Point of Sale, QC, LOS Products; STRATMOR on Customer Service; Academy, False Claims, and $38.5 Million

Anyone who has ever gone swimming in the ocean knows that, in a violent surf, the swimmer can’t spend time and energy in the waves near the shore being knocked about. They either swim out beyond them, or swim into the beach. Using that analogy, think about lenders and vendors in the current environment. Having “no plan” is not a plan. Best to go one way or the other, because staying in the surf can be exhausting. (It will be a topic of today’s chat between the MBA’s fabled chief economist Mike Fratantoni and me at 11AM PT.) Meanwhile, capital markets departments are grappling with renegotiations, although I am hearing from lenders that with pipelines primarily consist of non-rate sensitive new home purchases and cash-out refis. It would be fair to expect new, lower mortgage rates to actually stimulate some new demand by consumers. And consumers certainly have options, including sponsored stories about the best cash-out refinance and home equity loan providers. “Our editors have selected the best cash-out refinance and home equity loan providers.” Guaranteed to rile up every MLO out there. (Today’s podcast is sponsored by Appraisal Logistics, a full-service AMC licensed in all 50 states. AIM-Port’s robust integrations, custom automations, and granular reporting tools are delivering gains in efficiency and cost savings to lenders across the country. Today’s has a discussion between RC2 and RC3 on the residential lending landscape as we wind down 2022 and look to 2023.)

Lender and Broker Software, Products and Services

Whole loan investors know all too well the challenges of profitably competing in today’s secondary market and establishing new seller relationships. Tight competition makes it difficult to stand out amongst the crowd at a time when scale is necessary to offset extremely low margins. Read MCT’s recent blog, How to Efficiently Scale Your Whole Loan Acquisition Channel, which includes a primer on how MCT developed the industry’s first truly open loan exchange, BAM Marketplace, with the necessary tools for buyers and sellers to transact regardless of approval status. As 2022 ends, it will be characterized as one of the most volatile years in housing history, but what can we expect for 2023? MCT’s latest blog, 2023 Housing Market Predictions, delves into potential paths forward for the residential housing industry as we close 2022. Additionally, sign up for MCT’s newsletter to receive the latest capital markets content.

The triple has been called “baseball’s most exciting play” for a reason: we don’t see them very often today. While there is no active player with more than 85 career triples, “Wahoo Sam” Crawford, the all-time triples leader, hit 309 in his career. Watermark Home Loans wants to make history by stacking its team with mortgage advisors emulating “Wahoo Sam” and tripling the average mortgage originator production. As Watermark vice president Regan Hagestad said, “People ask how we have such a high-performing team. It’s all about building the right playbook. But when you start adding tools like Sales Boomerang as part of your playbook, you equip the people on the field to succeed.” See how Watermark has added Sales Boomerang and Mortgage Coach to the playbook and start your journey to the career triples leaderboard. Download the free case study today.

This time of year, “simple” is in short order. The holidays mean a run on gifts, big dinners for big families, and never enough time to make any of it come together how you’d like. As busy as you are wrangling the rest of your life, the last thing you need is a headache with your loan origination system (LOS). Empower®, Black Knight’s industry-leading mortgage LOS, puts the “simple” back in loan origination without sacrificing horsepower. Empower brings cutting-edge automation to a single, flexible platform helping lenders and credit unions of all sizes save time, save money and improve the mortgage process and homebuying experience for customers. It supports retail, consumer-direct, home equity, correspondent, wholesale and assumption channels – all on a single system. Explore what Empower can do today, and see how this innovative LOS is helping businesses grow -- even in this tough originations market.

ACES Quality Management’s Upgrade Enhances Communication, Collaboration on QC Findings. The proprietary ACES CONNECT portal provides enhanced productivity and collaboration in resolving loan defects, requesting or supplying additional documentation, answering questions and concerns and tracking communications within the organization and externally with third parties. This latest enhancement, enables ACES administrators to customize access to QC reporting and data on an individual user basis for improved flexibility and greater security. “This enhancement was a direct result of listening to our clients’ needs and making the necessary advancements to our technology to improve communication and collaboration on QC activities,” said ACES CEO, Trevor Gauthier. Read More.

