New Products, ARM Primer, Investor Fee and SRP Changes - Cost of Lending Changing

By rchrisman@robchrisman.com

Thanks to Bob F. who sent:

What did the bra say to the hat?

"You go on ahead, and I will give these two a lift."

On this date in 1867, 150 years ago, a few years before I started trading MBS, Seward's Folly was created. Put another way, on this date a treaty was signed where the United States purchased "Russian America" (Alaska) for $7.2 million in gold bricks, or two cents per acre. Many called it worthless, which of course it isn't, illustrated by the Klondike gold rush in 1896 when the population doubled (but only 8% of the newcomers were women - unfortunately kind of like the senior management ranks of some lenders) and the discovery of North America's largest oil field at Prudhoe Bay on the Arctic Coast in 1967.

 In terms of product news, Simplifile is a leading provider of real estate document collaboration and recording technologies for lenders, settlement agents, and counties, announced integration with Ellie Mae's Encompass Mortgage Management Solution and LendingQB. Paul Clifford from Simplifile writes, "There's a growing need in the mortgage industry for solutions that facilitate real-time collaboration between mortgage lenders and settlement agents. In the past three months, we've announced integrations with the industry's two leading LOS providers (Ellie Mae and LendingQB) to deliver our Collaboration and Post Closing services to their users. These integrations enable both LendingQB and Encompass users to seamlessly work with their settlement partners on documents and disclosure data from pre-closing to post-closing. We're seeing lenders who utilize these services experience less miscommunication with settlement on fee data, documents and transaction details, which leads to fewer errors and ultimately creates a more positive borrower experience." To learn more, visit https://simplifile.com/or call 800.460.5657.

 New York adopted the first of its kind, rigorous cybersecurity regulation on March 1 for the state's financial services industry, including mortgage originators and servicers. Companies need to start planning now, as the first of four compliance deadlines is September 1, 2017. Richey May, an accounting and business advisory firm recognized as a leader in the industry, is helping originators and servicers understand their obligations under this new cyber regulation and working with you through the upcoming deadlines to ensure compliance. Reach out to Seth Cohen for more information, and view a recording of a webinar they recently hosted here.

 Lenders Compliance Group launched is "Servicers Compliance Group," a new practice area offering regulatory compliance support to Mortgage Servicers. "The unique feature of the new practice area is its concentration on interacting with clients monthly, continual compliance maintenance, and fulfillment of compliance management system requirements. Additionally, this practice area offers a full range of project initiatives involving audits, due diligence, risk assessments, subject matter expertise, 'mock' regulatory examinations, assistance as 'first responders' for those institutions that may be experiencing negative actions from regulators, and support with business start-up for servicing. The company has appointed Michelle Leigh, CRCM, MBA as Executive Director and Michael Pfeifer, Esq. as Director. Together, they will offer regulatory compliance support for providers of residential mortgage servicing, subservicing and master-servicing.

 ARMs are for hugging

 Sorry - flashback to the anti-nuclear demonstration era. But adjustable rate mortgages have become a topic of interest in the last several months. The product is not well liked in the secondary market (just ask your Freddie or Fannie rep about securitizing them), nor are they well-liked by pipeline hedging companies since hedging them is...problematic, to say the least.

 Yet in the primary markets good LOs are only too happy to ask potential borrowers, especially first-time home buyers, how long they're planning on staying in the house, and then showing them intermediate ARM rates. Last week the average contract interest rate for 5/1 ARMs decreased to 3.30% from 3.41%, and yesterday the MBA told us that the adjustable-rate mortgage share of activity decreased to 8.5% of total applications, down from 9% in the previous week, which was the highest level since October 2014.

 Once again, the MBA's "Chart of the Week" captured what many in the industry are paying more attention to - namely the uptick in interest in adjustable rate mortgages. The world-ranked research team of Lynn Fisher, Mike Fratantoni, and Joel Kan, supervising scores of researchers, tells us, "The ARM share of mortgage applications has increased to 7.2 percent of all applications in February 2017, led by 7/1 ARMs and followed in share by 5/1 and 10/1 ARM products. The ARM share has increased for both purchase and refinance applications, although in different contexts.  In early 2017, purchase applications have been flat to slightly increasing on a year over year basis, but the number of purchase ARM applications increased at a more rapid rate. Over the same period, refinance applications fell on a year over year basis but refinance ARM applications did not decline as quickly, leading to an increase in share.

