Efficiency, AVM, POS Products; MI, Wholesaler, Correspondent News; STRATMOR M&A Interview

“I threw my phone from the roof, and it broke. I guess airplane mode wasn’t working.” Plenty of folks will be traveling soon. Here’s some trivia for tomorrow at the dinner table! (One wonders if residential lending is heading in this direction) … But there are only 12 passenger airlines in the United States. That’s up from 10 just a few years ago but down from about 80 airlines at the peak industry in the 1980s due to a series of bankruptcies and mergers. Four of those companies (Delta, United, American, and Southwest) control 80 percent of the market, with the remaining 20 percent being low-budget airlines that are increasingly struggling. The average airline fare has declined 13 percent over the past year, and that’s been causing issues for the companies that specialize in lower fares, as many of their customers are now seeing the big guys as more accessible than before. (Today’s podcast can be found here, sponsored by Candor. Candor’s patented automated underwriting decision engine, CogniTech, is a state-of-the-art, 100 percent machine platform that can handle infinite loan scenarios. Hear an interview with the STRATMOR Group’s Garth Graham on M&A activity in 2023 and trends in the space heading into 2024.)

Lender and Broker Software, Products, and Services

With increased regulatory focus on property-valuation bias, lenders need robust risk-management processes in place. The recently released interagency proposals on AVM quality control and ROV-process guidance are designed to prevent valuation bias and help ensure industry stakeholders follow fair-lending practices. Watch our complimentary on-demand webinar to learn how you can prepare, and implement the tools needed to support the proposed AVM standards and ROV guidance.* Our experts discuss how to identify potential bias in valuations, ways to mitigate bias risk, how to monitor AVM and appraisal compliance with fair-lending requirements, and more. Watch this timely and important webinar here. *Check with your compliance or legal department for information on complying with applicable law.

Pipeline as dry as your mother-in-law’s turkey this time of year? Moisten it up with LiteSpeed by LenderLogix.

From zero to correspondent in 60 seconds… Building a correspondent channel requires exceptional customer service, precise execution, & immediate responses. Regular way, it’s costly & inefficient. Blue Water has solved this. Our comprehensive Correspondent-as-a-Service (CAAS) solution allows firms of ANY size to quickly streamline their operations and get up and running. Automated bidding provides instant pricing via email, branded portal & bid desk for sellers facilitated by our tape crack features and customizable seller settings. Ingest multi-seller tapes, price different product types, access agency pricing and LLPAs. (“Blue Water”) will integrate with your LOS for point and click onboarding, help you transfer loans, and manufacture clean product. Choose an optimal Servicing execution, best-ex in-bound loans and drive volume. Make $, grow your business and pay as you go with no upfront cost. From pricing, valuations, transactions, transfer, QC, to boarding, Blue Water makes it easy to scale up your business. Connect with our expert Sales Team.

Orion Lending slashed its annual expenses by $300,000 and boosted its conversion rate by 32 percent using Truv’s income and employment verification solution. “Truv transformed our verification process, expanding our reach and cutting costs,” asserts Richard Plummer, EVP of Operations at Orion Lending. Stop Overpaying. Highlights include impacting $300,000 annually in savings as a result of increased conversion rates, 32 percent end-to-end conversion rate, an increase of $100 in savings per application, implementing Truv in a couple of weeks, and reduced the loan manufacturing time and approval process by several days. Contact TRUV today for your income, employment, insurance, and asset verifications.

Miscellaneous Wholesaler, Correspondent, and MI News

Angel Oak Mortgage Solutions announced the release of its new DSRC Loan Calculator, providing borrowers with a quick and straightforward tool to estimate whether or not a property’s expected cash flows are sufficient to repay the mortgage loan. In tandem with Angel Oak’s DSCR Loan program, the DSCR Loan Calculator helps you show borrowers what their monthly fixed payment or monthly interest only payment would be depending on the option they seek.

