Agency Updates Indicate Lending Trends; Millennial-Monster-Mania: Catch the Wave!


Appraisers, and pet lovers, will find this house dedicated to felines
of interest. Personally, I view it as somewhat quirky. Maybe not so
quirky are the marriage laws for the various states. After I asked
yesterday about the Census Bureau using the age of 15 for its marriage
stats, Dan Macy was kind enough to send this site listing the teen marriage laws, perhaps enough to make parents wince.

“Invest in real estate – they’re not making any more of it.” They’re not making any more Millennials either, and housing and lending analysts love to talk about them.
Many are still hunkered down on their parent’s couches while others are
roosting in city centers around the nation, clustered around mass
transit and trendy dining places. A recent story in the Wall Street
Journal points out that many of these Generation Y folks will, at some
point, head for the suburbs especially after they bear children of their
own. The poll, done by the National Association of Home Builders
(surprise!), shows nearly 70% of those asked want to live in the
suburbs. One must ask if a similar poll carried out 10 years ago would
show the upcoming trend of moving into city centers. Little pink houses
for you and me!

And how does one “sell” to a Millennial? I asked Kristin Messerli, owner of Cultural Outreach Solutions.
She agreed that Millennials want to own a home and that certain things
were very important to them. They want authenticity (trustworthiness
from a counterparty is important), accessibility (hence the city center
lifestyle), and tend to rely on customer reviews and referrals when
making a purchasing decision. The group tends to be price sensitive but
willing to spend more on products they perceive to be investments. Ms.
Messerli is quick to point out that roughly 40% of Millennials are
Hispanic – about 18 million Americans! They prefer homeownership, low
debt, and higher average household size.

are fewer homeowners with negative equity, as home values have improved
since the recession, yet there always seems to be a cohort in the
housing industry that gets sidelined despite the advancements. As home
prices increase in value, homeowners are benefiting from the gains but
young adults are being out-priced from the market. The rise in home
values closes the revolving door of homeownership for young adults, who
end up delaying their plans to purchase a home according to data from
Zillow Housing Confidence Index. Zillow compared the 20 most populous
metro areas in the U.S. and found that a greater share of young renters
plan to buy a home in the next year in metros where home values are
lower, compared to a greater share of young renters who plan to wait at
least 5 years until buying a home in areas with higher home values.
Expensive homes may make more young adults wary about their ability to
purchase a home in the future, with a greater amount of millennials
moving to expensive metro areas where employment opportunities are great
but homeownership is out of reach. Data indicates that married young
adults living off of income from two, full-time jobs are more than three
times as likely to own a home as their unmarried counterparts. The
recent hike in home prices can be seen as a positive for the industry,
but more affordable housing is necessary to engage millennials in the

Has the recession affected the job market for Millennials?
According to Wells Fargo Securities, LLC Economics Group, a greater
number of young adults are now employed in leisure hospitality,
and retail industries than before the recession. These two industries
employ the largest share of Millennial workers and a growing number of
young adults are finding employment in these low-paying sectors.  About
45% of employees in the retail sector and 60% in the leisure
hospitality sector are Millennials.

Traditionally, most young adults have found employment in industries that require few skills and more flexible hours.
This has held true among the Millennial generation, mainly because of
the weak labor market. In 2013, 30.6% of workers between 16-34 years old
were employed in these two industries, a 2.2% increase since 2007. This
shift has been just as prominent for older Millennials, those between
25-34 years old, as this cohort accounts for a higher share of retail,
leisure hospitality workers. Millennials have also moved into
lower-paying industries at a faster rate than their older counterparts.
Conversely, the construction and financial industries have evidenced a
decline in the share of young workers and the manufacturing and
information industries employ the least amount of young adults. To read
more about Wells Fargo’s article, click here.

Wells Fargo published another article comparing employment rates among Millennial men and women. Among Millennials, more women have obtained a college degree than men,
a trend that has favored women since the 1990s and has been closing the
labor participation gap between the two genders. Despite the education
level of women, research indicates that females still take on a more
noticeable role at home. Many young women do not engage in income
building activities because they are held back by family
responsibilities, with the employment gap between men and women largest
among older Millennials (aged 30-34). Young females are more likely to
work part time, as 21% of women between the ages of 25 to 34 years old
are employed part time compared to 9% of men. Even so, the workforce
participation rate among Millennial women is most similar to men their
age than any other generation. This statistic is mainly due to a greater
decline in participation among young men. More women are engaging in
the workforce, but labor participation has declined among women between
16 to 34 years old.  The wage gap between Millennial men and women has
narrowed, but women are still earning less than their male counterparts.
Female workers are more inclined to be employed in industries that
offer fewer working hours and lower pay. Data suggests that the wage gap
only increases with age, as full-time female workers who are 45 and
older realize earnings that are 25% below men earnings. This may be due
to family responsibilities women experience as they age, as research
suggests that child rearing reduces female earnings. Women may also not
be taking advantage of their education, for example, men are twice as
likely to be employed in high-paying science, technology, engineering,
and math jobs as women.

Fannie Mae released a new FM Commentary introducing its 4th quarter Fannie Mae Mortgage Lender Sentiment Survey Topic Analysis titled: Survey Shows Lenders Are Looking to Grow Their Origination and Servicing Businesses. Yes,
the industry suffered through regulatory changes, a shift from a
refinance to a purchase market, and the modest pace of housing growth.
But the vast majority of lenders remains largely positive and are
planning to grow their origination and servicing businesses this
year. No lenders reported plans to downsize or exit their origination
business, and only 4 percent of lenders reported plans to downsize their
servicing business. In particular, consistent with industry trends
observed, lenders reported plans to increase marketing to first-time
homebuyers and move-up homebuyers as part of their 2015 origination

are supposedly easing standards for mortgage loans but some have noted
weaker demand for mortgages linked to purchase activity, according to the Fed’s Senior Loan Officer Survey.)

