8.7.23 Overcapacity and Overhead; STRATMOR's Brett McCracken on Secret Shopping; Rates to Open the Week

Thanks to today's podcast sponsor, SimpleNexus, an nCino Company, developer of mortgage technology uniting the people, systems, and stages of the mortgage process into one seamless, end-to-end solution.

Learn more at simplenexus.com. 

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Jordan Peele met his famous comedy partner Keegan-Michael Key around 2002 at Second City in Chicago, and eventually performed this classic routine that every air traveler should see. This morning I head to Chicago, and from there to the MMLA event in Mt. Pleasant, Michigan. Given my time with originators last week, the email traffic over the weekend, lenders are very concerned about overcapacity and therefore overhead. On a micro level, staff that may have been held onto “just in case” volume picked up are being reviewed. On a bigger scale, owners of lenders and vendors have seen their values decline and mergers and acquisitions are definitely a topic. The latest example of this is Denver’s Proprietary Capital announcing plans to buy 100 percent of New Jersey’s American Financial Resources (AFR); employees and counterparties were told Friday. And on a macro level, this week the economic calendar features fresh updates on inflation, with both the July Consumer Price Index and the Producer Price Index reports. We also have auctions of three- and 10-year notes and 30-year bonds going off at higher amounts than originally forecast and yields generally on the rise. Lots going on! (Today’s podcast can be found here and is sponsored by SimpleNexus, an nCino Company, developer of mortgage technology uniting the people, systems, and stages of the mortgage process into one seamless, end-to-end solution. Listen to an interview with STRATMOR’s Brett McCracken on how mortgage companies can utilize secret shopping.)

Jobs, and a death

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The top 3 reasons mortgage sales professionals change companies: 1) Poor service levels compromising relationships with clients and referral partners. 2) Inadequate sales and marketing support. 3) No chance for advancement or opportunity to take their business to the next level. The top 3 reasons mortgage sales professionals join radius: 1) Nimble and proactive IMB that’s right-sized to meet today’s changing demands. 2) Takes the guesswork out of marketing with their marketing team. 3) Allows you to your own mortgage dream team, or take advantage of theirs. At radius financial group, the focus is on YOU! Empowering you to build and run your business, your way. We give you the tools to help you strengthen relationships and you can build your own mortgage dream team, or take advantage of ours. Either way, you’re an actual shareholder of everyone’s success! For confidential inquires please contact Carla Herrera.

With an aging mortgage banker population comes occasional sad news. In this case, New England’s Jimmy Ryder passed away at the age of 70 from brain cancer. Scotty Bowden wrote, saying, “Jimmy, as I called him, was one of the best LO recruiters here in New England for many years, and began his mortgage banking career as a LO for Old Stone Bank (RI) in the mid-1970s earning a base salary of $12,500 + 12.5 bps on closed loan production… Jimmy was an absolutely wonderful human being & he’ll be missed by many, including his wonderful family + many friends and business relationships. RIP, my dear friend!”

Lender and broker software, products, and services

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For a third year, Surefire℠, Black Knight's CRM and Mortgage Marketing Engine, was recognized by the Business Intelligence Group’s prestigious Sales and Marketing Technology Awards program. Designed specifically for mortgage lenders, Surefire is distinguished by turnkey automated marketing campaigns and a library of multi-channel creative content that supports borrowers through each step of the homeownership journey. Surefire’s dozens of native integrations with other lending technologies further enables lenders to provide personalized, milestone-based outreach and reduce process redundancies to achieve greater operational efficiency. To learn how Surefire can help your organization win new business, generate repeat business, and earn referrals, schedule a demo today.

Check out this video showing the coolest closing gift ever!

Maximize your profits with discounts and incentives from the industry’s top-tier service providers and investors. Capital Markets Cooperative (CMC) has a proven track record of helping lenders reduce costs with a suite of preferred partners that now include Halcyon, Wintrust, and Certified Credit. With these new partners, CMC can offer their members access to incredible savings on VOI services, warehouse lines of credit from $10-$250 million, and bundled credit score products. CMC is always looking for solutions that give lenders an edge, so join the mortgage cooperative that gets results.

