Hedging, Guideline Search, VOI and VOE Tools; Rocket Earnings; Events and Training

“Alexa, where’s my damn package?” (Page down 3-4 times to the video.) Life is full of surprises, good and bad. Rates aren’t a surprise… The U.S. Federal Reserve can only do so much about inflation. Geo-politics are a big deal, of course, and there is nothing our Fed, tasked with maintaining economic stability in this country, can do about those. Vendors and lenders are doing what they can, cutting over-capacity and expenses. Capital markets staffs everywhere are interested in which investors have pushed out the $2,500 Freddie and Fannie month-old HomeReady credit, as well as non-QM, jumbo, co-issue, and servicing buyers. (STRATMOR’s current blog is titled, “It’s 2024: Do You Know Where Your Servicing Is?”) Speaking of capital markets, today’s TMC Rundown features Mutual of Omaha’s Matt Nyman. (Found here, this week’s podcast is sponsored by Truv. Truv lets applicants verify income, employment, assets, insurance, and switch direct deposits. Unlock the power of open finance, with Truv. Today’s has an interview with Verisk’s Kingsley Greenland on servicing for climate risk and technology solutions.)

Lender and Broker Services, Products, and Software

Mortgage lenders using Empower, the loan origination system (LOS) by Dark Matter Technologies, rejoice! TRUV and Dark Matter bring consumer-permissioned VOI & VOE to the Empower® LOS, reducing costs by 60-80 percent, accelerating loan cycles, and creating a better borrower experience. TRUV brings the best-in-class coverage and conversion directly from the source to your Empower LOS for income and employment verifications. Ask one of us to see a demo of TRUV in Empower® LOS!

Discover the "ChatGPT of mortgage guidelines," Guideline Buddy, at NMP's next OriginatorTech webinar on Tuesday, March 5, 2024, at 11 AM PT/2 PM ET. On this live group demo, you will witness how this AI-powered chatbot streamlines the search for mortgage guidelines, transforming it into a quick, easy, and precise process. Embrace a new era of efficiency as originators move away from the endless navigation through PDFs. Plus, don't miss your chance to "Stump the Buddy.” Ask a question that stumps Guideline Buddy during the webinar and you may win a $100 Amazon Gift Card! Register here.

Product and Processing News

Rocket reported annual origination volume in 2023 of $78.7 billion, a 40 percent decline from 2022, and Rocket Companies, Inc. (RKT) reported a loss of $10.6 million in its fourth quarter.

Citi Correspondent Lending posted credit policy updates on personal gifts and gift equity, future income, rental properties, variable income, VISA classification chart, rental properties, 2024 FHA maximum loan amount changes and DU Version 11.1 – LTV updates. View Citi Correspondent Lending Bulletin 2024-01 for details.

LoanStream Mortgage buydown loans provide a lower rate for the first one or two years, paid by the seller. 2-ONE and 1-0 Buydown Highlights include 30-year Fixed Rate Mortgages, Primary Residences only, Single Family Residences, PUD and Condos, VA, FNMA, and FHA only. Find out more about LoanStream Mortgage buydown loans.

In its commitment to enhancing your loan originating experience, Plaza Home Mortgage® introduced a seamless improvement to the Initial Closing Disclosure (ICD) process in BREEZE.

AmeriHome revised the Relock policy for loans delivered under the Delegated underwriting program. Details are available in the AmeriHome Mortgage Secondary Announcement.

Effective immediately, Citizens Correspondent has further improved pricing for non-owner occupied properties.

Jet Mortgage is offering FHA DPA - 100% LTV FHA with new improved pricing. Jet 200 FHA DPA highlights include 600 Min FICO, Must be DU Approve/Eligible - No Manual Underwrites, 1 Unit, Condo's, Townhomes, Repayable & Forgivable Option, No 3rd Party Processing Fee Allowed, Loan Amounts Per County Limits ($726,200 Max), DTI: No Max Per AUS, All Borrowers Must Have at Least 1 Credit Score, 1st Lien Must Be: Primary, 1 Unit, Purchase, 600 FICO, 30 YR Term.

Webinars and Training

(A good place for longer term conference planning is to start is here, and click on “Conference List” for in-person events in the future.)

Today is this week’s episode of The Mortgage Collaborative’s Rundown covering current events in the mortgage market for 30-45 minutes starting at noon PT, 3PM ET, in “The Rundown”. Listen in to Matthew Nyman discuss renegotiations and extensions.