“Outperforming Industry Benchmarks for Customer Service! At Cenlar, we are always looking to improve the homeowner experience through our investments in people and technology. The results of our efforts are clear, with the kind of progress that is measurable. Our call center is consistently outpacing industry benchmarks. This performance reflects our philosophy to “think like a homeowner” and we have committed ourselves to anticipating homeowner needs. Through proactive communications like our chat bots and website, homeowners can get what they need, when they need it, in a manner they choose. While it is important to us that we are among the best in our industry, it’s an even greater importance that we are always improving the service we deliver to our clients and their homeowners. Let’s discuss how Cenlar can meet the mortgage servicing needs of your organization. Call 1-888-SUBSERV (782-7378) or visit us.”

Are you ready for 2023? It's never too early to be thinking about next year’s bottom line. Planet Home Lending’s Correspondent team is ready to help with unparalleled service, innovative technology, and expanded temporary buydowns available for Conventional, FHA, VA, and USDA loans. Regional Sales Manager Jennifer Caldwell (909-225-8444), and Regional Sales Manager Tiffany Ta (714-376-3214) will be at the Independent Mortgage Bankers Conference at Hotel del Coronado in Coronado, CA, Jan. 23-26. Reach out for a 30-minute consultation that can boost your business all year long. Whether mandatory, best effort, or bulk delivery, put Planet to work for you next year and beyond. No matter the market, we do Correspondent lending right.

Does your current loan application have a 90% completion rate? In a competitive market, lenders must maximize every borrower lead. Maxwell Point of Sale delivers a game-changing digital experience to help you attract, convert, retain, and delight borrowers like never before. The Maxwell QuickApply™ feature allows borrowers to pre-fill required fields by simply inputting their zip code and last four digits of their social security number, cutting time to complete the application and leading to an over 90% application completion rate. With other built-in options, such as a Spanish-language application, a powerful eClose solution, and HELOC abilities, Maxwell is a powerful differentiator for lenders in a tough market. Ready to close more loans than your competitors? Schedule a call with our team to learn more about Maxwell Point of Sale and start turning more leads into borrowers.

STRATMOR: What Customers Want

What’s on the wish list of every loan origination this season? 1) Lower rates, 2) More client referrals, and 3) New partnerships… A tall order even for Santa! In his December Customer Experience Tip, STRATMOR Group’s Director of Customer Experience Mike Seminari outlines what LOs are asking for and offers lenders three suggestions for fulfilling their LOs’ wish list. “Most lenders want to play Santa for their staff,” says Seminari. “In a recent STRATMOR workshop, we asked lender executives their own ‘wish list’ for their companies. The number one ranked answer was to ‘Improve sales effectiveness,’ with ‘Improve customer experience’ and ‘Optimize process/workflow’ coming in second and third. To step into the Big Man’s boots, lenders must first consider their employees’ wish list requests, then ultimately pass them through a filter of what will truly bring the most (and most lasting) enjoyment.” Don’t miss Seminari’s article, “The Mortgage Originator’s Wish List: A Lender’s Guide to Giving.”

Academy and the False Claims Act

The False Claims Act is a federal statute originally enacted in 1863 in response to defense contractor fraud during the American Civil War. The FCA provided that any person who knowingly submitted false claims to the government, in that case to the government for Union supplies, was liable for double the government's damages plus a penalty of $2,000 for each false claim. Critics say that it is a “catch-all” Act that has snared many lenders for a variety of reasons and is responsible for many heavy fines. The latest example being…

Mortgage company Academy Mortgage Corporation, based in Draper, Utah, has agreed to pay $38.5 million to resolve allegations it violated the False Claims Act by improperly originating and underwriting mortgages insured by the Federal Housing Administration (FHA).