 "Historically, the ARM share has increased when entering a purchase market and as rates rise. Home buyers in a strong housing market tend to look for ways to extend their purchasing power, and ARMs are one way to do that. While the ARM share got as high as 35 percent pre-crisis, however, it is highly unlikely it will climb that far again given the QM regulation which effectively prohibits many types of ARMs that were prevalent pre-crisis, and simply tighter credit in general. Additionally, mortgage rates are more than 2 percent lower than when the ARM share peaked." (One can always check out the Chart of the Week page.)

 For any loan officer who hasn't been in the business during any kind of ARM market, there are a few issues often discussed with borrowers that can help make a more informed decision when considering an adjustable rate mortgage. The first is "How do ARMs work?" Most ARMs have an initial note rate that is fixed for a period, after which the mortgage interest rate would change based on adding the "then" current index to the margin. An ARM note will show that the index (LIBOR, T-Bill) can change but the margin cannot.

 An LO will ask the borrower about their timeline for living in the house or refinancing. ARMs generally have a lower interest rate than fixed rate loans, and in recent years with rates having come down many ARM borrowers have seen their rates drop. The risk, of course, is that the rate on an ARM could go up in the future after the initial fixed period. The LO must ensure that the borrower understands the index selected for the ARM so that the client knows what could cause their interest rate to go up or down in the future.

 As a reminder, NYCB's Jumbo Portfolio, Jumbo Fixed 30 Year and Jumbo Standard ARM programs sometimes require two appraisals to be completed on the subject property. Both reports must be ordered, completed and reconciled prior to delivery, by the same Appraisal Management Company (AMC).

 Effective with new locks Friday, March 24^th, Flagstar Bank will be making 3 loan level price adjustments that apply to state tier adjustments, Escrow Waiver (not applicable to Jumbo Advantage) and VA Fixed & ARM.

 Refinances dropped to 43% of all originations in February, according to Ellie Mae. Refis have been falling due to the change in VA IRRL securitization treatment and rising rates. The refis that still make sense however, are refinancing old ARMs into 30-year fixed rate mortgages, as LIBOR (which is what the interest rates is pegged to) is definitely going up, while longer term rates may or may not increase. The other trade is refinancing out of FHA loans from a few years ago, where the borrower has enough equity to qualify for a conforming loan with no MI.

 Investor & lender fee and pricing changes

 The MBA's Chief Economist Mike Fratantoni stated that if people look at the cost to produce a loan a decade ago, it was around, $4,000, and now it's around $7,000 and $8,000. And that doesn't help volume: unless purchases pick up through more inventory, estimates for 2017 may come down from the current forecast of $1.63 trillion (down from $1.89 trillion in 2016).

 Effective with MI applications received on or after April 10, MGIC is refining its LPMI Single rates for loans with amortization terms greater than 20 years. MGIC is also removing the rate adjustment add-on for rate/term refinances.

 On April 1^st, U.S. Bank is reducing the charge for tax service fee at the time of loan purchase for its correspondent lenders. AZ, CA, CO, DE, ID, MT, NE, NV, UT, WA, WV $21.50. All other states $58.00.

 Effective on all applications as of April 3^rd, Equity Prime Mortgage's underwriting fee will increase from $895 to $995. This is Equity's first increase since 2010.

 U.S. Bank Home Mortgage announced that effective Monday, April 3, it offers per day extensions for all loans, regardless of when they were locked or which website they reside in. The cost for extensions will be 2 basis points per day with a maximum of 30 days, provided the original lock period was 30 days or greater. All original lock periods of 15 days will have a maximum extension period of 15 days. There is no maximum number of times a loan can be extended, provided the total number of days does not exceed the maximum stated. The rate lock may not expire on a non-business day for U.S. Bank Home Mortgage. Extensions will be automatically extended to the following business day following a weekend or federal holiday. FICO, or LTV adjustments will be applied in addition to the above stated extension fees.

