New Products Including LE Tool

By rchrisman@robchrisman.com

(Overheard at a local coffee shop.)

"The only math we should teach our children is arithmetic."

"But if we taught them differential equations, they could calculate interest and make investments! If we taught them probability they'd understand polls and predictions. If we taught them logic, they wouldn't be fooled by scams."

"You're making my point for me. If they understood differential equations, they wouldn't max out their credit cards. If they understood probability, they'd never buy lottery tickets. If we taught them logic, they wouldn't buy products that do nothing. In short: If people understood math, the economy would tank immediately."

"Holy smokes! I never realized innumeracy was the major driver of economic growth."

"Try to explain America any other way."

Remember when someone was "fired" instead of "managed out?" Then there's a good old-fashioned purge like what Turkish President Erdogan did yesterday to over 15,000 education officials from the government. Personnel changes happen all the time, but I don't know when candidates starting naming their cabinet nearly four months before an election, yet it happened. In this case there is a tie-in the mortgage biz: Donald Trump has said he wants former Goldman Sachs banker and IndyMac owner Steve Mnuchin to serve as Treasury secretary in his administration. Mnuchin has his bases covered...he reportedly has donated sizeable chunks of money to Hillary Clinton and Barack Obama.

In wholesale news Freedom Mortgage launched a new online Loan Estimate (LE) tool! This new online technology now provides a higher-quality user experience starting with enhanced, intuitive functionality on a single page, streamlined data input process with real-time data checks, continuous visual display of the LE submission deadline, and Click and Scroll navigation. According to Keith Bilodeau, SVP Freedom Wholesale, "Freedom Mortgage Clients can look forward to our continuous commitment to technological upgrades and enhancements in the coming months. We understand the need for ease of use and intuitive applications and are committed to these enhancements". If you have any questions, or would like to attend one of the upcoming training sessions please contact a Freedom Mortgage Account Executive, or visit the Freedom Mortgage Website.

 "Have you been looking for the right tool to compete with RocketMortgage and keep your existing processes? With Lendsnap, you can have both. Lendsnap automatically gathers and stores borrower qualifying documents. By linking to consumer accounts, the platform securely and quickly collects W2s, pay stubs, bank statements and full tax returns while reducing fraud risk and putbacks. Lendsnap provides authoritative documents, the actual statements from financial institutions, keeping your loans universally accepted on the secondary market. Lendsnap is a lightweight solution that works with your existing workflow. That means it doesn't require a lot of training like a new LOS. Lendsnap is live: visit its website or contact Cofounder and VP of Business Development, Mike Romano, to learn more.

 The White House spread the word that The Federal Housing Administration would approve mortgages on properties with energy-related home improvements financed through special tax assessments. The FHA said it would insure mortgages with PACE (Property Assessed Clean Energy) assessments that are subordinated to the mortgage lien. PACE loans, however, will retain a first-lien position on foreclosed properties or for delinquent PACE obligations. Property Assessed Clean Energy (PACE) obligations allow homeowners to finance energy-efficient upgrades and renewable energy systems and repay the cost through extra charges on their property tax bills.

 Banks generally dislike PACE loans because they take precedence over mortgage debt in the event of a default, upending a basic tenet of the market. Real estate agents urged the FHA to reconsider the policy, saying the existence of a PACE assessment would make a foreclosed property harder to sell. Six years ago the FHFA directed Fannie Mae and Freddie Mac not to buy mortgages on properties with PACE liens, limiting the salability of such homes. Yet lenders argue that a big attraction of PACE financing is that it is attached to the property, allowing homeowners to pass it on to subsequent owners. Some institutions, such as Renovate America, are quite pleased. Mortgagee Letter 2016-11, Property Assessed Clean Energy, will make it easier for future home buyers to purchase or refinance homes using FHA financing when there is an existing PACE obligation, that meets FHA requirements, attached to the property.

 Angel Oak is now offering business bank statement program.  No tax returns required, LTV up to 80% and much more. Contact Bob Hutchens for details.

 Guild Mortgage has joined forces with FirstREX to empower homebuyers with down payment funding to expand home ownership choices. Under its REX HomeBuyer program, FirstREX can contribute up to half of a 20 percent down payment for a home purchase. FirstREX's contribution to the buyer's down payment is an investment, not a loan, so there are no interest or monthly payments on the money.  Instead, FirstREX hopes to earn a return on its investment from a portion of the appreciation when the homeowner eventually sells. A homeowner can also buy out the agreement after three years. The REX HomeBuyer investment combined with a Guild Mortgage loan will empower prospective homebuyers to buy the home they really want with unprecedented opportunity, flexibility and control. More information is available on the Guild Mortgage website.

