America (CHLA) commended FHA Commissioner Julia Gordon for the announcement that FHA is proposing a program to create a flexible partial claim loan modification option for defaulted borrowers, which avoids having to take the underlying loan out of a Ginnie Mae loan pool. CHLA was the first national association to ask FHA to develop such a program option, in a letter to FHA last August.

All Participants Memorandum (APM) 23-08, Ginnie Mae announced updates to the adoption of Single Family and Manufactured Housing Program pooling into the new Single Family Pool Delivery Module (SFPDM) in MyGinnieMae. This transition from GinnieNET to the SFPDM application will enhance user experience and align Ginnie Mae with mortgage industry standards by using the MISMO-compliant Pool Delivery Dataset (PDD).

USDA Rural Development posted a bulletin on 05/30/2023, Interest Rate Decrease for SFH Direct Programs.

FHA announced the availability of 203(k) Rehabilitation Mortgage Program fact sheets for consumers and aspiring and current FHA203(k) Consultants. These materials are designed to help increase awareness and understanding of the features and benefits of the program. The fact sheets include a program overview with features, benefits, and requirements, as well as additional 203(k) Program resources.

PRMG Product Update 23-29, includes Investor Solution update on AirDNA requirement for short term rentals on a purchase. Clarification on UT Utah Housing FHA for wholesale loans regarding the allowance of In-House and Third-Party Processing Fees charges, and multiple clarifications on CO CHFA FirstStep Plus.

AmeriHome Mortgage General Announcement 20230512-CL summarizes previously published changes made during May, additional changes made with the announcement, and recent Agency and regulatory news.

Capital Markets

Why did rates improve Thursday, and this week, especially when there is no “big” data? Well, initial jobless claims, which are a leading indicator, hit their highest level since November 2021. That connotes some softening in the labor market which the Fed would like to see, and which could tip it toward holding, rather than raising, the overnight Fed funds rate.

Supply is also on the radar screen but expected. Investors remain cautious ahead of next Wednesday’s Federal Open Market Committee meeting and fears about the impending sale of $1 trillion of Treasury bills is also not helping sentiment: With the debt ceiling deal in place, the Treasury will issue more than $1 trillion in short-term debt to keep the lights on. This will push up short term rates at least in the near-term, which won’t help those looking for mortgage rate relief.

In addition to rate worries, as mortgage-backed security spreads remain at the widest levels since the 1980’s, home prices continue to move higher. Lower mortgage rates earlier in the year likely played a role in the uptick, however scarce supply of desirable homes continues to add to price pressures. A strong job market helps housing demand, particularly in the face of challenging affordability and last week’s release of the May employment report generally showed a healthy labor market, with the headline reading coming in around 145k above analysts’ estimates to register at 339k. Despite that new robust employment data, downward revisions to earlier numbers suggest a broad cooling trend remains intact. The numbers now show the US added an average of 182k private sector jobs in the past three months, the fewest since January 2021.

Despite a strong labor market, consumer sentiment also slipped in May to register down 9.1 percent from April, according to the University of Michigan Consumer Sentiment Survey. Inflationary expectations for the near term fell, while longer-term expectations rose to 3.2 percent, the highest level in 12 years. The Fed pays close attention to the UM inflationary expectations, so this is bad news for those hoping for rate cuts this year and does not bode well for those hoping for a sudden window of billions of dollars’ worth of mortgages coming into refinance incentive again

Lastly, while we’re waiting for all those recession predictions to come true, yield curve inversion has increased over the past couple of weeks as the market continues to capitulate to the Fed’s “higher rates for longer” message. The latest run up in rates over the past couple of weeks was a function of the market correcting its Fed Funds “hike, pause, cut” path. That upward pressure on the front-end of the yield curve immediately re-flattened the yield curve back into deeply negative territory.

Moral of the story: the Fed is not set to cut rates anytime soon as inflation remains an issue and investors have been forced to unwind bets that rate cuts will be in store later this year. As recently as a couple of weeks ago, three rate cuts were expected before year end. With no economic data on today’s schedule, we begin a slow news Friday with Agency MBS prices worse about .125 and the 10-year yielding 3.74 after closing yesterday at 3.71 percent; the 2-year’s up to 4.55 on continued inflation worries.

Employment

Village Capital & Investment is excited to announce that Pete Tamoney has recently been hired to help grow its Correspondent Lending division. Pete has been in correspondent sales for 20 years, most recently with Northpointe Bank. Village Capital is a GNMA buyer with no overlays and a consistently strong execution. You can contact Pete.

“Equity Resources is pleased to continue our expansion throughout our 19 states along the east coast and mid-west. We are an independent and family-owned mortgage banker that is proudly celebrating our 30th anniversary this year, continuing to create incredible opportunities for our team members, Realtor partners, as well as our B2B partners. We are currently searching for talented and career-focused loan officers that have a demonstrated “self-sourced” business philosophy. Equity Resources is an agency direct lender that offers an exceptional compensation and marketing platform for our loan officers, including a media and video production team, an underwriting “hotline,” a talented marketing and social media group, and an exceptionally tenured leadership team. We offer a full suite of loan products and programs (including several specialty lending programs). To learn more about “Why Equity Resources” and to join our award-winning team, please contact Tom Piecenski, EVP of Sales and Development (614.327.5353).”

