Huh?
Did someone say baseball season is here? Here's 18 seconds of non-mortgage humor
Dave McGill, a senior AE with
UG, mentioned that “all mortgage insurers are required by the GSEs to
establish new master policies that will go into effect on July 1st of this
year. The GSEs are requiring standardization of many aspects of these new
master policies, including rescission relief after 12 months on full file
underwrites (i.e. files that are submitted to and underwritten by the MI
company on a non-delegated basis) and relief after 36 months on delegated files
where the MI piece is underwritten by the lender. These and other required
changes will establish a more common master policy among all MI companies, thus
eliminating much of the variance that we see among the different policies that
are in effect today." Thanks Dave!
So where do standardized
uniform master policies leave MI companies trying to differentiate themselves
in the business? Turn times, service, paying claims immediately jump to mind.
And companies have personnel or roles that others don't, of course. For
example, Arch MI has a dedicated economist - Ralph DeFranco, Ph.D. - whereas
other MI companies do not. I am sure they'll all figure it out...
While I am yammering on about
MI, here's a recent note: "My client refinanced and the resulting LTV was
approximately 85% so he had a private mortgage insurance payment. That was over
a year ago and the homes are appraising quite a bit higher now. Due to
appreciation he inquired about having the PMI dropped. But his servicer
Ocwen sent two letters basically saying that it will not consider a current
value that considers market conditions such as appreciation. Is this normal or
legal?"
Rather
than suggest something that would be in the realm of common sense, I asked a
contact at MGIC. She replied, "Ocwen is not obligated to drop the MI until
the loan meets the requirement of the Home Owners Protection Act (HPA) which
generally requires that the servicer drop MI coverage once the loan amortizes
to 78% of the original value. (There are some caveats depending on the original
loan type.) Aside from that, it's really up to the servicer. Most
servicers follow agency standards and will consider dropping MI coverage when
the value (appreciated) reaches 20% with proof of equity AND two years payments,
as agreed. But there is no law requiring that they drop it. The borrower
could refinance into an uninsured loan or wait for the loan to amortize to 78%
(with an 85% loan, that won't take too long). MGIC has a QuickLink on our
homepage for MI cancellation at MGIC. There's a
good consumer brochure that can be emailed as well as a detailed explanation
about the HPA."
It's
been said that it's hard to find good help, or at least that's what my wife
tells me when I load the dishwasher incorrectly (if it fits, it's goin' in!).
HR departments are usually tasked with the due diligence process of prospective
employees, and in the process normally run some kind of background profile.
Recently the Federal Trade Commission and the Equal Employment Opportunity
Commission have issued guidance on doing background checks. Any time you
use an applicant's or employee's background information to make an employment
decision, regardless of how you got the information, you must comply with
federal laws that protect applicants and employees from discrimination. That
includes discrimination based on race, color, national origin, sex, or religion;
disability; genetic information (including family medical history); and age (40
or older). The joint publication covers areas such as the use, and disposal of
acquired information, along with how it can be used to arrive at employment
decisions. The guidance can be found here.
In
early March, the agencies issues the final Dodd-Frank Act stress test guidance for
companies with total consolidated assets between $10 billion and $50 billion,
the so-called "medium-sized firms." As most may know, medium-sized
companies are required to conduct annual, company-run stress tests under rules
issued by the agencies in October 2012 to implement a provision in the
Dodd-Frank Wall Street Reform and Consumer Protection Act. These companies
are required to perform their first stress tests under the Dodd-Frank Act by
March 31, 2014. The agencies' stress test rules are flexible to accommodate
different risk profiles, sizes, business mixes, market footprints, and
complexity for companies in the $10 billion to $50 billion asset range.
Consistent with this flexibility, the final guidance describes general
supervisory expectations for these companies' Dodd-Frank Act stress tests, and,
where appropriate, provides examples of practices that would be consistent with
those expectations.
Carrington has
lowered its minimum credit requirement to a FICO score of 550 in its wholesale
channel, and expanded its guidelines on a number of FHA, VA and USDA loan
programs, extending eligibility to more property types and reducing overlays.
"In addition to reducing its minimum FICO requirements to 550, Carrington
has added to and enhanced a number of its primary product offerings to further
complement this strategy and increase its accessibility for the underserved
market."
The market didn't really do
much exciting on Monday, so once again, I am not going to waste your time
explaining why it didn't. But we have a decent chunk of scheduled news today:
9AM EST has the FHFA housing price index and the Case-Shiller house numbers,
10AM EST we'll see New Home Sales for February (468k last) and Consumer Confidence.
And the Treasury doesn't want the primary dealers out there to forget about its
auction of $32 billion of 2-yr notes. Looking at the numbers, the 10-yr.
yield at the close on Monday was 2.73%, and in the early going we're unchanged
at 2.73% - and there isn't much change to agency MBS prices.
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