DPA, Servicing Oversight, Relationship Mgt., Change Mgt. Products; TPO and Broker News

Remember when lenders were fretting about Amazon rolling out a major home loan program? The new acronym that the mortgage industry was about to start using was “WACD” (What Amazon Can’t Do). We reminded ourselves that Amazon couldn’t do is to deliver high value and personalized service and build relationships that last a lifetime. Play to your strengths! One strength is keeping up with what is going on, especially in the regulatory world. Today’s L1 show at 2PM ET features Kathy Kraninger, former director of the Consumer Financial Protection Bureau from 2018 to 2021, now CEO of the Florida Bankers Association, with a “behind the scenes” look at being the CFPB director and setting clear “rules of the road.” Next week Rich Swerbinsky returns to the airwaves on Thursday the 18th at 3PM ET, interviewing the CFPB’s Mark McArdle on what the big misconceptions about the CFPB are, and where its focus is currently. (Found here after 8:30AM ET, this week’s podcasts are sponsored by PHH Mortgage. From subservicing to correspondent lending, MSR/co-issue transactions, portfolio retention, reverse mortgages, and commercial servicing, PHH has solutions for the entire mortgage lifecycle. Hear an excerpt of an interview with Bank of Oklahoma’s Chris Maloney from last week’s Mortgage Matters show presented by Lenders One on all things capital markets, from supply and prepayment speeds to the evolution of the Federal Reserve’s balance sheet over time.)

Lender and Broker Products, Software, and Services

Where is your Change Management focus? Amidst ongoing industry and operational changes, the approach to change management is rapidly evolving, and automation can be key to your success in this area. Clarifire’s recent blog “Accelerate Change to Alleviate Pain – An Oxymoron?” looks at how smart, flexible technology will deliver an agile, easier way that enables traceability, accountability, and iterative improvements. Change is constant and part of the imperative to keep moving and be fluid to stay ahead. You don’t want to be held captive by outdated Change Management practices. Incorporate technologies aligned with collaboration into your Change Management approach. When you consider the Who, what, When, Where, and Why areas impacted by change, the overall Change Management process becomes more meaningful and impactful across your organization. Experience a better approach, better results, and better software. CLARIFIRE®, truly BRIGHTER AUTOMATION®.

Usherpa has a saying, “Born in a branch, forged in a meltdown.” Most of its team got their start in a mortgage branch in the mid-1990s. And from the mortgage meltdown of 2008, Usherpa was born. Today, the award-winning Relationship Management Platform’s purpose is the same as it was in 1995: To provide more opportunities for loan officers to do more loans. Stop hassling with CRM tools that charge for the basics. With Usherpa, Admin and LOA support accounts are free. Best-in-class customer service with live, in-person training is included, free of charge. Expanding and need to add a branch? Usherpa will get them up and running in a matter of hours, not weeks. Again, free of charge. Tired of hassling with statement of works for every request? Look no further. Usherpa has your back.

In today’s regulatory environment, audits seem to be nonstop: Is your team ready? Clayton’s Servicing Oversight specialists can support your associates as they prepare for regulatory, GSE and investor audits, including customer contact evaluations, yearly validation of PRCI and RCSA and focuses on loss mitigation and foreclosure. Whether you need staff augmentation or help with audit responses, our experts are there for you. Clayton’s Servicing Oversight team provides audit support services across the entire mortgage servicing lifecycle. Contact Clayton’s Samantha Shanaberger to learn more about how Clayton Servicing Oversight can help your team tackle audits.

Click n’ Close has a long-held reputation for helping borrowers and addressing affordability challenges. Its SmartBuy Down Payment Assistance (DPA) program has provided more than 1.5 billion dollars in DPA-related financing to over 6,000 borrowers, with an average of nearly $12,500 in assistance per transaction. Unlike other DPA programs, SmartBuy isn’t subject to budgetary shortfalls and offers tremendous flexibility to accommodate a wider range of scenarios, enabling it to help your borrowers achieve homeownership. And now, the SmartBuy product suite includes a shared appreciation program, offering a below-market interest rate for first-lien FHA and USDA loans and a repayable DPA second lien in exchange for up to 40 percent of the home’s appreciation during the first five years. DPA with Shared Appreciation is available through Click n’ Close’s retail and wholesale divisions. To learn more and check availability in your market, reach out to Devin Dubuc for retail and Soliman Martinez, Adam Rieke, or Kerry Webb for wholesale.