 PennyMac will revise SRP grids effective for all commitments taken on or after Monday, April 3.

 Effective with loans locked in Mandatory commitments and Best Efforts locks on or after April 3, Nationstar Mortgage will update the values on its State and Loan Amount Adjusters. Click the link to view details.

 Capital markets

 =Angel Oak Capital Advisors, LLC announced AOMT 2017-1, a $146.4 million securitization rated by both the Fitch and DBRS rating agencies. This transaction, backed by non-Qualified Mortgages (non-QM), marks Angel Oak's third securitization since 2015. All three securitizations are backed by mortgages originated through the firm's two affiliated residential mortgage lenders - Angel Oak Mortgage Solutions LLC (wholesale) and Angel Oak Home Loans LLC (retail). "We are able to show that we can finance and securitize our production through the coordinated efforts of our affiliated companies. Angel Oak will continue to be a leader because of our expertise and commitment in the non-QM space," says Mike Fierman, Co-CEO of Angel Oak Capital Advisors. Angel Oak's loan production reached an all-time high in 2016 of over $1 billion from loans originating in 33 states.

In terms of interest rates, despite higher short-term rates the longer end (like 10-year and 30-year Treasury yields, or 15 or 30-year mortgage rates) continues to do nicely. Yesterday we had plenty of intra-day price changes for the better, and this was despite learning that pending home sales rose at the fastest pace in six years during February. The 5-year, 10-year, and agency MBS prices all improved between .125-.250.

 This morning we've already had Initial Jobless Claims (-3k to 258k) and the final 4^th quarter GDP figure (2.1%, revised higher). Coming up is another bevy of Fed speakers, and they'll probably say the same thing as the other speakers this week: 2-3 more short-term increases this year. Yes, the U.S. economy is doing that well. To start the day rates are slightly higher versus last night with the 10-year yielding 2.39% and agency MBS prices worse "a few ticks."

Lender Training and Events, Digital Mortgage Survey, Vendors and Lenders Raising Capital

By rchrisman@robchrisman.com

        

(Smart aleck answers)

It was meal time during an airline flight.

"Would you like dinner?" the flight attendant asked Chet, seated in front.

"What are my choices?" Chet asked.

"Yes or no," she replied.

The average residential loan file has 367,000 documents - and each one must be verified by the underwriter. Okay, just kidding. But every Boeing 737 (like Southwest flies) has 367k parts. Boeing's assembly line moves at 2 inches per minute, and a plane takes 9 days from start to finish to assemble. If only processing a loan was that efficient...perhaps it can be!

 It is beyond me how it's almost April already. And there are plenty of upcoming events and training for residential lenders.

 The revised HMDA reporting rule is upon us and hopefully your company has implementation projects well underway. There is a lot of consider and plan for across your business policies, processes, system and organization while ensuring your data is complete and of the highest quality for reporting. Please join Newbold Advisors, LLC and Gooi Mortgage for a free one hour webinar on Wednesday, April 12 at Noon ET to review the rule, discuss implementation considerations and get some planning tips. You can register for "HMDA Reporting - What, Why, Who, When" at this link.

 The NYMBA 2017 Convention "Great by Choice" will be held April 3-5 at the Desmond Hotel in Albany. Join NYMBA at the Opening Dinner of its Convention on April 3rd, to hear one of New York's finest and most dedicated members of the New York State Senate, Senator John J. Flanagan. The dinner and opening reception may be purchased without a convention registration or included in the Monday Daily Pass or Full Registration Packages.

 MGIC'sApril training calendar is ready and waiting with tons of webinars to choose from.

 InSellerate, the developer of the most advanced lead management system in the mortgage industry, has announced its first Digital Lending Workshop. The live, full-day event will be held Thursday, April 20 at the Center Club Orange County in Costa Mesa, California.

 If you're in Michigan, or want to be, join MMLA Southeast Chapter for a speed networking event on April 27^th. It sure to be a fun evening at The World of Beer.