Academy shot a note over to me, saying, “Since 2016, Academy Mortgage has been engaged in a lawsuit in the Northern District of California. Despite the U.S. Government asking the court to dismiss the case multiple times, Academy made a business decision to settle the case to mitigate additional costs and disruption of further litigation. As stated by the Department of Justice, ‘The claims resolved by the settlement are allegations only and there has been no determination of liability.’”

Capital Markets

The Fed raised its target overnight rates .5 percent (50 basis points) to 4.375%. Dr. Eliot Eisenberg observed, “Markets were hoping the Fed might halt increases going forward due to declining inflation, and because in September Fed members anticipated raising the fed-funds rate to slightly above where it’s now. Those hopes were dashed. The Fed now expects to slowly raise the fed-funds rate another 75bps-100bps and keep the higher rate there through 2023!”

So as expected, the Federal Open Market Committee raised its benchmark rate by 50-basis points to a new range of 4.25 percent to 4.50 percent. That marked a slowdown from the 75-basis points per meeting pace registered from the prior four meetings, but is still a large rate hike, historically speaking. The FOMC also signaled that they anticipate slower growth, higher unemployment, and higher inflation for next year than they had indicated at the September meeting.

Further increases are expected in 2023 with the benchmark rate projected to rise to a peak of 5.10 percent for this cycle, up from 4.60 percent that was projected in the September dot plot. Rates are then expected to taper off in 2024 and 2025, to 4.10 percent and 3.10 percent, respectively. The hawkish tone of the dot plot invited selling in Treasuries and equities with inflation remaining high and the tight jobs market adding to current price pressures. Fed Chairman Powell said that the central bank is not considering any changes to its inflation target at this time.

Following yesterday’s FOMC events, today sees a laundry list of central bank decisions including the SNB, Norges Bank, BoE, and ECB, with all but Norges Bank expected to raise rates 50-basis points, like the Fed. The U.S. economic calendar is also packed with data and supply starting with retail sales (-.6 percent but October was revised higher), Empire and Philadelphia Fed manufacturing (Empire was -11.2, a disappointment) and weekly jobless claims (211k, down from 230k, continuing claims unchanged). Later this morning brings November industrial production and capacity utilization, October business inventories, and Freddie Mac’s Primary Mortgage Market Survey. We begin the day with Agency MBS prices roughly unchanged from Wednesday, which were roughly unchanged from Tuesday, and the 10-year yielding 3.48 after closing yesterday at 3.50 percent after the slew of news.

Employment and Transitions

Opteon USA, one of the fastest-growing international providers of valuation, advisory, and property services, is looking for a Senior Director of AMC Operations to join its team. Standout candidates will have significant experience leading the day-today operations of an AMC (preferably 10+ years), the desire to lead, inspire, and develop other leaders, and experience collaborating across functional organizations. Opteon is a high energy, open, and collaborative company that is changing how appraisals are done in the U.S. If you’re looking to join a company that delivers stability, culture, growth, and a vision for the future, contact EVP of Human Resources Gerald Sexton to confidentially explore this opportunity.

Have you ever wondered how Originators close $100M + per year? The answer is simple: They have a team in place that allows them to originate all day without distractions or getting pulled back into files. One of the Top Originating teams in the nation is looking to provide 1 Originator an extremely unique opportunity. This Originator would plug directly into the team, have their files worked on by 2 processors, 2 underwriters and 1 operations manager with a combined 70 years of experience. Sounds pretty good right? This Originator will also be personally coached by one of the top producing Originators over the last decade. If you close $20M or more per year and are looking for a breakthrough in your career, contact Anjelica Nixt or click here to schedule a confidential conversation.

U.S. Mortgage Insurers (USMI) announced that Seth Appleton, the President of the Mortgage Industry Standards Maintenance Organization (MISMO), will serve as the association’s new President starting in January 2023.

Not surprisingly, MISMO®, the real estate finance industry's standards organization, announced that Vice President of Operations Jan Davis will serve as Acting President, following the departure of Seth Appleton.