The
Quotes of Steven Wright, part 1 of 3.
1 - I'd
kill for a Nobel Peace Prize.
2 -
Borrow money from pessimists -- they don't expect it back.
3 -
Half the people you know are below average.
4 - 99%
of lawyers give the rest a bad name.
5 -
82.7% of all statistics are made up on the spot.
6 - A
conscience is what hurts when all your other parts feel so good.
7 - A
clear conscience is usually the sign of a bad memory.
8 - If
you want the rainbow, you got to put up with the rain.
9 - All
those who believe in psycho kinesis, raise my hand.
10 -
The early bird may get the worm, but the second mouse gets the cheese.
11 - I
almost had a psychic girlfriend, but she left me before we met.
12 -
OK, so what's the speed of dark?
Here's
your IT lesson for the day. The NSA's Skynet program utilizes metadata to
identify suspected terrorists. The system uses mass surveillance of cell phone
data and runs patterns through a learning algorithm that identifies
"normal" human behavior (i.e. daily routine travel patterns) against
individuals who go through greater lengths to remain undetected. The use of
metadata is not new (i.e., Instagram is uses it to sell products to users) but
the NSA's program overseas is far more controversial as the results are passed
along to the CIA for potential drone strikes. I am not a terrorist, but don't
like Apple or Google tracking where I am all the time so turned that feature
OFF on my phone. (Go to Settings, Privacy, Location Services, System Services,
Frequent Locations - but it is a great way to see where your kids have been.)
And
after less than a year in operation, Google is reportedly abandoning its
mortgage comparison business in the U.S. It's also closing its
well-established U.K. mortgage site. Google sent a letter to advertisers saying
the sites would shut down March 23. "Despite people turning to Google for
financial services information, the Google Compare service itself hasn't driven
the success we hoped for. We greatly appreciate your partnership and understand
that this decision will be disappointing to some. But after a lot of careful
consideration, we've decided that focusing more intently on AdWords and future
innovations will enable us to provide fresh, comprehensive answers to Google
users, and to provide our financial services partners with the best return on
investment." In other words the revenue generation was insufficient and
selling leads cannibalized Google's other advertising businesses. After all,
there is overlap. Had Compare not existed, many lead buyers would have used
Google AdWords to attract mortgage leads.
Yesterday
the commentary mentioned several updates to Fannie's, Freddie's, and other
conventional conforming programs. There's more! And why do folks care?
Because the lion's share of originator's volume continues to be directed to
these programs, which in turn flow into agency mortgage-backed securities.
A state
of emergency has been declared for Flint, Michigan, due to the city's water
quality. This Fannie Mae Notice reminds servicers that workout options
are available to assist borrowers who may be struggling to make their mortgage
payments, including granting disaster relief. "Servicers are authorized to
temporarily suspend or reduce a borrower's mortgage payments for up to 90 days.
The Notice also reminds lenders about existing products and options that
homeowners can use to purchase homes, or refinance or repair existing homes.
This includes DU Refi Plus and Refi Plus, HomeReady, HomeStyle Renovation, and
Community Seconds. Fannie Mae continues to buy loans secured by properties in
Flint and the surrounding area. We also published Frequently Asked
Questions that answer a number of appraisal- and property-related
questions that we have already received."
Fannie
Maeservicing guide updates include: Updates to Form 629,
Removal of the DO and DU Maintenance Fee, Update to the New Jersey Foreclosure
Attorney Fee, Introduction of the Servicing Guide Change Control Log, and
Reminder of Law Firm Selection and Retention Requirements.
Fannie
Mae is eliminating the continuity of obligation in its entirety via
SEL 2016-02. "The continuity of obligation policy is being eliminated in
its entirety. This policy was introduced during the financial crisis, to ensure
borrowers who recently acquired ownership of a new property in the absence of a
recorded sale of the previous property were properly qualified and it applied
to all limited cash-out and cash-out refinance transactions. Since this policy
was introduced, Fannie Mae has implemented a number of policy updates to
improve the reliability of borrower qualification, broadened the collection of
appraisal data, and developed Collateral Underwriter®, an appraisal assessment
tool. These actions collectively provide adequate controls to ensure borrower
eligibility requirements and maximum LTV ratio limits are met. As a result, the
continuity of obligation policy is no longer required. The elimination of this
policy will simplify refinance transactions. The Desktop Underwriter® (DU®)
messaging referencing continuity of obligation will be updated in a future
release and may be disregarded until that time. Also, the reference to
continuity of obligation on the Eligibility Matrix has been
removed. The updated Matrix is available on Fannie Mae's website.
