Non-QM, Underwriting, Appraisal Products; MBA's Compliance Offering; Higher Rates Hitting Apps
As the MBA’s Secondary Marketing Conference wraps up in Manhattan, and the 1,200 or so registered head home and face post-conference life, Rob B. asks, “What was the mood of the attendees: Denial, anger, bargaining, depression, or acceptance?” The talk in the hallways revolved around constructive things like ARM investors and pricing, outlets for investment and second homes, lock and shop programs, extended locks, all-cash programs, and the various vendor offerings. On a larger scale, the FHFA, acting through Fannie and Freddie, has a lot going on. The Agencies continue to retain earnings and are doing credit risk transfers while the FHFA is in constant contact with U.S. Treasury. Both are striving to serve the underserved, and the actions must be sustainable. Progress has been made in terms of solar panels, green bond program, affordable housing programs, green specified pools, protecting borrower information, and addressing climate-related losses due to storms and earthquakes. Both F&F are looking at “growing the pie” while managing their credit risk. (Today’s podcast is available here and this week’s is sponsored by Candor. With Candor’s Machine as an Underwriter, lenders modernize their manufacturing infrastructure making them immune to margin, capacity, and staffing challenges forever. Today’s has an interview with Sara Knochel, CEO of Candor’s burgeoning Data & Analytics business on the dearth of loan data available for lenders, servicers, and cap markets players and how data can be used as a strategy to improve operational efficiency.)
Lender/Broker Software and Programs
HomeBinder is excited to announce it is a new affiliate member to the American Credit Union Mortgage Association (ACUMA) as part of a tech forward initiative for the association. All members can now receive a strategic discount from HomeBinder in their first year of use. As offered by Peter J. Benjamin CMB, the association’s president. “In this highly digital and competitive world, consumers need an automated means that centralizes their home and mortgage information. Thanks to its comprehensive nature, HomeBinder is the best such service we’ve seen, and we’re proud to offer it to our members.” To learn more about HomeBinder, click here to schedule a time.
New statistics show desktop and hybrid appraisals using Class Valuation’s new digital technology are making a significant impact. Class Valuation, a nationwide top 10 Appraisal Management Company, has completed more than 15,000 appraisals using its Digital Appraisal technology on desktop and hybrid orders. These Digital Appraisals have reduced turn times by more than 50 percent in many markets. Underwriter revisions have been reduced to under 3 percent. Class Valuation’s whitepaper, “How Appraisal Modernization is Impacting Mortgage Lending,” details the new desktop appraisal guidelines, industry modernization, and the latest technologies making a difference, including 3D scans that create a “digital twin” of the property without an appraiser site visit. Learn how to make the most of the new desktop rules and digital technologies by reading the whitepaper here.
With the renewed government focus on home-valuation inequities, lenders need a reliable, efficient way to proactively detect problematic appraisals. But identifying minority bias in appraisals is challenging, especially given the sheer volume of loans originated every day. Black Knight CA Risk Profiler Plus provides a solution. This cost-effective and automated tool leverages robust analytics, local market data, neighborhood trends, a proven Black Knight Collateral Analytics AVM, and other key collateral metrics to help identify potential bias in appraisals for both refinance and purchase transactions. Black Knight CA Risk Profiler Plus will flag the identified problematic appraisals and provide you with a detailed report that can integrate directly into your loan origination system’s workflow, or be delivered numerous other ways, depending on your business needs. Learn more about this innovative, pragmatic solution – download our complimentary white paper: Minority Appraisal Bias – Reduce Your Risk Exposure and Help Make Fair Lending Decisions.
“What’s hot in appraisal: From appraisal modernization to operational efficiency and cost reduction, lenders are looking for guidance. We have you covered! Here’s a round-up of the most popular lender resources and upcoming events from Reggora: Webinar - May 25: Learn how Assurance Financial is delivering a digital mortgage experience with a focus on appraisal technology (Register). STRATMOR Insights: Review the industry survey results on appraisal operations to see where you stack up (Learn more). The Ultimate Desktop Appraisals FAQ (read now).”
