Trends in Mortgage Banking; Conferences Across the Nation Being Lined Up; Snazzy USDA Pilot Program

Two Brits
were playing chess. Liam said to John, “Hey, do you want to make this more
interesting?” John said, “Sure.” So they stopped playing.

One thing
that is certainly interesting is trends in mortgage origination – and they are
hard to miss. Regional banks and smaller
are picking up origination and servicing market share given up by BofA,
Citi, and Chase. U.S. Bancorp, Flagstar, Fifth Third, and BB&T all gained
market share in the fourth quarter on top of double-digit gains over the past
three years. By most accounts Wells is up to a 30% market share through its
three channels. Flagstar, for example, reported an 11% jump in home lending
volume from a year earlier, but is struggling with buyback requests. It
received $190 million in repurchase demands in the quarter and increased its
repurchase reserve by $35 million. Kate Berry with American Banker reports that
“SunTrust has been hit hard by repurchase requests. The $177 billion-asset
Atlanta bank has been dealing with the effects of the scarred Florida real
estate market, and in the fourth quarter alone it posted $636 million in
repurchase demands and a $215 million repurchase provision. SunTrust chairman
and CEO Bill Rogers told analysts on a conference call last month that mortgage
origination volume ‘continues to be healthy’ and has ‘attractive margins.’
Still, volume fell 22% to $6.8 billion in the fourth quarter from a year
earlier” per AB.

One reader noted, “Your Saturday post had a comment from someone who said
that “no servicer in their right mind would tell a borrower to stop making
payments”. Well I beg to differ. I have rental properties one of which is
financed with SunTrust.  We tried for a year to get them to modify the
interest rate or let us do a short sale with us taking a note back for the
difference. We were told that 1) we were current so we weren’t a priority 2) we
made too much money to be considered and 3) you might stop making payments to
get someone’s attention.”

Another wrote, “Why even tell the borrower that a modification is available if
they are behind in their payments? We receive a few phone calls a day saying
BofA, Chase, or Wells told them that they need to be late on a payment in order
to be considered for a mod, been that way for two years. They can’t all be
lying. Our industry continues to shoot its self not in the foot, but right in
the head. Then we blame the media and everyone else for our problems.”

There are some pretty good conferences
coming up.
For one
next week, don’t try to obtain a room at the conference hotel – they’re sold
out (other places are available). The MBA’s National Mortgage Servicing
Conference & Expo (2/21-24) in Orlando, Florida, promises to be well attended. “Gain Critical Insight on
the New Servicing Settlement” and other topics will be covered. My bet is that
many hope that there will be a session on how the major aggregators can sharpen
their pencils on SRP’s!).  More info

Here’s a rundown of some of the next few
months’ conference offerings
The Annual Regional Conference of MBAs for the Mid-Atlantic States will take
place from March 11-15, 2012 in Atlantic City, New Jersey.  The conference draws mortgage professionals from
25 states and Washington, DC, and caters to both those who work in residential
and those who work in commercial mortgages.  More information can be found
at me up if you’re going! If you fancy
reserving an exhibitor booth for the 21st Annual Rocky Mountain Mortgage
Lenders Expo in Colorado April 5, reservations
are now being accepted.  “It features product demos, educational
programing, and networking opportunities, the exhibition will professionals
from a variety of industries.” Plus Denver is lovely in the springtime – to
find out more go to and click
the EXPO link.

The Maryland MBA’s annual conference will
be held May 10, 2012 in Columbia, Maryland and features speakers, various
panels, exhibitions, and networking opportunities, with MMBA President and CEO
David H. Stephens delivering the keynote address.  Details soon to come;
in the meantime, you can email your queries to
For those based in Texas, the Texas
MBA will host its 96th (!) annual convention in San Antonio from May 20-23,
2012.  Along with a varied program of speakers, over a dozen major Texas
mortgage institutions are slated to be exhibiting.  You can reserve at, and if you’re interested
in sponsoring the event, you can contact the TMBA directly.

