The first half of the Lykken on Lending program will feature our Weekly Updates….to read more info about our regulars and weekly updates, go to our website!
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Weekly Updates With Alice, Allen, Matt, Les, And Rob
It is Monday, October 11th, 2021. We are so excited to have you tuning into the show. However you are doing it, I appreciate it very much. We create this show for mortgage professionals and we do it as mortgage professionals. Our commitment is to bring you timely information which you can read anytime and anywhere.
Our downloads are going up. We had a 400% increase in downloads. Something is going on. We are appreciating it so tell others about it. It’s a great way to get information, especially for new people coming into the industry who want to get their heads wrapped around what’s going on in the industry. They can go back in time and read the show.
I’ll never forget the time when I was at Thompson Reuters in New York. This guy walked out to me and said, “I’m head of everything electronic here and someone suggests to start tuning in to your show. I started the most recent. I had an hour train ride into the city and an hour train ride out of the city. I tuned in to your show for one hour, coming into work and going home from work. I’m two and a half years into the show. You have helped me learn the mortgage industry.” I say that for you to realize this is a valuable tool that you can use to get an update on what’s going on in the industry. We appreciate it.
Thank you so much. It’s happening because our audiences are way up because of the Industry Syndicate. We’re a part of that. We get our show promoted on that as well as other channels. We want to say a special thank you to our sponsors, the Mortgage Bankers Association of America. I’m doing an episode with Finastra, which is the next sponsor I want to say thank you to.
I’m doing a webinar for Finastra and we’re doing it for the American Bankers Association, ABA webinar, talking about leadership in the mortgage banking space, especially in the regulated world. For those of you that want to tune in, be sure to request or sign up for the webinar by going to the Finastra website. Also, I want to say thank you to Lenders One and The Mortgage Collaborative. Both of these coops do a great job of helping you get them to be up close and personal with other vendors.
It doesn’t replace the MBA, as I always say but it allows you to get into a setting where you’re able to talk one-on-one with your peers a little bit more practically. I encourage you to check that out. Pete Mills does a great job for the independent mortgage bankers bringing them all together. Thanks to Bill Cosgrove, who started that when he was president of the MBA. Also, The Community Mortgage Lenders of America. I’m grateful for their support as well as Insellerate.
Josh Friend at Insellerate does have one of the coolest technologies out there for helping with engagement with the borrowers. It doesn’t have to be just a consumer direct. It’s anytime you’re connected with a borrower or leads that you’ve had systems in there. We got to put in a plug for Sales Boomerang because when you combine Sales Boomerang with Insellerate, it’s a powerful tool in helping you connect with people.
If you are looking at how to train people, check out Knowledge Coop. Ken Perry has got a great product there and helping you teach. It’s called the Learning Management System. Mobility MMI, Mortgage Market Intelligence, does a good job, as well as Modex for creating and giving you data on what’s being funded by whom, whether it be realtors, builders or mortgage loan originators. It’s a great tool. Also, to our friends at Snapdocs. It’s so great to have them as a sponsor of the show. Amy Moses and the team there at Snapdocs got a great vision.
I am impressed with the vision that they have. You got to get to know them because the name does not describe all that they do so they are going to be leaders. They are leaders and becoming even greater leaders in the eMortgage space so check that out. I want to say special thank you to Rob Van Raaphorst, Les Parker, Alice Alvey, Allen, Matt and Jack for their contributions to the show each and every week. Let’s get over to Rob Van Raaphorst with the weekly Mortgage Minute update. Rob?
Welcome to the Mortgage Minute and the latest news from the Mortgage Bankers Association. MBA released its latest forbearance and call volume survey. It revealed that the total number of loans in forbearance has decreased to 2.62% with an estimated 1.3 million homeowners in forbearance plans. Things are headed in the right direction. Beginning on October 16th, 2021 and running through October 20th, 2021, MBA will be holding its annual convention in person in San Diego, California. Speakers will include HUD Secretary Marcia Fudge, FHFA Director Sandra Thompson and the CEOs of Fannie Mae and Freddie Mac. That’s it. We’ll see you later.
