Good News for Thornburg; Upcoming Events and Training; Investor News

Tomorrow we’ll take a deep look at potential future Dodd-Frank changes, but for something more concrete the Census Bureau told us that U.S. home ownership last quarter stood at nearly 64%. This is a slight rebound from its 52-year low in the second quarter; the homeownership rate for 2016 was the lowest since records began in 1965. Every residential lending vet will tell you that not everyone should, or deserve to, own their own house based on credit and other considerations. How hard does the government want to push it? (The other one percent of what I know comes from Wikipedia, and in this case how the home ownership in other countries stacks up.)

Here's some good news, unless you work for the SEC. The U.S. Securities and Exchange Commission dropped the last two remaining civil fraud charges in a long-running federal case against Larry Goldstone and Clarence Simmons, former executives of Santa Fe-based Thornburg Mortgage. This has been going on for nearly eight years since the firm went bankrupt in 2009. Remember that last June a U.S. District Court jury in Albuquerque found in favor of the two Santa Fe residents on five fraud counts and failed to reach a verdict on five other charges, including the central claim that the men had filed a false financial statement inflating the company's income. And the SEC dropped three of those charges in September, and a retrial for two final charges was set to begin later this month - one claim that Goldstone and Simmons had misrepresented information to auditors, and an additional claim against Goldstone that he had made a false statement to investors.

Goldstone, the firm's former CEO, and Simmons, the former chief financial officer, were accused by the SEC in March 2012, along with chief accounting officer Jane Starrett, of trying to hide the company's deteriorating financial condition, including an allegation that they schemed to overstate the company's income by more than $420 million in 2007. The SEC began investigating the case in 2008.

The big news in capital markets last week was CitiMortgage entering a sub-servicing agreement for a pool of Citi-owned loans and certain mortgage servicing rights, while also signing a definitive agreement to sell the mortgage servicing rights on the rest of the portfolio. Thus, CitiMortgage will be effectively exiting mortgage servicing by the end of 2018. Sub-servicing will be leveraged for all new originations beginning in 2018. This decision will enable Citi to simplify operations, and allow a deeper focus in developing and broadening relationships in key strategic markets. Citi will continue to be committed to the Correspondent Channel and its approved lenders.

Greystone, a real estate lending, investment and advisory company, announced it has provided a $5,221,000 Fannie Mae DUS Green Mortgage Loan to refinance The Duddington in Washington, D.C. The Duddington is a three-story, 34-unit residential market-rate rental building that was built in 1910. The owners purchased the property in April 2014 and invested over $1.5 million in environmentally friendly capital improvements such as rooftop solar panels, new roof, double-pane windows and replacement of the gas-fired boiler heating system with in-unit individual HVAC systems. Because of the retrofits, the building received the Environmental Protection Agency's ENERGY STAR Certification in December 2016. The Duddington loan is a non-recourse, 10-year fixed rate loan with a 30-year amortization that received the Fannie Mae Green Building Certification Pricing Break.

Fannie Mae's new investor reporting policy is now in effect. Servicers must report loan activity according to the new investor reporting policy requirements for borrower activity occurring on or after February 1 (see the Release Notes for details). Now through March 31, the post-delivery Servicing Transfer Moratorium is in effect for all post-delivery transactions that result in a change to the Fannie Mae seller/servicer number. Live webinars run through February - register today and take advantage of helpful resources on the Changes to Investor Reporting page.

FHA published Mortgagee Letter 2017-03, FHA Loan Review System - Implementation and Process Changes. This Mortgagee Letter announces FHA's intention to implement its new Loan Review System, which will provide an electronic platform for FHA loan-level file reviews and other quality control functions for Title II Single Family mortgages. The system implementation date will be confirmed in a subsequent Mortgagee Letter.

In terms of interest rates, yes, last week we had some minor moves, including some caused by Friday's employment data. But overall the yield on the 10-year, if you want to use that as a bell weather, didn't vary much from the 2.40-2.50% yield range last week. On Friday things wrapped up with it yielding 2.49%, on the high side, and the 5-year note and agency MBS sold off a couple ticks (32nds).

The data continues to show a solid U.S. economy, the Fed continues to buy $1-2 billion a day of MBS, and the Fed presidents continue to talk about future increases. Total transparency, right!? The Fed's eventual tapering of their MBS holdings will transform the mortgage market into one that is dominated by private investors. The devil's in the details...

This week, post-Super Bowl, has its share of scheduled news. Will any of it change analyst's minds that the Fed will raise short-term rates two or three times this year? Probably not. We have zip today of consequence. Tomorrow we'll have some Trade Balance numbers, JOLTS Job Opening stats, and Consumer Credit.

Wednesday we'll have the usual MBA read on last week's applications, and then on Thursday is Initial Jobless Claims. Friday are some Import Price figures along with the University of Michigan reports. We start the week with rates better: the 10-year is yielding 2.43% and 30-year agency MBS prices are better by about .250 versus Friday night.

Trainings and Events

Need to rapidly grow your purchase business?  Check out this special live event this Thursday, 2/9, at 1PM ET titled "How to Rapidly Build a Purchase Origination Business".  Ron Vaimberg, President and Executive Director of nmpU, will be presenting via livestream video.  One low price and you or your entire office can attend this national live broadcast. (This is NOT a Webinar). In just 90 minutes, Ron will show you exactly how to win purchase business using no cost / low cost strategies in today's competitive market.  Only 200 seats will be sold for this program. Please visit nmpULive.com for complete details and to capture one of the few remaining spots. Save $100 with discount code "Chrisman".

