Loan Think

THIS JUST IN: Bank of America is contemplating ending its warehouse unit's "early purchase program" by yearend, according to one source familiar with the matter. If so, that means nonbanks that originate mortgages in the primary market with B of A warehouse money and then sell that production to its correspondent group (through a captive arrangement) could be out of luck.

It's bit too early to declare one topic the "biggest mortgage story of the year" but the front runner is Bank of America's downsizing in residential finance. I don't mean to pick on the bank, but never before in the history of the business has a number one ranked company in both production and servicing fallen so hard, so fast.

First the good news: the White House later this month will release its plan to refinance billions of dollars of outstanding mortgages. (We might get a taste tonight when the president makes his speech.) Now the bad news: no one is certain exactly what it will look like and who will be eligible.

The new MBA application survey is out and the news is a bit perplexing: despite the lowest rates in 50 years application volume fell by 5% for the week ending Sept. 2. What's going on here?

When it comes to mortgage banking, Bank of America is heading for the turnstiles. Over the past 12 months it has exited wholesale and reverse lending, announced plans to downsize its servicing portfolio in a major way, and put its correspondent division on the auction block.

Effective immediately, FHA-approved supervised lenders that are regulated by the Federal Deposit Insurance Corp., Office of Thrift Supervision, or National Credit Union Administration whose consolidated assets do not meet the threshold required by those agencies for submitting audited financial statements (delineated at 12 C.F.R. § 363.1(a), 12 C.F.R. § 562.4(b)(2) and 12 C.F.R. § 715.4(c)) are not required to submit audited financial statements to FHA, nor an audited computation of net worth.

If you haven't embraced blogging yet as a marketing tool, social media expert Randall Craig has a few reasons why you should.

I'm not one to spout out Pollyanna hope to readers when there is none. Friday's job figures from Uncle Sam was a blow to the gut, the only good news being that it could've been worse. Here's one ray of hope: the mortgage brokerage segment added jobs for the first time since October 2010.

On Friday morning the yield on the 10-year Treasury fell to 2.06% compared to a record low set two weeks ago of 1.98%. The reason for Friday's rate tumble: a still ugly labor market.

At the recent SourceMedia Loss Mitigation Conference in Dallas I sat down with industry experts for a chat on the latest in loss mit.