Category Archives: News

Not Just the Season; MBA Predicts New Home Sales Down Sharply

The Mortgage Bankers Association (MBA) added
a little more evidence to the pile indicating a rather rapid slow-down in the
housing market.
  MBA’s Builder
Application Survey (BAS) data for November shows mortgage applications for
newly constructed home purchases falling by 14 percent compared to
October.  The MBA data is not adjusted to
account for seasonal variations, and while sales nearly always decline this
time of year, applications were also down 11 percent compared to November 2017.

Based on the survey data and assumptions about
market coverage and other factors, MBA estimates new home
sales were running at a seasonally adjusted annual rate of 627,000 units in
November. This is down 6.8 percent from the October estimate of 673,000 units.

On an unadjusted basis the
estimate is for 45,000 new single-family sales during the month, a 15.1 percent
decrease from 53,000 sales in October.

“By our estimates, new home sales fell almost 7 percent in November, and were
about 5 percent lower than a year ago,” said Joel Kan, MBA’s Associate Vice
President of Economic and Industry Forecasting. “Despite a still-strong job
market and recent declines in mortgage rates, affordability challenges continue
to hold back sales activity, as wage growth still lags behind home-price
growth. Additionally, recent stock market volatility and some economic
uncertainty likely also contributed to the pullback in home sales in November.”

MBA estimates that 69.7 percent of the purchase mortgage applications were for conventional
loans
and 17.3 percent went to FHA.  Applications for VA loans accounted for 12.3 percent and RHS/USDA loans for 0.7 percent. The average loan
size decreased from $331,732 in October to $326,037 in November.

MBA’s Builder Application Survey tracks application volume from
mortgage subsidiaries of home builders across the country. Official new home
sales estimates are conducted by the Census Bureau on a monthly basis. In that
data, sales are recorded at contract signing, which is typically coincident
with the mortgage application.  November new
home sales data will be reported on Thursday, December 27.

Article source: http://www.mortgagenewsdaily.com/12132018_mba_new_home_sales.asp

MBS RECAP: MBS Handily Outperform Treasuries as Consolidation Continues

Today’s trading session was far less eventful than anything else seen in the past few weeks, both in terms of movement and volume.  Although Treasury yields were higher, most of the increase came in the overnight session, and additional volatility was minimal throughout the day. 

By the time we get to MBS (as opposed to Treasuries), things were even more calm.  Fannie 4.0 coupons were almost perfectly unchanged compared to 10yr Treasuries which lost more than a quarter of a point in price.  

At least some of the pressure may have been due to the fact that it’s a 3/10/30yr auction week with today being 10’s.  It’s not uncommon for bonds to lose a bit of ground heading into auctions  Today was no exception with most of the losses coming BEFORE the somewhat weak 10yr auction.

The morning’s economic data was also a non-event with CPI coming in right on the screws.  

In the bigger picture, we’re in the midst of a consolidation following the recently strong rally and the Fed Announcement coming up next Wednesday.  Bonds may or may not take a ‘lead-off’ ahead of the Fed, but for the most part, that’s the event most likely to dictate the next wave of momentum.

Article source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/889541.aspx

Lenders Looking to New Tech as Pessimism Over Profit Margins Grows

Lenders continue to be pessimistic about
their profit outlook as 2018 draws to an end. 
Fannie Mae said its fourth quarter 2018 Mortgage Lender Sentiment Survey
found the profit outlook reported by respondents at an all-time survey
low. 
This was true whether they were
talking about purchase or refinance mortgages or about GSE-eligible,
non-GSE-eligible, or government loans. It was the ninth consecutive quarter
that lender outlook has declined.

Smaller slices of a shrinking pie sums up
the reasons given by lenders for their lowering outlook, especially for
refinancing. When asked whether refinancing demand had increased over the past
three months for any loan type, or if they expected it would over the next
three months, positive answers did not break 5 percent. 

 

 

Responses to the same questions about purchase
mortgage demand were a little more positive
, but across all loan types the net share of lenders reporting demand growth over the
prior three months reached the lowest reading for any fourth quarter since the
survey’s inception in 2014.  Responses
about growth expectations for the next three months reached was the lowest for
all loan types in the entire survey history.

