Old Republic and Foreclosure Legality Updates; CA Homeowner Bill of Rights Nears Vote; Lots of Training and Education News

The political climate is heating up. Jokes that we were able to tell on
the trading desk, regardless of political
, are flying around, like, “How do you tell a Romney
supporter from an Obama supporter? Romney supporters sign their checks on the
front; Obama supporters sign ’em on the back.” Of course, being
independent I could never use that one in
this commentary
, but watch for politics here and in Europe to influence the
markets and environment more than much of the weekly and monthly economic data
that comes out.

And companies continue to fill in where BofA, MetLife, ING, and GMAC scaled
back. SF retail & wholesale shop Bay Equity is recruiting wholesale Area
Sales Managers and Account Executives in the Sacramento, Colorado, Utah, and
Arizona markets. Bay Equity was recently ranked #5 on the Bay Area’s top
100 fastest growing private companies by the SF Business Times, and is looking
to aggressively expand in those areas by hiring executives who can make an
impact in these regions. For more information visit its website at bayeq.com or contact their Director of
Wholesale John Curtin directly at john@bayeq .com.

Lending is searching for qualified DE underwriters (LAPP experience is a plus)
and FHA/VA processors, both with a minimum of 5 years’ experience, to
work in its Denver/Boulder, Colorado Operations Center and its Irvine,
California office. In addition, Intercap Wholesale is hiring AE’s in
Texas, New Mexico, Colorado and Utah. The company is also in search of
Regional Vice Presidents of Wholesale Production for Southern and Northern
California. Intercap Wholesale offers unlimited HARP and FHA
Streamline loans as well as standard government and conventional loan products.
The lender is a DBA of Suburban Mortgage Company of New Mexico, is 33 years old,
and is a Fannie Mae and Freddie Mac Seller/Servicer as well as a GNMA
issuer. If interested in any of the positions available, please contact
Jim Storm at jstorm@intercaplending .com.

Here’s an interesting note I received; “Rob, have you heard anything
about a rumor that Fannie is coming out with a bulletin with new counterparty
, and that Fannie will have volume limits based on a lender’s net
worth, quality, repurchase record and servicing.  There are too many
thinly capitalized independents that could not buy back 10 loans and were doing
$100 mm per month. One lender with a $5 million net worth was told their limit
was 7x, or $35 million, on an annual basis.” I haven’t heard anything new that
wasn’t industry knowledge in early May, and noted in this commentary, about
capping. On May 8th I wrote, “Here at the MBA’s National Secondary, one of
the big topics is monitoring & limiting counterparty risk, the
current version, with a few twists, of ‘Don’t put all your eggs in one basket.’
Pipeline hedging firms advise not doing all your security trades with one
broker-dealer, just like a wholesale lender doesn’t want all its business
coming from broker. The CFPB has pretty much said that financial institutions
need to concern themselves with, and in some cases be responsible for, their
counterparties following policies and procedures. One piece of scuttlebutt from this conference in NY is the possible
capping of agency counterparty risk in the form of limiting sales to Freddie
& Fannie based on net worth
. At this point it is a rumor, but if it
plays out, it could severely hamper small independent mortgage bankers in
selling large sums to Fannie & Freddie and help the depositories. Makes
sense… if your net worth is $3 million, and you’re selling $100 million a
month to an agency, does the agency want that potential liability?” It
is best to discuss items like this with your Freddie or Fannie rep.

MERS fans take note! Massachusetts’s highest court ruled that a foreclosure
sale in the state can be valid even when the entity foreclosing on the home
doesn’t hold the mortgage note as long as it has proper authority. Here you go.

Uh oh… Late last week the final bill language was received for California’s
“Homeowner Bill of Rights.”
A vote is expected this week. One
saying is that, “As California goes, so goes the nation,” and if that
is the case, it is not good: the California Mortgage Bankers Association did
have a strong oppose position to the original language in the previous versions

of the proposals.