Mortgage Market: The total number of loans now in forbearance has decreased to 2.62%, with an estimated 1.3 million homeowners in forbearance plans. Clearly, things are headed in the right direction.
I’ll be there interviewing and meeting a lot of people. I’m looking forward to that. Great job, MBA. Thanks, Rob Van Raaphorst, for taking the time. It’ll be fun to see you in San Diego. You do need to get tested to be compliant with the conference. You need to get COVID testing within 72 hours before that. I scheduled my COVID test here at the local drugstore. If I get that certificate, I go to the conference, pick up my badge and then I’ll be able to participate. Supposedly there are no masks required. We’ll see what the update is.
A lot of people are pushing back on this COVID testing. The MBA is doing its job to make sure we’re all safe at this conference. I don’t like the test and doing any of that stuff but I got to do it. I want to see everybody. We’re going to be there fully tested, compliant and excited to be a part of the conference. Let’s get over Les Parker with the TM Spotlight and a macro view of the markets. Let’s see what Les and Gary Catrambone have cooked up for a music parody and how Les ties it all together. Les?
If bonds could escape, they would but first of all, let bears say they must apologize for acting stank and selling off this way. The anticipated avalanche of debt gives little hope for bonds to escape except for the big problems in Europe and China. When the US economy has a supply problem, why would US leadership address demand? Think affordable housing. It needs no more demand but it needs lots more supply, yet government policy seeks subsidies that increase demand. The odds grew for a mega-budget that does little to address the energy supply. Maybe the rise in rates, energy costs and bottlenecks will get Congress to act on supply issues. Come on, Joe. Wouldn’t that be sweet? These views are my own. Find a sweet escape at TMSpotlight.com.
If bonds could escape, they would, but first of all, let bears say they must apologize for acting stank and selling off this way. Click To TweetCheck out TM Spotlight Newsletter. You can subscribe to it for free and get the paid version by putting in the word POWER for PowerSeller. We appreciate Les, our partnership with them and our friendship. Les and I work together. We do a lot together on the TMS, Transformation Mortgage Solutions, business consulting. Thanks. I appreciate it, Les, for doing that. Normally, we’ll be running over to Matt Graham. It does not look like he’s sending it in. He got time to send in a recording.
Markets fell apart, especially when you look at the jobs claims and the non-farm payroll numbers. We anticipate it. I was reading a bunch of articles talking about flying home and what a fiasco that was. What we’re looking at with the job numbers came in unexpectedly and surprisingly low which normally would cost set off a bond rally that did not happen. We’re all scratching our heads and seeing what’s going on. There is an article that Matt posted on the bond market. I encourage you to head out to MBSLive.net, read all this and take a look at what’s going on. I’m looking at where the 10-year treasuries are trading right at the moment at 1.612%.
That’s a steady increase since the craziness happened. What’s going on? Why did that happen? Sometimes, we’re disconnected. We’re going to get Mike Fratton out here to try to explain some of it. I’m also going to try to get Les Parker to give us some information on this. We are very grateful to have a partnership with Matt. He comes on and gives us all this great information. If you go in and sign up for MBSLive.net and put in the code LOL for the show, you’ll get an extended no-credit card trial period. I encourage you to do so.
What happened to Matt? He is not joining us. I suspect it is because of all that is going on in the markets. Let’s get over to Alice Alvey. Alice is here. She’s dialed in as she is faithfully for many years, almost always. It’s so good to have you here, Alice. Alice is CMB and Vice President of Education and Training at Union Home Mortgage. She’s one of the reasons they’re so successful in growing and educating everybody. Alice, it’s good to have you here. What do you have for the legislative update?
Dave, the markets are closed and so is Union Home but I thought that makes it a great day to sit outside and report on the legislative update from my patio. I hope everyone is having a beautiful day. For my update, I thought I’d give a quick focus on FHA. We are still waiting for confirmation from Julia Gordon as the FHA Commissioner. Related to that, Alanna McCargo is the first nominee to be president of Ginnie Mae. We have been missing a president of Ginnie Mae for a while and it looks like that confirmation has a lot of people excited that she may get approved. From an FHA standpoint, I’d like to give a shout-out to an article I read in Inside Mortgage Finance.
