Tuesday, May 3, 2016

A Glance At Millennials - In The UK Parents Are A Top 10 Lender!



 

(Part 2 of 3 of quotes about marriage.)

I had some words with my wife, and she had some paragraphs with me.

Sigmund Freud

"I would rather be a beggar and single than a queen and married." 

 Elizabeth I

"I married beneath me - all women do."

Nancy Astor

"The desire to get married, which - I regret to say, I believe is basic and primal in women - is followed almost immediately by an equally basic and primal urge - which is to be single again. "

Nora Ephron

'Some people ask the secret of our long marriage. We take time to go to a restaurant two times a week. A little candlelight, dinner, soft music and dancing. She goes Tuesdays, I go Fridays.'

Red Skelton

'There's a way of transferring funds that is even faster than electronic banking. It's called marriage.'

Sam Kinison

'I've had bad luck with both my wives.

The first one left me, and the second one didn't.'

James Holt McGavra

 

Change is all around us. The Wall Street Journal reports that the CFPB plans to bring the largest online lending platforms under its supervision by 2017. In the primary markets LendingClub said it expects loan losses on its loans will increase and it is raising interest rates on some loans based on changing credit risk. Avant said its online loan origination declined 27% in Q1 vs. Q4. And Bank of America is now offering customers the ability to check their credit score through the bank's website, supposedly through a link with TransUnion. (BofA, by the way, says it settled another lawsuit -this time with FHLB of Seattle - for $190 million.)

We've seen an abundance of job, training, and educational events - here's a new batch worth a gander.

 New Penn Financial will be hosting a job fair on May 5th from 11:00am - 4:00pm (PST) at the Newport Beach Marriott Hotel at 900 Newport Center Dr., Newport Beach, CA. The national lender, a Shellpoint Partners Company, will be looking for candidates with experience in the mortgage industry, and has over 100 job openings in the greater Orange County area. New Penn will be filling roles for Underwriters, Ops Leaders, Processors, Sales Managers, Loan Officers, and Closers. For more information, please contact Aubrie Cusumano. (For the Philadelphia area lender, this is one of several westward expansions in 2016. Earlier this year, New Penn opened branches in Salt Lake City and Las Vegas, and last year they opened an office in Pasadena. In addition to appearances on the Inc. 5000 Fastest Growing Private Companies list for four consecutive years, New Penn has been consistently recognized as a Top Mortgage Lender by Scotsman Guide and has appeared on Mortgage Executive Magazine's lists for Top Lenders and 50 Best Companies to Work For.)

 Todd Duncan's annual Sales Mastery Event was announced today. The event will be held in Palm Desert, California from Oct. 4-7, 2016. It's the longest running sales training event in the mortgage industry. Sales Mastery comes back this year with a fresh new look, website, and theme for the event: Focus. A completely new roster of speakers will be announced soon, that will include yours truly. Whether you've attended Sales Mastery before or not, you should check out their new direction. Click here for more info: www.salesmasteryevent.com

 Richey May & Co., the leading public accounting firm serving the mortgage industry, will be hosting their 7th annual Mortgage Banking Roundtable on June 8th in Denver, CO. The Roundtable is designed to facilitate peer-to-peer discussion among CEOs and presidents of independent mortgage banking companies from around the country on the most current topics and trends affecting the industry. This year's event consists of a panel discussion focused on cyber security and features Anthony Hsieh, founder and CEO of loanDepot, as the keynote speaker and Bethany McLean, author of Shaky Ground: The Strange Saga of the U.S. Mortgage Giants and contributing editor at Vanity Fair, as the lunch speaker. For more information and to register for the event, please contact Dustin Pfluger.

 All employees of Fairway Independent Mortgage, not just the sales professionals, are heading to AWI boot camps for the opportunity to hear Sean Parnell and Ben Lunak speak - but also the Boot Camp "experience" and witness several veteran initiatives, all of which help to explain the "WHY" of giving back to those to have served this nation to protect our freedom. Details can be found here: May 5 in Newark, Delaware and May 6 in Rehoboth Beach, Delaware.

 MBA Education is providing Loan Officer focused webinars. Click a link for details on: Hiring Superior Originators May 4th being led by Pat Sherlock AND Close More Loans... FasterJune 9th being taught by Deb Killian.

 How about this news out of England? The average amount being lent or gifted by parents, multiplied by 300,000 adult children a year receiving assistance for a house purchase, is enough to put the "Bank of Mum and Dad" at the equivalent of a top 10 UK mortgage lender!