 Finovate is known for showcasing the best-of-the-best in the fintech industry, unrivaled for entrepreneurs and companies looking to demo new technology or get discovered. FinovateSpring 2017 is gearing up for its San Jose event April 26^th-27^th. Check out its event brochure and registration information.

 Did you know that Fannie Mae provides participating servicers with free loss mitigation training? The Know Your Options™ Customer CARE (Connect, Assess, Resolve, and Execute) team will present two live webinars in April.

 In Reston VA, June 8-9, is the MERS 2017 User Conference bringing together System members from all areas of the mortgage industry. Learn from the experts how to achieve the ultimate MERS experience. Also, new this year, prior to the conference, in the evening of June 7^th, will be the celebration of women's leadership and achievement in the mortgage industry. Registration is now open.

 Are you registered for MMBBA's 2017 Annual Conference on May 10^th & 11^th? Early Bird registration ends April 15th.

 The TMBA has announced the location and dates of its 101st Annual Convention. This year's conference - "Defining Our Future" - will be held at the Hyatt Regency Hill Country Resort and Spa in San Antonio, Texas on May 21 - 23, 2017. Our 43rd President of the United States and Founder of the George W. Bush Presidential Center, George W. Bush will speak at conference. Other notable topics include: How Changes in Washington D.C Will Affect the Mortgage Industry; Changes to HMDA and Fair Lending Implications; and Technology and our Next 100 Years. Registration and full details are now available.

 Lenders & vendors raising money in a digital world

 Before I forget, every year a new buzz word or phrase appears in our industry. These days it's "Digital Mortgage". What does it mean and what are you and your peers doing to act on it? You're in luck, STRATMOR is running a new Spotlight Survey this month to answer these questions and more about Digital Mortgage. To learn more about Consumer Interaction, Automated Data Verification, and Database Marketing, click here and participate in our STRATMOR Spotlight survey: Lender Adoption of Digital Mortgage Survey. For questions, contact STRATMOR.

 Online lender SoFi announced on Thursday it has elected Mike Bingle, Steven Freiberg, and Robert L. Joss to its Board of Directors. This news comes just a couple of weeks after SoFi closed a $500 million funding round led by Silver Lake. SoFi has raised $500 million to expand to Australia and Canada. In fact, SoFi has now raised $2 billion to date. It moved into mobile payments with its acquisition of online bank Zenbank earlier this year. SoFi's latest funding round was led by Silver Lake and included existing investors SoftBank and GPI Capital.

 Strandview Capital, a strategic investor in financial services companies, has committed up to $1.25 million in InSellerate, a sales automation software company that empowers mortgage lenders to optimize lead opportunities by communicating with borrower prospects within seconds of starting the buying process. This is Strandview Capital's second investment to help fund InSellerate's rapid growth. "InSellerate's first-to-contact dialer technology empowers originators to respond to leads within 30 seconds of making a request. The simple-to-use yet sophisticated system delivers almost instant lead engagement, real-time sales and marketing resource management, as well as an effective prospect nurture program. InSellerate further distinguishes itself by connecting the loan officer to the borrower and real estate agent in real time, giving loan officers up-to-the-minute status reports on the loan in process, alerting them on required disclosures and timing disclosures to prevent compliance errors, and helping them to turn current borrowers into long-term customers."

 cloudvirga, developer of the automated, cloud-based intelligent Mortgage Platform (iMP), announced it has raised $15 million in a series B funding round "led by a portfolio company of The Blackstone Group, the world's largest alternative investment firm. The new funding will support cloudvirga as it scales its technology and expands its product offerings.Like others, cloudvirga's flagship mortgage point-of-sale (POS) platform puts consumers at the helm of the loan application process. But cloudvirga takes automation even further. It has completely re-engineered mortgage workflow moves many traditional back-office tasks to the front of the loan application and automates the entire initial disclosures process, enabling cloudvirga to deliver unmatched transaction speed and efficiency to both borrowers and lenders."

 Alight announced that Nations Lending Corporation has selected Alight Mortgage Lending for continuous reforecasting. "With Alight, we'll be able to explore limitless numbers of strategies for addressing marketplace volatility, see results across our financials and record decisions made as a basis for future planning," said David Critzer, CFO at Nations Lending.

