Category Archives: Lending

Ask the Underwriter:  Are DACA borrowers considered ‘lawfully present’ in the United States?

Ask the Underwriter is a regular column for HousingWire’s LendingLife newsletter, addressing real questions asked to, and answered by, professional mortgage underwriter, Dani Hernandez. 

Question: Are DACA borrowers considered to be lawfully present in the United States, according to the USCIS?

Answer: Overwhelmingly, the main argument I have received as to why DACA borrowers are not eligible for mortgage financing is because FHA and Fannie Mae guidelines state that a U.S. citizen borrower must be legally present in the United States. Critics argue that because DACA does not confer a Lawful Permanent Residence Status according to the USCIS, this means that DACA borrowers are not eligible for mortgage financing. Fortunately for Dreamers, this interpretation is wrong.

First let’s look at exactly what the USCIS Website says about this…

The USCIS issued updated DACA FAQs in 2018 but, according to the USCIS, the archived DACA FAQs still apply unless otherwise provided in the new guidance.


Here is that answer from the USCIS website:

Q1: Do the archived USCIS DACA FAQs still apply?

A1: Yes, except as explained below. Unless otherwise provided in this guidance, the DACA policy will be operated on the terms in place before it was rescinded on Sept. 5, 2017, until further notice.

The only guidance on lawful residence that the USCIS provided in the new DACA FAQs was Q68, which refers to Lawful Permanent Residence Status.

Q68: Does deferred action provide me with a path to permanent resident status or citizenship?

A68: No. Deferred action is a form of prosecutorial discretion that does not confer lawful permanent resident status or a path to citizenship. Only the Congress, acting through its legislative authority, can confer these rights.

So, DACA recipients DO NOT have Lawful Permanent Residence! This means DACA borrowers are not eligible… WRONG!

And this is where the majority of the Mortgage World has gotten confused…  They failed to realize that FHA and Fannie Mae DO NOT require a borrower to have Lawful Permanent Residence. The guidelines only state that the non-U.S. citizen borrower must be legally present in this country.

And guess what the USCIS has to say about whether or not DACA recipients are to be considered lawfully present in the U.S.… Nothing in the new DACA FAQs… so, we defer to the archived DACA FAQs – which are still in effect according to the new DACA FAQs. And wouldn’t you know it, the very first question in the archived DACA FAQs provides us with guidance on this subject:

The Archived USCIS DACA FAQs

Q1: What is deferred action?

A1: Deferred action is a discretionary determination to defer a removal action of an individual as an act of prosecutorial discretion. For purposes of future inadmissibility based upon unlawful presence, an individual whose case has been deferred is not considered to be unlawfully present during the period in which deferred action is in effect. An individual who has received deferred action is authorized by DHS to be present in the United States, and is therefore considered by DHS to be lawfully present during the period deferred action is in effect.


Final note to mortgage lenders: Please make someone’s Christmas Wish come true and start lending to Dreamers… Your loan officers will be grateful, too!

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ARIVE boasts strong network of 100-plus wholesalers aiming to bolster broker market share

There’s good news and better news for mortgage brokers as the calendar flips to 2019.

The good news is that mortgage brokers continue to outpace their retail counterparts in business growth, a trend that has lasted the better part of two years now, especially as the market has been so heavily dominated by purchases.

The better news is that brokers will see their competitive advantage intensify following the January  launch of ARIVE, the industry’s first centralized digital platform that connects independent loan originators with a network of wholesale lenders, third-party vendors and borrowers.

ARIVE, which was announced by Association of Independent Mortgage Experts (AIME) founder Anthony Casa at AIME’s October Fuse event in Las Vegas, has already established multi-year contracts with a network of more than 20 wholesale lenders that are committed to integrating to align with ARIVE. That includes five of the most widely used wholesale lenders in the country: United Wholesale Mortgage (#1), Caliber Home Loans (#2), Stearns Lending (#3), Flagstar Bank (#7) and Home Point Financial (#8). Combined, these lenders make up nearly half of wholesale market share. Top Renovation Lender AFR Wholesale, Reverse Lender Finance of America Mortgage, and Paramount Residential Mortgage Group are among the additional 20 wholesale lenders connecting to ARIVE.