Join MBA Breakfast & Learn today, February 23, from 8:30 am-10:30 am at Founding Farmers and hear an Economic and Market Update from MBA's Marina Walsh, CMB. The cost is $30 for members, $45 non-members.

As part of the certified packaging process, Rural Development (RD) partners with Housing Assistance Council (HAC), NeighborWorks America (NWA), and Rural Community Assistance Corporation (RCAC) to provide the Section 502 direct loan application packaging training. In person certified loan application packaging course is now open for registration, NeighborWorks America: Monday, February 26 – Wednesday, February 28, 2024. Completion of an approved course is required for a loan application packaging certification.

Learn the checks and balances you can use to ensure your partners are complying with industry regulations on the RESPA: Ensuring Fintech Partner Compliance webinar on Feb. 27th. FNF Family of Companies’ Chuck Cain and Mortgage Connect’s Gabe Minton will be sharing the factors you need to take into consideration including: a brief overview of fintech and artificial intelligence, lessons learned from the Amazon AI and First Federal Bank settlement, strategies to ensure partners follow through on their stated compliance protocols, and much more. Learn how to identify what you need from your partners: RESPANews.com.

Today, looking for more in-depth commentary on weekly mortgage news? Register here for "Mortgage Matters: The Weekly Roundup” presented by Lenders One. Every Wednesday at 2:00 PM EST/11:00 AM PT is a dive into a range of mortgage-related topics, including market trends, interest rate fluctuations, innovative mortgage products, and industry advancements. Hear from Owen Lee of Success Mortgage Partners on the 28th!

At noon ET on February 28th the NY MBA offers up Carla Johnson and Craig Hoff from Earthvisionz as they dive into foreseeable climate risks and solutions for 2024 in New York.

Join MMLA Southeast Chapter at the Federal Reserve Bank - Detroit Branch on Thursday, February 29th 11:00 a.m. - 1:30 p.m. to hear from speaker, Martin Lavelle, senior business economist who will provide insight on what's really going on with our economy and what it means for our business. An exclusive tour of the building will follow lunch. NOTE: all registrations need to be made before February 24 for security purposes. Cost: $29/member and $39/non-member include boxed lunch.

A&D Mortgage offers the upcoming webinar "Generational Bridges in Mortgage" on leap day of February 29 at 1PM. “This distinctive roundtable event will feature a dynamic discussion among members of two families (Denese Carty, Ally Carty, Rob Chrisman, and Robbie Chrisman). “The webinar aims to bridge the gap between generations within the mortgage industry, offering unique perspectives on the challenges and opportunities faced by Baby Boomers, Gen Xers, Millennials, and Gen Z.

The 2024 Central Florida FAMP Education Day is 8:30 AM to 4:30 PM; followed by the Free Annual Trade Show from 4:30 PM to 8:00 PM, on February 29th at the Altamonte Hilton.

Capital Markets

Navigating the mortgage secondary market over the last few years has been challenging, to say the least, requiring capital markets professionals to deploy more advanced hedging strategies to appropriately price and most effectively hedge their loans. One such strategy is cross-hedging, which Vice Capital Markets’ Chris Bennett has outlined in a just released white paper, “Cross-Hedging: A Guide to Safely & Efficiently Increase Profitability in the Secondary Market.” The white paper is free to access on Vice Capital’s website: no need to give up your email. Take a read, and feel free to reach out to Chris if you’d like to learn more.

Turning to the economy, and therefore the bond markets, and therefore mortgage rates, the implied likelihood of a Fed rate cut in May continued to fall yesterday after U.S. jobless claims fell to the lowest level in a month and Fed officials warned of easing too much on improving inflation. Vice Chair Jefferson said that it will likely be appropriate to begin cutting rates later this year, and that he is cautiously optimistic about the way inflation is evolving. His main risks to predictable Fed policy in 2024 are resilient consumer spending, robust employment, and elevated geopolitical risks.

It is important to remember that not only does consumer spending serve as an excellent recession indicator, but it also plays an underrated role in Fed policy. The bullish U.S. economy has forced investors in 2024 to walk back bets on rate cuts. Pricing in fed funds futures now implies three rate cuts for the year. The Fed minutes released earlier this week revealed that “In discussing the policy outlook, participants judged that the policy rate was likely at its peak for this tightening cycle."