The mortgage insurance business is still not out of the woods quite yet – just
ask Old Republic, whose stock plunged last week when it withdrew a plan
to spin off
the mortgage-guaranty operation that ran short of capital.

Moody’s cut the ratings of many major, and non-major, banks last week – but not
Wells Fargo’s.
Why not? It isn’t necessarily because Moody’s liked the
stage coach – it must have something to do with residential lending decisions
in the last ten years.
Citing “significant exposure to the volatility and risk of outsized losses
inherent to capital-markets activities,” Moody’s completed its review begun Feb.
15 and downgraded 15 global banks as follows: 1 notch (13 banks), 2 notches
(Morgan Stanley), and 3 notches (for Credit Suisse Group). The downgrades were
expected and analysts dismissed them as coming years too late. Nonetheless, the
cuts will cost billions of dollars for each bank

is some solid training and industry event news out there.

Clarifying and containing risk is on everyone’s mind in this environment.
As it turns out, the MBA is holding a “Risk Management &
Quality Assurance Forum 2012” in early September in Dallas. (Yes, there
will be air conditioning.) It will cover risk analytics, quality assurance,
underwriting, and servicing QC. It’s very meaty and impressive- check it

The summer lineup of the FHA’s Basic Loss Mitigation training for
HUD-approved housing counseling agencies includes September 13th in Las Vegas,
NV and September 30th in Phoenix, AZ.  Loss mitigation webinars that focus
on different aspects of the foreclosure process will be held throughout the
summer as well. Additional loss mitigation training is available at the FHA’s
National Servicing Center in Oklahoma City, OK on August 15th and 16th. 
Designed for HUD-approved housing counselors, nonprofit housing counselors, and
HUD-approved mortgagees, these seminars cover delinquencies, defaults, mortgage
collection activities, and initiating foreclosure.  More information can
be found here.

The Mortgage Bankers Association of New Jersey is hosting a seminar on LO
compensation and CFPB regulations in Wednesday, June 27th in Jamesburg,
NJ.  Speakers will discuss the processing of the new CFPB regulation and
what it could mean for the mortgage industry.  Register here.

With FinCEN’s August 23rd deadline in mind, CampusMBA is presenting a webinar
on establishing Anti-Money Laundering and Suspicious Activity Report programs
on June 19th.  Aimed at non-bank lenders and originators, the program will
cover topics such as the background of the Bank Secrecy Act, the role of the
Lender Compliance Officer, and SAR red flags.  More information and registration
links are available here.

We are in the middle of this year’s MBA Chairman’s Conference (June
24th-26th) in Palm Beach, FL and is open to all Senior Executives of
regular MBA member firms, premier associate members, and members of the Board
of Directors and Board of Governors.  The program is slated to include
peer-to-peer discussions, roundtables, and presentations by industry
leaders.  Visit here
for more information.

Online loss mitigation training is being offered for underwriters and
home retention specialists will be available from July 9th-11th. 
Combining self-study, live webinars, and instructor guidance, the course covers
loss mitigation and retention resources, options, decision-making criteria,
government agency directives, and foreclosure prevention models.  To find
out more and register, go here.

As part of the MBA’s adoption of inspector qualification best practices for
properties financed by Fannie and Freddie, CampusMBA will hold a workshop on multifamily
property inspections
in Palatine, IL on July 12th and 13th. Participants
will be instructed on the regulation governing such properties, performing a
physical inspection, and evaluating observable market factors.  Registration
can be found here.

CampusMBA’s next Residential CMB online prep course will run from July
13th-August 31st.  Designed to prepare candidates enrolled in the CMB
program for the written exam, the course covers origination, underwriting, loan
administration, marketing, investor relations, financial management and
strategy, real estate law, and industry-wide issues over its eight-week
duration.  Visit MBA’s website
to register.

An online training session on the notary compliance required by the OCC and AG
settlement and the CFPB’s proposed National Servicing Standards is being
offered by CampusMBA on July 19th.  The webinar will discuss the
background of the settlement, training standards, supervision of notary
employees, record-keeping requirements, penalties, and how firms can improve
their notary programs.  Further details and registration are available here.