I love that publication. I’ve read it for many years since I was brand new in the mortgage industry. They reported back on October 1st, 2021 that some analysts are estimating that there could be a drop in the FHA mortgage insurance premiums in 2022. The reports are due out, as we all know and we usually have a show. I’ll give an update on how that actuarial report comes out. The fund is expected to be very healthy, prompting industry insiders and FHA to take a look at it. Could we drop the premiums? Things on the table, one of the big ones, is the fact that that monthly premium is the life of the loan for most loans. That is a real game-changer for many home buyers when you’re comparing the cost of the financing of MIP to PMI. There’s been a lot of debate on this lately with DU’s new average credit score.
Fannie Mae instituted that their system is going to be making loan decisions on average credit scores but pricing is still going to be based on the low middle score. I should clarify the average middle score versus pricing will still be the low middle score. A few borrowers will make it in who might not otherwise have made it in but their price is going to be high.
We’re encouraging loan officers to still make that comparison even though you might be sitting with the approved eligible. We know that sellers very often are not happy with seeing an FHA on a purchase agreement, which is a total misunderstanding of that FHA product. They want so much to see that it’s a conventional loan on a purchase agreement that you have to be careful that we’re not causing a fair lending problem by putting a customer in a more expensive product just because they want that word conventional to get the house in the first place.
It’s a real conundrum in the market as this product is starting to see a few borrowers with lower credit scores who might be great FHA borrowers but because they’re so desperate to get in that house after a dozen offers, hopefully, the loan officers are doing the right thing and comparison for what finance makes the most sense for the borrower and comparing those premiums. They’re not all bad. It’s not always best to flip it to FHA. We think it’s hugely important to get the word out that loan officers have to do that comparison and do the right thing regardless of the eligibility. That’s my words of wisdom.
Mortgage Market: Hopefully, the loan officers are doing the right thing and doing the right comparison for what finance makes the most sense for the borrower and those premiums.
Alice, we flew into Ohio into Cincinnati and then we went to the Ark Encounter and the Creation Museum. It’s a great place to go and has interesting information. That Ark is huge. It is amazing. We’re flying home Sunday morning and we caught a 7:30 flight out flying Southwest. Alice gets us to the airport and they say, “I’m sorry but your flight has been canceled.” Southwest has got gazillions of flights going out everywhere. I said, “No problem. We’ll get on the next one.” They go, “I’m sorry. All flights have been canceled.” I go, “All flights like in system-wide?” They go, “That is correct. We don’t know when we’re going to be able to reschedule at this point. We think we might get you home on Tuesday. You may want to consider another airline flying home.”
I’m looking at my wife going, “This is certainly strange.” We went and got an American flight and flew home and got nonstop. We got home in the evening. We’re sitting there and spent nine hours in the Delta Club. That was a long time hour. We sat there and started reading the articles. They said it was the weather, then it was the ATC problem or the American Air traffic controllers then it came back. The report started coming in, “No, that isn’t at all the case. The weather wasn’t bad in Florida.” The FAA came out and said, “We are not having any issues.” It left it to speculation.
Finally, there was a Bloomberg article that came out that said, “Many pilots are protesting getting the vaccination for COVID that they’re staying home. It grows because of the mandate that if you don’t get vaccinated, you get fired.” Everyone is taking vacation time, is what we’re hearing and other airlines are going to be doing the same thing. They’re checking in and saying, “We’re not going to get a vaccination. You don’t judge anyone who has or speak for me. It’s a personal choice. I don’t want to be forced to do it. It’s going to cost my job.” I think about the MBA Conference that’s coming up. It was nine hours later before we got home than we were supposed to. It was delayed and then we started looking at all the flights.
