Regional Population Gains; List of Largest Banks; Agency Foreclosure Waiting Periods


According to the U.S. Census Bureau’s statistics on population, between
July 1st, 2013 and July 1st, 2014 an average of 803 new residents were added each day in Florida and it passed New York to become the third most populous state.
Florida’s population has reached almost 20 million whereas the
population of New York is 19.7 million. California is still ranked as
the most populous state at almost 39 million residents followed by Texas
with 27 million. Georgia’s population has also exceeded 10 million for
the first time, landing the eighth spot on the list. North Dakota was
the fastest growing state followed by Nevada and Texas compared to six
states that lost population, including New Mexico, Alaska and Vermont.
Overall, in 2014 the total U.S. population increased by 2.4 million to
319 million.


Certain areas are attracting more growth than others. As the housing
industry attempts to attract young adults and promote home buying among
millennials, the young adults who are interested in homeownership are
more inclined to buy in certain areas, according to an article
published by Zillow. It used data from the Minnesota Population Center
to take a closer look at homeownership rates amongst working-age
emerging adults. The majority of these adults have been most successful at buying homes in the Midwest and South,
with the least amount of young adults buying in expensive coastal
metros, particularly in California. Conversely, the young adults who
don’t own a home and don’t pay rent mainly reside in Southern Texas,
Eastern Pennsylvania and Riverside, CA. Finally, the areas with the
largest generational homeownership gap between millennials and baby
boomers include New England and California, while the smallest gap can
be found in the South and West, as well as Las Vegas, NV, Fresno, CA and
Oklahoma City, OK.


Zelman and Associates November Mortgage Originator Survey predicts a re-accelerating housing market with low rates and lax credit standards.
With improvements to the GSEs’ rep and warrant policies and the CFPB’s
curing abilities, more lenders will look to reduce overlays which will
benefit borrowers in the coming months. The survey identified that 52%
of lenders expect underwriting standards to ease over the next year and
none expect credit standards to tighten. With the new integrated
disclosures taking affect in August of 2015, most lenders are prepared
for the change and the new disclosures should not adversely impact
underwriting standards. November purchase applications increased 4% YoY
and refinance applications were down 10% YoY. The analysis reported that
the credit quality index dropped to 67.5 from 68.9 a year earlier, with
32% of third quarter securitized loans below 700 credit score and the
average GSE credit score dropped to 754 from 759 a year before,
reflective of credit standards beginning to ease.


While we’re speaking about macro issues, Comerica writes, “Despite
the expected GDP reset, we observe strong momentum in the U.S. economy
at year end. Labor markets continue to improve. A robust 321,000 payroll
jobs were added in November. Hours worked increased, and so did wages.
The combination of more workers, working longer hours, for higher wages
provides a powerful boost to the U.S. economy. The unemployment rate for
November held steady at 5.8 percent, but is set to resume its decline
through early 2015. Auto sales have roared back.
The 17.2 million unit sales rate of November cannot be sustained
indefinitely, but it provides strong evidence that U.S. consumers are in
a better mood this holiday shopping season. “That got me thinking…which is a good thing, otherwise I’d spend my time watching videos
of squirrels running obstacle courses…how are auto sales doing? The
answer is an easy one as sales in November haven’t been this robust
since 2001; up nearly 5% from a year earlier with five of the top six
automakers selling more cars and trucks than analysts expected,
compliments of a surging economy, heavy discounting and falling fuel
prices luring consumers into U.S. showrooms. Case-in-point, according to
the Wall Street Journal, luxury SUVs are up 17% YoY, and with the recent talk of SISA and NINA loans I’d swear it was 2004 all over again.


Wednesday’s commentary mentioned that Congress unanimously voted to extend a provision of the Servicemembers Civil Relief Act (SCRA)
until January 2016, which “prohibits foreclosing on a Servicemembers
house for one year after returning from active duty.” Josh Kotin with BuckleySander LLP writes, “The SCRA does not prohibit foreclosures on property owned by servicemembers.  Instead,
it requires that a foreclosure be pursuant to court order so a court is
in position to provide any protections to the servicemember that may be
appropriate.” Thanks Josh!


SNL Financial’s financial analysis found the top 4 largest US banks
and thrifts by total assets in order as of Q3 were JPMorgan ($2.5T),
Bank of America ($2.1T), Citigroup ($1.9T) and Wells Fargo ($1.6T). This
group adds up to a whopping $8.2 trillion in assets. Rounding out the
top 10 list are: US Bank ($391B), Bank of New York Mellon ($386B), PNC
Financial ($334B), Capital One ($300B), HSBC North America ($280B) and
State Street ($275B). This group adds up to about $2.0T. Finally, banks
ranked 11 to 20 add up to $1.6T and include: TD, BBT, SunTrust,
American Express, Ally, Charles Schwab, MT, Fifth Third, Citizens
Financial and USAA. How many of these have well-known mortgage operations?
Meanwhile regulators have increased the asset size threshold used to
define a small bank for CRA purposes as one that as of Dec 31 of either
of the prior 2Ys has assets of $1.22B. And an intermediate small bank is
defined as a bank with at least $305mm in assets but less than $1.22B
for the same period.


latest Fed report finds loans at US banks grew to $7.87 trillion, an
annualized 8.2% in Nov vs. 6.8% in Q3. Meanwhile, deposits increased by
an annualized 10.4% vs. 5.7% in Q3. The Fed reported loans and leases at
the 25 largest banks increased 5.6% annualized in Nov vs. 7.6% for the
rest of the industry. Most of the loan growth was in CI (+13.6%),
while CRE was flat.


pace of bank closings, fortunately, dropped dramatically from 2014 –
but last Friday regulators closed Northern Star Bank ($19mm, MN) and
sold it to BankVista ($135mm, MN) under a PA agreement. BankVista
received 2 branches as well as all of the deposits (at a 1.06% premium)
and essentially all of the assets. And merger and acquisitions continued to be announced this week.
Weymouth Bank ($212mm, MA) will acquire Equitable Co-operative Bank
($106mm, MA). Cornerstone Bank ($1.3B, NE) will acquire North Loup
Valley Bank ($20mm, NE). As part of its move to streamline operations
Citibank will sell its Peru subsidiary with 8 branches and 130k
customers to Bank of Nova Scotia for an undisclosed sum.