This June’s
MBA of Florida annual convention
offers a variety of events, including networking receptions and a seminar
providing an in-depth economic analysis of the current market.  There are
slated to be speeches on technology in the mortgage business, new legislation,
and how to use the constantly changing nature of the mortgage market to your advantage. 
The conference will feature speakers from HUD and the lending division of the
preeminent mortgage banks as well as the chance to enjoy balmy Fort Lauderdale.
(More information to come soon.) And in early June, in Sedona, Arizona, the “Tools for the Future:
Rebuilding the Industry” conference will take place – exact details are yet to
be released.

Remember in the old days when new programs came out? The USDA launched a pilot
refi program in 19 states
. No credit report, no appraisal, no minimum property
standards, no property inspections – wow. There are 19 states involved which
are considered “hardest hit” states: AL, AZ, CA, FL, GA, IL, IN, KY, MI, MS,
NV, NJ, NM, NC, OH, OR, RI, SC, and TN. Don’t take my word for it:

Looking at interest rates – they’re good! Tuesday the U.S. 10-yr dropped down
to 1.93%, and MBS prices improved by about .250 – mostly due to Retail Sales
for January increasing less than expected, and several downgrades of European
countries by Moody’s (no surprise there). And we were reminded that Europe
continues to dominate sentiment in the Treasury market, and that lesser weekly
or monthly numbers here make little long-term difference. European GDP numbers
were released overnight, showing some strength, and China came out saying it
would continue to invest in Europe regardless of its present difficulties. (Why
don’t we hear much from the cash-rich Middle East on this subject?) Originator
selling appears to have held to the $1+ billion area which was more than offset
by buying from the Fed alone (which has been averaging $1.2 billion per day).

for mortgage bankers and Realtors, agency MBS (Fannie, Ginnie, and Freddie) have
been on a strong run since November despite record-low mortgage rates. Most
attribute this to two primary reasons: investors want the perceived relative
safety and security of the U.S. fixed-income markets, and investors in mortgage
securities don’t seem to be afraid of the possibility of a big increase in
refinances. This is despite the Administrations refinance plans. (Long term
investors tend to fear volatility, which is not happening, and 30-yr fixed-rate
mortgages firmly at 3.75% at no cost to borrowers.)

For excitement
today we’ve already had the European GDP numbers, along with the MBA’s weekly
application index. The overall index for last week was down 1%, and while refi’s
were up .8% purchase apps dropped over 8%, putting the share of refinances at
over 81% of new apps. We’ve had the Empire State Manufacturing Survey for
February (higher than expected at 19.53); later we’ll have Industrial
Production and Capacity Utilization and another in the series of seemingly
endless housing price indicators: the National Association of Home Builders’
Housing Price Index for February. Early
on the 10-yr is practically unchanged, as are MBS prices, at 1.93%

(An oldie but a goodie.)
A group of 15-year-old girlfriends discussed where to meet for dinner. Finally,
they agreed to meet at the Dairy Queen next to the Ocean View restaurant
because they had only $6.00 among them and Jimmy Johnson, the cute boy in
Social Studies, lived on that street.
10 years later, the group of 25-year-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
the beer was cheap, the restaurant offered free snacks, the band was good,
there was no cover and there were lots of cute guys.
10 years later, the group of 35-year-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
the cosmos were good, it was right near the gym and, if they went late enough,
there wouldn’t be too many whiny little kids.
10 years later, the group of 45-year-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
the martinis were big and the waiters had tight pants and nice buns.
10 years later, the group of 55-year-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
the prices were reasonable, the wine list was good, the restaurant had windows
that opened (in case of a hot flashes), and fish is good for cholesterol.
10 years later, the group of 65-year-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
the lighting was good and the restaurant had an early bird special.
10 years later, the group of 75-years-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
the food was not too spicy and the restaurant was
10 years later, the group of 85-years-old girlfriends discussed where to meet
for dinner. Finally, they agreed to meet at the Ocean View restaurant because
they had never been there before.

If you’re
interested, visit my twice-a-month blog at the STRATMOR Group web site located
at The current blog discusses
residential lending and mortgage programs around the world, part 2. If you have
both the time and inclination, make a comment on what I have written, or
on other comments so that folks can learn what’s going on out there from the
other readers.

…(read more)

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