 

 

 “Stressful conditions continue to hang over
the mortgage industry,” Doug Duncan, senior vice president and chief economist
at Fannie Mae said.  “Lenders are
reporting the lowest purchase mortgage demand expectations across all loans
types and the worst refinance demand expectations for GSE-eligible loans in the
survey’s five-year history. Rising mortgage rates and lean inventory amid solid
home price appreciation have discouraged both first-time and trade-up
homebuyers. However, mortgage rates have shown signs of stabilization, and
annual home price gains have slowed from the red-hot pace seen earlier this
year. While 2018 is likely to end up a disappointing year for the housing and
mortgage industries, continued strength in demographics and the labor market
offers hope that conditions should stabilize and may even improve next year.”

While only a sliver (11 percent) of
respondents thought their profit margins would increase over the next quarter,
those who did overwhelmingly (65 percent) said it would be because of improved
use of technology
.  Trailing far behind was
savings through staff reductions and increased demand, better pricing from
non-GSE investors, and less competition were each mentioned by about one-fifth
of lenders. 

Of the 49 percent of lenders who
said they expected profits to fall, competition from other lenders was the top
reason cited for the eighth consecutive quarter, mentioned by 74 percent of
respondents. Thirty-eight percent named falling demand while staffing costs,
the shift from refinancing to purchase mortgages, and GSE policies and pricing all
were cited as contributing to the negative outlook.

The Mortgage Lender Sentiment Survey
by Fannie Mae polls senior executives of its lending institution customers on a
quarterly basis to assess their views and outlook across varied dimensions of
the mortgage market.  Over 200 lending
institutions participated in the fourth quarter survey, 76 mortgage banks, 88
depository institutions, and 38 credit unions. 
The survey was conducted between October 31, 2018 and November 12, 2018
by PSB in coordination with Fannie Mae.

Article source: http://www.mortgagenewsdaily.com/12122018_lender_sentiment_survey.asp

Lenders Looking to New Tech as Pessimism Over Profit Margins Grows

Lenders continue to be pessimistic about
their profit outlook as 2018 draws to an end. 
Fannie Mae said its fourth quarter 2018 Mortgage Lender Sentiment Survey
found the profit outlook reported by respondents at an all-time survey
low. 
This was true whether they were
talking about purchase or refinance mortgages or about GSE-eligible,
non-GSE-eligible, or government loans. It was the ninth consecutive quarter
that lender outlook has declined.

Smaller slices of a shrinking pie sums up
the reasons given by lenders for their lowering outlook, especially for
refinancing. When asked whether refinancing demand had increased over the past
three months for any loan type, or if they expected it would over the next
three months, positive answers did not break 5 percent. 

 

 

Responses to the same questions about purchase
mortgage demand were a little more positive
, but across all loan types the net share of lenders reporting demand growth over the
prior three months reached the lowest reading for any fourth quarter since the
survey’s inception in 2014.  Responses
about growth expectations for the next three months reached was the lowest for
all loan types in the entire survey history.

 

 

 “Stressful conditions continue to hang over
the mortgage industry,” Doug Duncan, senior vice president and chief economist
at Fannie Mae said.  “Lenders are
reporting the lowest purchase mortgage demand expectations across all loans
types and the worst refinance demand expectations for GSE-eligible loans in the
survey’s five-year history. Rising mortgage rates and lean inventory amid solid
home price appreciation have discouraged both first-time and trade-up
homebuyers. However, mortgage rates have shown signs of stabilization, and
annual home price gains have slowed from the red-hot pace seen earlier this
year. While 2018 is likely to end up a disappointing year for the housing and
mortgage industries, continued strength in demographics and the labor market
offers hope that conditions should stabilize and may even improve next year.”

While only a sliver (11 percent) of
respondents thought their profit margins would increase over the next quarter,
those who did overwhelmingly (65 percent) said it would be because of improved
use of technology
.  Trailing far behind was
savings through staff reductions and increased demand, better pricing from
non-GSE investors, and less competition were each mentioned by about one-fifth
of lenders. 

Of the 49 percent of lenders who
said they expected profits to fall, competition from other lenders was the top
reason cited for the eighth consecutive quarter, mentioned by 74 percent of
respondents. Thirty-eight percent named falling demand while staffing costs,
the shift from refinancing to purchase mortgages, and GSE policies and pricing all
were cited as contributing to the negative outlook.