Wednesday the commentary noted some information regarding the USDA eligible areas. Bill Scammell from PMAC
reminded me that, “USDA Announcement (posted 12-22-14):  President
Barack Obama signed the Consolidated and Further Continuing
Appropriations Act of 2015 (omnibus spending bill) into law last
Tuesday.  With the signing of this Act and barring further congressional
action, the USDA will implement the eligibility maps on February 2nd,
2015.  The changes will be those already published on the ‘Future
Eligible Areas’ maps posted on the USDA eligibility website (USDA Future Eligible Maps).  A complete package for conditional commitment must be submitted to the USDA on or before Feb 2nd, 2015 in order to fall under the current eligible areas.  Packages that are submitted to USDA after Feb 2nd will be subject to the new ‘Future Eligible Areas’.” Thanks Bill! 


Dale Delliquadri, an Account Executive for Mountain West Financial has provided the waiting periods for Fannie, Freddie, VA, USDA and FHA loans after a foreclosure or bankruptcy
For Fannie Mae products, if you have foreclosed on a loan, the waiting
period is 7 years from the completion date and 3 years for extenuating
circumstances (90% LTV). For a short sale or deed-in-lieu the waiting
period is 4 years and for Chapter 7 bankruptcy the waiting requirement
is 4 years from the discharge or dismissal date and 2 years for
extenuating circumstances. For Chapter 13 bankruptcy, there is a 2-year
waiting period from the discharge date, a 4-year waiting period from the
dismissal date and a 2-year waiting period for extenuating
circumstances. With Freddie Mac and LP Super Conforming loan products,
the waiting period after a foreclosure is 7 years from the completion
date, and for a short sale or deed-in-lieu the waiting period is 2-4
years. If you have filed for Chapter 7 bankruptcy, the waiting period is
4 years from the discharge or dismissal date and if you have filed for
Chapter 13 bankruptcy the waiting period is 2 years from the discharge
date and 4 years from the dismissal date. FHA loans are the most
forgiving when it comes to derogatory credit events.


information went on. The waiting period after a foreclosure is 3 years
and for a short sale or deed-in-lieu the waiting period can be anywhere
from 0-3 years from the completion date. If you have filed for Chapter 7
bankruptcy, the waiting period is 2 years and if you have filed for
Chapter 13 bankruptcy, one year of the prepayment period has to lapse in
order to qualify. For VA loan products, the waiting period after a
foreclosure, short sale or deed-in-lieu and Chapter 7 bankruptcy is 2
years for a loan less than $417,000 and 7 years for a loan greater than
$417,000. If you have filed for Chapter 13 bankruptcy, the waiting
period is 7 years for a loan amount greater than $417,000, but it’s
mandatory to finish making all payments prior to qualifying. Finally for
USDA loans, the waiting period after a foreclosure, short sale or
deed-in-lieu and Chapter 7 bankruptcy is 3 years and one year of
repayment has to occur for Chapter 13 bankruptcy.


Let’s keep playing catch up on lender and investor updates over the last several weeks.


Franklin American Mortgage Company
has posted its Correspondent National Bulletin 2014-34 which includes
various Product and Guideline Updates, Clarifications and Reminders.


Kinecta Federal Credit Union
is now offering an additional option for Mortgage Insurance (MI). You
will be able to choose a MGIC MI plan for all new submissions in the New
Loan Submission form.


NewLeaf Wholesale
has updated its Lock Renegotiation Policy on Conforming/High
Balance/FHA and VA Products. In the event the market has significantly
improved since the date of the lock, each loan is eligible for
renegotiation subject to specific requirements.


New Penn Financial
is offering free webinars for its new Home Key product. This product is
a market leading option for borrowers looking for a fresh start who
have suffered a mortgage credit event such as bankruptcy, foreclosure,
or short sale just after one year. You can find out all the information
by following the link for Home Key Overview and Webinar Registrations.


Plaza Home Mortgage’s Elite Jumbo Program Guidelines have been updated for loans locked on or after November 25, 2014. Please refer to the Program Guidelines for complete details.


United Wholesale Mortgage (UWM)
announced that it rolled out a new product called Investor Edge, which
is designed specifically for borrowers that are looking to purchase or
refinance non-owner occupied investment properties. Interested parties
can learn more about UWM’s Investor Edge program by visiting its website.


briefly to the markets, Wednesday we learned that US Jobless Claims
dropped 9k to 280k, a seven-week low. The 4-week moving average was
290,250, a decrease of 8,500 from the previous week’s unrevised average
of 298,750. We had a 2.26% close on the 10-yr Wednesday and this morning
we’re sitting at…2.26% and agency MBS prices are roughly unchanged.
There is no scheduled news, not much exciting happened overnight, and no
company is expecting much in the way of locks.

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