9.11.23 Insurance Company Withdrawals; J.D. Power's Craig Martin on the U.S. Mortgage Servicer Satisfaction Study; Uncertainty in Capital Markets

Today's podcast is brought to you by SimpleNexus, an nCino Company, and award-winning developer of mortgage technology for modern lenders. SimpleNexus leads the pack in mortgage technology innovation, continuously introducing new features that enable lenders to support borrowers at every step of the homeownership journey. Learn more at simplenexus.com.

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One of the topics here in Tennessee is how lenders can help real estate agents or clients. Wanna maybe help your client or favorite real estate agent grappling with inventory? HUD has a “Home store” of houses. Worth a shot at 3.5 percent down properties! For something to really start your synapses firing on a Monday morning ahead of a five day work week, the CEO of the California MBA, Susan Milazzo, sent, “The latest effort to pass legislation to address California’s insurance crisis has died. Assembly Democrats felt that the bill favored insurance companies over consumers, and they wanted to add a provision that would prohibit insurance companies from not renewing any business through the end of next year. With no real guarantee of when the commissioner would do the emergency regulations or the contents of those regulations, it amounted to a poison pill.” (More insurance news below in the “disaster” section.) (Today’s podcast can be found here and this week’s is sponsored by SimpleNexus, an nCino Company, and award-winning developer of mortgage technology for modern lenders. Hear an interview with J.D. Power’s Craig Martin on the U.S. Mortgage Servicer Satisfaction Study.

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“We are absolutely thrilled to introduce Veronica Soto, the newest member of our University Bank Warehouse Division family! Veronica is joining us as our Warehouse Lending Client Relationship Manager and brings with her a wealth of experience in the mortgage and banking industry. With her passion for mortgage/banking and her exceptional attention to detail, Veronica is sure to make a significant impact on our team. Veronica's vibrant personality and positive attitude are contagious, making her a true team player. We are confident that her strong work ethic and dedication will contribute to the success and growth of our division. Veronica is ready to get going! Contact University Bank Warehouse Division today! Mail Veronica Soto or visit here. University Bank® NMLS #715685 | Member FDIC | Equal Housing Lender”

NMI Holdings, Inc., the parent company of National Mortgage Insurance Corporation (National MI), today announced that Lesley Alli and Andrew Greenberg have joined the company as Senior Vice Presidents and members of its Executive Committee.

Freddie Mac announced that Michael DeVito has informed the Board of Directors of his intention to retire as Chief Executive Officer in the first quarter of 2024. The Board will begin a search for a successor. (There are other jobs at Freddie as well.)

Lender and broker software and services

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Credit unions, it’s time to make your mark at the 2023 ACUMA Annual Conference from Oct. 1 – 4. Secondary marketing experts from Optimal Blue will be on-site and ready to discuss ways you can up your game and do even more to maximize success. Whether you’re working to get your members the best possible rates, trying to more effectively mitigate pipeline risk, or aiming to better understand the value of your MSR assets – we’re ready to help you reach your goals. Stop by our booth to learn more.

Your online loan application should win you business, not scare prospective borrowers away. Win borrowers here.

Attention TMC Members! Join Capacity CEO David Karandish and Mike Metz of VIP Mortgage for an exciting 3:15 p.m. session on Monday, September 11th. Learn how VIP Mortgage is springboarding their AI pursuits. Book one-on-one time with our team at TMC Fall, or join the session to learn about our personalized, in-depth AI Assessments. Whether you already use automation tools or you’re just starting to explore, Capacity’s AI Assessments offers a unique way to scale your tech initiatives. Over three meetings, our team will learn about your business needs, identify automation and AI tools opportunities, and provide in-depth resources to guide you through your AI roadmap. Want to jumpstart your AI journey? Meet Capacity at TMC Fall.

“OptiFunder Bringing the Primary and Secondary Markets Together. Nearly 15% of all warehoused loans now go through OptiFunder for warehouse selection and automated funding, shipping, and purchase advice. Since 2019, our mission has been to bring mortgage bankers and warehouse lenders together to optimize selection and streamline the historically manual process of funding mortgage loans. Nearing the top of Inc. 5000’s list of fastest-growing private companies, it’s safe to say we’ve been successful in that mission. As we continue to grow, we’re working on additional opportunities to bring the primary origination and secondary markets together. We’ve spent the last few years making the lives of originators easier; it’s time to put some focus on warehouses. Join the OptiFunder community on Linkedin to keep up with what we’re doing or visit our new website to learn more about OptiFunder.”

Does it feel like your current point-of-sale vendor has lost focus on mortgage? As a mortgage-specialized partner, Maxwell is committed to giving lenders a competitive advantage in a tough mortgage market. Compared to a top competitor, Maxwell Point of Sale averages a 5.9% higher pull-through rate from rate-lock to close. For the average lender using Maxwell POS, this equates to $42MM in additional loan volume. Maxwell also focuses on providing an excellent borrower experience, with a 17% faster turn-time from application submission to conditional approval. Schedule a call with the team to learn how Maxwell Point of Sale can start working for you and your borrowers quickly.