 Marketplace Home Mortgage has rolled out its on-time closing guarantee in the eastern United States.Marketplace Home Mortgage now offers the service to customers in its Eastern Division, which includes markets in South Florida, New Hampshire and Maine. The program guarantees that a mortgage will close on or before the new home's closing date, or the home buyer and seller will each be entitled to compensation. If Marketplace misses the closing date, the customer is eligible for up to a one-time $1,500 mortgage payment and the seller will be eligible to receive a $5,000 benefit. Visit the Marketplace website for more information on the company's Closing Guarantee.

 The Mortgage Partnership Finance (MPF) Program and Redwood Trust, Inc. announced increased loan limits on mortgage loans for the MPF Direct product, which will become effective during the third quarter of 2016. The new single-family loan limit will be $2.5 million, up from $1.5 million previously. In addition, hybrid adjustable rate mortgages (ARMs) will become eligible for delivery. ("The MPF Direct product allows members of a Federal Home Loan Bank that participate in the MPF Program to deliver eligible jumbo mortgage loans through the MPF Program's operational platform to a subsidiary of Redwood Trust. This arrangement adds private capital to the secondary mortgage market. Six FHLBanks have been approved by their regulator to offer the MPF Direct product: Atlanta, Boston, Chicago, Des Moines, Pittsburgh, and San Francisco.")

 In reference to loan purchased on or after July 12^th, Wells Fargo is expanding its Non-Conforming Loan policy to allow additional types of title changes. Examples include domestic partnerships, civil unions, court-ordered changes not limited to death or inheritance, and transfers to and from Limited Liability Corporations (LLCs) when borrowers match the members of the LLC.

 Starting Monday, July 18 AmeriHome's Core Jumbo, Non-Agency Hybrid ARM, and Expanded QM Non-Agency loan transactions must be in an active Rate Lock at the time the loan is submitted for Eligibility Review. The Rate Lock should have at least 15 calendar days remaining. A new Eligibility Review User Guide is now available on SellerWeb. The user guide provides updated details and instructions for the Eligibility Review process, including the new Rate Lock requirement. 

 Pacific Union Financial, LLC (Pacific Union) is discontinuing the Jumbo Series O product due to the investor's elimination of their Jumbo program. In addition, Pacific Union issued a reminder, all collateral for Correspondent Delegated and Non-Delegated loans should be delivered to Deutsche Bank, collateral custodian for Pacific Union Financial, LLC.  Documentation should be sent in a manila folder marked with the Pacific Union loan number.

 Ditech announced that effective immediately properties located in declining markets are not eligible for the Piggyback Closed End Second EE Product. The appraisal report and corresponding Clear Capital CDA report must be reviewed to determine the stability of the property values in the subject neighborhood. If either report indicates that the market is declining, the loan is not eligible. Any conflicts between the original appraisal and the CDA must be resolved with Clear Capital prior to submitting the loan for review.

 As of Monday, July 18, Flagstar Bank is on board with the Fannie Mae change to its HomeReady product limiting income to 100% of the area median income and properties located in low-income census tracts will continue to require no income limit. These updates will be implemented in DU over the weekend of July 16th and will apply to all DU Version 9.3 loan casefiles submitted, or resubmitted, on or after that date.

 In addition, Flagstar Bank announced an update to the Freddie Mac Home Possible and Home Possible Advantage program (Freddie Mac Home Possible and Home Possible Advantage, Doc. #5335). It is no longer necessary to obtain a signed consent form from the Borrower authorizing the release of the Borrower's information to a counseling agency in the event of a delinquency. As such, the product description has been updated to remove the requirement for Borrower's Authorization for Counseling, Doc. #3233. Borrower income disclosed on the 1003 Application will be considered for loan qualification for the ability to repay and to apply the income limits. The requirement to provide full tax returns and all schedules has been removed unless required by Loan Prospector.

 Shifting to interest rates, overall Tuesday was a pretty quiet day in the electronic U.S. bond market. U.S. Treasury prices moved slightly higher (the 10-year was +.250), probably because they didn't want to go lower. (Trader humor.) The 5-year T-note and agency MBS prices both improved slightly. We did have U.S. housing starts increase to 1189K in June from 1135K in May although May was revised downward. Building permits totaled 1153K in June but was also revised down in May.

 We've already had all the scheduled news we're going to see today. The MBA, at 4AM PDT via CNBC, sent out its survey of retail application data for last week: apps -1.3%, refis accounting for 64% of them. If you're guessing where rate sheets are going to be, we closed the 10-year Tuesday at a yield of 1.56%; this morning both it and agency MBS prices are pretty much unchanged.