Fifth Third Correspondent Lending News 2023-7-11.13.23 discusses Final Document Reminders, and Fannie Mae Products 2-4 Unit LTV.

PRMG Product Update 23-52 clarifies information on Expanded Access including multiple Financed Properties requirements for Pime and Plus connect, prepay is no longer allowed in KY and LA. Also, due to prepay not being allowed in KY, Investor Premier is no longer eligible in KY. Updates to Choice Products Profile and/or Expanded Guidelines which includes revisions to investment properties standard prepay penalty amount and increased maximum interested party contributions. Revised guidelines for Short Term Rental income. Updates to Product Profile and/or Expanded Guidelines on Choice Stretched Prime and Choice Non-Prime, Choice DSCR, and Closed End Second Products.

Reach more clients with loan programs that allow Manufactured Homes. LoanStream Mortgage knows the complexity of financing these types of homes and can help your borrowers attain a mortgage by offering a variety of loan solutions to fit their needs. Loan Programs allowing Purchase & Refinance Manufactured Homes include Conventional – Fannie Mae FNMA, RefiNow, FHA, VA, MaxONE. The following are not allowed on these programs: Non-QM / NanQ, Conventional – Freddie Mac – FHLMC, USDA, and Jumbo ONE.

Did you know that borrowers can turn cash-only properties into their dream homes with a renovation loan? When homes don’t meet the minimum property requirements (MPR), Plaza Home Mortgage® has the solution. Renovation loans can help elevate homes to meet MPR standards, and the improvements can even take place after the closing process. What’s more, qualified borrowers can be approved based on the future value of the improved property, making this option accessible to even first-time homebuyers. Renovation is becoming an increasingly popular strategy in today’s high-cost, tight inventory housing environment. Plaza Home Mortgage® makes it easy to capture more business in this growing lending segment. We offer multiple renovation loan options and have a department of dedicated renovation specialists to walk you through every step.

An ADU, or Accessory Dwelling Unit, is defined as an additional unit on a residential lot in addition to the main house (or main multi-family building). Recently in Los Angeles County, Orange County and California as a whole, new laws SB9 & SB10 and guidelines regarding ADU’s have been modified to allow for more ADU construction as a way to help solve the CA Housing shortage. The newer laws allow for much higher density in transit rich areas or urban infill areas. Visit 17th Street Capital for Lending Criteria & Guidelines.

The availability of 2-1 Seller Paid Buydown options with CalHFA programs from Kind Lending. This new option will be offered on both CalHFA Conforming & CalHFA FHA 1st loans: the Seller or Agent may provide buydown funds, subject to the standard IPC limits, Lender paid buydowns are not offered. Buydowns are allowed for conforming and high balance loan amounts. The borrower is qualified at the note rate fully amortized (not the buydown rate).

National MI announced updates and clarifications regarding underwriting changes to support affordable housing initiatives, effective November 18, 2023. View National MI Announcement Bulletin: UW 2023-04, and Servicing Guide for details. Additionally, National MI posted a Rescission Relief Guide in alignment with Fannie Mae and Freddie Mac retirement of Covid-19 forbearance requirements for all forbearance evaluations with an evaluation date on or after November 1, 2023, including evaluations for new forbearance plans and evaluations for extensions to existing Covid-19 forbearance plans.

Arch MI noted, “In response to Fannie Mae’s recent Desktop Underwriter Release Notes expanding LTV ratios for 2- to 4-unit properties and to further support affordable housing, Arch MI reminds our customers that our EZ DecisioningSM Program allows 2 to 4 units at a maximum 95% LTV ratio as follows…” (See the bulletin for full details.)

Radian MI revised its Eligibility Matrices to include One Underwrite (AUS) to reduce the minimum FICO from 700 to 620 for 3-4 unit properties.

MGIC reminded clients of the tools that can help turn renters into first time home buyers.