 LBA Ware, a leading provider of automated compensation software and systems integration solutions for mortgage lending and retail banking, announced it has hired Matthew Marshall as a solutions consultant to support the firm's sales efforts. Marshall will be responsible for articulating the value proposition of LBA Ware's solutions through preparing and delivering technical presentations to clients and prospects, while also collaborating with the sales team to understand customer requirements and provide support where needed.

 Despite more technological and quantitative solutions now available for banks as they make syndicated loans to companies, the human factor represented by loan officers remains important can't be ignored In fact, a study by Columbia Law School researchers yields strong evidence that highly valuable human judgment cannot be automated easily to take into account the soft information that experienced and successful loan officers routinely apply. 

 Capital Markets

 Optimal Blue has launched a new business intelligence product and unveiled its new API initiative. "The first deliverables available through Optimal Blue's new API platform allow secure access to pricing for eligible products for both consumer direct and loan officer implementations. The APIs may be used by customers who wish to integrate product and pricing data with proprietary website, mobile, or point-of-sale solutions, and by vendor partners whose solutions are enhanced through the integration of originator-specific price data for eligible products. Through this API initiative, the company will enable an ecosystem of third party developers serving Optimal Blue customers.

 Bonds have been up some, down some, and Tuesday was down some, causing rates to rise somewhat. Blame it on the strong Consumer Confidence report, or the thinking that the market just wanted to sell off a little. Consumer confidence jumped to a 16-year high during March and various metrics of consumers' confidence in the job market and future income also showed a lot of strength. Or blame it on the mediocre five-year Treasury auction. Or the fact that the S&P/Case-Shiller 20-city index was up 5.7% y/y in January, beating December's growth of 5.5%. The yield on the 10-year went out at 2.41%.

 For news, today we've already had the weekly MBA Mortgage Index showing apps for last week (a non-event at -.8%). Coming up are February Pending Home Sales, several Fed speakers (again), and a $28 billion 7-year Treasury auction. With those items influencing the market we find the 10-year yielding 2.41% and agency MBS prices nearly unchanged versus last night's levels.

Mortgage Vendor Updates, Servicing Trends Inc. Owen's New Consent Order, Rates and The Health Care Plan

By rchrisman@robchrisman.com

                           

(Warning: Rated PG, I guess, for content.)

I went to my nearby CVS Pharmacy, straight to the back, where the Pharmacists' high counter is located.

I took out my little brown bottle, along with a teaspoon, and set them up on the counter.

The Pharmacist came over, smiled, and asked if he could help me.

I said, "Yes! Could you please taste this for me?"

He took the spoon, put a tiny bit of the liquid on it, put it on his tongue and swilled it around.

Then, with a stomach-churning look on his face, he spat it out on the floor and began coughing.

I looked him right in the eye and asked, "Now, does that taste sweet to you?"

Shaking his head back and forth with a venomous look in his eyes yelled, "HELL NO!!!"

I said, "Oh, thank God!  That's a real relief! My doctor told me to have a Pharmacist test my urine for sugar!"

I can never go back to that CVS, but I really don't care, because they aren't very friendly

As an industry, we continue to be reminded of a small minority's wrongdoings. The latest example comes from New York where a Copiague man was sentenced last Friday to 12 ½ years in federal prison for conning banks out of more than $30 million in a mortgage scam over a six-year span. Before everyone starts hoping for fewer rules and regulations, and looser loan guidelines, how can we convince politicians and regulators that things like this won't happen again?

 "What distinguishes a premier warehouse lender from the other choices available in this market?  BofI Federal Bank believes it comes down to diverse product offerings, including a broad array of non-agency/non-QM investors, exceptional service and basic economics. They provide facilities from $5MM to $100MM for small to large mortgage bankers with varying business models. BofI will fund non-QM loans to approved investors, loan amounts up to $5MM, and agency and government loans with no overlays.  Their extended funding times up to 5:30 pm ET and a comprehensive list of approved investors make BofI Federal Bank an essential partner to help grow your business." Contact Robert Martini or Robert Norine at 888-764-7080 to learn more about BofI's warehouse program and its features.

