Housing News, Appraisal, Broker Pricing, LOS to G/L Automation Products; FHA, USDA Program News; Renter Data

Inflation and price increases can be widespread and impact many, like gasoline or flour, or can be very specific and impact only a small portion of the population, like guitar strings or limoncello. Continued rent increases impact many, not the least of which are the roughly 50 million tenants themselves along with their potential loan originators who could help them finance a house. Word has it that owners stay in their homes 13 years, although this source says 16 years, whereas tenants stay in their rental about 3 years for a house and 2.5 years for multi-family/apartments. There is a lot of hope being placed by lenders in tenants who move into ownership, as volume stinks. According to Curinos, August 2023 funded mortgage volume decreased 26 percent YoY and increased 8 percent MoM. In the Retail channel, funded volume was down 31 percent YoY and up 8 percent MoM. The average 30-year conforming retail funded rate in August was 6.82 percent, 13bps higher than July and 124bps higher than the same month last year. Curinos drills into this data further here. (Today’s podcast can be found here and this week’s is sponsored by LoanCare, a Fidelity National Financial (NYSE: FNF) division and award-winning developer of the most sophisticated mortgage servicing portfolio management tool, LoanCare Analytics, built to support MSR investors with a focus on customer engagement, liquidity, and credit risk. Hear an interview with LoanCare’s Kevin Cooke on servicing technology advances and differentiators.)

Lender and Broker Products and Services

“Elevate Your Mandatory Trades with AFR Wholesale® (AFR)! With AFR you can expect: 1) Market-Leading Pricing - We don't just compete, we often lead! Experience the best value with our competitive rates. 2) Speedy Turnaround - We value your time. Expect swift responses and efficient services. Today, September 8th, we will be rolling out an enhanced version of our AFR Loan Center which makes confirming and delivering loans to AFR a breeze! 3) Winning Offers - Bid with confidence! Our aggressive rates are crafted to ensure you're backed by rates designed to win. Ready to elevate your game? 1) Not a client of AFR’s? Apply here. 2) Integrate AFR into your mandatory pricing engine. 3) Prefer a direct touch? Drop us your bid tape here. We’re here to chat! Visit here, email us, or dial 1-800-375-6071. AFR Wholesale® - Don't wait. Unlock your potential today!”

In this market, hustle is everything. You can’t afford to waste a single deal, or a single minute. That’s why ReadyPrice has launched Shop.Lock.Deliver,® an innovative new platform designed to help independent mortgage brokers like you save time and money. Now you can shop competitive loan offerings from multiple lenders, get rate lock guarantees in real time, receive underwriting findings, and deliver the borrower’s complete loan file to lenders, and all on a single platform, at no cost to brokers. It's already helping brokers around the country thrive and compete in even the toughest market environments. Multiple lenders. One delivery platform. Zero b.s. Check out ReadyPrice today.

“When the mortgage industry faces adversity, it requires an innovative approach and experienced leadership to guide its Loan Originators through headwinds towards success. Last week, Dave Higgins, VP of Business Innovation and the driving force behind policy implementation and process restructuring at UMortgage, earned the distinction as one of HousingWire’s 2023 Insiders Award Winners which honors operational leaders in housing who are working behind-the-scenes to drive their companies and clients forward. UMortgage is proud to boast an award-winning executive leadership team—which also includes Gil Arbitsman, CFO and 2023 HousingWire Finance Leader, and Corie Meredith, VP of Marketing and 2023 HousingWire Marketing Leader—whose industry expertise and creative solutions have allowed the platform and its Loan Originators to grow exponentially in a shrinking market. Follow this link to hear directly from Scotsman Guide top producers and UMortgage Loan Originators about the ways that this innovative platform can help your business reach new heights.”

Heading to NAMMBA Connect next week? Stop by the Byte booth to learn more about the LOS that gives you the freedom to do business the way you want. With unlimited custom screens and fields, robust process controls and flexible integration tools, you can design and manage custom workflows with automation, validation rules and countless customization options that don’t require a fortune or small army to administrate. If you’re tired of long contracts, failing implementations or having to change your process to fit your LOS, maybe it’s time to see why Byte has such happy clients. Schedule a meeting with the Byte team. Oh…and cookies. We’ll have freshly baked cookies at our booth! But don’t worry, you don’t have to schedule a meeting to get a cookie. Just stop by and say hi.

In challenging down economic times, Loan Vision is your solution to maximizing profitability and reducing costs in your business. With Loan Vision, companies see improvements of 25 to 35 percent decrease in days to close the books, 20 percent reduction in accounting headcount, complete LOS to G/L automation, and improved reporting and visibility that allow for better business decisions. Don’t accept a competitive disadvantage or get caught flat footed in a recovering market. To improve your cash position, gain a competitive edge, and prepare your business for sustained growth, contact Carl Wooloff to schedule a call today.