More than 80 additional lenders are on a waiting list to be added to the platform, with ARIVE expecting to add 15-20 lenders each month. Over 13,000 independent loan originators are pre-registered for ARIVE, with more to come, so partnership opportunities look promising for both sides. Lender and user adoption will begin in January and continue throughout the first quarter of 2019.

A great deal of excitement and anticipation surrounds the launch of ARIVE, as independent mortgage brokers have waited a long time for an all-inclusive platform that simplifies transactions. Instead of abiding by different processes and systems of each respective wholesale lender they send loans to, ARIVE will now allow brokers to more easily shop on their borrowers’ behalf and connect them with the products and pricing that best fit their needs with a standardized end to end manufacturing process.

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Here’s where HECM originators see opportunity in 2019

There’s no disputing that it’s been a rough year for the reverse mortgage industry, with volume recently falling to a low the industry hasn’t seen in 14 years.

But now that program changes issued in October 2017 are firmly in the rearview, some HECM originators are ready to charge ahead, optimistic about the promise for better business in the year ahead.

ReverseReview reached out to a handful of seasoned reverse specialists to talk about their plans for 2019 and where they intend to set their sights for growth.

While many said they were bracing themselves for another tough year as the industry works to regain its footing, they also stressed the need for positive thinking, believing firmly that the opportunity is there for those who go after it.

Here’s what they had to say:


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Movement Mortgage launching mobile app for loan officers

Top 10 national retail mortgage lender, Movement Mortgage, is launching Movement Mobile, a productivity and relationship management mobile application for loan officers.

The news is provided first to LendingLife readers; the actual launch, via a small pilot user group to start, is set for January 2019.

The app will integrate a loan officer’s pipeline, database, pricing engine, marketing resources and many other productivity tools, available right on your phone.

“In today’s competitive environment, the best loan officers want to provide their clients with superior speed and service anywhere, anytime,” says Movement CEO Casey Crawford. “Movement Mobile will help our loan officers do more business in less time. It’s that simple.”

“Movement Mobile puts the tools an LO needs in the palm of their hand. That’s what the marketplace expects and we’re committed to delivering that experience,” Crawford added.

Movement Mobile is the result of a research and planning process that included an advisory board of the company’s top producing loan officers and the Movement Crowdsource Challenge, a competitive event, held earlier this year, to identify the top technology solutions available.

These exercises identified common pain points for loan officers and the technology to address them.

As a result, Movement Mobile will bring the tools loan officers use everyday into a single application on a mobile device. Movement loan officers’ pipelines, pricing engine, loan origination system and more will be incorporated into a single app updated in real-time. Finally, Movement Mobile will integrate these tools in a simple user interface that includes common productivity tools such as calendars, calculators, messaging and documents.

Mobile joins other technology tools and resources, such as Movement’s EasyApp digital borrower application experience and EasySign e-closings to give Movement Mortgage loan officers a full suite of technology offerings that provide a competitive edge.

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AAG hires new senior VP of operations

American Advisors Group has named Joe Stephenson senior vice president of operations. As such, Stephenson will oversee operations for all of AAG’s sales channels, including its call center, national field sales division and wholesale division.

Stephenson will report to Paul Fiore, AAG’s chief retail sales and operations officer, and Jesse Allen, executive vice president of alternative distribution.

The hire comes not long after AAG, a leading lender in the reverse mortgage space, launched a massive rebrand to become a holistic provider of home equity solutions.

As part of this move, the company expanded its suite of product offerings beyond reverse mortgages to include traditional mortgage products and real estate services designed to help seniors utilize their equity to “retire better.”