“Are you frustrated as a retail loan officer or mortgage banker with the lack of flexibility to provide custom loan options? Take control: follow the lead of over 24,000 MLOs like you who have joined the wholesale channel in the last year. Whether you open your own independent mortgage brokerage or join a team as a loan officer, you’ll have the ability to provide your clients with the personalized solutions they need. Contact our team at BeAMortgageBroker.com today and you’ll be well on your way to a more fulfilling tomorrow.”

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 resume to Chrisman LLC’s Anjelica Nixt for forwarding.

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

Apache is functioning normally

Updated June 9, 2023 at 5:11 AM

McCLEAN, Va. (AP) — U.S. long-term mortgage rates jumped to their highest level since June, though still remain near historic lows.

Mortgage buyer Freddie Mac reported Thursday that the average rate on the 30-year fixed-rate home loan rose to 3.17% from 3.09% the previous week. One year ago, the benchmark rate stood at 3.5%.

The average rate on 15-year fixed-rate loans, popular among those seeking to refinance their mortgages, increased to 2.45% from 2.40% last week. It was 2.92% a year ago.

Economists have expected modest increases in home-loan rates this year, though they likely will remain low while the Federal Reserve keeps interest rates near zero until the economy recovers from the coronavirus pandemic.

Record-low lending rates have prodded buyers into the housing market, which has been one of the strengths of the U.S. economy. But a shortage in the supply of homes remains a problem and has pushed prices higher.

Also Thursday, the government reported that the number of people seeking unemployment benefits fell sharply last week to 684,000, the fewest since the pandemic erupted a year ago and a sign that the economy is improving. It is the first time that weekly applications for jobless aid have fallen below 700,000 since mid-March of last year.

Originally published March 25, 2021 at 12:07 PM

Source: aol.com

Apache is functioning normally

“Persistently high inflation and the recent spike in lending rates will trigger a correction in the UK (Aa3 negative) housing market,” Moody’s Investor Service said in a report.

Matt Cardy | Getty Images News | Getty Images

LONDON – The U.K.’s biggest bank temporarily withdrew mortgage deals via broker services on Thursday, as the effect of higher interest rates ripples through the British housing market.

HSBC told CNBC Friday that it was reviewing the situation regularly, but did not specify whether the new deals would differ from its previous offerings. Higher rates are a possibility, given that the Bank of England is continuing to increase interest rates.

It comes eight months after hundreds of mortgage deal offers were pulled in one day after market chaos at the time sparked concerns about rising base rates.

In a statement issued Friday, HSBC said: “We occasionally need to limit the amount of new business we can take each day via brokers. All products and rates for existing customers are still available, and we continue to review the situation regularly.”

The banking group said the protocol was in order to ensure it meets “customer service commitments” and stressed that it remains open to new mortgage business.

Soaring rates

The HSBC decision comes as analysts expect mortgage rates to soar and housing prices to plummet in response to the increased base rate.

A large number of fixed-rate mortgage deals is set to expire this year, leaving homeowners vulnerable to the impact of interest rate hikes, according to economic research company Capital Economics.

The organization made an upward revision to its mortgage rate forecasts, which showed borrowers would be “subject to a larger interest rate shock than … previously envisaged.”

“Those coming to the end of a 2-year fix will see a particularly large increase in the cost of their mortgage. While those refinancing a 5-year fix this month may see their mortgage rate jump from 2.1% to 4.9%, those on a 2-year fix will see an increase from 1.4% to 5.2%,” Capital Economics said in a note published Thursday.

There are also warnings that house prices will tumble in the next two years, with credit ratings agency Moody’s forecasting a 10% decline. 

“Persistently high inflation and the recent spike in lending rates will trigger a correction in the UK (Aa3 negative) housing market,” Moody’s Investor Service said in a report.

The Halifax House Price Index showed that U.K. house prices were flat in May after a 0.4% fall in April, while the average U.K. property now costs £286,532 ($360,000).

In February, U.K. house prices experienced their sharpest contraction since November 2012, according to building society Nationwide.

Prices tumbled 1.1% year-on-year, logging their first annual decline since June 2020.

The Bank of England raised its interest rate to 4.5% from 4.25% as the central bank attempts to tackle high inflation that currently sits well above the 2% target, at 8.7%. 

The Organization for Economic Cooperation and Development predicts the U.K. will have the highest inflation rate out of all advanced economies this year.

Lenders and homeowners will be watching the central bank closely for its next base rate decision on June 22. It is widely expected the bank will agree its thirteenth consecutive increase.

Source: cnbc.com