(Gretchen
T. sent this one with a note saying it is from her octogenarian uncle who may
have heard this when he was in the military during WWII.)
A new
prisoner just arrived at the prison. While he started to get acclimated, he
noticed that out on the courtyard, one of the men shouted "53!" The
whole group doubled over in laughter. Then, a little while later, another man
shouted, "24!" Once again, the whole group laughed in hysterics.
That
evening, the new prisoner asked his cell mate what was going on. The cell mate
said, "Here. Take this joke book. Each joke is numbered. Since we're not
allowed to gather and tell long jokes outside, we just memorize the jokes here
and yell out the number."
"Oh,
I get it now," said the new prisoner. So he decided to memorize one of the
jokes in the joke book.
The
next day on the courtyard, the new prisoner shouted out the number of the joke
he memorized, "17!" But there wasn't even a peep from the crowd! No
laughter at all.
He
asked his cell mate who was standing next to him what the matter was.
The
cell mate replied, "Some people just don't know how to tell a joke."
"They"
say plenty of things about time flying as you grow older - Sunday is May
already. ("Life is like a toilet paper role - the closer you get to the
end the faster it goes" comes to mind.) HMDA changes are a couple years
out - so why are companies worried about them now? Because time flies. In my
discussions with compliance & QC folks around the nation, the HMDA concern
revolves not around borrower issues - most of the data is already being
collected by lenders - but around the statistical testing, increased regulatory
concerns, the increase in potential extreme penalties, and the increase in FTEs
required in auditing every file. See an explanation below.
National
MI is hosting a "Millennials in the Workforce" webinar
session led by Kristin Messerli of Cultural Outreach Solutions. Participants
will learn how to navigate the workplace dynamics between Millennials and other
generations in their organization, which recruitment tactics will prove most
effective in sourcing talent, and how to develop a loyal workforce of
Millennial employees. Click here to register for National MI's May 2nd,
1-hour, free webinar.
If
you're near Columbus Ohio this Monday or Tuesday, say hello. The Ohio Mortgage Bankers
Association is holding its Annual Convention May 2-4.
May 1-3 are the dates to mark for TMBA's 100th
Annual Convention in San Antonio. This is the largest gathering of Texas real
estate finance industry leaders and top performers. Click here for more
information.
May 9-11 is the Annual OMBA
"Home" Conference in Catoosa at the Hard Rock Hotel. Don't forget
about the Golf Tournament on the 11th! With a powerful line up of
speakers, this year is sure to be a memorable one. Conference details and registration information is available
here.
If
you're near Oklahoma City on Friday May 13th you may want to take
advantage of some HUD 184 training featuring Deanna Lucero, HUD 184 Senior Loan
Guarantee Specialist and
Michelle
K. Tinnin, Native American Program Specialist. Registration 8:30 - 9:00 Seminar
9:00 - 11:30; $25 NAPMW Member and $50 Non Member. Online Credit Cards payments
are accepted. Registrations can made here. For additional information
email Carol.Clark@guildmortgage.net.
Silicon
Valley CAMP's upcoming May events are available via YouTube video, presented by its President, Richard Wang.
Registration and details for events are available on the CAMP website.
Having trouble with BAML's warehouse monies?
You're not alone. Apologies went out to lenders due to the "technical
issues." "This was a bank-wide issue we were having with our wire system.
The highest level of executives in our treasury team were involved to resolve
this problem as quickly as possible. We did not re-issue these wires because we
were unable to cancel them; once the wire gets initiated in our system, it will
eventually get funded. The bank was not comfortable sending out duplicate wires
for every loan that is stuck in queue as this problem was not limited to just
the warehouse group and impacted multiple warehouse clients. If you do decided
to use another warehouse line, please let us know so that we can coordinate
getting the funds back from the closing agents as the wires were released this
morning." What lender, at month end, wouldn't have used another lender
in order not to negatively impact their borrowers?