Looking to kick off the MBA Annual Conference in style? Join Lender Toolkit and its co-hosts for the Ultimate Independence Block Party being held the evening of Sunday, Oct. 15 at Philadelphia’s famous SPIN ping pong and social club. Enjoy networking with industry peers and potential partners in a vibrant and fun setting… Or grab a paddle and see how your table tennis skills stack up against all comers. And while you’re at it, you can learn how Lender Toolkit's powerful AI Underwriter™  technology delivers one-touch loan decisions in 90 seconds or less, creating a fast, hassle-free mortgage experience your clients will rave about. The event kicks off at 7:30 p.m. and promises to be an evening filled with food, laughter, and a little friendly competition. Secure your spot now by signing up here. Hurry, spaces are limited, and this block party promises to be one to remember.

You don’t have to accept lower profitability when loan volume is down. Instead, find efficiencies in your mortgage process that add up to cost savings and bolster your bottom line. Loan officers using Maxwell Point of Sale achieve more with less work, closing 20% more loans and moving loans to clear to close 35% faster. Maxwell POS syncs with your LOS bi-directionally, keeping real-time data in one place for easy management and seamless updates and preapprovals. Managers have visibility into the team’s entire pipeline, allowing them to identify opportunities for quick adjustments and better results. If you’re ready to maximize your mortgage operations and take advantage of every basis point, schedule a call with the Maxwell team.

“Brokers can now shop, lock, and deliver on one platform that seamlessly connects brokers, lenders, and originators. 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 its innovative new Shop, Lock & Deliver loan exchange 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 the industry’s most powerful universal delivery portal, and it’s already helping thousands of brokers around the country thrive and compete in even the toughest market environments. Multiple lenders. One platform. Zero b.s. Come check us out today.”

TPO programs for brokers and correspondents

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“CBC Mortgage Agency to begin offering USDA financing! As part of its ongoing commitment to the communities it serves and to mark its tenth year in business, CBC Mortgage Agency, home of Chenoa Fund down payment assistance, is pleased to announce it now offers a USDA program. The new USDA30 program is designed for low-and-moderate income families in rural and semi-rural areas and provides 100% financing for the purchase of a home. Are you interested in becoming an approved partner with CBC Mortgage Agency? Visit our website for more information.”

Take Advantage of LoanStream’s Summer Specials to help you grow that pipeline!  NON-QM Special for Purchase, Refinance & Cash-Out Programs. 50 BPS Price Improvement on all 740+ FICO Non-QM Programs (Special may not be combined with Select Non-QM Programs). Only Non-QM Special available for Correspondent. Prime Special: 35 BPS Price Improvement on Government Purchase Loans, 35 BPS Price Improvement on Government and Conventional High-Balance Purchase, Refinance and Cash-Out Loans (Specials are not available for use with DPA loans and cannot be combined together or with Select Loan Promotions.  Restrictions apply. For loans locked 8/1/2023 through 8/31/2023. Visit us for more information or speak with your Account Executive.

Agency news of all shapes and sizes

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Freddie Mac announced enhancements to its automated income assessment tool to include tax transcripts as a new data source opening the door to homeownership for more qualified self-employed borrowers who report income on IRS Form Schedule C (sole proprietors). The new capability is available to mortgage lenders nationwide through Freddie Mac’s Loan Product Advisor® (LPASM) asset and income modeler (AIM).

Freddie Mac Single-Family Seller/Servicer Guide (Guide) Bulletin 2023-16 announces multiple updates pertaining to topics such as credit underwriting, IRS installment agreements that are pending IRS approval, documentation requirements for alimony, child support and separate maintenance, underwriting requirements for manually underwritten mortgages pertaining to medical collections, AIM, ACE+ PDR, AIR, and PDCIR.

Fannie Mae August Selling Guide update, SEL-2023-07, revises the Appraiser Independence Requirements, introduces Property Data Collector Independence Requirements, and makes miscellaneous changes.

Fannie Mae and Freddie Mac have updated the Appraiser Independence Requirements (AIR) and introduced Property Data Collector Independence Requirements (PDCIR). These requirements are designed to protect the integrity of mortgage lending collateral risk management processes for lenders, investors, and borrowers. Learn more at the AIR/PDCIR page.

Fannie Mae will update Condo Project Manager™ (CPM™) on Sept. 18th, in accordance with the review requirements for condo project eligibility announced in SEL-2023-06. The updates will include new review questions and data elements related to critical repairs, material deficiencies, significant deferred maintenance, inspection reports, evacuation orders, and special assessments.

Fannie Mae’s new eLearning series for reconciling custodial bank accounts is designed to give you a high-level overview of the completion process for monthly P&I and T&I custodial bank account reconciliations.