Joe StephensonStephenson, who has more than 20 years of mortgage industry experience, worked previously as head of mortgage operations at Morgan Stanley. Prior to that, he was COO of Bank of America’s reverse mortgage division.

“Joe and his team will take the lead in building new processes focused on optimizing operations and capitalizing on synergies throughout the business,” said Fiore. “We’re excited to see Joe’s ideas come to life, as he partners with leaders across the enterprise to scale operations for projected future growth.”

“Bringing Joe on board furthers our commitment to building an industry-leading platform,” added Allen. “Joe’s depth of industry knowledge and impressive experience made him an optimal choice for us.”



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Federal Reserve: More homeowners are getting their refi applications rejected

Every few months, the Federal Reserve Bank of New York’s Center for Microeconomic Data releases a survey of consumer experiences. The survey is the result of panel data acquired directly from consumers when they apply for credit.

That survey covers a wide range of asset classes, from credit cards to auto loans, and even mortgages. The big news today is that the latest poll finds that rejection rates are on the decline across all credit applications, but not for mortgage refinancing.

The survey instead finds that more homeowners are getting their refi applications rejected. In fact, this rejection rate is the highest since the Fed began polling consumers about their credit experiences.

“The October rejection rate on mortgage refinance applications of 34.3% is the highest reading since the start of the SCE Credit Access Survey in October 2013. For 2018 overall, rejection rates for credit cards and credit card limit extensions and for mortgage refinancing exceeded those in 2017, while those for auto loans and mortgage applications were stable,” the Fed reports.

Of course, with interest rates rising, refinance applications are slowing down, too. For mortgage refinance applications, 2018 respondents reported a 6.8% likelihood of applying over the next 12 months, compared with 8.2% for 2017 respondents. Further, more and more Americans also report that they don’t plan to bother even trying to apply for a refi in the next 12 months.


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MBA: Mortgage applications rise 2%

Mortgage applications climbed 2% for the week ending Nov. 30, 2018, according to new data from the Mortgage Bankers Association’s weekly Mortgage Applications Survey.

Notably, the results for the week ending November 23, 2018, included an adjustment for the Thanksgiving holiday.

“Treasury rates continued to slide last week, driven mainly by concerns over slowing global economic growth and U.S. and China trade uncertainty,” MBA’s Associate Vice President of Economic and Industry Forecasting Joel Kan said. “The 30-year fixed-rate fell for the third week in a row to 5.08% and has declined a total of nine basis points over this span.”

On an unadjusted basis, the Mortgage Composite index increased 2% from the previous week.

“Application activity increased over the week for both purchase and refinance loans, and were 10% and 7% higher, respectively, than the week before the Thanksgiving holiday,” Kan continued. “Additionally, we saw a decrease in the average loan size for purchase applications to the lowest since December 2017.”

According to Kan, this might be an indication that there are fewer jumbo borrowers, or first-time buyers are having better success reaching the market.

The Refinance Index increased 6% from the previous week, and the unadjusted Purchase Index spiked 36% from last week and was 0.2% higher the same week in 2017. The seasonally adjusted Purchase Index inched forward 1% from the previous week.

The refinance share of mortgage activity grew to 40.4% of total applications, up from 37.9% the week before. The adjustable-rate mortgage share of activity decreased to 7.4% of total applications.

The Federal Housing Administration share of mortgage apps increased from last week’s 9.6% to 10.2%, and the Veterans Affairs’ share of applications also grew, climbing from 9.9% the previous week to 10% this week.

The Department of Agriculture share of total applications slid, falling from 0.7% last week to 0.6% this week.

The MBA reported that mortgage interest rates for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 5.08% from 5.12% the previous week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) slightly increased from last week’s 4.88% to 4.89% this week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA fell from 5.11% last week to 5.08% this week.

The average contract interest rate for 15-year fixed-rate mortgages fell, slid from 4.53% last week to 4.5% this week.

