A guy who owns a local bar asked
me and my band to play next Friday night. He tells me, "We can't pay you
anything, but it will be GREAT exposure for you and the guys!"
So I told him "Hey, can I
bring 30 of my besties to your bar next Saturday night to drink? We can't pay
you anything, but it will be great exposure for your bar!"
Every day we have news coming
out of Fannie Mae and Freddie Mac. Some of the news is attempts at changing the
structure of the two - being under government conservatorship under the FHFA is
not a long-term solution - and some of the news pertains to programs and
policies. Both are a few paragraphs down. And occasionally I am still asked
about F&F CEO pay. Yes, Congress capped it late last year at $600k, but
rest assured that those under the CEO level at the agencies have no such
limits. But in general CEOs are paid a lot because they're worth it.
StockTrade Capital Markets is an aggressive
NON-QM secondary market purchaser of whole loans. Accepting credit scores
as low as 500, Borrowers 1 day from a housing event, allowing bank statements
for income and LTVS to 90% with loan amount from 100,000.00 to 2,000,000.00 Warehouse
lines for this product are available, and willing to accept Brokers wanting to
become a Banker. We even can arrange for all services to be out sourced
such as underwriting, closing, funding and compliance. Depending on the
Client's needs, we can arrange something to fit. Accepting new Seller apps now.
Click here to register for rates and guidelines. Seller
questions and general inquiries can be directed to William Stock
(619-721-0743).
And Greenbox Loans was founded based on the
concept of 'out of the box' underwriting of residential loans. Raymond
Eshaghian, President of Greenbox Loans believes that the "The residential
lending environment has been plagued by regulatory challenges limiting credit
to well qualified borrowers that do not fit in the box. We think outside the
box with a common sense approach in helping qualified borrowers obtain the
financing they need. Greenbox's proprietary programs and guidelines include 24
Months Bank Statement loans with 580+ FICO score - up to $2MM loan amounts, no
income investor loans (borrowers qualify based on rental income up to 75% LTV),
no income investor loans for Foreign National borrowers up to 70% LTV,
Non-Prime loans up to $2MM with 500+ FICO score, Non-Prime loans for borrowers
with recent short sale/foreclosure/BK discharge, and non-warrantable condo
programs. For more information on programs or on becoming an approved broker,
contact Greenbox Loans at (800) 919-1086; email wholesaleinfo@greenboxloans.com for
additional program information.
And Compass Analytics,
LLC announced the offering of CompassPPE (formerly known as LenderHub) - an
enterprise level product, pricing, and eligibility engine (PPE).
"CompassPPE (CPPE) is a comprehensive, contemporary product and pricing
engine designed for flexibility and ease of use with robust capital markets
capabilities that enable lending institutions of all sizes to offer a
point-of-sale PPE to their correspondent, wholesale, and retail origination
channels. CPPE empowers originators and lock desk personnel with a streamlined
lock and relock workflow that combines mobile access, automation, historical
pricing, LOS integration, and optional integration to Compass Analytics' risk
management solution, CompassPoint. Capital markets groups can now comfortably
enable automated locking, relocking and extensions, and utilize originator
performance reporting to implement dynamic and granular control of profit
margins and mortgage servicing rights (MSR) values.
"Additionally, CPPE
is the first PPE in the industry to offer a comprehensive application
programming interface (API) that allows all core PPE functions and PPE
integrations to be leveraged programmatically from within a client's
proprietary user interface and system. Compass Analytics has established
investor relations, accuracy, support, flexibility, and capital markets control
as the hallmarks of its PPE solution, as the company feels that other providers
have lost this targeted focus." For more information, find Compass on the
web at compass-analytics.com or contact Wes Horbatuck
to schedule a demo or a meeting.
In
the secondary markets, PennyMac sent an announcement that it is removing
the Mandatory Forward delivery method from its offering of commitment
types. "PennyMac is removing the Mandatory Forward delivery method
from its offering of commitment types. Best Effort, AOT/DT and Bulk will
NOT be affected by this change. Please note important cutoff dates for
Mandatory Forward below..." View the
important cutoff dates for Mandatory Forward. PennyMac, however,
sent along an e-mail to me saying, "We are not eliminating mandatory
delivery. We have bulk and we have Direct trade and AOT and we have Best
efforts. No one was using the rate sheet forward concept that we called
Mandatory so we are killing it."
Congress only has
about 15 legislative days, or less, left before the November election - so
don't look for a lot of government changes to Freddie or Fannie this year. But
that doesn't stop the jawboning, posturing, negotiating surrounding the two,
and the internal changes that impact the residential lending business.
One editorial piece
noted, "It's been said that Washington is where good ideas go to die. We
don't know about that, but some bad ideas are certainly hard to get rid of.
Consider the persistent non-solution to the zombie-like status of Fannie Mae and
Freddie Mac known as 'recap and release.' The plan is to return the two mortgage-finance
giants to their pre-financial-crisis status as privately owned but
"government-sponsored" enterprises. That is to say, to recreate the
private-gain, public-risk conflict..."
Recently Freddie Mac
received some bad news. A federal appeals court revived a lawsuit accusing Freddie Mac and several former
top officials of defrauding shareholders by concealing its subprime mortgage
exposure and its inadequate risk management prior to the 2008 financial crisis.
The 6th U.S. Circuit Court of Appeals said a lower court judge erred in
concluding that the Ohio Public Employees Retirement System did not
sufficiently allege that its losses were caused by Freddie Mac's disclosure
shortfalls.