Effective
Feb. 8 Fannie Mae and Freddie Mac implemented the Appraisal-Sharing release
in the Uniform Collateral Data Portal (UCDP). This new functionality enables
correspondent lenders to easily share appraisal information in UCDP with their
aggregators. Aggregators also have access to real-time results for their
correspondents' appraisals. Updated UCDP user documentation, as well as new job
aids that highlight this functionality, are all available on the UCDP page.
Effective
for loan submissions after February 1st, ditech updated its
Fannie Mae (DU and Manual Underwrite) guidelines regarding how to calculate and
document self-employment income, including the parameters under which business
income without a history of distribution may be included to qualify
self-employed borrowers. Ditech has posted an update to its DU Refi Plus
products. When the borrower receives/received Hardest Hit Funds assistance
(HHF), the loan is not eligible if the borrower received HHF assistance to make
the mortgage payment in the past 12 months. For loans submitted to ditech for
underwriting, a copy of the HHF note and the disbursement schedule and bank
statements for last 12 months will be required to verify funds were not used in
making the mortgage payment. For loans underwritten by a delegated
correspondent, ditech recommends obtaining this documentation to verify the HHF
assistance was not used to make the mortgage payments. Note, this process is
for refinance transactions where the borrower had previously received HHF
assistance. Ditech does not currently allow a refinance transaction with new
HHF assistance.
Lenders
are encouraged to begin using Fannie Mae's new Loan Delivery application
as soon as possible. Import and submit functions within the old application
will be disabled as of Feb. 1, 2016 (only archive and MBS correction
functions remain). Lenders should be aware that delayed use of the new
system could impact future deliveries. To support your transition reference the
Checkpoint, At-A-Glance User Tips and
more on the new Loan Delivery page.
For all
loans sold to AmeriHome, Sellers must comply with the requirements of
the Interagency Guidance on Response Programs for Unauthorized Access to
Customer Information and Customer Notice (Section 501(b) of the
Gramm-Leach-Bliley Act (GLBA)). Its new requirement, to ensure compliance,
Sellers must: maintain a response program designed to address incidents of
unauthorized access to borrower information maintained by the Seller, report
known or suspected data breaches affecting loans sold to AmeriHome, and cooperate
with AmeriHome in the event of a breach.
ditech is
eliminating the 5% reduction to the LTV for mortgages with secondary financing
that are locked in a Freddie Mac program. Implementation of the removal of the
5% reduction will be done in phases.
Fifth
Third Correspondent is aligning with HUD guidelines, and a new appraisal is
required to be ordered on all HUD REO properties. For HUD REO properties
with escrow repair, the cost of the necessary repairs will be based upon the
appraisal, Real Estate Assets Manager's (REAM) inspection, and/or staff
inspections, as necessary. Regarding Freddie Mac cash-out refinance,
the maximum LTV/TLTV/HTLTV expansion to 85% for fixed-rate mortgages secured by
1-unit primary residences is permitted provided ALL of the following conditions
are met: minimum 740 FICO, LP Accept/Ineligible required with Ineligible due to
LTV, any condo must not have used a Streamlined Project Review and not Super
Conforming.
We had
a fair amount of U.S. news yesterday, but it was mixed. The S&P/Case-Shiller
showed that home prices in major metropolitan areas continued to rise in
December. The 20-city home price index increased +5.7% as the best
year-over-year gains centered in Portland, San Francisco and Denver each adding
over 10% gains. But Consumer confidence numbers fell to seven-month lows as
Americans are more pessimistic about job prospects and business conditions. But
wait! U.S. existing home sales rise to a six-month high. So when all was said
and done agency MBS prices didn't do much.
Intra-day
volatility has increased however, which is never an inexpensive thing for
lenders trying to hedge their pipelines and pass along cost savings to
borrowers. As a proxy for the bond market in general, 10-year notes briefly broke
1.80%, hitting a high of 1.814% but then finally closed at 1.75% - about where
they started the day!. The early backup in treasuries proved attractive for MBS
investors who were good buyers on better than average volumes early in the
session. And then the Fed came in buying their usual daily billions which
certainly helped the "demand" side of the equation.
This
morning the MBA told us what lock desks around the nation knew: overall app
volume was down about 4%. (Purchases were actually up about 2% with refis
tumbling almost 8%.) Later we will some forgettable Market Services PMI number,
but also January New Home Sales at 9AM CST. And if you have any loose change
the Treasury will conduct two auctions today: $13 billion reopened 2-year FRNs
and a $34 billion 5-year auction. As mentioned above we had a 1.75% close on the
10-year and this morning it is down to 1.69% and agency MBS prices better by
roughly .125-.250.
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