Lastly, the average contract interest rate for 5/1 ARMs grew, reaching 4.33%, up from 4.29% last week.

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CBRE: Here’s where multifamily investors should be putting their money in 2019

While most of the market attention tends to be focused on Class A multifamily buildings, new research from CBRE suggests that there is another class of multifamily housing that represents a much larger opportunity for investors – workforce housing.

According to CBRE, workforce housing, rental communities that are affordable for low- to median-income workers, has actually outperformed the overall multifamily market in each of the last four years, thanks to relatively low vacancy rates and above-average rent growth.

According to the report, approximately 13.5 million households currently live in workforce housing, most of whom are individuals and families who are “renters by necessity” because they are paying off student debt or perhaps saving to buy a house and do not have the financial means for homeownership or for higher-quality multifamily housing.

And going into 2019, market conditions are positioning workforce housing for continued return on investment.

“Slow wage growth over the past decade contributing to a high number of potential renters, an extreme lack of new supply, and limited alternative options means strong and sustained demand for workforce housing apartments is expected to continue in 2019,” CBRE said in its report.

According to the report, workforce housing has brought in nearly $375 billion in investment over the last five years, more than 51% of the total for all multifamily asset classes.

But despite the capital coming from “unlikely sources,” including institutional and international investors, only a “small” amount of workforce housing has been built in the last 10 years, while many older apartment communities have been torn down to build new, luxury apartments and the like.

That means there’s opportunity for both preserving existing and building new workforce housing.

“The multifamily industry removes more than 100,000 units per year due to obsolescence, and these are predominantly workforce and affordable housing units,” CBRE said in its report. “The redevelopment of older housing units is tremendously valuable to the multifamily sector, providing better-quality and updated units for renters. The physical improvement to the older multifamily housing stock has also made it more attractive for investors.”

According to the report, nearly all areas in the U.S. are benefiting from workforce housing’s “strong” market conditions, with Orlando and Las Vegas leading the way with 7% workforce housing rent growth in the last year.

But the workforce housing market is not without risks, specifically the ability of renters to be able absorb any more rent increases when wages are not rising as quickly as rents.

“Workforce housing affordability has begun to create some resistance to rent increases and may limit them further in the future,” CBRE notes.

According to the report, more than one-third (35%) of workforce renter households were considered “rent burdened” last year, meaning their rent payments represented 30% or more of their incomes, compared to 21% in 2006.

Additionally, proposed rent control policies, like the one defeated in California last month, could also limit rent growth, while the wide array of public and private programs focused on trying to improve housing affordability may improve the supply/demand situation for renters at the expense of owners, CBRE said.

Despite that, Brian McAuliffe, CBRE’s president of Institutional Properties, Capital Markets, said that there is still a significant opportunity for investors, if they’re smart.

“The balance of the market forces points to continued strength in workforce housing, justifying the strong investment appeal. Investment in this segment is also very good for the housing market by helping to preserve much-needed accommodation for lower income renters,” McAuliffe said. “Value-add investment, in particular, helps to preserve workforce housing inventory directly by improving the physical quality of the asset through renovation.”

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HUD gives $23 million to fair housing groups to fight discrimination

Nearly 80 fair housing groups will be receiving federal funding to fight discrimination, the Department of Housing and Urban Development announced this week.

The funding is provided through HUD’s Private Enforcement Initiative. The money, in for the form of grants, offer a range of assistance to the nationwide network of fair housing organizations so they can carry out testing and enforcement activities, HUD said.

In total, nearly 80 fair housing groups will receive approximately $23 million to address housing discrimination.

“It’s been 50 years since the passage of the Fair Housing Act, yet the fight against housing discrimination continues,” HUD Secretary Ben Carson said in a statement. “Today we are making another investment to support our fair housing partners and protect families from discrimination.”