The Mortgage Lender Sentiment Survey
by Fannie Mae polls senior executives of its lending institution customers on a
quarterly basis to assess their views and outlook across varied dimensions of
the mortgage market.  Over 200 lending
institutions participated in the fourth quarter survey, 76 mortgage banks, 88
depository institutions, and 38 credit unions. 
The survey was conducted between October 31, 2018 and November 12, 2018
by PSB in coordination with Fannie Mae.

Article source: http://www.mortgagenewsdaily.com/12122018_lender_sentiment_survey.asp

MBS RECAP: Bonds Continue Circling Wagons (Nothing To Do With Shutdown News)

Government shutdowns make good news.  When risks of a shutdown flare up (especially with today’s sort of political theater) it tends to dominate the news coverage.  This creates the risk that shutdown news is perceived to impact bonds in a way that isn’t really accurate.  

This was the case today, to some extent.  Shutdown headlines dominated the afternoon news cycle right at a time when bonds were weakening.  So was it the shutdown headlines causing the issues?  Not hardly.  In fact, the shutdown headlines would have arguably been good for bonds. 

Instead, bonds were simply backtracking after having been led into stronger territory by European markets.   The latter were on the move due to the latest round of Brexit-related headlines, which basically conveyed “no additional negotiations” for Theresa May’s failed Brexit plan.  Additionally, Sky News reported that british lawmakers in May’s party had sent enough letters of no confidence to challenge her leadership.  

In the grand scheme of things, this is the 2nd day of moderate weakness after a stellar run for bonds.  If you have lock/float decisions to make in the short term, keep a close eye on 2.89%, which was tested multiple times today as a ceiling.  2.82% has been similarly firm resistance below.  Next week’s Fed announcement is the biggest flashpoint on the horizon, but a lead-off is always possible before that.

Article source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/889276.aspx

September Delinquencies Mostly Unaffected by Disasters, Eased Underwriting

CoreLogic reports that mortgage delinquency rates were little changed in
September.
  The percentage of mortgage
loans that were 30 or more days delinquent and including those in the process
of foreclosure declined by 0.6 percentage point on an annual basis, to a
national rate of 4.4 percent. Early delinquencies, those 30 to 59 days past due
were down from 2.4 percent in September 2017 to 2.2 percent.  Other delinquency rates are reflected in the graphic
below.

Serious delinquencies, those more than 90 days past due or in foreclosure were
either down or unchanged in every state. 
Rates however increased in 10 metro areas.

The improvements were despite the considerable disruption along the southern
Atlantic Coast caused by Hurricane Florence in September.  Seven of the eight metropolitan areas that experienced
the highest annual gains in delinquency rates were in North Carolina and South Carolina.
In Wilmington, North Carolina the 30-day delinquency rate jumped more than 2
points to 3.8 percent between August and September and was up 1.6 point
year-over-year.  That put it in a tie for
first place with the eighth metro on the list, Grand Rapids, Michigan.  CoreLogic says data over the next few months
will shed more light on Florence’s effect on loan performance . 

Frank Nothaft, CoreLogic’s Chief Economist said, “The effects of 2018’s
natural disasters have begun to show clearly in our delinquency data.  After Kilauea’s eruption began in May, serious
delinquency rates jumped on the Big Island by 10 percent between June and
September, while falling by 4 percent in the rest of Hawaii.  The Carr Fire began late July, and the 30- or
60-day delinquency rate in the Redding metro area jumped 19 percent from August
to September.  This was the largest
monthly spike up in this delinquency metric since July 2006 when the
foreclosure crisis was beginning. 
Additionally, 30-day delinquency rates doubled in major metros in North
Carolina in September, the first month after Hurricane Florence reached
landfall.”

The report also doesn’t yet reflect any upcoming impact from two other
natural disasters
, Hurricane Michael, which caused significant damage in the
Florida Panhandle and southeastern Georgia, and the deadly late fall wildfires
in California.

CoreLogic examines all stages of delinquency as well as transition rates
that indicate the percent of mortgages moving from one stage of delinquency to
the next. The share of mortgages that transitioned from current to 30-days past
due was1.2 percent in September 2018, down 1.2 percentage point from the
previous September
.  By comparison, in
January 2007, just before the start of the financial crisis, the
current-to-30-day transition rate was 1.2 percent and peaked in November 2008
at 2 percent.