 I travel around the country meeting plenty of people age 19-35 (the definition of "Millennial" per the Census Bureau). It's not hard to do, given that they outnumber Baby Boomers. Plenty of them are hard-working adults who stretched while at school to afford an education, and now have student debt. A fair number of them came out of college to find no jobs during our credit crisis, and took part time or hourly jobs in spite of fine degrees. And a fair number of them are looking at the housing market thinking, "I don't know where I am going to be working in five years, so how about I skip the entry level house, save for a nicer house where I am going to stay put for a while, and I'll buy something later. But I sure don't want a 90-minute commute twice a day in and out of a city..." Give them some time.

 Speaking of student loans, as well as mortgages, The Financial Times reports that "online lending group SoFi is offering institutional investors slices of its equity in exchange for commitments to buy loans, as it tries to lock down secure sources of funds. The new equity round, which could come close to the $1 billion SoFi raised in the biggest ever fintech fundraising last year, should give the fast-growing student-loans specialist more firepower to expand into mortgages, personal loans and wealth management products. But unlike the group's last round in September SoFi is now targeting insurers, pension funds and sovereign wealth funds in Europe and Asia, trying to tie them in to deeper, more strategic partnerships."

 Data show that very few millennials, people aged 18 to 34, know what their net worth is. A survey found that 73% of millennials don't know the value of what they own versus what they owe to others. Call me poorly informed, but I would venture a guess that a) plenty of them don't have a huge net worth suitable for tracking, and b) I am sure that sizeable portions of the Gen X gang and Baby Boomers don't know their net worth either.

 No, it wasn't enough to go to every one of their sports events, and save every one of their toys, and arrange their playdates instead of saying, "Just go ring their doorbell." No, now we must track them. Ellie Mae has unveiled its Ellie Mae Millennial Tracker - a new interactive online tool showing millennial loan trends in the United States. The "new interactive tool provides insight into the next generation of U.S. home-buyers based on Ellie Mae mortgage application data." Not included, of course, are all cash buyers and those using a lender that doesn't use Encompass. But the statistical sample should hold water. In this era of Big Data "Searches in the Ellie Mae Millennial Tracker can be tailored by borrower geography, age, gender, marital status, FICO score and amortization type."

 March highlights included "Women were listed as the primary borrower on 31 percent of closed loans...men were listed as the primary borrower on 66 percent of closed loans." Hang on, let me find my HP 12C to add those two numbers.

 An online tool, which will be refreshed with new data the first week of each month, the Ellie Mae Millennial Tracker provides access to up-to-date demographic data about this new generation of homebuyers. Searches can be tailored by borrower geography, age, gender, marital status, FICO score and amortization type. The Ellie Mae Millennial Tracker mines data from a robust sampling of approximately 66 percent of all closed mortgages dating back to 2014 that were initiated on Ellie Mae's Encompass all-in-one mortgage management solution. Given the size of this sample and Ellie Mae's market share, it is a strong proxy of millennial mortgage indicators across the country.

 "The mortgage industry is poised to experience a monumental shift as more millennial homebuyers begin to enter the market," said Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. "There are roughly 87 million would-be homebuyers in the millennial generation and 91 percent of them say they intend to own a home one day. Lenders must prepare today to meet their needs."

 To no one's surprise, "In March, the average primary FICO score for Conventional loans was 749 vs. 692 for FHA loans for those using Encompass. And since 2014, 37 percent of mortgages made to millennial homebuyers were FHA loans and took an average of 44 days to close, and 60% were conventional which took 43 days to close" for lenders using Encompass.

 Seriously, hats off to Ellie Mae for capturing data that is much more "real time" than, say, the S&P/Case Shiller home price index with its two-month lag.

 Changing gears to the day-to-day bond markets, rates went up slightly Monday despite weak U.S. data. Go figure. The headline construction spending data missed expectations (+.3%) but there were sizeable revisions to prior months. Revised data showed total construction spending increased 1.0% in February after it was previously reported to have declined 0.5%. The upshot of that positive revision was offset by a downward revision to January, which saw a 0.3% decline in total construction spending after a previously reported increase of 2.1%. And the Institute of Supply Management's Manufacturing Index fell to 50.8 in April from 51.8 in March.

 For scheduled news today in the U.S. there is none. We ended Monday with the 10-year sitting at a yield of 1.87% and in the very early going this morning it is down to 1.82% after an Australian central bank rate cut with agency MBS prices better by a solid .125. During the last three months, the yield on the 10-year hit a high on 3/11 of 1.98% and a low on 2/25 of 1.70% - very stable.

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