Here are the groups that are getting the HUD funds:






 Alaska Legal Services Corporation




 Fair Housing Center of Northern Alabama




 Fair Housing Council of Central California



 Project Sentinel Inc

 Santa Clara


 Southern California Housing Rights Center

 Los Angeles


 Bay Area Legal Aid



 Fair Housing Advocates of Northern California

 San Rafael


 Inland Mediation Board



 Legal Aid Society of San Diego, Inc.

 San Diego


 District of Columbia

 National Fair Housing Alliance



 National Community Reinvestment Coalition



 Equal Rights Center




 Community Legal Aid Society, Inc.




 Fair Housing Continuum, Inc.



 Jacksonville Area Legal Aid, Inc.



 Housing Opportunities Project for Excellence, Inc.



 Legal Aid Society of Palm Beach County, Inc.

 West Palm Beach


 Community Legal Services of Mid-Florida, Inc.

 Daytona Beach



 Legal Aid Society of Hawaii




 South Suburban Housing Center



 H.O.P.E. Inc d/b/a HOPE Fair Housing Center



 Open Communities



 Prairie State Legal Services, Inc.



 Access Living of Metropolitan Chicago



 Chicago Lawyers’ Committee for Civil Rights Under Law, Inc.




 Fair Housing Center of Central Indiana, Inc.




 Lexington Fair Housing Council, Inc.




 Greater New Orleans Fair Housing Action Center, Inc. 

 New Orleans



 Suffolk University




 Community Legal Aid, Inc.



 Massachusetts Fair Housing Center Inc.



 SouthCoast Fair Housing, Inc. 

 New Bedford



 Pine Tree Legal Assistance




 Fair Housing Center of West Michigan

 Grand Rapids


 Fair Housing Center of Southwest Michigan 



 Fair Housing Center of Metropolitan Detroit 



 Fair Housing Center of Southeastern Michigan 

 Ann Arbor


 Legal Services of Eastern Michigan 




 Mid-Minnesota Legal Assistance




 Metropolitan St. Louis Equal Housing and Opportunity Council

 St. Louis



 Mississippi Center for Justice



 Housing Education and Economic Development, Inc. 




 Montana Fair Housing, Inc.



 North Carolina 

 Legal Aid of North Carolina, Inc.



 North Dakota 

 High Plains Fair Housing Center

 Grand Forks



 Family Housing Advisory Services, Incorporated



 New Jersey 

 Fair Housing Council of Northern New Jersey




 Silver State Fair Housing Council



New York 

 Housing Opportunities Made Equal, Inc.



 Fair Housing Justice Center, Inc. 

 Long Island City


 Brooklyn Legal Services (formerly South Brooklyn Legal Svcs) 



 CNY Fair Housing, Inc. 



 Legal Assistance of Western New York, Inc. 



 Long Island Housing Services, Inc. 




 Fair Housing Resource Center, Inc.



 Fair Housing Contact Service, Inc. 



 Fair Housing Opportunities of NW Ohio, Inc. 



 Housing Opportunities Made Equal of Greater Cincinnati, Inc. 



 Housing Research Advocacy Center 




 Legal Aid Services of Oklahoma, Inc.

 Oklahoma City


 Metropolitan Fair Housing Council of Oklahoma, Inc. 

 Oklahoma City



 Fair Housing Council of Oregon




 Fair Housing Council of Suburban Philadelphia, Inc.

 Fort Washington



 Fair Housing Rights Center in Southeastern Pennsylvania



 Southwestern Pennsylvania Legal Services, Inc. 



 Fair Housing Partnership of Greater Pittsburgh 




 West Tennessee Legal Services, Inc.




 North Texas Fair Housing Center



 San Antonio Fair Housing Council, Inc.

 San Antonio


 Austin Tenants’ Council



 Greater Houston Fair Housing Center, Inc.




 Disability Law Center

 Salt Lake City



 Housing Opportunities Made Equal of Virginia, Inc.




