Appraisal, Broker, QC Products; Industry Shifting Programs, Underwriting, Pricing, and Execution

Posted To: Pipeline Press

Yesterday I decided to put thoughts of SRP values plummeting, and EPO & EPD penalties being enforced, out of my mind and get some exercise. My cat Myrtle had a mix of curiosity and disdain while watching me do my the 90-second yoga class on YouTube, which is about all my body can handle. “Come into the moment! Feel the energy flow from your ‘sit bones’ into the earth. Feel your heartbeat throughout your spine!” After the 90 seconds Myrtle lost interest and had begun to lick “herself” with ease, and I was ready to go back to staring at my computer for 14 hours day like I am now. I figure if I add 10 seconds a day, by the time we’re released from captivity I’ll be up to doing… seven hours of yoga per day. Namaste! Speaking of animals…(read more)

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Source: Mortgage News Daily

Single-Family, Public Construction Spending on Upswing

Posted To: MND NewsWire

Nationwide outlays for construction slipped slightly in February. The Census Bureau said public and private sources spent at a seasonally adjusted annual rate of $1.367 trillion on all forms of construction, down 1.3 percent from the rate in January. This was 6.0 percent more than was expended in February 2019. The total spent during the month on a non-adjusted basis was $96.999 billion, up slightly from the $96.462 billion spent in January. For the year-to-date (YTD) spending totals $193.460 billion, an increase of 8.2 percent from the first two months of 2019. Privately funded projects were funded at a seasonally adjusted annual rate of $1.026 trillion, down from $1.039 trillion in January, a 1.2 percent decline. That spending rate, however, is 5.6 percent higher than the rate in February…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Data Doesn't Matter? Oh, It Will…

Posted To: MBS Commentary

This morning's ADP Employment showed a loss of 27k jobs. Forecasts called for a loss of 150k jobs compared to last month's report that was strongly positive at +183k. Normally, when ADP or NFP job counts beat their forecast by more than 100k jobs, it's enough to prompt at least a little bit of bond market weakness (i.e. higher rates), even in the recent era where jobs counts weren't that big of a deal. And it's a big deal for me to say ADP/NFP are not a big deal because they have historically been very big deals. In fact, there is no bigger deal in the economic data world than NFP (the non-farm payrolls component of the big jobs report). If it hasn't been a big deal for the past however many years, it's because the labor market has been so stable and strong . Almost…(read more)

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Source: Mortgage News Daily

FHA Jobs; Broker, Marketing, Training Products; Servicing Trends; Processing and UW Changes

Posted To: Pipeline Press

“I hadn’t planned on giving up quite this much for lent.” So true. It is a different world than only a month ago. Of course rates are going to stay at these levels for a long time. But rate sheet prices are disconnected from MBS prices, which are disconnected from Treasury prices. Those of you who have subscribed to my commentary for more than a year know that I truly relish producing my April 1 edition. The April Fool’s Day Commentary has fooled many a senior executive and regulator, and the stories have brought many chuckles to readers. And although I inject some humor into my daily commentary, and will continue to do so, I didn’t have the heart to produce a totally farcical commentary this year, especially after spending 34 minutes of my “work at home”…(read more)

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Source: Mortgage News Daily

Lessons From Great Recession Wall Street Buying Spree

Posted To: MND NewsWire

In an earlier article , (before more pressing issues shelved the topic) we summarized highlights from a recent New York Times Magazine article about the ownership of a large share of the nation’s single-family rental stock by institutional investors. Part 1 recapped how private equity funds moved to purchase distressed single-family homes during the housing crises, turning it into rental stock. Their property management has been uneven, and tenants are suffering from significant financial abuses. The author, Francesca Mari, who tells much of the story through the eyes of Chad who is now renting the home he used to own, says the extent of the financial repercussions from Wall Street’s investment are not limited to the rapid rent increases and unfettered fees we pointed to in the first article…(read more)

