I had an interesting conversation on Friday with one key industry player in the risk retention debate. Without giving away any hints on his identity, he relayed this scenario, which I paraphrase for you: FDIC chairman Sheila Bair, a big booster of RR, leaves next month and exits the debate permanently. By August or so legislation is introduced that amends the Dodd-Frank bill and gets rid of the whole concept of risk retention, qualified residential mortgage and its cousin qualified mortgage. In other words this colossal industry headache goes away and mortgage bankers are happy and hopefully consumers will be, too. As for the regulators, I’m sure they have plenty of other issues on their plates. From what we are told, of the six agencies involved in the RR/QRM debate, few of them see eye to eye…
As for Bair, the mortgage insurance industry is none too sorry to see her leave. Some MI officials have been griping to me for months that she doesn’t seem to recognize (at all) MI coverage. The irony of this whole matter is that the MI industry introduced the concept of a QRM into the risk retention debate. They just assumed that politicians and regulators would recognize MI coverage. But somewhere along the line the MI industry was shown the door. Funny, how those things work in Washington…
IN CASE YOU MISSED IT: Mortgages funded through the broker/wholesale channel fell to 6.9% in the first quarter, the lowest reading ever recorded by National Mortgage News and its affiliate, the Quarterly Data Report. Last quarter the share was almost 11%. Three years ago it was 30%. The complete analysis is in the Monday paper edition of NMN. If you don’t subscribe call 800-221-1809. If you’re looking for a ranking of the nation’s wholesale and correspondent funders drop an e-mail to
PennyMac has a new correspondent chief and his name is Doug Jones. He comes to the firm from Bank of America. One source who knows Jones informed us that his neighbor is the actor Will Smith. Folks, you don’t get that kind of intelligence from free periodicals. Of course, this column is free…
A STRANGE TALE CALLED ARCH BAY: Arch Bay was for sale, but currently is not. Confused? Let me back up for a minute. On Monday I had a short conversation with the general counsel of the nonperforming loan investor, Gene Clark. He said, “We’re not being sold.” His comment was in response to an earlier story on our website that said an offering book on the company “is” making the rounds. I asked Clark if an offering book had been issued on the firm. His response: no comment. That’s all he would say. I had at least two solid sources on the story and then a third came forward to tell me that yes, Arch Bay’s owners, were in fact peddling the firm—up until recently. So here’s the update: NPL investor Arch Bay was for sale, but currently is not. For the complete story see the Monday edition of NMN. There’s a story about Arch Bay, Kondaur and G8 Capital…
THE BIG PICTURE AND MACRO ECONOMICS: Let’s see if I can help steer you through all the muddy economic indicators out there. The stock market sold off Friday afternoon, falling by 170 points at its worst, and dipping below 12,000 for the first time since March. If an investor sells stocks he receives cash and he either sits on that cash or (I assume) or puts it in a “safe” short-term asset like a government bond (our government). It would appear that many investors believe the heady days of the stock market are over which means more sales and more cash. Companies are sitting on $2 trillion in cash and they’re not putting it to work investing much of that, or so we’re told. That means rates will stay low. At some point investors will buy real estate because at least with a house or apartment building you can rent the darn thing out and generate cash flow. Am I missing something?
OTHER MORTGAGE COLUMNISTS: In the past I’ve mentioned in this column mortgage consultant Joe Garrett who also writes an interesting blog that covers mortgages, baseball and Hollywood (depending on what day of the week he’s writing). But Joe has failed to tell you that there’s a great new CD out about baseball by a band called The Baseball Project. The LP boasts an amusing rocker about the Twins with a chorus that boasts, “Don’t call them Twinkies”…
MORTGAGE PEOPLE: Freddie Mac named former GMAC executive Tony Renzi EVP of a new division called Single-Family and Operations and Technology. Texas Mortgage lender Caliber Funding LLC hired Brian Simon as its CEO. He joins the firm from Freedom Mortgage, Stan Middleman’s shop.
DATA NOTICE: If you’re looking for a full year ranking of all the top-ranked correspondent loan buyers and wholesaler funders (and more) that information is in the new Annual Data Report, which is published by National Mortgage News. The ADR, an Excel spreadsheet, also includes the nation’s top 100 retailers, servicers and much more. If you need telephone numbers and contact names that information can be found in the new edition of MortgageStats.com. For more on the ADR and M-Stats drop an e-mail to
KEY CONFERENCE YOU NEED TO ATTEND: Yes you can still go! On June 16-17 SourceMedia will hold its annual Distressed Assets Conference in the Big Apple. Upcoming: SM’s Third Annual Best Practices in Loss Mitigation Conference. That show is in Dallas. SourceMedia is the publisher of NMN, Origination News, Mortgage Servicing News, Credit Union Journal, U.S. Banker, American Banker and other financial publications.
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THE LAST WORD: What’s going on with Aurora Loan Services these days? Drop me a line at
