Loan Think

People are becoming more and more comfortable with the idea that participating in the social media should be part of their key marketing strategy. But be careful - these same forums are also an outlet for someone who might be a disgruntled client.

JPMorgan Chase chief Jamie Dimon took another (minor) swipe at loan brokers in today's earnings conference call (see the NMN website for details) but he also said something interesting -- that JPM soon will be "over capitalized," as will the banking industry. As for the wholesale/broker channel, there's at least one new entrant we can tell you about -- Total Mortgage Services of Connecticut. TMS is about to launch a multi-state initiative. And in case you missed it: the Real Estate Settlement Procedures Act now requires mortgage lenders/brokers and settlement agents to use the new Good Faith Estimate and HUD-1 Settlement Statement forms. Not sure what to do? Better lawyer up...

The level of preparation and action of the past six months is the only "asset" you have. If you want your "asset" to produce more income six months from now, you must adjust yourself right now to develop yourself into the person/business that is ready to, can, earn more income in six months. Nothing else will change your circumstances than you changing you.

The strangest story of the past week is the huge disparity on the 2010 residential forecasts from Freddie Mac and the Mortgage Bankers Association. Freddie looks downright bullish at $1.75 trillion while MBA looks like a skunk at the garden party with $1.3 trillion. It's the widest disparity in forecasts I've seen in years. There are days when I think $2 trillion is a good number but that's only if unemployment falls to 9%. (I'll get to the employment crisis in a moment.) Anyway, we try to sort it all out in the Monday edition of National Mortgage News - as well as what it could mean for loan brokers. As we reported on our website Friday, a former wholesale lender owned by Richard Branson could have a new lease on life. And believe it or not there could be some stirrings of life in warehouse lending. Don't subscribe? Call: 800-221-1809...

The federal 'Crisis Commission' turned its attention to Attorney General Eric Holder today. Headed by Phil Angelides, the commission's job is to explore our nation's financial meltdown and write a "definitive" report on it. (Of course, they could read and republish 'Chain of Blame, How Wall Street Caused the Mortgage and Credit Crisis' -- and save the taxpayers a lot of money, but don't get me started.) Anyway, Commissioner Angelides today raised the issue that the FBI's focus on national security concerns after the Sept. 11 attacks sucked resources away from financial fraud investigations. (I'm paraphrasing.) The only thing I can say is this: Duh! And: Duh! Of course, terrorism siphoned off resources from other areas of criminal inquiries. Both DOJ and FBI have already said as much -- many times. You want to fund more investigations? That means more tax dollars will be needed. And to get more tax dollars our elected leaders will need to, gulp, raise taxes. (Or cut entitlements.) I will admit that I haven't listened to the hearings too much but from what I've heard (and read) so far we're not learning anything new. Goldman Sachs betting against CDOs that another part of the company was selling? Do tell. Deutsche Bank was doing the same by shorting the ABX Index while its trading desk was buying and issuing subprime ABS. (That's in 'Chain of Blame' too.) There's gambling going on on Wall Street? Shocking. Round up the usual suspects...

What to do when it’s time to update your marketing and the creative juices aren’t flowing.

Just when you think there may not be much of a future for nonbank lenders, the government tightens the screws (or threatens to) changing the playing field. I'm talking about, of course, the Obama Administration's plan to impose new fees on banks as a way to recoup some of the $700 billion bailout money allocated via the Emergency Economic Stabilization Act of 2008. I'm not saying this tax will force depositories to become nondepositories but it might shape some future strategies. The key determinant for any owner of a lending business is capital -- as in: "Do we have enough of it?" The FDIC is also looking at penalizing banks for what it calls "risky compensation" practices. As I recall, during the height of the lending boom, many depository lenders paid their wholesale account executives based on how many loans they brought in via loan brokers. Is the FDIC thinking of wholesale AEs in contemplating its new rules? Meanwhile, later today National Mortgage News will break yet another story about a new entrant to the warehouse lending sector...

A couple of weeks ago I asked the readers of this column to let me know what they are looking for from me in 2010. The response was swift and sure. You very much want to be connected to the reverse mortgage world and our senior clients. You want guidance and to feel your efforts are being supported. You've come to the right place.

NATION STILL IN RECESSION WITH 85,000 JOBS LOST IN DECEMBER 2009

There's no way to put a positive spin on the new origination forecast unveiled by the Mortgage Bankers Association this morning. At $1.28 trillion, if the MBA's number becomes reality, it would be the industry's worst year since 2000 when just $1.067 trillion of mortgages were funded. The only rational positive spin that comes to mind is this: yes, loan volumes are expected to fall, but keep in mind that homes today are worth quite a bit less than the past few years -- and with falling home prices comes a lower dollar volume of originations. In other words, perhaps we should focus on the number of loans originated, not the dollar volume. If mortgage rates stay steady, or even rise a bit, servicing rights will increase in value. For that story see this week's front page story of National Mortgage News...