A few weeks ago the
industry learned of something new to worry about: a borrower's language
preference.Fifty-four members of the House, in a letter to Federal Housing
Finance Agency Director Mel Watt, urged the agency to exclude from its new Uniform Residential
Loan Application a question asking borrowers to indicate their language
preference, saying that FHFA should work with Congress, federal agencies
and industry in developing a "comprehensive approach" to address
mortgage consumers with limited English proficiency.
A draft Republican Party
platform calls for dismantling Freddie Mac and Fannie Mae and limiting the
government's role in the mortgage system. The platform also calls for scaling
back financial regulations and getting rid of the Consumer Financial Protection Bureau.
Obviously nothing is going to happen in 2016 regarding any of this, but it is
good to know what some folks are thinking.
The Fannie Mae Servicing
Guide has been updated to include changes related to the following:
Post-Foreclosure Bankruptcy Clarification, Short Sale Offer Acknowledgement and
Pooled from Portfolio (PFP) Mortgage Loans. Read the Announcement for details.
The area median incomes
(AMIs) used in determining borrower income eligibility for HomeReady mortgage
loans have been updated, as announced in this Selling Notice. The 2016 Income
Eligibility by Census Tract Lookup spreadsheet is posted on Fannie Mae's
website and updated AMIs will be implemented in Desktop Underwriter® (DU®) the
weekend of July 16, 2016. For manually underwritten HomeReady loans, lenders
can begin using the updated AMIs immediately. Loans already in the pipeline
will not be affected by updated AMIs.
Lenders are encouraged to use
the revised Fifth Third Condo Questionnaire for condominium loans
delivered to Fifth Third. Fannie Mae Form 1076, Freddie Mac Form 476 and
other common industry questionnaires (CondoCerts.com, Homewise, etc.) are
acceptable. Regardless of the condo questionnaire used, it does not eliminate
the lender's responsibility for verifying the project meets all applicable
project warranties and guidelines. The updated Ineligible Condo list is
available in the Correspondent Connect Online Guides and Forms.
Per Fannie Mae's announced postponement of DU Version
10.0 until September 24, 2016, Mountain West Financial will not be
implementing any changes for DU Version 10.0 until Desktop Underwriter can
support the changes. This would include Trended Credit Data; Underwriting
Borrowers Without Traditional Credit; and Borrower's with Multiple Financed
Properties.
Sun West Mortgage
Company is aligning its guidelines for Multiple Financed Properties as per
Fannie Mae announcement SEL 2016-03. The revised policy is effective for loan
submissions on or after 06/30/2016. The updated guidelines can be
accessed through its website.
Citi's recent
bulletin includes credit policy updates, regarding Principal
Curtailments, Arch Mortgage Insurance and AUS Note Updates: LP Loans. Clients
should check out Citi's 2016-07 bulletin.
Ditech updated its
Conforming, FHA and VA underwriting guidelines. The Client Guide and product
summaries must be referenced for complete guideline requirements. Conforming
underwriting guidelines are being clarified or updated related to the following
topics: Restructured Mortgages, Written Verification of Employment for Bonus,
Overtime, Commission Income, Self-Employment Income FHA underwriting guidelines
are being clarified or updated related to Energy Efficient Homes as a
Compensating Factor. VA underwriting guidelines are being clarified or updated
related to termite/pest inspection fees.
Effective August 1 Mortgagees must use the updated HUD
92900-A. This form will be incorporated into Mountain West Financial
Disclosure package and is required for case numbers assigned on or after August
1, 2016. Also announced by MWF, it now has the availability of the
Fannie Mae Property Inspection Waiver (PIW) on loan transactions with
confirmation of the offer indicated on the final submission of the DU Findings.
Pacific Union is
pleased to announce the availability of the USDA Streamlined-Assist product,
formerly the USDA Pilot Refinance program (available only in certain
states). Loans with no credit score or credit score <620 will be
subject to Specialty pricing. Pacific Union alsoannounced Pacific Prime, its
new proprietary Jumbo Fixed Rate financing option. All Correspondents
approved for Conventional lending are eligible to submit loans under the
Pacific Prime Jumbo program. This is a non-non-delegated program;
therefore, all loans must be submitted to Pacific Union for
underwriting/eligibility review prior to closing, using a Non-Delegated
Submission Form. A $675 Non-Delegated Jumbo Administrative Fee will be netted
from the purchase price.
Rates: up a little, down a
little. For many lenders rates are the least of their problems, unless you
include possibly paying penalties for previous loans paying off early. On
Friday U.S. Treasuries, and agency MBS prices, traded modestly lower/worse on
no news of substance although the 10-year risk-free T-note had a half point
price range during the day.
This week we have a full larder
of economic tidbits although today there is zilch. Tomorrow we have the
Case-Shiller 20-city Index if you'd like some news from May, July Consumer
Confidence, and June New Home Sales. Much later we'll have a $26 billion 2-year
Treasury auction - grab your checkbooks.
Wednesday we'll have the
MBA's Mortgage Index, June Durable Goods Orders and Durable Goods Orders
ex-transportation, June Pending Home Sales, and then the FOMC rate decision -
there will be no change to short terms rates. Thursday contains the usual
Initial Jobless Claims, but also June's International Trade Balance, and a $28
billion 7-year Treasury auction.
Friday will be some
substance: Q2 GDP, Chain Deflator, and ECI - Advance Estimate (08:30 EDT), the
Chicago Purchasing Manager's survey, as well as the Bank of Japan's statement
on rates - but Japan has had low rates for many years so don't get your hopes
up.
If you're trying to guess
where rates sheets will be, we closed Friday with the 10-year at 1.57%. This
morning it's at 1.59% and agency MBS prices are slightly worse.
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