“Cheers to 20 Years! Carrington Mortgage is proud to announce a significant milestone in our journey: it’s our 20th anniversary! Celebrate with Carrington Wholesale & Correspondent with our 20-20-20 Special! 20 Years of Excellence, 20 Basis Points Savings on FHA, VA and USDA purchase and refinance loans and ends on the 20th of September. We’re also offering an additional 25 BPS off every VA & FHA purchase loan in the month of September! It's been an incredible two decades filled with trust, growth, and a commitment to serving our partners. As we celebrate this remarkable achievement, we want to express our heartfelt gratitude for your continued support. Please contact your Account Executive for more information on these special offers.”

Calling Brokers on the Go! STG Mortgage is thrilled to introduce Drone TPO, our innovative mobile app, at NAMB National. Drone TPO empowers Broker Partners with instant loan pricing and locking, pipeline management, condition uploads, and live status notifications. Most importantly, it enables 24/7 scenario submissions and exception requests, all powered by AI technology. Download our Fast Track form to start submitting loans!

Are you ready for Fannie Mae & Freddie Mac’s new appraisal independence requirements? They now explicitly prevent LOs from having any influence on the appraisal provider selection process, including AMC’s. Book a complimentary GSE appraisal compliance evaluation for help adjusting to these requirements. Our Head of Appraisal Compliance, Ken Dicks, will review the update, how it impacts your team, and advise you on how to ensure compliance.

New guide: Mortgage experts including Rob Chrisman, Maxwell Co-founder & CEO John Paasonen, and theLender EVP Chris Ledwidge weigh in on today’s market reset. Is your lending business prepared for the market reset? To survive, lenders need a fresh game plan driven by home buyer trends, creative lead generation, and insightful data. Maxwell put this guide together to help you refresh your thinking for the market ahead. In it, you’ll learn ways to rebuild your pipeline, the borrower segments that are still rising in the housing market, and how to better leverage data to make confident business decisions. Lenders: The next five years likely won’t be anything like the last five. Now is the time to rethink your business. Click here to download your free copy of Maxwell’s Mini-Guide to Surviving Today's Big Housing Market Reset.

Program News from FHA, VA, and the USDA

In a development that has been a priority of the MBA since Chris George was Chairman five years ago, the Federal Housing Administration (FHA) issued a waiver to a requirement that FHA-approved mortgagees flag rejected loans in the FHA Connection (FHAC) system. “FHA has determined that this flag does not improve risk management and is often why other lenders will reject an applicant even when that applicant might otherwise qualify for a loan. Currently, when a mortgagee rejects a borrower’s application for an FHA-insured mortgage, the denial information must be entered on the Mortgage Credit Reject (MCR) screen in FHAC. This action generates a warning flag associated with both the case number and the borrower for a six-month period, requiring a review by the jurisdictional Homeownership Center (HOC) when a borrower applies for an FHA-insured loan from another lender during this timeframe.

“By waiving this provision of the Single Family Housing Policy Handbook 4000.1, FHA will no longer require lenders to enter rejection information in FHAC, streamlining the loan underwriting process and removing an unnecessary barrier for borrowers who wish to obtain FHA-insured financing. This waiver is effective for all cases pending endorsement on or after September 11, 2023. For cases pending endorsement, any MCR case warning flags will be removed.

FHA announced a new functionality in the FHA Connection (FHAC) system, available in FHAC beginning Monday, August 14, enabling lenders to process their case cancellations and reinstatements through the Case Cancel/Reinstate Screen, and through the Business to Government (B2G) connection in the future. This eliminates the requirement to submit most requests to the FHA Resource Center for processing and in large part “eliminates an unnecessary manual request submission process by providing lenders with increased flexibility and efficiency to manage their case processing needs in FHAC without FHA assistance. When FHAC identifies an exception that requires FHA staff intervention, it will direct mortgagees to submit the request to the FHA Resource Center using the applicable template on the Single-Family Case Processing Requirements web page, which will be available on August 14, 2023.”

FHA published updates to the Single-Family Housing Policy Handbook 4000.1 (Handbook 4000.1). The update contains additions, revisions, and various technical edits to Handbook 4000.1, Sections I, II, III, and IV, Appendix 1.0 and 7.0, and incorporates previously published Mortgagee Letters (ML). A separate redline version of Handbook 4000.1 has also been posted on the Handbook 4000.1 Information web page.

USDA announced the online training modules for Combination Construction to Permanent Loans and Combination Construction to Permanent Loans: Rehabilitation and Repair are now available in Spanish. The training modules are available under the “Lender Training” tab in the USDA LINC Training and Resource Library.