Are you tired of having to adjust head count every time the market changes? The Mortgage Automation Suite, brought to you by Richey May and Zoral, can help. With scalable automated solutions that improve accuracy while reducing repurchases and costs, your business will be well-equipped for any market cycle. Leveraging this powerful automation will allow your team to close loans more easily, helping to retain your best staff. Plus, it adds the extra layer of stability needed during difficult times; something we could all use a bit more of these days! Find out how the Mortgage Automation Suite from Richey May & Zoral can help you today. Email info@richeymay.com.

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 Shop. Lock. Deliver.® It’s an innovative new 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 already helping brokers around the country thrive and compete in even the toughest market environments. Multiple lenders. One platform. Zero b.s. Check out ReadyPrice today.

Attention Lenders and Real Estate Appraisers: In a September 6th article found in Housing Wire, it was pointed out the 1/2 of all appraisers claimed "fee pressure" by AMCs was their biggest challenge this year. Also included were "technology fees" appraisers are forced to pay has become a major issue. AMCs are taking an increasing cut of the appraisal fees and at the same time selecting appraisers who are willing to work for relatively lower fees. The Private Asset & Management Group, LLC has launched its new platform allowing retail and wholesale lenders the ability to use they're 'own' roster of approved appraisers, with realistic fees for their market areas, self-manage the process with 1 dashboard from a state-of-the-art software system with absolutely "NO" cost! And it reduces the appraisal fee to the borrower by 25%-35%. For further information contact David Cedar (631-319-6161).

TPO programs for correspondents & brokers     

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In this most challenging of rate environments for the industry, Luxury Mortgage ("LMC") continues to show steadfast commitment to all its business partners. LMC strives to offer competitive rates and products to assist brokers in closing more loans. Due to overwhelming popular demand, LMC is stepping up again and extending last month's unprecedented purchase specials. Full and Alt Doc loans (including Bank Statement, 1099 Only, and Asset Qualifier) will receive up to a 100-bps price improvement (yes, you read that correctly!), and DSCR loans will receive a 50-bps price improvement! Click here for complete details of these special offers. If you are not yet an approved broker, now is the perfect time to become one. Click here to begin the process of becoming an approved wholesale broker.

Sometimes, your clients' needs are as simple as a safety net. A HELOC is a perfect product to provide them with financial liquidity, stability, and support - especially in today's market! Symmetry's HELOC offers your borrowers the ability to purchase a home with less cash down, afford home renovations or repairs, purchase a 2nd home or investment property, consolidate and pay off debt, and many more benefits… Not sure how to best present Symmetry's HELOC to your borrowers? Contact your area manager to build a plan that works for you!

Lions and tigers and bears

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Or maybe fires, hurricanes, and flooding…

Several top insurance companies (like Farmers, State Farm and Allstate) have reduced their footprint in California over the last several months. State Farm and Allstate say they’re not writing any new homeowner insurance policies in California moving forward due to it being too expense. And just ask a homeowner in a low-lying area of Florida, Louisiana, or the Carolinas how it’s going.

Last month the Biden administration urged a federal judge to reject a challenge by Florida and other states to an overhaul of the National Flood Insurance Program that has led to higher premiums for many property owners.

Meanwhile, the FDIC sent out, “The Federal Deposit Insurance Corporation, the Federal Reserve Board, the National Credit Union Administration, the Office of the Comptroller of the Currency, and state financial regulators, collectively the agencies, recognize the serious impact of Hurricane Idalia on the customers and operations of many financial institutions and will provide appropriate regulatory assistance to affected institutions subject to their supervision. The agencies encourage institutions operating in the affected areas to meet the financial services needs of their communities.

“The agencies encourage financial institutions to work constructively with borrowers in communities affected by Hurricane Idalia. Prudent efforts to adjust or alter terms on existing loans in affected areas are supported by the agencies and should not be subject to examiner criticism. In accordance with U.S. generally accepted accounting principles, institutions should individually evaluate modifications of existing loans to determine whether they represent troubled debt restructurings or modifications to borrowers experiencing financial difficulty, as applicable. In making this evaluation, institutions should consider the facts and circumstances of each borrower and modification. In supervising institutions affected by Hurricane Idalia, the agencies will consider the unusual circumstances these institutions face. The agencies recognize that efforts to work with borrowers in communities under stress can be consistent with safe-and-sound practices as well as in the public interest.”

FEMA Disaster Declarations are in the news. Georgia Hurricane Idalia - DR-4738-GA. Florida Hurricane Idalia - 4734-DR-FL, Amendment 001, Amendment 002,  Amendment 003.