MGIC offers a FREE skill-based training for both Operations and Sales. For example, today Monday, February 6th, and again on Tuesday, February 28th, MGIC is offering a Special Event: 2 hours of training for Processors and Loan Officers with less than 3 years of experience or for  someone looking to buff and polish their expertise.

The NYMBA 2017 Convention "Great by Choice" will be held April 3-5 at the Desmond Hotel in Albany.  There is a great line-up of speakers already scheduled including Rodrigo López, Chairman of the Mortgage Bankers Association. Maria Zywiciel with over twenty years of financial services experience holding senior sales and management positions always aimed at serving the U.S. Latino market. Matt Tully, vice president of government and industry relations at Essent and yours truly, a senior associate of the STRATMOR Group. The agenda, registration information and other details are now available.

On February 9th, Join Buckley Sandler for a complimentary webinar. Learn about "W-2 Fraud - A Privacy Risk for Employees and an Often Uninsured Risk for Companies."

This month Arch MI offers "the right blend of industry education for your career. Its professional webinars on processing, appraisals, underwriting self-employed borrowers, and other essential mortgage lending topics help grow your career and expand your opportunities. Attend on your desktop computer or preferred mobile device. Audio streams through your device, no telephone connection required."

MBA's Mid-Winter Housing Finance Conference at the Ritz-Carlton, Bachelor Gulch, March 1-4 in Avon, Colorado is nearly sold out. An exclusive event in an exclusive location, the Mid-Winter Conference attracts a select gathering of top industry leaders for productive and open dialogue about the future of real estate finance, as well as unparalleled networking opportunities. The conference is closed to the press and will feature notable speakers like Esther George of the Federal Reserve Bank of Kansas City, Tim Mayopoulos, Ivy Zelman, Raj Date, Pam Patenaude, Dave Lowman, Joe Murin plus several DC insiders and industry leaders. The full agenda and additional details can be found here. Make your plans for Colorado now while space is available!

The California Mortgage Bankers Association is partnering with the State Treasurers Office's California Capital Access Program (CalCAP) to host a free webinar this week detailing their new program that provides loss reserve funding for participating lenders making qualified loans to residential property owners and small business owners (with fewer than 500 FTEs) to seismically retrofit residential and commercial buildings.  Beginning in January 2017, the Program incentivizes private lending to borrowers to make seismic-safety upgrades to existing commercial buildings and homes, including multi-unit housing and mobile homes registered with the California Department of Housing and Community Development.  The webinar is Thursday, February 9th at 11AM PT.  

Franklin American Mortgage has published its February Wholesale "Monthly Customer Training Calendar".  This month's calendar offers a variety of training opportunities such as "Loan Processing", "Shut the Door on Fraud", "How to Review an Appraisal", "Not your Ordinary Assets" and "Selling to Millennials"".

Jobs and Announcements

A few pieces of personnel & hiring news to start the week.

SocialSurvey welcomes Leena Kostelich to the team as our Northeast RVP of Business Development. She has hit the ground running with 6 Enterprise Contracts out in her first 3 weeks. SocialSurvey is looking for several additional Regional Sales Professionals. There's still time to come onboard before The Mortgage Collaborative and LendersOne conferences. SocialSurvey provides a platform for our clients to collect customer feedback, share it on social media, boost SEO, retention, recruiting, and social proof. SocialSurvey is offering salary, commission and equity. Send confidential resume and contact info to afaiz@socialsurvey.com

As Angel Oak Mortgage Solutions closed 2016 with a record month, management reported the addition of 8 new Account Executives in the 4th quarter alone. Florida alone gained 4 new AEs as Gerry Calderon, Rick Gil, Arthur Barrera and Sergio Gutierrez all joined while also adding Charles Haney in Texas, Suzi Swisher in Pennsylvania, Chris Barker in South Carolina and Carlos Yniguez in California. Angel Oak Mortgage Solutions has doubled its sales force from this time last year. "As we look to expand across the country and build market awareness, each of these new Account Executives bring something different to Angel Oak." added Tom Hutchens, SVP of Sales and Marketing. With aggressive growth plans for 2017, Angel Oak is continuing to hire AEs in markets across the country and underwriters/support staff in their Atlanta headquarters. Email careers@angeloakms.com immediately for consideration.

Congratulations to Frank Mancino, who was promoted to Regional VP for the Mid-Atlantic region at Finance of America Mortgage. In this role, Mancino will be supporting FAM branch managers in DE, MD, NJ, NY and PA as well growing the FAM branch network in these states. Mancino is a 30-year veteran of the mortgage industry and has held senior posts at several well-known lenders before joining Finance of America Mortgage in 2005.

On the flip side of things Paul Muolo with IMF reported that, "Len Israel, who was hired by Flagstar Bancorp as president of mortgage banking roughly 18 months ago, has left the company, according to industry officials close to the matter...One of the tasks that Israel was reportedly given was to grow the depository's retail division. In the fourth quarter, Flagstar funded $590 million in retail mortgages, a slight decline from 3Q16 but almost double what it did in the fourth quarter of 2015. In 4Q16, Flagstar originated $8.56 billion in residential loans, ranking 12th nationwide, per Inside Mortgage Finance. Third-party lending accounts for most of its production."

Some lenders are reveling in their 2016 numbers. For example, Salt Lake City's Primary Residential Mortgage, Inc. spread the word that it funded nearly $6.3 billion in residential home loans, launched 40 new branch locations nationwide and added more than 800 new employees. "Additionally, 145 PRMI branch offices set new monthly or annual production records.  Most importantly, an extraordinary 9 out of 10 customers would recommend PRMI to a friend or family member." Congrats!