 Vendor updates - it seems like every conference has fewer lenders and more vendors!

 Origination is heating up, so with the race to cut cycle times a streamlined borrower process is a must. Mortgage giants like Quicken Loans and Movement Mortgage are leveraging technology to boost their capacity. But even the smallest teams can compete using lightweight platforms from players like Maxwell. For example, Maxwell's FileFetch technology automates borrower document collection by linking to thousands of financial institutions to automatically pull in actual bank statements, W-2s, paystubs and full tax returns. Maxwell also keeps the borrower and real estate agent in tune with regular notifications. The Maxwell team tells me that loans facilitated with their technology close 22 days faster than the national average. You can sign up for a demo of Maxwell using the link.

 Bank of England Mortgage has chosen ReverseVision's RV Exchange LOS to support the bank's new home-equity conversion mortgage (HECM) division. Bank of England (based in England, Arkansas) is a depository institution with branches in 39 states. It chose RVX primarily because of the LOS's smooth integration with other software used by the bank. ReverseVision technology supports more reverse mortgage transactions than all other systems combined.

 Matic Insurance Services, Inc., a digital homeowner's insurance agency for mortgage borrowers, has partnered with Maxwell, a provider of digital mortgage software. Matic's network of nationally A+ rated insurance carriers enable borrowers to quickly find a customized homeowners insurance policy with just a few clicks on their desktop or mobile device. Under an agreement between both companies, Maxwell will integrate Matic's homeowner's insurance software into its platform, allowing borrowers to receive customized homeowner's policy options in seconds and helping Maxwell's clients close loans faster. Lending teams on Maxwell collaborate with homebuyers in a modern digital workspace, on any device, with connectivity to thousands of data sources. Leveraging connectivity, like Matic Insurance Services, Maxwell reports that loans on its platform close 22 days faster than the industry average.

 Servicing news? Yup!

 Fitch reported that most U.S. mortgage servicer portfolios are seeing their non-agency exposure continue to decline, though Select Portfolio Servicing (SPS) is proving to be a notable anomaly, per Fitch's latest quarterly U.S. RMBS Servicer Handbook. ThomsonReuters noted, "The slow return of the new issue RMBS market continues, though not enough to offset declines in non-agency portfolios. SPS is an exception as one of the few non-agency servicers that has seen dramatic growth in its portfolio over the last year. SPS' total non-agency portfolio totaled 410,286 loans with a balance of $80.03 billion at fourth-quarter 2016 (4Q'16), a notable increase from 333,520 loans with a UPB of $71.5 billion at 4Q'15. 'SPS has grown largely through successful acquisitions of seasoned portfolios from large bank servicers, with much of the new product coming in the form of subprime loans,' said Managing Director Roelof Slump.

 "Nationstar, normally the #2 servicer on this list behind Ocwen, fell to #3 with the rise of SPS with 403,609 non-agency loans ($78.2 billion) at 4Q'16. Ocwen remains the servicer with the most non-agency loans in its portfolio, totaling 1.01 million and $151.6 billion at the end of last year. 'Nationstar will be an area of focus as 2017 progresses as they are likely to inherit CitiMortgage's agency product as its gradual exit from servicing continues,' said Slump. 'Another servicer of note will be Cenlar, who stands to take over much of Citi's non-agency portfolio.'"

 News broke yesterday that Ocwen Financial Corporation entered into a new consent order with the NY DFS that ends the requirement for a third-party monitor. The new order, however, still does not yet allow for MSR acquisitions until a scheduled servicing exam is completed. The previous NY DFS consent order was scheduled to end at the end of March though the regulator had discretion to extend it for another year. The announcement comes about one month after resolving similar matters in California.

 Switching to agency servicing, servicers wonder when the increase in rates, which one would think should increase servicing values, will result in companies paying more for it. I've seen two Prestwick Mortgage Group offerings recently. The first was an MSR package of $335 million New England FNMA A/A. Go Pats? The 100% fixed rate, 100% retail originated pool has a WAC of 3.743%, an average unpaid balance of $199k, 755 WaFICO, 66% WaLTV, approximately 85.7% of the loans on properties in Massachusetts with the remaining 14.3% on properties in New Hampshire. The bid date for the portfolio is tomorrow, Wednesday, March 29, 2017, at 5:00 PM EDT.