USDA Rural Development posted a bulletin on 08/16: USDA Proposed Rule – Manufactured Housing Provisions. A Proposed Rule was published in the Federal Register seeking comments on proposed changes to Handbook 1-3550 and Handbook 1-3555 that would make existing manufactured homes, which meet specific criteria, eligible for financing. In addition, the proposal reduces regulatory burdens related to manufactured housing requirements and provides flexibilities for energy efficient manufactured and modular homes located in land lease communities operating on a non-profit basis. Comments on the proposed rule must be received on or before October 16, 2023, through the Federal eRulemaking Portal.

Capital Markets

There was a slight rally yesterday, reflecting growing expectations that the U.S. economy will thread the needle of a soft landing, or at least avoid a downturn this year. That’s good news after bonds didn't like the stronger than expected Institute of Supply Management (ISM) report earlier in the week. Fed funds futures don't see another rate hike at the September meeting, but there are coin-flip odds for another rate hike at some point later this year.

Regarding economic releases yesterday, initial jobless claims declined to the lowest level since February and continuing claims also declined to 1.68 million. While that is good news economically speaking, in a monetary policy sense it will likely keep the Fed in a restrictive policy position for longer.

Good news for originators: mortgage rates in the U.S. decreased for a second week in a row. The average 30-year fixed rate fell to 7.12 percent from 7.18 percent a week earlier, according to Freddie Mac. Mortgage rates have been above 7 percent for the past month and have more than doubled since the start of 2022. Even with rates at extremely elevated levels for the past four weeks, demand for homes around the country continues to outpace supply. A resilient housing market could mean the Fed’s fight against inflation will continue through the end of the year, either by way of more rate hikes or simply keeping rates where they are for longer. On the downside, a meaningful housing recovery raises the risk that inflation is going to be stickier.

This week winds down with a relatively quiet calendar, starting later this morning with remarks from Fed Vice Chair of Supervision Barr, wholesale inventories and sales for July, remarks from San Francisco Fed President Daly, and July Consumer Credit. We begin the day with Agency MBS prices better by a few 32nds and the 10-year yielding 4.23 after closing yesterday at 4.26 percent.

Employment

“Recently, Mountain West Financial (MWF) announced our growth plan into the Mid-West and Southeast markets with continued expansion into Oklahoma and Florida. MWF’s next stops are in South Carolina and Tennessee where we are looking to partner with like-minded, community-oriented loan originators and branches in these markets. This is part of our written growth strategy and an instrumental component of our overall company expansion,” Ed Adams, SVP Production. For information about our growth plans and career opportunities, contact Ed Adams or visit here for more information.”

“STG Mortgage, a National Wholesale Lender based in Anaheim, CA, offers a wide range of products, including competitively priced Conventional, Gov't, Non-QM, ITIN, FHA-DPA, 2nd Liens, and Jumbo options. "We're committed to excellence, blending cutting-edge technology with the expertise of our Executive and Sales teams," says CEO, Nectar Kalajian. STG is expanding and looking for Senior AEs to join our team. For more information, contact Todd Carte, our National Sales Director. Visit Booth #501 at NAMB to discover how STG can help take your business to the next level.”

Mortgage Equity Partners (MEP), an Independent Mortgage Banker headquartered in Massachusetts, continues to build upon its growth strategy. Earlier this year, MEP picked up a large group led by John Cabral, Executive VP/National Sales Director, and bringing over $100M in annual production. Continuing to expand, MEP has added loan officers and management in key markets, including MD & FL adding another 200M in annual production and opening new markets in TX and CA. Ian Aubourg, former Regional Director at Movement Mortgage, recently joined MEP as Senior Vice President. Ian brings a wealth of experience to the MEP management team. “We are very excited to add someone of Ian’s caliber to our team and looking forward to the many things Ian will contribute to our company,” said John Cabral. Learn more about MEP.

Jeffrey Flory Joins QC Ally as its new CEO! The leader in tech-enabled enterprise loan quality and audit services announced Jeffrey B. Flory, CMB, AMP as the company’s new Chief Executive Officer. His depth of knowledge within the risk, compliance and quality control space will allow him to champion the company’s vision of helping client partners achieve true enterprise loan quality while also driving initiatives designed to fuel further growth. “I am humbled to take on this role and help bring the company’s vision to fruition,” said Flory. “QC Ally is invested in only high-quality outcomes in both the services and the proprietary technology it offers to clients. The combination of flexibility and world-class service are a legacy I look forward to expanding on in the years to come,” Flory concluded.

WBK is pleased to announce that Timothy Ofak has been chosen to lead its Litigation Practice Group. Tim is a seasoned litigator with the expertise and industry knowledge to spearhead the group and continue providing WBK clients with exceptional service in the areas of financial services litigation and government investigations and enforcement actions. Congratulations, Tim!