The residential lending biz was thrown a
bone yesterday when the CFPB issued a letter in response to the industry, led by the MBA,
seeking additional clarity on several aspects of the Know Before You Owe (KBYO)
rule. The CFPB is not, at the moment, clarifying anything but instead is
outlining an "expedited path" to issuing a formal Notice of Proposed
Rulemaking (NPRM) to address many of the industry's outstanding questions and
concerns, and incorporating many of the issues that have been addressed so far
through informal oral guidance. The MBA notes that, "The CFPB has already
begun drafting the rule based on the ongoing dialogue with MBA and other
industry participants, and CFPB will be holding additional meetings with
stakeholders prior to the targeted July NPRM."
So
the CFPB announced that it will propose changes to TRID in July to provide
"greater certainty and clarity" to the mortgage industry. This
does not mean that TRID is going away. It means that they will make
adjustments and provide more clarity. Though Cordray did not provide details of
the changes, industry groups have asked for further guidance on a dozen
significant issues, including how to cure errors, account for lender credits,
and calculate cash-to-close transactions. the changes requested by the industry
do not involve policy issues but rather resolving differing interpretations of
the rule.
The
news prompted one broker to write me saying, "We are about 7 months into
the implementation and suddenly the CFPB blinked. Why? But worse yet, why are
they waiting until July to announce the proposal. At best any changes
wouldn't come until October 2016. And it the changes are real and we need
software changes the time would be out to next spring. What changed? Is
there a major lender or lenders in trouble because of TRID? This isn't
out of the goodness of their hearts. Are larger institutions being appeased
while claiming they are asking small business for input. Something is
amiss. Congress needs to ask the GAO to do a start to finish cost assessment of
the sinking of the Titanic, I mean TRID. Just consider the losses on rate
locks, compliance, manpower, software and hardware and the national economic
impact to the RE sector of GDP all from TRID."
The
CFPB also controls HMDA and its process. Sure we have until 2018 for collecting the expanded data required under the
revised Home Mortgage
Disclosure Act (HMDA). But
lenders and their IT staffs are already at work on it - we have plenty of lead
time, certainly more than with TRID. But experts think that the expanded
version of HMDA may prove harder than TRID was/is. And with worse penalties.
And not to look for any last-minute extensions that save lenders from
non-compliance.
The new version of HMDA doesn't simply add to the
number of data points being collected (from 26 to 48). HELOCs will be subject
to reporting. The new rule applies to any residential loan that's secured by a
dwelling, and thus more loans will be covered by HMDA on the residential side,
and it expands the scope for commercial loans. Commercial loans covered
under the rule still have to satisfy the HMDA purpose test, which is for
purchase, home improvement or refinancing, but this is still a major change in
how HMDA affects commercial lending.
Lenders are well advised to understand HMDA's new requirements since data will have to be integrated from multiple sources. And lenders have learned not to rely 100% on vendors. Lenders need to know what their technology and business processes will need to do to enable accurate compliance.
Lenders are well advised to understand HMDA's new requirements since data will have to be integrated from multiple sources. And lenders have learned not to rely 100% on vendors. Lenders need to know what their technology and business processes will need to do to enable accurate compliance.
What could go wrong? Plenty: HMDA data is released
publicly and it becomes fodder for fair lending cases and issues from the
public, attorneys, and regulators. Even now companies are already
conducting the statistical analysis that consumer advocacy groups would do on
the HMDA data before lenders report it. Don't dally.
The lack of volatility continues in the
bond market although on Thursday the MBS
market ended higher in price and mostly tighter on spread, despite a rallying
treasury market, as heavy Fed demand was joined by real money interest. As
usual, the Fed was in buying billions of dollars of various securities and
coupons. At the close, the 10-year note was better by nearly .250 to yield 1.84%
while current coupon agency MBS prices improved about .125.
Today we've had more news. Anyone caring about
employment costs noted the Employment Cost Index for March was +.6% (as
expected). And Personal Income and Consumption/Spending, expected +.4% and
+.1%, respectively, were indeed +.4% and +.1%. Coming up later are the
Milwaukee and Chicago Purchasing Manager surveys as well as some University of
Michigan Sentiment figures. After the initial bout of figures rates are
higher with the 10-year at 1.87% and agency MBS prices worse .125.