Frank Martell, President and CEO summed up the month’s report. “Outside of
areas affected by natural disasters, serious delinquency and foreclosure rates
have declined steadily across the nation as the labor market has improved and
home prices have risen.  However, we have
also seen a rise in high loan-to-value and high debt-to-income lending in our
CoreLogic TrueStandings data, heightening the risk of a significant upturn in
loan default if the economy slips into recession or home prices decline.”

Article source: http://www.mortgagenewsdaily.com/12112018_corelogic_delinquency_report.asp

MBS RECAP: Bonds Hit Resistance Right in Line With Last Week’s Floor

Bonds struggled to find inspiration for the first few hours of the domestic session, but it was soon in ample supply thanks to Brexit-related headlines (like this one).  The result was a broad-based risk-off move that saw bonds move back to their strongest recent levels.  

Notably, though, that’s as far as bonds got.  Specifically 10yr Treasury yields were once again blocked by a floor in the mid 2.82% range.  This has been an on-again off-again pivot point of high significance since late May, 2018.  

Sometimes, bonds approach such pivot points with the intention of breaking through.  That seems like a lot to ask of this rally, given the ground that’s already been covered.  At the very least, it seems like we’ll need help from economic data in the rest of the week, and at the very least, from next week’s Fed Announcement.  The tricky part there is that the Fed announcement could also fall short of satisfying bonds’ bullish desires and paradoxically act as a catalyst for an even bigger reversal.  

Either way, all we know today is that bond yields bounced at the same old floor, and relative to other ‘risk-off’ metrics, they didn’t look as eager to rally.  All things being equal, this suggests a bit more caution ahead in what has otherwise been a fairly optimistic winning streak.

Article source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/889055.aspx

A Gift From Fannie/Freddie

Both Freddie Mac and Fannie Mae have
announced the suspension of eviction lockouts for single-family and two- to
four-unit properties for the holiday season. 
The moratorium will begin December 17 and end January 2. 

Fannie Mae said it will allow legal and
administrative proceeding for evictions to proceed during the 16-day period,
but families will be allowed to remain in the home.

“We believe it is important to extend the
timeline of help for struggling borrowers during the holidays,” said Jacob
Williamson, Vice President of Single-Family Real Estate at Fannie Mae. “We
encourage homeowners who may be struggling with their mortgage or facing
possible foreclosure to reach out to Fannie Mae or your servicer to get help.
We want to help pursue those options whenever possible.”

The GSE’s said the suspension will apply to eviction lockouts on Freddie
Mac real estate owned homes but will not affect other pre-or-post-foreclosure
activities. Companies managing local evictions for Freddie Mac may continue to
file documentation
as needed during the suspension period.

Persons who think they may be affected by these suspensions or eligible for
disaster relief from either of the GSEs should contact their servicers or call
Fannie Mae or Freddie Mac for more information.

Article source: http://www.mortgagenewsdaily.com/12102018_gse_servicing.asp

MBS Day Ahead: So Much of The Recent Volatility Has Been Building Toward Today

Powell’s speech last week at the Economic Club of New York marked the beginning of an official shift.  Until then, while the Fed had its dovish dissenters, the consensus was “steady as she goes” with respect to regular rate hikes in the coming quarters.  The only uncertainty was whether or not the Fed would hike 2 more times in 2019 before leveling off (maybe it would be 3 times, maybe 1 time…).

But seemingly overnight, the consensus is now that we’re only likely to see one hike in December, and perhaps NO hikes in 2019.  This has been a big adjustment for financial markets.  You might think that  stocks would enjoy this shift (after all, the news has been eager to tell you that stocks are tanking because of rates), but no…  This move was actually led by the longer end of the yield curve–it happened well before Fed rate hike expectations shifted.  

That mystery rally suggests there’s been a huge amount of year-end reallocation out of stocks and into bonds as a general defensive positioning.  Traders are preparing for the economic realities associated with an absence of Fed hikes.  That means there’s been some adjustments to be made to stock/bond balances.

If today’s NFP confirms the underlying motivations for that “risk-off” shift (or if it soundly rejects them), the reaction could be very big.

