Loan Think

By now almost everyone has heard about Apple’s introduction of its tablet the iPad. Blogs, Twitter and mainstream media have all weighed in on Steve Jobs’ announcement. Will it be a game changer? How is it going to change the eReader market? Did Apple miss the mark? What is missing in the iPad? In reading all of these differing opinions, I ran across an interesting blog from Stan Schroeder, European Editor at Mashable. His insights made me think of the mortgage industry and the ongoing debate of “Best-of-Breed vs. End-to-End”. Here is what Stan had to say about the iPad.

In the early 1950s my parents bought a Levitt-built house in Wantagh, out in Long Island, paying about $8,000 for the property. (It was an FHA loan. My dad was in the Air Force.) They sold the home seven years ago for roughly $330,000, making a tidy profit. This past week I interviewed Kyle R. Walker of Home America, Lake Forest, Calif., whose specialty is buying REO properties -- including some from Fannie Mae -- for between $1,000 to $10,000. Some of the homes reside in inner city Detroit, a metropolitan area that is hemorrhaging residents. Stated differently: a home in Detroit today costs less (or about the same) as a newly built house in the potato fields of Long Island 60 years ago. What's wrong with this picture? Is this the buying opportunity of the century or is something else afoot? Meanwhile, the new jobs number is out. The government said the economy shed 20,000 jobs after losing 150,000 jobs in December. November was revised to a gain of 64,000, up from 4,000. Follow all that? The good news is that the jobless rate fell to 9.7% from 10%. Are there fears the economy is truly improving and that the Federal Reserve soon will hike interest rates? Don't bet on it. The yield on the 10-year Treasury is falling as I write this...

Effective accurate action is what you must demand, not just action alone. In last week's article, a very good article according to the responses, I made a major error. The headline used a word incorrectly. I hate when I do something like that.

THIS JUST IN: A midtier bank that is knee deep in the credit card business is looking for residential servicing help and has contacted 10 "combat servicers" for their assistance. For full details see the Monday edition of National Mortgage News. Don't subscribe? Call 800-221-1809...

A large portfolio of nonperforming payment option ARMs has hit the market. Investors that have seen the offering book and talked to the seller say the asking price might be a bit rich, though others suggest it's merely a starting point. "Some of these loans have LTVs of 105," one vulture fund manager told National Mortgage News. For the full story and complete analysis see the Monday edition of NMN. Meanwhile, the stock market was in the tank Thursday morning after a weak private sector job report and concerns over debt troubles in Greece, Portugal and Spain. On Friday morning the Department of Labor releases unemployment figures for January...

Is your licensing info on the Consumer's NMLS website yet? We played with the site and its pretty much impossible to find "individual loan officers" - consumers are going to freak out if they can't find you. Learn a few tricks on how to find your NMLS listing - to make sure your clients can verify that you hold a valid mortgage license.

The Federal Reserve is staying firm on its commitment to stop buying Fannie Mae and Freddie Mac MBS (and debt) by March 31. That said, speculation began to increase that the GSEs themselves would start buying their own MBS, holding these tradable bonds in portfolio. And maybe they will -- or maybe not. A new letter from Ed DeMarco, acting director of the Federal Housing Finance Agency, says (more or less) don't count on the GSEs being big buyers. In fact, he's sticking to an earlier plan to make sure their portfolios are no larger than $810 billion by yearend 2010. (Both are under that figure presently.) But the cap means they won't be buyers. And if the GSEs aren't buying and the Fed isn't buying that leaves the private sector. And the private sector will want something in return -- yield. Yield means higher rates. Will it play out this way? Stay tuned...

For the next few weeks, Broker Universe will feature some of our favorite Sue Haviland columns from the past year.As we look forward to 2010, we continue to see stories of companies closing their doors or scaling back their operations. Have you taken decisive steps to be sure that in 2010 your reverse mortgage business will continue and you'll be able to serve the seniors in your community? You've heard it said, "hope is not a strategy" Are you sitting around just hoping that things will be OK in 2010? Or have you taken stock of your business and put a plan in place that reflects your goals and current conditions?

ARIZONA LAW PROFESSOR STATES IT IS NOT IMMORAL TO 'WALK AWAY' FROM A MORTGAGE HOME LOAN

What's that line in 'Godfather III' where Al Pacino says, "Every time I try to get out, they pull me back in"? It's something like that. Any way, I was thinking of that line when I heard that Kyle Walker, the former CEO of Fremont Investment & Loan, and Bob Clafford, another alumnus of that subprime shop, are back in business. However, this time they are buying REO properties through their somewhat new firm, Home America of Lake Forest, Calif. During his career, Mr. Clafford also worked at Associates Financial Services, a subprime lender that was once owned by Ford Motor Co. Associates later went public and was bought by Citigroup. If you don't know what happened to Fremont, then you shouldn't be reading this...