Remember that 1972 movie “The Poseidon Adventure” when the cruise liner flips over in the ocean and is turned completely upside down in the water and the only way out is to hike north to the hull? (Then again, what do you do when you get to the hull? Pray?) The way I see it, the Gene Hackman character is a loan broker/loan officer. He has a firm belief that he’s right, even though the odds are insurmountable. But don’t misread what I’m saying. I don’t, for a second, believe all brokers are innocents in the housing bubble. They helped cause it, sure, but as I’ve said here many times before (and in that book), the true culprits were the subprime wholesalers who created the loan menus, and the Wall Street firms like Lehman Brothers, Bear Stearns and Merrill Lynch that securitized that crap without truly underwriting what they were buying—or caring. It was all about the money—and rationalizing one’s behavior. Let’s not kid ourselves. The loan brokers left today are probably (the operative word here is probably) the “cream of the crop” and offer a valuable service to homebuyers. And thanks to this past week’s court ruling, brokers may have one toe in the grave, but I don’t think they’re down for the count. My problem with the Federal Reserve rule on LO compensation is that it gives too big of an advantage to the megabanks, and no wiggle room to brokers. Though, based on the executives and brokers I interviewed this past week, the real winners might be sole proprietor brokerage shops and well capitalized nonbank lenders. For the full analysis read the Monday paper edition of National Mortgage News. Don’t subscribe? Call 800-221-1809…
One last thing: Mortgage banking/brokerage veteran Chris Sorensen on the LO comp rule: “This isn't as bad as people think. Once the whining and crying is over, brokers will pick their comp rate and start competing with the big boys”…
THE BEST OF ALL OUTCOMES FROM A GOVERNMENT SHUTDOWN: A member of Nancy Pelosi or Rand Paul’s staff goes house hunting this weekend. They find a nice little home they can afford but when they go to sign a contract they realize they’re unemployed and the FHA loan they were hoping to use is no longer available because Uncle Sam is closed for business. In case you’re wondering, here’s how to solve the budget mess: cut spending and raise taxes—just do it in a way that doesn’t bankrupt the nation and alienate most of our citizens…
MORTGAGE RELATED ENTITIES THAT ARE HIRING: The new Consumer Financial Protection Bureau is looking for bank examiners. (The go-to guy at the CFPB is Steven Antonakes, assistant director for large bank supervision there.) Union Bank of San Francisco is hiring a few retail LOs, and TMS Funding of Milford, Conn., is looking for veteran account executives. (Give Lisa Schreiber a call.) Of course, as reported on the NMN website this past week, Wells Fargo & Co. confirmed that it is trimming 1,900 mortgage-related workers from their payroll…
SOMETHING TO THINK ABOUT: If it weren’t for the budget crisis and $112 a barrel oil consumers might actually be out house hunting this weekend.
A DATA THOUGHT: With residential loan volumes becoming a challenge this year, you need to know which firms are on top and thriving. Get a leg up on the competition by checking out NMN's Quarterly Data Report, an Excel spreadsheet and database product that tracks the top 100 every quarter without fail. To view a sample or order the QDR send an e-mail to
MORTGAGE PEOPLE: Industry veteran Tom Wind has accepted a position with EverBank of Jacksonville, Fla. On Monday, CoreLogic will announce a major new hire. Here’s a hint: the person’s last name is a famous park somewhere in the world. (That should narrow it down.)
WASHINGTON NEWS: Who says socialism doesn’t work? Check this out: Not only is business booming over at the FHA, but HUD secretary Shaun Donovan told Congress this week that the government insurance fund could earn $10 billion on new loan guarantees in fiscal 2011, which ends Sept. 30. The most Fannie Mae or Freddie Mac ever earned was $5 billion a year. (Reporting by NMN's Brian Collins.)
TECHNOLOGY STUFF: Congrats to vendor
KEY CONFERENCE YOU NEED TO ATTEND: On June 16-17 SourceMedia will hold its annual Distressed Assets Conference in the Big Apple. Upcoming: SM’s 3rd Annual Best Practices in Loss Mitigation Conference. That show is in Dallas. SourceMedia is the publisher of NMN, Origination News, Servicing News, Credit Union Journal, American Banker and other assorted financial publications.
CALLING ALL LOAN OFFICERS: We want to know how you did in 2010 and your outlook for this year. NMN's new LO survey can be found at http://originationnews.com/losurvey.
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THE LAST WORD: Time to short gold?