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Source: Mortgage News Daily

Mortgage Apps Defy Coronavirus Woes and Post a 15% Increase

Posted To: MND NewsWire

Well this was a surprise. In a week when unemployment claims soared to the highest level in probably ever and several large states went into a COVID-19 induced lockdown, the Mortgage Bankers Association (MBA) announced a significant increase in mortgage application volume. MBA’s Market Composite Index, a measure of that volume, which had dropped like a rock (-29.4 percent) during the week ended March 20, bounced back by 15.3 percent on a seasonally adjusted basis and 15.0 percent unadjusted during the week ended March 27. While application volume was up, purchase mortgage applications fell, down 11 percent from the previous week on an adjusted basis and 10 percent before adjustment. The unadjusted index was 24 percent below the same week in 2019. It was the largest drop in the Purchase Index…(read more)

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Source: Mortgage News Daily

HAVE A QUESTION ABOUT FED MBS BUYING?

Posted To: MBS Commentary

CURRENT FED MBS BUYING SCHEDULE AND PURCHASE LOOKUP TOOL I'm changing up this Q&A to make it shorter, denser, and better. If it's too pithy for you, revisit the previous version of this commentary HERE and take time to internalize the bigger picture). Bullet points that answer the most common questions I receive: WHAT IS THE FED BUYING? Fannie, Freddie, and Ginnie MBS, 2.5-4.5 coupons WHY? Because you're not (buying MBS), and neither is anyone else (relatively). If no one is buying, no one can lend. Fed is facilitating liquidity in credit markets. Juicing MBS prices is a byproduct, not the primary goal. NOT BUYING: 2.0 coupons START DATE: March 16th, 2020 WHEN: Every biz day since then. They publish a buying schedule ahead of time and results are posted immediately (LINKED AT…(read more)

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Source: Mortgage News Daily

Solid Home Price Gains Continued into January Ahead of Coronavirus Pandemic

Posted To: MND NewsWire

Home prices entered 2020 still on the uptick according to the S&P CoreLogic Case-Shiller indices. The U.S. National Home Price Index, which covers all nine U.S. census divisions, reported a 3.9 percent annual gain in January. The year-over-year increase in December was 3.7 percent. There was no monthly change in the non-seasonally adjusted (NSA) index from December to January, but after adjustment the National Index was up 0.5 percent. The 10-City Composite Index posted a 2.6 percent annual gain, up from 2.3 percent in December and the 20-City Composite rose 3.1 percent, a 0.3-point greater increase than the month before. The 10-City measured eked out 0.1 percent monthly growth while the 20-City was flat on a non-adjusted basis. Both indices moved 0.3 percent higher after adjustment. Ten…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Let's Talk About Porridge

Posted To: MBS Commentary

I don't know much about porridge. I'm not even sure I've ever eaten it. I do know one thing about it though: the temperature has to be "just right" from what I've heard. Markets–especially bond markets–are very much like Goldilocks when they're responding to a major shock and quickly adjusting to a new reality. The initial reaction to a a shock often sees a quick investigation of the hottest bowl of porridge. That is to say, the world is ending and people can't buy bonds fast enough. Yields fall precipitously, and MBS prices rise as much as they can in the context of their convexity-related limitations. Then a new reality sets in that places a premium on liquidity and cash positions. It's exacerbated by a technical correction leading back from the just…(read more)

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Source: Mortgage News Daily

Marketing, Cybersecurity, eClosing Products; Shifts in LTVs, Credit, Pricing, Appraisal Policies

Posted To: Pipeline Press

Remember when all we had to worry about was Amazon taking over mortgage banking? The sun hits different here in March – see joke at bottom. (Thirty days hath September, April, June, and November. All the rest have thirty-one except March which has 8,000.) Unintended consequences: It’s a fascinating case study, among millions of others, that the Federal Reserve stepped in to buy Agency MBS in an attempt to create price stability but induced a huge rally in MBS (not rate sheets!), causing even more margin calls for lenders as their positions used for hedging increase in price and their mark-to-markets deteriorate. Talk is that the Fed is scaling MBS purchases back, helping lenders reduce renegotiations, increase pull through, and hopefully cause less of a price rally thus reducing…(read more)

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Source: Mortgage News Daily