Those who ventured to ICE Experience last month probably noticed the ever-present crowd in Down Payment Resource’s kiosk as it debuted the new integration with ICE’s LOS platform. Supporting DPA within Encompass® via automated program matching and underwriting support is brilliant, especially for lenders who either do a lot of DPA already or need a little help to get started. This may be the game-changer your org needs to help qualify more first-time, LMI and minority buyers. To learn more about DPR’s integration with Encompass, schedule a demo.

Correspondent and Broker Channels

Renovation lending is on the rebound! REMN Wholesale indicators point to an uptick in Renovation Lending loan submissions (FHA/FNMA). The lack of inventory nationwide is causing homebuyers to look towards purchasing properties requiring TLC. As a result, homebuyers are identifying more opportunities and brokers are closing more deals. “Since borrowers are not competing against multiple offers, their results have proven to be favorable. This has reignited relationship building with realtors and contractors for referrals” said Carl Markman, SVP, National Director of Sales. REMN offers FHA 203(k) Renovation Loans (Standard/Limited), and FNMA HomeStyle®. REMN ACCESS (NON-QM) PROGRAM: There’s no substitute for speed, knowledge, and experience. REMN’s dedicated team of underwriters are focused, goal-oriented, and ready to close YOUR loans quickly and accurately. REMN NON-QM covers DSCR, Bank Statement, Asset Qualifier, P&L Statement Only; 1099 ONLY, Full Doc, Foreign National (including Condotels). REMN’s committed to earning its customer’s next loan (Broker/Non-Del). REMN Wholesale is only wholesale, every day… 24/7.

“Have you heard about our expanding Community Lending platform? Citi Correspondent Lending is eager to share details about this, as well as our complete product and services offering, at the Secondary and Capital Markets Conference coming up next month! Reach out to your Citi Account Executive or our National Client Services Team to schedule some time to talk with us. We’re excited to discuss all the opportunities Citi offers that can help you grow your business.”

For the tenth consecutive year, U.S. Bank has been named one of the World’s Most Ethical Companies by the Ethisphere Institute, a global leader in defining and advancing the standards of ethical business practices. As a trusted advisor, U.S. Bank continues to invest in technology and solutions to support our clients. Contact a U.S. Bank account executive to connect with us at the MBA Secondary and Capital Markets Conference and Expo May 19-22 in New York City. To learn more about our HFA offering, contact a U.S. Bank HFA client sales executive to connect with us at the NALHFA Annual Conference May 1-4 in Las Vegas. Together, we will empower sustainable homeownership.

In a message to mortgage brokers, United Wholesale Mortgage (UWM) defended itself from the Hunterbrook Media’s report last week titled, “The Lie that Helped Make UWM America’s Largest Mortgage Lender,” a report that claims UWM steered loans. The wholesale lender said it’s offering legal support to partners in case they are sued and once again accused Rocket Mortgage of being behind the report, which Rocket apparently has denied.

The Hunterbrook Media reported that over 8,600 loan officers at independent brokerages were little more than retail outlets for United Wholesale and sent UWM more than 99 percent of their mortgages in 2023, more than double the number of partners sending 99 percent of their loans to the lender in 2020. Hunterbrook also claims that borrowers paid in UWM loans a total of $229 million more in closing costs over the past four years than the average-priced loan.

A lawsuit filed by borrowers soon after the Hunterbrook report states that UWM created a corrupt scheme with loyal brokers to send loans its way, applying excess fees and costs. Mat Ishbia responded with, “If any of our partners get roped into their frivolous lawsuit, UWM will cover your attorneys’ fees in connection with these fraudulent claims… We have seen ‘ambulance chasing’ attorneys try to scare consumers and brokers.”