What if you could underwrite at POS with no human assist? With Candor as your AI Underwriter you create an infrastructure with the ability to underwrite at POS, and the elasticity to seamlessly scale up or down with no change to staff. Just like your car can automatically diagnose problems, Candor can automatically diagnose borrower eligibility, documents required, conditions required, and loan defects that require resolution. Plus, Candor clears conditions and repairs defects, or provides precise instructions for your team to DIY. No guesswork, no speculation, no rework, and no bias. In addition to ingesting AUS, OCR, income calculations, data validation & verification and cross checks, Candor conducts a hands off underwrite, saves every detail to a permanent database, and backs up decisions with a warranty. Our clients rave. Implementation is a fast 30 days. It’s worth 30 minutes to learn more.
Loan Products
loanDepot Wholesale has added non-warrantable condos and loan amounts up to $3,000,000 to our non-QM Advantage EXPRESS FLEX program. This is in addition to loan amounts starting at $150,000 with full and alternative documentation options that include, expanded DTIs, 1-year tax return, asset utilization, and 12- or 24-month bank statement features. Refer to the Advantage EXPRESS FLEX matrix for details and contact your Account Executive today!
Did you know that qualifying borrowers with a 1099 is even simpler than bank statements? With IMPAC’s 1099 program, qualify self-employed borrowers who are independent contractors or exclusively commissioned based and are paid via 1099. No tax returns required. Our 1099 program allows for loan amounts up to $3M, LTV’s up to 90%, and DTI’s up to 55%, based on program guidelines. As a pioneer of Non-QM with over 26 years of experience, NQM is in our DNA™ and it shows. We allow borrowers to tell their story while our seasoned in-house underwriting and operations teams maintain 24-hour underwriting turn times. Also, ask about our 21 and Done™ program which can save your borrowers up to $500 on each loan. Contact your Impac AE or become an approved broker today. NMLS #128231.
ACC Mortgage’s CEO Robert Senko has set a target for non-QM at 10 percent of all US mortgage volume. That’s about $259 billion. In the upcoming NMP Webinar, “Non-QM is about Solutions and Confidence” on Thursday, May 26 at 1 pm ET / 10 am PT, he’ll help you understand the place in the world for Non-QM. The goal of Non-QM loans is to provide the best solution, not sell the lowest rate. Non-QM is another tool for Originators to have in their arsenal to service their borrowers. When the Originator understands the product, they’ll believe in the product and themselves. Clients and referral sources will see the Originators as problem solvers and valuable partners. This webinar will show you how successful Originators are selling Non-QM with these four steps, 1. Understand the problem, 2. Gather information, 3. Assess the information and 4. Provide the solution. See how originators are winning with non-QM by joining us here.
Vendor Updates
The MBA has entered a partnership with Winnow Solution, LLC to provide most favored nation pricing on the platform for MBA members. This partnership is an extension of MBA’s Compliance Essentials program which was built with the purpose of providing members timely and concise information to comply with state and federal regulations all while minimizing the overall cost of compliance. "MBA is offering this robust and dynamic platform to members at a discounted price. I encourage single-family members of all sizes and business types to explore this benefit," said MBA’s Pete Mills, Senior Vice President of Residential Policy and Strategic Industry Engagement. "With the rising cost of compliance, this partnership will help our members cost-effectively manage the growing complexity of mortgage regulations. Winnow is a tool that can help your team better manage compliance risks and increase efficiency." Current members of MBA who are interested in taking advantage of the 10 percent subscription discount can visit www.winnow.law/mba to schedule a demo and try it. Winnow will also have a booth at the upcoming Legal Issues & Regulatory Conference in Miami.
StoicLane, a long-term growth platform making strategic acquisitions to support digitizing Finance, Insurance & Real Estate (“FIRE”) verticals, announced that it has completed the acquisition of Triserv Appraisal Management Solutions (“Triserv”), a top-tier appraisal management company providing best-in-class appraisal and evaluation solutions for banks, credit unions and mortgage bankers in all 50 states. Through this partnership, StoicLane will provide capital, operational expertise, and technological infrastructure to accelerate Triserv’s growth.