Existing home sales started 2024 on a positive note, increasing 3.1 percent in January as single-family sales accounted for the entire gain. The 4.00-million-unit annual pace of total re-sales represents a moderate rebound from December's near cycle low and marks the fastest pace since last August. Sales declined 1.7 percent from the prior year. The boost in sales is the anticipated catching up to the contracts that were signed late in the fourth quarter as mortgage rates fell.

Some other data points of note from the NAR’s report include the median existing-home sales price climbing 5.1 percent from January 2023 to $379,100, the seventh consecutive month of year-over-year price gains. And the inventory of unsold existing homes increased 2.0 percent from December 2023 to 1.01 million at the end of January, or the equivalent of 3.0 months’ supply at the current monthly sales pace.

For the week ending February 22, Freddie Mac’s Primary Mortgage Market Survey reported that the average 30-year fixed-rate mortgage increased 13 basis points for the second straight week to 6.90 percent, the highest level since 6.95 percent in mid-December. Meanwhile, the 15-year rate increased 17 basis points to 6.29 percent after a 22-basis point jump previously, also its highest since 6.38 percent in the week ending December 14, 2023. The 15-year rate is important to pay attention to because with the aggregate prepayment speeds in both Ginnie Mae and Fannie Mae 30-year mortgages currently trending around multi-decade lows, one source of relatively faster speeds for investors are Ginnie Mae II 15-year agency MBS.

Compared to a year ago, rates on the 30-year and 15-year fixed mortgage rates remain higher by 40 basis points and 53 basis points, but lower by 89 basis points and 74 basis points, respectively, from the cycle highs in October. Last month, the rates had gotten to as low as 119 basis points and 127 basis points below the October highs.

Today’s calendar has no economic releases or Fed speeches scheduled, which is music to the ears of those market participants that are out of the office with many schools on vacation. Accordingly, trade volumes should be on the lighter side. Treasuries, though, will likely be seeing some set up for the $169 billion in month-end auctions next week with $63 billion 2-year and $64 billion 5-year notes on Monday followed by $42 billion 7-year notes on Tuesday. With no economic data on today’s calendar, we begin the day with Agency MBS prices little changed from Thursday evening and the 10-year yielding 4.32 after closing yesterday at 4.33 percent.

Employment

“Stronghill Capital, LLC, an Austin, TX-based Wholesale and Correspondent lender, is now hiring across the country! If you’re a relationship-focused Account Executive with experience in Non-QM and Investor Financing, including multi-family and mixed-use properties, we’d love to speak with you! Stronghill’s Account Executives enjoy open territories, multi-channel opportunities to work with clients as correspondents OR brokers, and consistent communication and collaboration with the Executive Leadership team. If you’re looking to join a rapidly-growing, dynamic organization with a focused commitment to growth and expansion in Non-QM, reach out to our SVP of Sales, Matt Brammer at 440.382.3183 to learn more.”

“Evergreen Home Loans is thrilled to announce our expansion into the Rocky Mountain States, starting with Montana! This strategic move introduces a new chapter in our growth, bringing Montana's top mortgage loan officers into the Evergreen family. Our expansion not only extends our reach but also underscores our commitment to making homeownership more accessible. With a focus on innovation and personalized mortgage solutions, we aim to empower more families to achieve their dream of owning a home in Montana. Evergreen's comprehensive mortgage services are designed to meet the unique needs of Montana's communities, promising to make a meaningful impact. Join us on this exciting journey as we continue to set new standards in the industry. Explore the opportunities and become part of our growing team. For more information on available positions, please visit our Mortgage Jobs and Careers.”

Fannie Mae announced that Peter Akwaboah has been appointed EVP and Chief Operating Officer (COO), effective May 20, 2024. Akwaboah has nearly three decades of experience and will be responsible for Fannie Mae’s Chief Information Office, Enterprise Operations, Business Resiliency, and Enterprise Workplace and Security functions. Akwaboah will be a member of Fannie Mae’s Management Committee and report to Chief Executive Officer (CEO) Priscilla Almodovar.

Xactus announced that 25-year vet Michael Crockett has been named Chief Operating Officer, moving from his role as Chief Data Officer. He will guide Xactus’ day-to-day operations and key departments including credit, verifications, and tenant screening, and lead the strategic advancement of the company’s data innovation and Quality Assurance/Quality Control initiatives, and evaluate internal and external customer experiences, focusing on enhancing its service quality, delivery, and technical support. Crockett is on the Consumer Data Industry Association Board.