Good news for Greystone Healthcare Lending Group, which is a national provider of multifamily and healthcare mortgage loans; recently the group announced it has earned Program Plus status from Freddie Mac Multifamily.
The new designation enables Greystone to offer loans of all sizes for
multifamily properties in New York, New Jersey and Connecticut.
Greystone has been a Freddie Mac Multifamily Targeted Affordable Housing
Seller/Servicer, providing financing for affordable housing since 2011.
Greystone began offering Freddie Mac seniors housing and assisted
living loan products in 2013, and the Agency’s Small Balance Loan
product earlier this year, which enables acquisition and refinancing for
properties between $1 million and $5 million. The new Program Plus
license completes a full spectrum of multifamily property financing
options available from Greystone with Freddie Mac. FHLMC Program Plus lenders by state.

And recently the FHFA released its 2015 Scorecard for
Fannie Mae and Freddie Mac (the GSEs), as well as Common Securitization
Solutions (CSS). This Scorecard sets the priorities for the GSEs and
CSS while they remain in conservatorship and provides a strong
indication of FHFA’s policy goals for the coming year. Key takeaways
include a commitment to finalize improvements to the seller
Representation and Warranty Framework, and additional clarity around
servicer performance and remedies standards and eligibility criteria.
Also an increase in GSE risk sharing goals for 2015, to $150 billion for
Fannie Mae and $120 billion for Freddie Mac. Let’s not forget a
commitment to finalize the structure of the single security while
continuing to develop the common securitization platform. Notably, these
will be pursued on their own timetables, following MBA’s strong
recommendation to this effect in the association’s comment letter
on the topic. The FHFA will also work to modify GSE servicer
eligibility standards to reduce counterparty risk exposure. MBA has
already had preliminary discussions on this topic and anticipates that
public comment will be requested for any changes. FHFA and the GSEs
pursuing strategies to reduce severely aged delinquent loans and vacant
real estate owned properties held by the GSEs by short sales,
deed-in-lieu, and other foreclosure alternatives with an emphasis on
improving outcomes in hardest hit markets. Lastly, work to encourage
HARP-eligible borrowers to pursue refinance opportunities and develop
solutions for borrowers facing HAMP resets.

Freddie announced an update to the Home Affordable Modification Program (HAMP®) Pay for Performance incentive program, effective April 1, 2015 in its Bulletin 2015-1.
The expansion of the HAMP Pay for Performance incentive program
includes a HAMP Year Six Pay for Performance incentive, which was
developed with Fannie Mae at the direction of the Federal Housing
Finance Agency. This new incentive will provide a $5,000 lump sum principal reduction
for borrowers with eligible HAMP modified mortgages.  Read Guide
Bulletin 2015-1 for complete details on the HAMP Year Six Pay for
Performance incentive.

I am sending this out and flying to Florida it’s darned early, but
somewhere the markets are trading. Yesterday was not a good day for
anyone who didn’t lock on Monday as the 10-yr went back to 1.80% and
agency MBS worsened by about .250. Up some, down some…


Jobs and Announcements

Cooke Mortgage
LLC wants folks to know that it is expanding and
actively seeking highly skilled and experienced Branch Managers and
their teams.
“CCM is one of the few lenders in the country that is a direct
Fannie/Freddie/Ginnie seller/servicer, which means amazing speed and
control of your files. We’re looking for branch managers and their teams
that are seeking a platform that provides the support, technology, and
advances needed to be an industry leader in today’s marketplace. The
positions report directly to the SVP of Sales Marketing and
require at least 2 years in branch management experience. Candidates
being considered for this position will be subject to additional
background checks as required.” Please contact Christopher Jensen for further information or go to Castle Cooke Mortgage.  EEO
Statement – All qualified applications will receive consideration for
employment without regard to race, color, sex, national origin,
protected veteran status, or disability.

Indecomm Global Services,
a leader in business process outsourcing, consulting, learning, and
technology solutions to the mortgage industry, is seeking additional
talent to Indecomm’s sales team, specifically a Sales Director for the Eastern Seaboard accounts. To submit a confidential resume, please contact Linda Bomar.

And three thousand miles away Stonegate Mortgage continues hiring in its West Coast Operations Center. Stonegate Mortgage Corporation (NYSE: SGM), a leading, publicly-traded mortgage company, is also growing its field force and is seeking AEs to solicit brokers and correspondents in Los Angeles, Las Vegas, and Sacramento; and Sales Directors
to solicit both credit unions and community banks in both the No
Cal/Nevada and So Cal/Arizona territories. “Stonegate’s vision is that
year after year it will be considered the ‘Lender of Choice’ and its
people will be regarded as the most respected mortgage professionals in
the industry.” More information about careers with Stonegate can be
found here and resumes can be submitted to resumes@stonegatemtg. com.

A quick congrats to Tim Smith. Due to its growth, Tennessee’s First Community Mortgage announced
that he has joined FCM as Vice President, Regional Sales Manager. 
Based in Minneapolis, Smith will be focusing specifically on building sales teams in Minnesota, Wisconsin, Iowa, Missouri, North Dakota and South Dakota.
In August of 2012, FCM opened its second operations office in
Louisville, KY, which now houses correspondent lending functions and a
branch retail team, led by Michael Hilleary and Shane Gilmet. If you’re
an LO or branch and interested in seeing what FCM is up to in a
confidential manner, contact Tim Smith.

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