Capital Markets
Our interest rates are buffeted by news around the world. Chicago wheat futures jumped by their 6 percent limit on Monday after India banned exports of the grain citing concerns over "food security." The move has the potential to drive food prices even higher and add to the current inflationary environment, while further weighing on the tight global supply chain. Since its invasion on Feb. 24, Russia has sealed off Ukraine's Black Sea ports to conquer its coast, hurting the county's economy which is known as the "breadbasket of Europe" (together with Russia it accounts for a third of global wheat exports). Things are grim.
With most capital markets heads in New York City for the conference, it’s been like an early preview of the dog days of summer to open the week. Economic data released yesterday showed slower than expected retail sales growth in April while sales excluding autos beat expectations. Industrial production beat April expectations, while the NAHB Housing Market Index fell to a level not seen in nearly two years. The yield curve flattened as Treasuries pulled back and the MBS basis ended mixed. Fed Chair Powell once again reiterated consensus for 50 basis point hikes over the next couple of meetings in remarks he delivered yesterday.
Today’s economic calendar is under way with a surprise decline in mortgage applications (-11.0 percent) from one week earlier, according to data from MBA, even with the start of spring homebuying season. We’ve also received April housing starts and building permits (-.2 percent, better than expected, SFH 1.1 million annualized; permits -3.2 percent, much worse than expected). Later today brings a Treasury auction of $17 billion new 20-year bonds and remarks from Philadelphia Fed President Harker. The Desk will purchase up to $1.7 billion in 30-year 3.5 percent through 4.5 percent MBS. We begin Wednesday with Agency MBS prices worse .125 and the 10-year yielding 3.00 after closing yesterday at 2.97 percent.
Jobs and Transitions
“NexBank continues to expand its Mortgage Banking team to support its growth in Wholesale, Non-Delegated, and Delegated Correspondent Lending. One of the key reasons for NexBank’s growth is our account executives. The team has achieved considerable success, reaching record loan volume in Q1, and the account executives continue to gain market share with their clients. With an average tenure of 12 years at the bank, our account executives are highly experienced and knowledgeable of the dynamic mortgage industry. To further strengthen the team, the bank recently hired four additional account executives and a delegated correspondent sales support member. We welcome Missy Apel (Mid-West region), Stacey Faul (Mid-West region), Lyndsey Madsen (West Coast region), Denise Tragale (East Coast region), and Susan Ferris (delegated correspondent sales support) to the NexBank team. Contact us to learn about the benefits of partnering with NexBank.”
“If you’re ready to join a company that gives you a voice in its direction, look no farther than New American Funding. We don’t have multiple layers of leadership and red tape surrounding everything we do. That means we’re able to give our loan officers a seat at the table when we make decisions that affect how we do business. From pricing exceptions to loan-level decisions, we want your input. We’re also committed to giving you the freedom to hire the team that is right for your market and your business. As a privately-owned company, your expertise helps us make strategic decisions that meet your needs and not shareholder needs. If you’re ready to join a company that gives you a voice, we’d love to talk to you – contact SVP, Business Development and National Recruiting, Brooke Anderson today! (609) 500-1520. EOE”
Originating loans just became a “snapp!” Embrace Home Loans has introduced eSnapp, a cutting-edge mobile app that lets borrowers apply for loans, upload documents, sign disclosures and even pay for their appraisals from anywhere, at any time. "eSnapp speeds up the loan process for borrowers while enabling loan officers to step in to help along the way, all from one app,” says Steve Adamo, president of national retail production. “It makes the jobs of our loan officers far easier, too.” No wonder Embrace continues to grow, even in today’s more challenging market. The company has added nearly 40 loan officers along the East Coast so far this year and will be hiring more. Interested in joining a winning team? Call Adamo at 401-524-5733.