Article source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/888625.aspx

Warehouse Products; Vendor/Service Provider Directory; Yield Curve Primer

The year has sped along, and here we are at Pearl Harbor Day already. Although mortgage rates have lagged, what has pushed Treasury rates down? Released earlier this week, the Federal Reserve’s latest report on economic conditions, known as the Beige Book, says most of its 12 regions achieved satisfactory growth in November but also says there is “increased uncertainty” among businesses over the influence of U.S. tariff policy. The report highlights rising costs for manufacturers and problems for farmers due to counter-tariffs imposed by China and others. (The Trump Administration’s trade fight with China has been particularly hard in Nebraska, with its Farm Bureau estimating that retaliatory tariffs let to a loss of more than $1 billion so far in 2018, which is about 11 to 16 percent of the entire value of Nebraskan agricultural goods. Factor in labor income losses and the total economic hit to the state is $859 million to $1.2 billion.)

 

Lender Products and Services

Get on point with BluePointMtg into 2019! “At BluePointMtg we are pleased to present several new products to our Broker Partners and offer Rate Improvement specials as we close out 2018! Free appraisals for any loan over 300k till the end of the year as well. (Except reverse loans.) A .25 rate improvement incentive on non-Agency loans 500,000, and a .375 rate improvement on Non-Agency loans over $2 million. (Applies to Leverage Product and Pivot Product only!) BluePointMtg is positioning itself to be a go to lender for Government loan options, conventional Loans, and Non-Agency loan options. Newly released is a VOE loan. New pricing on FHA 700+ credit scores as well this month! Highlights this month is a MIC DROP campaign where BluePointMtg has highlighted all files Submission to CTC with our Broker Partners of 15 days or sooner! Sign up today to expand your product mix, gain incentives monthly and get your own MIC DROP on your next loan! Contact your AE or marketing@bluepointmtg.com for details.”

Guaranty Bank Trust (GBT) “is proud to announce the promotion of Nikki Maimone to Vice President of Warehouse Lending. In addition, we are pleased to announce Nicole Haba joining our team as Operations Manager of Warehouse Lending. Collectively, Nikki and Nicole have over 40 years’ experience in mortgage and warehouse lending. GBT is working hard to earn your business and become a leading provider of mortgage warehouse servicesVeronica Soto (214.710.2340).

Carrington Mortgage Services launches its non-delegated Correspondent Lending Division. Carrington Mortgage Services, LLC (CMS), one of the nation’s largest privately held non-bank lenders with over $60 billion in servicing, announced the launch of its Non-Delegated Correspondent Lending Division to complement CMS’s full portfolio of loan origination channels which include Wholesale and Retail. “We have diligently planned and built the Correspondent Division and we’re now ready to make our presence known throughout the industry,” said Raymond Brousseau, President of CMS. “We are committed to delivering a high level of transparency and timeliness to the non-delegated correspondent lending process. We understand that it’s all about providing our sellers with the ability for further growth and profitability.” CMS’s wide program offers today’s non-delegated sellers with Fannie Mae and Freddie Mac products, FHA and VA products, and Carrington Advantage Products for underserved borrowers. To qualify, correspondent lenders should have a strong reputation of profitability in the industry.

PrimeLending Joint Ventures = Excellent Customer Experience + Increased Profitability for Home Builders.  You already know PrimeLending as a powerhouse mortgage lender providing an excellent home loan experience to customers across the U.S. Its proven joint venture model is no exception, providing home builders with a dependable formula for success, including an easy-to-use, fully-digital mortgage process, a huge range of loan options, an award-winning operations team, and solid backing from Hilltop Holdings Inc. and all its subsidiaries. If you are a home builder considering the next step to increase your profitability and give your customers a better mortgage experience, watch our videos and get more information at www.primelendingventures.com or contact Mike Matthews.

This is an offer you won’t want to miss! TMS partnered with Mortgage Educators to offer brokers extremely discounted rates on industry-required continuing education and pre-licensing courses. And the part that shocked me the most—they’re exclusively offering it at 73% off! The industry-required CE courses include the 2018 Online 8 Hour SAFE Comprehensive CE and NMLS 20 Hour SAFE Pre-license Bundle. To get started, go here.

PlainsCapital Bank National Warehouse Lending, a subsidiary of Hilltop Holdings (NYSE: HTH), is looking for mortgage bankers and lenders that offer renovation products and programs. PlainsCapital Bank National Warehouse Lending currently funds multiple renovation programs and products with little to no additional requirements. “Whether it is a FNMA HomeStyle, FHA 203K Full, Limited or even an USDA Rural Housing renovation loan, PlainsCapital Bank National Warehouse Lending wants to be your preferred warehouse provider for these programs and products. Please ask us about our competitive rates, utilization and deposit incentives and other ways that we can reduce costs and time to exceed your loan funding needs in 2018.” If you are interested in learning more, please contact Deric Barnett, EVP National Warehouse Lending.  

