Loan Think

Late this past week several advisors to the mortgage industry were saying that PNC Bank may be taking a close look at some of MetLife's mortgage divisions. Both institutions declined to comment to National Mortgage News. But one unit that PNC won't be buying is MetLife's warehouse group.

A few short years ago outstanding U.S. mortgage debt had Treasury borrowings beat $10 trillion to $9.5 trillion. But not so anymore. Uncle Sam owes $15 trillion on his tab while consumers have whittled down their mortgage debt to a mere $9.2 trillion. (The latter measurement is courtesy of NMN's Quarterly Data Report.)

This is how a Ponzi scheme collapses: the scammers running the fraud run out of suckers (participants) who stop giving them money. When the cash dries up at the lower (intake) levels there’s no way to pay the people at the top of the investment pyramid.

Now that the Fannie Mae/Freddie Mac loan limit has been whittled down to $625,500 a ton of private sector conduits have entered the market to make it easier for wealthier clients to get a jumbo mortgage. Congress is happy because the "de-risking" of the GSEs has begun.

For those who favor public sector cuts and who also don't like to read newspapers (online or print) perhaps there's a disconnect when the phrase "budget cuts" is aired. But let's get something straight: when a state or federal government talks about cutting costs, nine times out of ten it means a public worker (or private sector contractor) will lose his/her job.

I have some questions for all the owners of small mortgage origination shops: are you running your business like it is a business? Do you have the systems in place to examine what is succeeding in your business and what needs to be dropped or even eliminated? Or are you doing things by the seat of your pants, lacking the proper data to back up your decisions?

In case you missed the big news last week: PMI Mortgage Insurance has filed for bankruptcy protection. Its chances of emerging as a viable entity stand between slim and none. If you're looking for a silver lining here, it's this: its demise means more business for the nation's surviving MI firms, including United Guaranty, Genworth, Essent and the rest of the gang.

This week's crop has some opinions and some questions. As to the opinions, everyone is entitled to their own! For the question by Mr. Roper, I believe 62 is the minimum age for someone to be qualified for a reverse mortgage. For the question by Ms. Lange, Ocwen is publicly traded and not owned by DeutscheBank to my knowledge.

The Consumer Financial Protection Bureau plans to provide early warning of possible enforcement actions. Subjects under investigation to be given opportunity to respond to CFPB concerns, On Nov. 7, CFPB outlined plans to provide advance notice of potential enforcement actions to individuals and firms under investigation.

First the good news: at least interest rates are still low. And that's about it for the good news, folks. If you're like me, you're disgusted with the inability of our elected officials to swallow some of their promises and strike a deal to cut money from the U.S. budget.