Training: always a good thing

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Free, In-Person FHA Underwriting Training, August 15, 8:30 AM – 4:30 PM (Central) in Omaha, NE.

Free, In-Person FHA Appraiser and Appraisal Training, August 16, 8:30 AM – 4:30 PM (Central) in Omaha, NE.

Free, In-Person FHA Appraiser and Appraisal Training, August 22, 9:00 AM – 4:00 PM (Eastern) in Louisville, KY.

Free, In-Person FHA Underwriting Training, August 23, 9:00 AM – 4:00 PM (Eastern) in Louisville, KY.

Free, FHA Virtual Webinar on Loan Review System Basics, August 23, 2:00 PM – 4:00 PM (Eastern).

FHA free, Live, on-site training in Ankeny, IA will provide an overview of FHA underwriting procedures and addresses a number of industry-related frequently asked questions (FAQs). August 24, 9:00 AM to 12:00 PM

Earn 2 Hours of AZ Responsible Individual Continuing Education, join AzAMP Central Chapter Luncheon at Embassy Suites Scottsdale, McDowell Conference Rooms - First Floor, Wednesday, August 23, 11:30 a.m. to 1:30 p.m. Guest Speakers include Jacalyn Shirley, David Buckner, and Kristopher Martin.

Did you know you can use a reverse mortgage to purchase a home? It’s a great tool that many lenders don’t know they can leverage for a purchase. Join Mark Reeve, Plaza's VP, Reverse Mortgage Division, and he’ll share all you need to know about how to help your clients use a Reverse Mortgage to purchase a home. Plaza Home Mortgage - How to Use the Reverse Mortgage to Purchase a Home on Wednesday, August 23, 11:00 AM PT / 2:00 PM ET.

PRMG University TPO August Training Calendar. Walk through calculations to determine what income can be used to qualify a traveling health care professional. Join PRMG University and Essent training on Monday, Aug 14th 1:00 PM - 2:00 PM PDT, for On the Road Again... Traveling As a Traveling Nurse.

Capital markets: jobs, inflation, and now supply

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Economic data released over the last week continues to show a cooling jobs market as 187,000 jobs were added in July and the prior two months’ data were revised down by 49,000. The unemployment rate declined to 3.50 percent and average hourly earnings rose 0.4 percent during the month and 4.4 percent from one year ago.

The Fed remains concerned with wage inflation and views cooling labor costs as essential to bringing inflation down to its 2 percent target. Job openings remained high in June at 9.6 million, which equates to 1.6 openings per unemployed person. Higher productivity in the second quarter helped keep unit labor cost increases lower over the quarter, rising 1.6 percent on an annualized basis compared to the first quarter’s 3.9 percent increase and 2022’s 7.4 percent increase. Manufacturing activity continued to contract while services expanded at a slower pace in July. With most sectors of the economy still expanding and wage growth still strong, rates are likely to remain higher for longer.

The U.S. Government is constantly selling/auctioning off debt, but every three months there is a sale of longer-dated securities. This week’s market moving events include the $103 billion Quarterly Refunding over Tuesday to Thursday with Consumer Price Index on Thursday followed by Producer Prices and Michigan sentiment on Friday. Fed speakers are currently light amid the dog days of summer. Regarding MBS, markets will be reacting to tonight’s agency prepayment release with Class A 48-hours on Thursday then Classes B and C the following Tuesday and Thursday. Today’s calendar kicks off with Atlanta Fed President Bostic and Fed Governor Bowman delivering remarks before a Fed Listens event. Later today brings the Employment Trends Index for July and Consumer credit for June. We begin the week with the 2-year at 4.83, Agency MBS worse a few ticks (32nds), and the 10-year yielding 4.09 after closing last week at 4.06 percent.

Thank you to Brian E. who sent along “The Vincent Van Gogh Family Tree.”

His Dizzy Aunt – Verti Gogh

The brother who ate prunes – Gotta Gogh

The brother who worked at a convenience store – Stop N Gogh

The grandfather from Yugoslavia – U Gogh

His magician uncle – Where-diddy-Gogh

The nephew who drove a stagecoach – Wells-far-Gogh

The constipated uncle – Can’t Gogh

The ballroom dancing aunt – Tang Gogh

The bird-lover uncle – Flamin Gogh

An aunt who taught positive thinking – Way-to-go

The little bouncy nephew – Poe Gogh

A sister who loved disco – Go Gogh

The brother with low back pain – Lum Bar Gogh

The niece who travels the country in her RV – Winnie Bay Gogh