Vendor Updates

Floify and Equifax have joined forces to expand the features and functionality of the industry’s leading mortgage point-of-sale system. This groundbreaking partnership integrates the power of the Equifax Trended Credit*Hi-Lite™and The Work Number® with Floify’s flexible and feature-packed mortgage automation solution. Now, LOs who use both solutions to originate loans can instantly obtain and sync tri-merge credit reports via Trended Credit*Hi-Lite™ and VOE and/or VOI via a secure integration with The Work Number® directly with an application or loan file in Floify. Additionally, with GSE validation programs, such as Day 1 Certainty® from Fannie Mae, LOs can help mitigate risk and limit underwriting cycle times by reducing lenders’ reliance on applicant-provided W-2s, pay stubs and other income-related documentation. To experience the power of Floify’s Trended Credit*Hi-Lite™ and The Work Number® integrations, request a live demo.

The Mortgage List, LLC., the most inclusive directory of all facets of the mortgage industry, announced at the National Association of Mortgage Professionals (NAMB) Annual Conference, its official launch of their online directory and community. The Mortgage List is literally, a “Who’s Who” featuring thousands of listings and resources including industry associations, organizations, vendors, service providers and publications. The directory alone is the “go to” guide for mortgage professionals which includes attorneys, accountants, NMLS course providers, wholesalers, compliance companies, trainers, marketing companies and much more. Founded by long time industry professional, Ginger Bell, The Mortgage List’s goal is to become the hub for the mortgage industry. You can register for its webinar on Wednesday, December 12th to find out more.

Flood and Disaster Updates

Will Congress ever “man up?” With Congress moving to keep the government funded through December 21, the National Flood Insurance Program is again extended, this time for two whole weeks. Realtors point out that, “This is the 43rd extension of the NFIP since 1998, and the 41st short-term deal made to avoid a lapse in the program over the past 20 years. NAR is relieved to know that the NFIP was again extended before a lapse could occur. Flooding is a constant, unavoidable threat to Americans living in both coastal and inland communities across the country, however. As such, NAR urges the House and Senate to continue working towards responsible, long-term reauthorization that includes meaningful reforms, as the current process of continuous short-term extensions is simply not sustainable.”

Fannie Mae announced the Fannie Mae’s Disaster Response Network™: a comprehensive case-management service for disaster-affected homeowners with Fannie Mae-backed mortgage loans. Homeowners may access this program, a supplement to the post-disaster mortgage relief options currently offered, by visiting Know Your Options or calling 1-800-2FANNIE.

Regarding the California fires, and disaster areas in general, most lenders have a policy that says all impacted areas will require an internal escalation review to determine current containment percentage, evacuation status, and property distance from current burn zone prior to drawing loan documents. All impacted files have been conditioned appropriately (to include but not limited to photos of property and a disaster affidavit). No one wants to lend money on a house that isn’t there.

Mountain West Financial (MWF) is committed to helping its customers during the recovery process in areas impacted by the massive California fires. Re-inspection requirements for properties in FEMA-declared disaster areas are as follows: Conventional, VA and USDA loans require an exterior-only disaster inspection report to certify that the property was unaffected by the disaster. Conventional loans with property inspection waivers, VA IRRRLs and USDA Streamline loans will require re-inspections if the property is in a FEMA-declared disaster area. FHA requires an interior and exterior disaster inspection report and photos. FHA Streamlines do not require re-inspection. VA requires both the lender and the veteran to certify the property is not damaged.

The Camp Fire (Butte County) and Woolsey Fire (Los Angeles and Ventura Counties) have been 100% contained. The following loanDepot Wholesale processes are in place for properties in impacted areas: Conventional Loan fundings have resumed for Butte, Los Angeles, and Ventura Counties. All files in impacted zip codes have been conditioned appropriately based on requirements for properties in FEMA declared areas. Regarding FHA Loans, Re-inspections are required, however cannot be ordered until FEMA issues a Disaster End Date. Funding exception requests can be submitted through your Account Manager.