 Vermont Legal Aid, Inc.




 Fair Housing Center of Washington



 Northwest Fair Housing Alliance




 Metropolitan Milwaukee Fair Housing Council





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New York foreclosure firm admits to cheating Fannie Mae, VA out of millions

A New York foreclosure law firm admitted to defrauding Fannie Mae and the Department of Veterans Affairs out of millions of dollars by using its affiliated companies to “systematically” overcharge the entities for foreclosure-related services as part of a settlement with the Department of Justice.

The U.S. Attorney’s Office for the Southern District of New York announced Tuesday that it reached a settlement with Rosicki, Rosicki Associates, in which the law firm admitted to using its wholly owned affiliates, Enterprise Process Service and Paramount Land, to overcharge Fannie Mae and the VA for foreclosure and eviction-related expenses.

Back in March, the U.S. Attorney’s Office filed a lawsuit against the law firm, which specializes in foreclosures, acting as counsel to mortgage servicers that use the firm to execute foreclosures in New York, a judicial foreclosure state.

According to the complaint, the law firm appeared to only use its affiliated companies, a process server and a title search company, to serve process and perform title searches that were required to complete foreclosures on loans owned by Fannie Mae.

But instead of actually using its own companies, the law firm was accused of using third-party vendors to perform the majority of the work in question, applying “exponential” markups to the services performed, and billing Fannie Mae for the work, knowing that the government-sponsored enterprise would repay the firm for the services.

According to the complaint, the submission of those “fraudulently inflated expenses” caused Fannie Mae to pay out “millions of dollars” in falsely inflated foreclosure expenses. 

This week, the firm admitted to the conduct as part of a $6.1 million settlement with the U.S. Attorney’s Office.

According to the settlement, Rosicki, Enterprise, and Paramount admitted that from 2009 through 2018, Enterprise (the process server) added “additional charges to the costs charged by independent contractors and otherwise took actions that increased costs and expenses.

Additionally, Paramount (the title search company) “added additional charges to the costs charged by independent contractors and otherwise took actions that increased costs and expenses.”

Rosicki then submitted those costs and expenses to Fannie Mae for reimbursement, with the understanding that Fannie Mae would pay the company back.

According to the U.S. Attorney’s Office, the settlement also resolves “identical misconduct in connection with eviction-related expenses that were submitted to and paid for by the VA.”

As part of the settlement approved by U.S. District Judge Jed Rakoff, Rosicki, Enterprise, and Paramount admitted and accepted responsibility for their conduct and must pay $4.6 million to the United States.

This lawsuit began as a lawsuit filed by a whistleblower under the False Claims Act. In a separate settlement agreement, Rosicki, Enterprise, and Paramount agreed to pay the U.S. an additional $1,518,000 to resolve separate False Claims Act claims pursued by the whistleblower.

The total payout for Rosicki and the associated companies will end up being more than $6.1 million.

The settlement also requires the law firm to implement a compliance program with regular reporting over the next five years, and to disclose the nature of its affiliation with Enterprise and Paramount on its website.

“Lawyers are not above the law. For years, the Rosicki firm submitted bills to Fannie Mae and the VA that contained inflated and unnecessary charges,” Manhattan U.S. Attorney Geoffrey Berman said. “This Office will continue to hold accountable those who seek to achieve profits by fraudulent conduct.”

Joining the U.S. Attorney’s Office in pursuing the case were the Federal Housing Finance Agency Office of Inspector General and the Department of Veterans Affairs Office of Inspector General.

“This civil settlement should send a clear message to individuals and businesses that VA-OIG and its law enforcement partners will vigorously investigate and expose false claims that fraudulently impact programs designed to benefit our veterans and their families,” VA-OIG Inspector General Michael Missal said.

HousingWire attempted to contact the Rosicki firm through a representative, but as of publication, has not received a response. This article will be updated should the company respond.

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