Friday, February 14, 2014

Wells' volume up to 65% purchase & "edging" into subprime!





 A new study has found that women with large backsides live longer than men who mention it." I couldn't resist that one, given today being February 14th - and I make up for it with the joke at the end. I don't know what Melissa Burch looks like, but she represents the pain in the backside that our business has in improving public relations. Just when you think title folks are all as "pure as the driven snow", along comes this story: "Melissa Burch, a real estate closing agent at a Fort Lauderdale title company, pocketed more than $1 million from her employer's escrow accounts, police said." Andrew Liput, president of Secure Settlements, observed, "This unfortunate incident demonstrates the need to marry industry best practices with independent risk evaluation, ongoing monitoring and rapid real time reporting. Motive and opportunity can often lead to fraud, but independent oversight is a strong deterrent to bad actors. (It is rumored that Secure Settlements is in discussions with large settlement firms and title agencies exploring the best ways to combine best practice guidelines with data intelligence and risk metrics to reduce these types of criminal acts.)

 

As Wells Fargo goes, so goes the residential lending biz? Wells Fargo has cut its retail staff by 50%, volume is down 60% versus a year ago, but its purchase volume percentage is above 65% and it is pursuing non-QM IO loans for its own portfolio. How the heck did all that happen?  Here you go: Transition.

 

And now a story that Wells is "edging" back into subprime mortgages due to declining volumes and revenues. Didn't we all hear this story ten years ago? But seriously, this is truly indicative of current events. I see depository institutions using the advantages that they have (low cost of funds, deposit bases to match assets to and create portfolio products, being accustomed to a heavily regulated environment, and existing staff of trained mortgage employees) to press their advantage over other companies - and probably not through the wholesale or correspondent channels - at least initially.

 

Wells is now accepting the Doc Magic Loan Detail Report and the fee details forms from Byte Software and PPDocs in place of the Wells Fargo Fee Details Form.  The Compliance Ease full Compliance Analyzer report will also be accepted in lieu if all individual fees paid outside of closing by the borrower are clearly identified on the Final HUD-1.

 

Mountain West Financial has updated its income guidelines for both Conventional and Government loans to require borrowers with less than two consecutive years of employment history to provide documentation showing a prior immediate history of school attendance or enrollment in a training program relevant to the current position. With regard to mortgage insurance premiums as they pertain to the QM Points and Fees rules, MWF has clarified that lenders should exclude borrower-paid Monthly Premiums, monthly portions of borrower-paid Split Premiums, and lender-paid Upfront or Monthly Premiums in the calculation.  Premiums paid by the borrower at closing, such as borrower-paid Single Upfront (both refundable and non-refundable) and the upfront portion of the borrower-paid Split Upfront Premiums, are to be included in the calculation.

 

 

 Rate are hanging tough, and improved yesterday on a weaker-than-expected Retail Sales number for January, which is expected to result in downward revisions to Q1 growth outlook, and on an unexpected increase in Initial Claims. The 10-year note improved .5 in price, closing at 2.74%, and agency MBS prices improved .250-.375 on lower-than-recent-average volumes

 

In a dark and hazy room, peering into a crystal ball, the fortune teller delivered grave news:

"There's no easy way to tell you this, so I'll just be blunt. Prepare yourself to be a widow. Your husband will die a violent and horrible death this year."

Visibly shaken, Laura stared at the fortune tellers lined face, and then at the single flickering candle, and then down at her hands.

She took a few deep breaths to compose herself and to stop her mind racing.

She simply had to know...

She met the fortune teller's gaze, steadied her voice and asked..."Will I be acquitted?"

 

Happy Valentine’s Day!

 


 

 

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