 The second was a $283 million FNMA/FHLMC + $120-180 million FNMA/FHLMC Annual Flow Agreement. The pool is $164k average unpaid principal balance, 4.009% WAC, 0.2504% weighted average net service fee, 100% conventional and fixed rate, 95% retail originations of the seller, approximately 36.7% of the loans are on properties in Florida; 28.1% on properties in Michigan; 21.4% in Indiana; 10.6% in Alabama; and the rest in 8 other states, 0.754% delinquency ratio, with a WaFICO of 750. The concurrent flow agreement will be based on production during 2016 and the projections of the seller. The mix of product should be consistent with: 75/85% FNMA 15-25%, 85-90% 30yr 10-12% 15yr < 3% ARM, $180-190k avg, 92-95% O/O, 85% SFR, 750 WaFICO, FL (40%) MI (25%) IN (21%) TX (10%).

 MountainView Servicing Group, LLC had a $1 billion FHLMC/FNMA non-recourse servicing portfolio that is being made available to the national market. The package is: 100 percent of 1^st lien product, 239K average loan size, WaFICO of 744, WaLTV of 74%, a WAC of 3.90%, with top states of California (21.5 percent), Florida (10.4 percent), Georgia (9.3 percent), and New York (8.6 percent). 

 Capital Markets

 Altavera Mortgage Services (outsourced residential mortgage origination services) has been approved by Standard & Poor's Global Ratings (S&P) as a third-party due diligence provider for U.S. residential mortgage-backed securities (RMBS) rated by that agency. Altavera provides investors and correspondent aggregators with a full range of closed-loan file review services for agency and non-QM residential mortgages, including validation of product acceptability to investor guidelines, credit decision and supporting documentation, QM/ATR requirements, regulatory compliance, property valuation and closing documentation.

 Looking at bond prices and interest rates, of course stock and bond markets don't move in opposite directions. (Just look at the bond rally and stock rally we've seen for a decade or two.) But the same economic forces can move both markets, and lenders should keep in mind that Trump and Ryan aren't the only reasons why stocks have enjoyed a months-long advance. Starting in the 2^nd half of 2016 nominal growth started improving markedly not only in the US but globally too with impressive numbers witnessed in such major economies as the European Union and China. This is good for stocks, bad for rates - but can it keep going?

 In the near-term, hopes for tax changes (realistic or otherwise) and supportive nominal growth will continue to help stocks. But "the smartest guys in the room" are cautious over the long term: corporate earnings are doing well, the nominal growth backdrop is supportive, and there aren't any dramatic imbalances in the economy (although we should keep an eye on subprime auto loans, student loan defaults, farm values, and commercial real estate). The economy is near full-employment, and regardless of one's political leaning it is very difficult to "goose" a full-employment economy facing the twin structural headwinds of mediocre labor supply and productivity growth (which, let's face it, are the only two determinants of any economy's growth potential).

 Rates did well again yesterday, if for no other reason than the failed health care changes could lead to problems for the Administration putting forth a tax plan, which in turn would be "un-inflationary" - and health care savings were supposed to help the budget. Said another way, the markets reacted to the inability of Republican leadership, including President Trump, to repeal and replace "ObamaCare," and what it might mean going forward in getting other items on Trump's agenda passed. Evans, the Chicago Fed President, said that without that fiscal stimulus assumption, policymakers would have been forced to see the late-2016 jump in interest rates as a contractionary development and he didn't think that conclusion was appropriate. For those who like numbers the 10-year note rallied almost .250 in price (closing with a yield of 2.38%) and the 5-year note and agency MBS prices improved slightly.

 Today is a potpourri of economic events, probably none of which will move the markets much. At 8:30AM ET is Leading Economic Indicators, and at 9AM ET is the January S&P/Case-Shiller Home Price Indices. At 10am is March Consumer Confidence, and then later a $34 billion 5-year note auction along with several Fed officials speaking. In the very early going rates are nearly unchanged from Monday's close.