The social media post noted, “It’s not uncommon nor illegal for a broker to send most or all their business to a specific lender. This is not unique to UWM brokers. Nor this industry… We are 100 percent confident nothing needs to change or will change because of Hunterbrook’s disinformation. The only way they win is if UWM or brokers change behavior.”

In other, more constructive news, FICO announced that national mortgage lender, servicer and asset manager Planet Home Lending will be using FICO® Score 10 T in real-time comparisons for mortgage originations and to inform retention and recapture analytics for its $100 billion servicing portfolio. Xactus will supply Planet with the new score.

On 2/20/2024, VA Loan Guaranty Service released an enhancement to WebLGY, providing lenders with additional information about the existing VA guaranteed loan when ordering an Interest Rate Reduction Refinancing Loan (IRRRL). Additional information is available in Pennymac Announcement 24-33.

Pennymac updated Conventional LLPAs effective for all Best Effort Commitments taken on or after Friday, April 05, 2024. LLPA improvements are listed in Announcement 24-34.

Arch Mortgage Funding, Inc. (AMF), a division of Arch Global Mortgage Group, has recently expanded its offerings to include non-QM loans as a correspondent provider. AMF’s non-QM product lineup includes a range of options to meet diverse borrower needs, including Debt Service Coverage Ratio (DSCR), 12–24-month Bank Statement, Asset Depletion, Interest-Only, and Expanded Guidelines. These products cater to loan amounts from $150,000 to $3 million, ensuring flexibility and accessibility for both lenders and borrowers.

After review of the recent 2024 FFIEC updates, Citi Correspondent Lending will continue to use 2023 data for census tracts and Median Family Income values since complete 2024 data is not available at this time. Availability of complete 2024 FFIEC updates is anticipated later this summer. Citi Geocoding Data Announcement highlights a few critical points to be aware of during this interim period over the next few months.

A&D Mortgage, a leading innovator in the mortgage industry announced the expansion of its lending services with the introduction of A&D Mortgage Temporary Buydown options for Fannie Mae’s Manufactured Homes and HomeReady programs. Temporary Buydowns are an effective financial tool that reduces the interest rate on a mortgage for a specific period, significantly lowering monthly mortgage payments during the initial years of homeownership. This initiative reflects A&D Mortgage’s commitment to providing flexible and affordable financing solutions that cater to the evolving needs of modern homebuyers.

Capital Markets

There isn’t much to report from yesterday, as market participants were waiting it out for today’s release of the March Consumer Price Index, and for good reason. But first… The main economic release yesterday was the NFIB Small Business Optimism Index, which fell for a third consecutive month in March, dropping to its lowest level since December 2012. Firms reported sharply lower sales expectations from the previous month, and price pressures and finding quality labor were the primary issues facing small businesses in March. It is not a “major” economic release, so doesn’t move rates, but is still a measure worth noting.

Today’ CPI report will shape the market’s thinking about inflation trends and the likely path for rates. Lower rates would certainly be welcome, especially considering that bond yields hit a 2024 high earlier this week. Headline CPI was expected to rise 0.4 percent on a month-over-month basis, flat from February and an increase of 3.1 percent on a year-over-year basis, slightly lower than 3.2 percent in February. Core CPI was seen to be decelerating on both a month-over-month and year-over-year basis to 0.3 percent and 3.7 percent, respectively.

Today’s economic calendar kicked off with mortgage applications increasing 0.1 percent from one week earlier, according to data from the Mortgage Bankers Association. We have also received the CPI report for March (+.4 percent, +3.5 percent year over year) and core (+3.8 percent year over year).

Later today brings remarks from several Fed speakers, wholesale inventories and sales in February, a couple Treasury auctions headlined by $39 billion reopened 10-year notes, the March budget deficit, and the minutes from the March 19/20 FOMC meeting. The minutes will likely include a clearer signal about the timing and pace of rate cuts this year and may also lay out the criteria for when the Fed will begin to slow the runoff of its holdings of Treasuries and mortgage-backed securities. After the inflation data, Agency MBS prices are worse .25-.375 from Tuesday, the 10-year yielding 4.45 after closing yesterday at 4.37 percent, and the 2-year at 4.84.