Capital Markets

The MIAC Capital Markets Group is pleased to announce its offering of $365mm of new origination whole loans. The collateral consists of 100% ARM Loans originated by a Bank as a portfolio product with an alt-doc component. The portfolio is concentrated in MI FL with approximately 640 loans potentially qualifying for CRA credit. Loans 80 LTV are covered by PMI; this product has experienced near zero defaults over the history of the program. Parties should contact their MIAC sales representative at 212-233-1250 or Steve Harris for additional information.

There is chatter out there about the yield curve inversion – right up there with the coming of the Four Horseman, the Apocalypse, the Detroit Lions winning the Super Bowl, that kind of thing. There are different portions of the U.S. government securities yield curve (that graphs yields on the Y axis and maturity – overnight Fed Funds all the way to 30-year bonds) that one can compare. When long-term yields are lower than shorter-term yields, it typically reflects expectations of slowing growth, or a possible recession.

But the inversion between two-year and five-year Treasury yields could be temporary as it was in 1998. Everyone knows that, due to Quantitative Easing, the Fed continues to purchase long-term maturity securities, raising prices and keeping longer-term rates low. And LOs should know that inverted curves don’t cause recessions. They simply reflect a market assumption that growth will slow based on current economic information.

Yesterday was a volatile day for the Treasury market, which rallied strongly this morning when the SP 500 was down as much as 2.9%, spurred by trade concerns which stemmed from the controversial arrest of Huawei Technologies’ CFO in Canada on allegations the company violated U.S trade sanctions on Iran. The arrest and reported extradition to the U.S. would get in the way of the U.S. and China striking a trade deal, coupled with potential retaliatory action against U.S. companies doing business in/with China. After hitting a low of 2.82% intraday, the U.S. 10-year closed the day at 2.87%.

The flight to safety in the Treasury market saw support from the drop in oil prices and remarks from Dallas Fed President Kaplan and Atlanta Fed President Bostic, who suggested the target for the fed funds rate is close to neutral. Oil prices dropped on reports Saudi Arabia oil minister floated a proposal to cut daily production by 1 million barrels per day, less than the market was thinking, though no formal agreement has been reached yet. Finally of note, JPMorgan Chase CEO Jamie Dimon told CNBC in an interview that if there is a bubble anywhere, it is in U.S. government bonds.

Today began with the November employment data: Nonfarm Payrolls +155k (less than forecast, and with a back-month revision lower), the Unemployment Rate steady at 3.7%, and Hourly Earnings +.2%. At 10AM ET the University of Michigan Sentiment Index is seen falling in both current conditions and expectations, and October wholesale inventories and sales are due. Fed Governor Brainard speaks on financial stability before a luncheon just after noon. And October consumer credit will be released and is expected to rebound from September. After the employment data we have the 10-year yielding 2.87% and Agency MBS prices better a smidge versus last night’s close.

Jobs

GSF Mortgage Corporation is pleased to promote our Direct Originator Partnership Program for originators who are interested in a low expense and best execution opportunity in today’s market, while playing a critical role in delivering an exceptional customer experience during every step of the home lending journey. The program has no branch or lender fees, translating to better pricing and compensation for the originator. With access to management, technology, and a comprehensive set of products, we give you the tools to succeed and help you build solid and long-lasting relationships and engage all customers in a positive manner, ensuring the customer’s best interests are your number one priority. Originators participating in this partnership have enjoyed a 28-percent production increase – all while operating in a challenging market.” Please reach out to VP of Retail Lending, Frank Papaleo.

Mortgage Possible is expanding across the United States and has named Ty Kerns Senior Managing Director of National Production. With 25 years of industry experience, Senior Managing Director of National Production, Ty Kern, is leading the expansion of Mortgage Possible across the US. Kern has been in business leadership positions for 15 years and his experience makes him an excellent fit for the role of Senior Managing Director. Kern came to Mortgage Possible after a role as Senior Managing Director of National Retail Production elsewhere. He leads the channel to significant growth and profitability gains by overseeing the implementation of significant technology improvements and a reduction in cost structure. “It’s an honor to be a part of the expansion process with Mortgage Possible,” said Kern. “Our leadership team has what it takes to make a positive impact in the mortgage industry across the country.” Visit https://mortgagepossible.com/ for more information.

 

Article source: http://www.mortgagenewsdaily.com/channels/pipelinepress/12072018-primer-on-yield-curve.aspx

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