Loan Think

The mortgage industry’s economic challenges demand that we produce more from less. As a result, industry participants need to embrace new ideas, different approaches, and innovative technology and execute new strategies to be successful in today’s new lending landscape. Let’s face it; the mortgage industry that we have known for the last 5-10 years has changed forever, but has your company changed with it?

Who says loan brokers are toast? While mega bank after mega bank exits the wholesale arena, BankTennessee of Collierville is jumping in. The bank recently hired industry veterans Jim House and Hugh Edwards to lead the effort. But don't expect any huge volumes from the bank quite yet. A spokeswoman for BT told us that so far the depository only has two "approved" brokers. The bank has traditionally been a retail only shop…

The Broker section in the May issue of Origination News has a feature article on balancing your life and your work. But if you are the owner of the business, you have the responsibility for teaching and implementing a wellness program for your staff as well.

Bank of America is fighting back. Well, sort of. Now that Wells Fargo & Co. is winning the residential loan production war, BoA has come up with a plan to offer upfront guaranteed closing costs via its 6,100 bank branches. Yes, but will the plan catch fire with consumers and will it ever be extended to third-party loan brokers working for BoA? At press time BoA was holding a press conference on its "Clarity Commitment" marketing effort. For an update see National Mortgage News Online later today. Meanwhile, former Resolution Trust Corp. chief Stanley Tate has reportedly raised $1 billion to bid on mortgage assets through the Treasury's PPIP program. For all you youngsters out there the RTC was the S&L bailout agency that was in operation two decades ago...

I had such a great response to my article over the past few weeks, I'm going to stop writing it now because I picked up 100 new originators and that's enough response right? Yeah, right.

Paul Muolo is out of the office. We're running this story in place of his usual column.Fixing 'Too Big to Fail' For Mortgage ServicersIn case you missed one of the recent tabulations we published, let me tell you the industry's quiet little secret: the nation's top five servicers, as a group, control almost 67% of all outstanding mortgages in this nation. If that's not power, nothing is.

So, how's the jumbo and "super jumbo" market holding up these days? Here's some intelligence from one industry veteran: "In many long time expensive housing markets like Palm Beach, Beverly Hills and Greenwich (Conn.), values are off as much as 50% from their highs, and are still in a free fall as a direct result of no liquidity for this sector of the housing market." He notes that banks are no longer friendly to non-resident aliens, and that foreign buyers "better have all cash." He cautions that "As long as rates remain low we may avoid anarchy in the streets of the super jumbo housing market. If rates move up, all of the pay options and hybrid ARMs are going to explode." In case you're wondering some of the biggest POA holders include: Wells Fargo, which inherited Wachovia's portfolio, which orginally came from Herb and Marion Sandler's World Savings. It also means JPMorgan Chase should worry about Washington Mutual's portfolio, and Bank of America needs to think carefully about Countrywide's POAs…

Tired of being seen as a "head of lettuce"? Tired of only being shopped for rates and points? The reality is that no one will ever have the best rates and points. The issue is that we set ourselves up to be seen as a commodity, or a "head of lettuce." The only way a buyer can make a buying decision is by comparing price.

A lot is being made of the financial incentives that the Obama Administration is passing on to servicers and borrowers for successfully modifying problem loans. Some have said in the past that if investors that accept e-mortgages had taken these same steps — offer lenders a financial incentive to deliver a full electronic mortgage — lenders would have adopted much faster. I’m not so sure myself. Lenders are slow to adopt anything.

So, what was the mood at the Mortgage Bankers Association's secondary marketing conference in Chicago? It all depends on who you talk to. One of our editors said lenders were trying to be optimistic but (obviously) acknowledged the huge challenges that lie ahead, including the warehouse funding crisis and delinquencies. One analyst sent out a message to his clients, noting that every lender he spoke with "is at or near record levels of production. They are originating conforming and government products with the best underwriting standards in years and with the biggest profit margins in years. There was plenty of reflection that this is how 'the business used to be.'" As far as mortgage employment is concerned, every lender that this analyst talked to is looking to hire "good" underwriters…