I went on the Southwest app to look at what flights are still flying out of Austin. You can’t go anywhere today. Tomorrow, there was one flight to San Diego. On Wednesday, it showed more flights. By Thursday, it opens up. I’ve got a flight on Friday because I want to go in for the MPower Event that Marsh is putting on. That’s so much fun to have interviewed many from Union Home at those previous conferences at the MPower Event. Alice, you and I have done that and I appreciate that.
I’m wondering how this is going to impact the conference if people are saying, “I don’t want to be at risk of being stranded in a city like San Diego.” There are certainly a lot of worse places to get stranded than San Diego but the cost is interesting. Alice, we are concerned that we are going to make it home and what this impact. A lot of people are looking at this going, “Is this the time to be traveling?” We’ll see how it goes. At this point, we’re planning to go to the conference. If I have to, then I’ll buy a ticket to go on another airline. If you look at the chances of getting home if this starts snowballing, it’s an interesting time.
Sorry you got stuck. That sounds crazy. You were part of the news headlines about the Southwest.
This is so unusual. Everyone is trying to find out what’s going on. Think about the kids that are traveling and parents who are divorced and live in different cities. If they’re on their way home and then their flight gets canceled, they’re stuck in a strange city. The scenarios that were being talked about were horrific. My wife and I are traveling out there. We have to figure out the worst case if we’ll rent a car and drive home but that’s not possible for some. It’s interesting circumstances we were involved in, Alice. There you go. Travel update.
I’m glad you made it home safely. I hope you make it to the conference. Everybody I know will look forward to seeing you there.
I do. I’m looking forward to it. Sorry, you’re not going to be there in 2021. I understand many are not going but for those that are, we’re going to be a roof.
No, I’m not going to make it.
Sorry about that, Alice. We always had such great dinners and it’s always fun to have you get involved in some of the interviews we’re able to do at the MPower Event. Talk about MPower, Alice, for a minute because Allen Pollack has taken up the day off. What’s the importance of MPower? What it has done in recognizing women? Why is this such an important thing? This is on the spot but you do so well on the spot. Talk about MPower and the impact it’s having there at Union Home.
MPower is a wonderful way for women to get to know each other and learn about the support that we have in the industry. MPower is many things. Marsh has done a terrific job in getting it built to where it is. It’s a nationally recognized resource for women that helps us be connected. There aren’t as many women as there are men in the industry. It is incredibly inspiring for the younger generation of women to see the successful CEOs and women who run mortgage companies, who lead various divisions within mortgage companies and get connected with them.
mPower is a wonderful way for women to get to know each other and learn about the support that we have in the industry. Click To Tweet
That’s one of the most valuable things that MPower brings because it helps everyone grow. It helps people connect with individuals who can be coaches and mentors for them. I encourage companies to send their partners to the event. It is extremely valuable and motivational and will bring lots of value back to your company. It is one part of building a strong diversity, equity, inclusion and belonging environment at your company.
One of the friendships that have come out of that is Bronwyn Morrissey, whom I met at an MPower Event. She’s become a fairly dear friend as well. I’d look at her stories and what she’s doing to help empower women in the marketplace. We need that. We were all for that, especially since having two daughters that are for it. We got one of the mortgage industry. We’ll see if the other one ever makes our way into it. It’s good to have at least one converted in and we’re grateful for MPower. We’re there for MPower. If you’re going to be out there, try to come in Friday so you can be a part of the event on Saturday. I look forward to seeing everyone there. Alice, thanks so much for being here. With the holiday, we’re going to wrap up this first part of the episode.
This ends the weekly update of what’s going on in the market and what we’re seeing in the news. It’s great having you here as our audience. I want to say a special thank you to our sponsors, Finastra, CMLA, Lenders One, Insellerate, Mobility MMI, Modex and MBA. We’re going to be all at the conference. I’m looking forward to seeing you in San Diego. We’re going to get all the planes, trains and automobiles going. The right direction of working will be there. Also, Knowledge Coop, Mortgage Collaborative and Snapdocs. I’m very excited about their sponsorship and partnership with them. I appreciate you all. Have a great time. I look forward to having you back here in the next episode.