AmeriHome spread the word that on August 31, 2023, with DR-4734, the Federal Emergency Management Agency (FEMA) declared that federal disaster aid with individual assistance has been made available to counties in Florida to supplement recovery efforts in the areas affected by Hurricane Idalia from August 27, 2023, to September 4, 2023. On September 1, 2023, with Amendment No. 1, FEMA granted Individual Assistance to 6 additional counties. On September 3, 2023, with Amendment No. 2, FEMA granted Individual Assistance to 1 additional county.

• On September 4, 2023, with Amendment No. 3, FEMA announced an Incident Period End Date of September 4, 2023. On September 9, 2023, with Amendment No. 5, FEMA granted Individual Assitance to 2 additional counties.

On 9/3/2023, with Amendment No. 2 to DR-4734, FEMA declared federal disaster aid with individual assistance has been made available to an additional Florida county, Pinellas, affected by Hurricane Idalia from 8/27/2023 and continuing. See AmeriHome Mortgage Disaster Announcement 20230902-CL for inspection requirements.

On 9/4/2023, with Amendment No. 3 to DR-4734, FEMA provided an Incident Period End Date of 9/4/2023, for Florida counties affected by Hurricane Idalia from 8/27/2023 to 9/4/2023.

See AmeriHome Mortgage Disaster Announcement 20230903-CL for inspection requirements.

On 9/7/2023, with DR-4738, FEMA declared federal disaster aid with individual assistance has been made available to 3 Georgia counties Cook, Glynn, and Lowndes affected by Hurricane Idalia on 8/30/2023. See AmeriHome Mortgage Disaster Announcement 20230905-CL for inspection requirements.

Capital markets: the future is always uncertain, right?

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There’s anxiety (isn’t there always?) over the Federal Reserve turning more “hawkish” and impacting investor sentiment, and therefore bonds and stocks. While the Fed is largely considered to be nearing the end of its hiking cycle, the “terminal rate” is still unknown, of course. Federal Reserve speakers, typically the presidents of each district, are in a blackout period ahead of the FOMC meeting scheduled for September 19-20, which will give this week’s economic reports extra weight.

So, what is the financial press yammering about? Student loans having to be repaid, the latest jump in oil prices in the past few days driven by longer-than-expected production cuts by key oil nations Saudi Arabia and Russia, and data showing a tight labor market in the form of initial jobless claims falling for a fourth straight week.

Think about it. Despite the rapid rise in interest rates and restrictive monetary policy, the U.S. economy remains resilient. August’s employment report and last week’s ISM Services Index provided evidence that the post-pandemic economic expansion continues. The ISM Non-Manufacturing PMI Increased From 52.7 in August to 54.5 in September, its highest level since February, highlighting continued growth in sectors accounting for the majority of U.S. economic activity such as: services, mining, construction, and public administration. This series has been in expansion territory for all of 2023. There was a small increase in the prices paid index due to higher fuel costs, indicating that services inflation is far from returning to pre-pandemic levels.

The Fed’s Beige Book also reported an uptick in economic activity from July to August. However, unlike the ISM indices, the Beige Book showed inflation moderating in some parts of the country. A revision to unit labor costs - which gauges wage inflation - showed a 2.2 percent annualized increase compared to the initial estimate of 1.6 percent while productivity growth was revised down to 3.5 percent from the initial estimate of 3.7 percent. It is likely not the last revision for these data series from the Department of Labor as they are difficult to measure in real time. Elsewhere, the trade deficit has narrowed over the last few months but remains wider than pre-pandemic levels.

Even with a slight decrease last week, mortgage rates have ticked back up over the last couple weeks. The market has priced in “higher for longer” rate expectations from the Fed and are about one percent higher than the lows seen in February. Mortgage applications have declined six of the last seven weeks as higher rates erode affordability. Mortgage purchase applications reach a low not seen since April 1995. This week includes the $99 billion mini-Refunding as well as key inflation reports with CPI on Wednesday, PPI and retail sales on Thursday, and import / export prices as well as Michigan sentiment on Friday. No Fed speakers are currently scheduled with the FOMC in blackout period ahead of the September 19/20 FOMC meeting. Today’s economic calendar is limited to a Treasury auction of $44 billion 3-year notes. We begin the week with Agency MBS prices slightly worse, the 10-year yielding 4.29 after closing last week at 4.26 percent, and the 2-year at 4.98.

(This is truly a day of remembrance. And perspective.)

Today was the absolute worst day ever

And don’t try to convince me that

There’s something good in every day

Because when you take a closer look,

This world is a pretty evil place.

Even if

Some goodness does shine though once in a while

Satisfaction and happiness don’t last

And it’s not true that

It’s all in the mind and heart

Because

True happiness can be obtained

Only if ones surroundings are good

It’s not true that good exists

I’m sure you can agree that

The reality

Creates

My attitude

It’s all beyond my control

And you’ll never in a million years hear me say that

Today was a good day

Now read that from the bottom up.