The MBA School of Mortgage Banking will be hosting a training event titled “Managing
Profitability and Risk
” in Washington, DC from July 31st-August 3rd. 
Developing markets, production management, servicing portfolio management and
valuation, marketing risk management, and pricing strategy are all on the
agenda.  More information is available here.

The next DC offering from the School of Mortgage Banking will be its
“Introduction to the Real Estate Finance Industry,” which covers the structure
of a residential mortgage banking firm and the relationships of the various
actors within the industry.  Participants will receive instruction on loss
mitigation, predatory lending, capital markets, real estate law and regulation,
and real estate mathematics.  The event will take place from July
31st-August 3rd; more info.

CampusMBA will be offering an instructor-guided online course that will cover
property preservation requirements, resources for outsourcing vendors for
maintenance and preservation, GSE and non-GSE requirements for REO properties,
and valuation of REO assets from August 6th-8th.  Details and registration
are available here.

After reviewing its post-purchase RESPA audit practices, Citi is offering
several RESPA training sessions
to instruct correspondents on best
practices and common errors.  The sessions were available on June 18th,
20th, 22nd, and will be on 27th and 28th.  Registration can be found here.

The Texas Mortgage Bankers Association is presenting its Southern States
Servicing Conference in Grapevine, TX on September 19th and 20th.  Four
“tracks” are available, including loss mitigation, REO/property preservation,
bankruptcy and foreclosure, and “hot topics” like fraud and information
security.  More information and registry links can be found at https://www.texasmba.org/servicing/
The TMBA will also be holding its 62nd annual Educational Seminar and
Marketplace in Sugar Land, TX on November 12th and 13th; see http://www.texasmba.org/seminar/
for more details.

The Colorado Mortgage Lenders Association’s 39th annual convention will take
place in Vail, CO on August 8th and 9th.  Those interested in attending
can register here,
while those interested in sponsoring the event can find more information.

A webinar on self-employed borrowers is being offered by the FHA on June
27th.  The training will discuss new policies and underwriting
requirements, tax returns, and using the Schedule Analysis Method to analyze
the borrower’s business.  Register

Training on taking advantage of FHA regulation changes to assist housing
counseling clients will be available in Sacramento, CA on July 17th for program
managers and counselors with clients facing foreclosure or reentering the housing
market.  The event is only open to non-profit and government
organizations; more details.

Phew!! Our heads would all full of stuff after all that!

It is quite the week for news here in the United States, and Europe. Much
of it is “second tier” data, however – not really capable of moving
rates, but it will give us a flavor of things and we’ll see if we continue on
our “slow recovery” scenario. Today we have New Home Sales. Tomorrow is the
Case-Shiller 20-city Index and Consumer Confidence. Wednesday is the volatile
Durable Goods and Pending Home Sales, and Thursday is Jobless Claims & GDP.
We finish Friday with Personal Income and Consumption, some PCE Prices, the
Chicago Purchasing Manager’s Index, and the University of Michigan Consumer
Sentiment number. But the biggest event could be Friday’s EU Summit and also Treasury
auctions on Tuesday, Wednesday, and Thursday.

In the early going, our 10-yr, which closed at a yield of 1.67% of
Friday, is back down to 1.62%, and agency MBS prices are better by about .250.

Here are the “Top 10 things you wish you could say to your borrowers but
can’t.” (Part 1 of 2.)
10. After reviewing your tax return…Is your company hiring?
9. Unfortunately, we just cannot use the $20,000 you have stored in your gun
safe to cover the cash you’re short to close.
8. Listen, there’s been a red-dot out-break at my office, I will have to call
you back tomorrow
7. Let’s just say I ruled the world, I’d certainly loan you $417,000 without
bothering to check your credit or verify your income.
6. Sure, take as long as you want to think about my offer of 4% with no points.
In the meantime, I will ask the markets (US and abroad) to suspend all trading
until you decide.


…(read more)

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