Capital Markets

Markets largely shrugged off the release of Fed minutes from the November meeting yesterday as old news with no surprises. Minutes showed that policymakers see room for additional tightening if incoming data shows insufficient progress toward slowing inflation, but they would also like to see more evidence to suggest that inflation is slowing toward the central bank’s target. Yes, the markets are pricing in rate cuts as early as March of 2024, but the markets and the Fed have been on different pages for most of the post-pandemic economy. Higher-for-longer rates have created a frozen U.S. housing market as homeowners are reluctant to sell and buyers are squeezed. The U.S. 30-year fixed mortgage rate has risen 460 basis points over the past three years.

Existing home sales fell 4.1 percent in October to a seasonally adjusted annual rate of 3.79 million, according to the National Association of Realtors. That is the slowest pace of sales since August 2010. Sales were down 14.6 percent from one year ago, though the median home price rose 3.4 percent to $391,800, the fourth consecutive month of year-over-year price increases. Sales continue to be hurt by persistent lack of housing inventory, high prices, and the highest mortgage rates in a generation. The inventory of unsold existing homes grew 1.8 percent from the previous month to the equivalent of 3.6 months’ supply at the current monthly sales pace. Multiple offers are still occurring, especially on starter and mid-priced homes, even as price concessions are happening in the upper end of the market.

As U.S. bond yields continue to fall, mortgage applications increased 3.0 percent from one week earlier, the third straight increase according to MBA. That kicked off today’s economic calendar, and was followed by October durable goods orders (soggy), and weekly jobless claims (209k, down from 231k, better than expected). Later today brings final November Michigan sentiment, Treasury announcing the auction sizes for next week’s 2-, 5-, and 7-year notes, and Freddie Mac’s Primary Mortgage Market Survey. Unlike Friday, today is not an early close, but it is likely to trade like one. We begin the last full session of the week with Thanksgiving looming tomorrow and an early close on Friday with Agency MBS prices better .125-.250 and the 10-year yielding 4.38 after closing yesterday at 4.42 percent.

Employment and Transitions

“It is with great pleasure that GHMC TPO announces the latest addition to our esteemed sales team: Mr. Tom Carroll. Tom assumes the role of National Account Executive, overseeing our Midwest region. We are excited about Tom joining our team and eagerly anticipate the opportunity for you to benefit firsthand from his experience and exemplary customer service. Furthermore, GHMC TPO has successfully completed the transition into the First Colony Mortgage family. We are on a mission to be the first choice of loan officers nationwide by offering consistent competitive pricing, superior service, and best in class technology. Check us out here or email Rex Hagood.”

“SWBC Mortgage fosters an environment where our Loan Officers can thrive and continue to provide exceptional service to their clients and partners, even during tough times. One of the most successful ways our team has stayed connected and engaged this year is by hosting educational workshops across the country. One in particular features Blake Hastings, SVP Corporate Strategy & Chief Economist at SWBC. As keynote speaker of 12 workshops, he has covered local and national economic analysis and provided dynamic forecasts for the coming months. Support is more important now than ever before. Because SWBC Mortgage has the right resources available to our teams, we are able to navigate challenges with resilience, while continuing to grow in a down market. To learn more about career opportunities at SWBC Mortgage contact Scott Brown, EVP of Retail Sales or visit us here.”

Movement Mortgage is helping builders and buyers navigate the high-rate environment with its new Lock It & List It program. Designed for new home builders, the program allows builders to lock in and buy down an interest rate today, PLUS pay up to the maximum amount of seller contributions toward closing costs. With Lock It & List It, builders can attract new buyers with competitive interest rates and closing cost savings, give buyers rate confidence with one free float down, and meet many buyers’ needs as the program is available for 30-year conventional, VA and FHA loans. By empowering builders to enhance home affordability and attract a broader pool of buyers, Movement is revolutionizing how builders navigate the complexities of today’s real estate landscape. Learn more here and contact Movement today to get locked in!