Loan Think

It's good to be king. Last month PHH Corp. named mortgage industry veteran, Luke Hayden, president of its mortgage division "effective immediately." A recent SEC filing by PHH notes that Hayden was granted 15,000 stock options. The conversion price is $20.85 which means the options aren't yet "in the money" but are getting close. Over the past six months insiders at PHH have bought (or been granted) 36,500 shares, according to figures compiled by Thomson Financial. But insiders have been selling too. Among mortgage banking firms, PHH Mortgage ranks among the nation's top 10 lenders and servicers, according to figures compiled by National Mortgage News and the Quarterly Data Report…

It's unconfirmed, but there could be a buyer for a $1 billion nonperforming loan package being peddled by the Federal Deposit Insurance Corp. The NPLs belonged to the now defunct AmTrust Bank of Cleveland, once a major player in correspondent lending. It's believed the sale will be accomplished through a structured transaction, which means there likely are multiple parties involved on the buy side. Stay tuned. Meanwhile, earlier in the week FDIC chief Sheila Bair hinted that the agency's first securitization of problems loans from troubled (or failed) institutions is still moving forward. Originally, it was believed that the FDIC would securitize billions worth of loans. But market sources say the first deal will be in "the hundreds of millions." And in case you missed it, Ginnie Mae has a new MBS program for manufactured housing loans. But there is a catch: only issuers with a net worth of $10 million or more can play...

In my world, marketing is knowing what to do or finding out what to do and selling is executing on the marketing plan.

THIS JUST IN: If you're trying to foreclose on a home in Florida it can take up to four years. That's the worst-case scenario, I've been told by some investors in distressed loans. "Usually it's at least two years," said a West Coast-based vulture fund manager. Of course, some borrowers got hosed on their loans and have every right to stay in the house. Then, there are folks who are gaming the system. It's a crazy mixed up world. Have a horror story about foreclosure problems? Drop me an e-mail at Paul.Muolo@SourceMedia.com. I'll post the best ones here next week...

Today, the government oversight panel that keeps an eye on TARP money said it's still unclear whether Uncle Sam will fully recoup the $182 billion taxpayers plowed into American International Group. "We want a profit" on taxpayers' behalf, said panel chair Elizabeth Warren (who, by the way, is not a big fan of loan brokers.) "We are holding Treasury's feet to the fire." Well, here's an interesting development that Warren may've missed: United Guaranty Inc., a mortgage insurance company, had the best performance (by far) among the nation's six active writers of new MI policies. While every MI in the nation suffered brutal declines in new policies written in the first quarter (ranging from 39% to 80%), United Guaranty had a mere 9% fall-off in new business. Who owns UGI? Answer: AIG. A year ago it looked as though AIG would sell the unit, but the deal fell apart after it realized that the bidder (Uber bottom fisher Wilbur Ross) was getting too good of a price, or so we heard. More on that story in my weekend column…

The affluent mortgage borrower, who needs to borrow a large sum for a purchase or refinance, should be easy to "catch" if you plan and prepare properly. Fishing off the dock using breadcrumbs, you are likely to catch an abundance of little sunfish. To catch the large fish, you need to row your boat out to the middle of the lake where the water is deep. The big fish congregate on the bottom of the lake.

With tech stocks getting clobbered of late and the "dot-com" bubble a somewhat distant (or is it, not-so-distant?) memory, an old news nugget popped into my head concerning Fannie Mae. Before Frank Raines got the gate as CEO he was contemplating legally changing the GSE's name to FannieMae.com. I'm not sure, but I may've heard a similar rumor about Countrywide. The two mortgage companies (as we all know) were once joined at the hip in a classic 'junkie-dealer' relationship. For many years Countrywide was the largest seller of loans to Fannie, garnering huge discounts on guarantee fees assessed by the GSE. Anyway, that's all history, but keep in mind this one thought: I would venture that today, many of Fannie's most delinquent loans can be traced to Countrywide, especially those of the 'alt-A' variety...

This week we are pleased to share with you one of our favorite columns from Sue.

FTC AGAIN DELAYS ENFORCEMENT OF THE "RED FLAGS" IDENTITY THEFT MANUAL UNTIL DEC. 31, 2010

We're still trying to figure out what's going on with BB&T and its correspondent/wholesale plans but the bank, for now, has pulled down the "cone of silence." (For you non Baby Boomers, go rent a DVD of the 1960s comedy 'Get Smart' to understand the reference.) The short story is this: wholesale is out, correspondent is in, but that's all we really know. Meanwhile, it appears that BB&T is the largest warehouse lender in the nation, according to a new tally by National Mortgage News. Then again, the tally excludes Bank of America's warehouse unit. For some reason BoA won't disclose commitment figures, which I don't get. As I've noted before: what's the big secret? B of A is a publicly traded bank regulated by the FDIC. Meanwhile, if you're trying to figure out where the employment market is headed, you'd better buy a neck brace to protect yourself from whiplash. The following two headlines offer a hint at the mixed signals. From MarketWatch: "Jobs news even worse than it appears." And from the Associated Press: "Job openings rise to highest level in 16 months." Go figure…