Who in their right mind would start a new mortgage insurance company in today's financial atmosphere? Mark Casale, that's who. Mark is the former head of Radian's MI business. Word is that he has capital commitments of $500 million for his new venture. Former MI executive Trez Moore is an advisor and former FHLB regulator Bruce Morrison has done some lobbying work on Mr. Casale's behalf. Some MI executives tell me now is actually a great time to start an MI. For the full story, which you can't get anywhere else, read the Monday edition of National Mortgage News. Don't subscribe? Call 800-221-1809...
Let's face it, Americans love a bargain. "Buy low and sell high" is in the U.S. Constitution. (OK, it's not, but maybe it should be). Remember the Federal Home Loan Bank Board's "Southwest Plan" where in 1988 the government auctioned off hundreds of failed thrifts to investors by giving them "income capital certificates" and allowing them to write off past losses going forward? Ah, those were the days. Now, we have the Federal Deposit Insurance Corp.'s "legacy" loan program where that agency plans to sell thousands upon thousands of mostly under performing and troubled loans. On Thursday the agency held a conference call (press not invited) to pick the brains of potential buyers, sellers and others. Sheila "I'm the new Bill Seidman" Bair was there as was John Bovenzi. One source close to the FDIC said the agency is looking at building at least four websites through which it will auction loans. At least one website will be for loans held by failed banks/thrifts. Our source also noted that right now in the market place, when it comes to selling troubled mortgages, there is a "wide disparity" between the bid and ask price. But Ms. Bair if you're reading this (and I'm sure you're not) keep in mind that investors in crummy loans want to make money - and that means loans will have to be priced accordingly. You can open a nice little store with beautiful furniture and well-groomed sales executives but if the prices are too high the customer will walk. Meanwhile, MWOB (minority and women owned business) contractors are salivating at all the money they can earn working for Uncle Sam on this disaster...
Are loan brokers toast? I asked that question a few weeks back. NMN's Brian Collins reports that this week the House Financial Services Committee will mark up a mortgage reform bill that bans certain types of yield-spread premium payments and requires lenders to retain 5% of the credit risk on subprime loans that are sold to investors. Marc Savitt, president of the National Association of Mortgage Brokers, told National Mortgage News that he is OK with the language in the bill, noting that "this doesn't ban yield-spread premiums outright" and instead "prevents people from making a couple of extra points" by putting consumers in higher cost loans. For the full story visit
We're starting to hear whispers that some regional banks might step up to the plate on warehouse lending - but not necessarily in a major way. One warehouse executive told us that Branch Banking & Trust is looking at making direct lines of credit to non-banks. He noted that "regional banks are dipping their toe in it but they're only taking on a $10 million to $15 million exposure." The wild card for the sector is whether Wells Fargo will ramp up the warehouse business of Wachovia Corp., which it bought a few months back...
DATA STUFF: Need a list of delinquencies ranked by servicer? What about top jumbo lenders and alt-A servicers? See the new Quarterly Data Report. To order e-mail
MEDIA STUFF: Both The New Yorker and Vanity Fair are working on stories about the mortgage crisis and Angelo Mozilo. So, we are told. So far, at least two books have been written about Countrywide...
INTERNATIONAL AFFAIRS: Ah, China. Zhou Xiaochuan is the governor of the $2-trillion-asset People's Bank of China, the central bank of that fast growing nation. According to Forbes, this past week Mr. Xiaochuan said he wants to break the dollar's hegemony in global finance. In a paper grandly called "Reform the International Monetary System," Zhou has called for the creation of an international currency unit that he admits will require "extraordinary political vision and courage." He suggests that we start with a blend of the dollar, pound, yen and euro. Zhou's remarks come only days after Premier Wen Jiabao demanded U.S. action to safeguard China's holdings of U.S. bonds - some $740 billion of Treasuries and $600 billion of other debt. "We have lent huge amounts of money to the U.S. and we are concerned about the safety of our assets," said Wen. That's nice. They can stop buying our Treasuries and we will stop buying all that stuff from their factories. Case closed...
THE MAIN EVENT: Next Friday, the government releases the unemployment figures for March. This should be interesting. As I've pointed out before, many of those unemployed workers have mortgages. Meanwhile, more states logged double-digit unemployment rates in February, with North Carolina and Rhode Island seeing their rates hit record highs. Seven states now have unemployment rates that topped 10% last month. In January there were four...
SCOTT GETS BEAMED UP: The nation's top thrift supervisor Scott Polakoff has been placed on leave while the Treasury Department inspector general completes a review of several cases where the Office of Thrift Supervision back-dated capital infusions so the institutions could retain their "well capitalized" classification. (Sorry, this editor could not resist the headline temptation. It's been another long week.)
UH OH DEPARTMENT: In a recent column CNBC's Jim Cramer turned bullish on housing saying, "You are looking at what might be the single greatest moment to buy a home in the last 10 years." The theory on Cramer's picks is this: whatever he says, the opposite comes true. If Cramer thinks housing is turning around that means it's headed for a steeper fall. Sorry, folks...
MORTGAGE PEOPLE: Industry veteran Tom Donatacci has left Residential Capital Corp and joined the Clayton Group. At ResCap/GMAC Mr. Donatacci was the go-to guy on subservicing matters.
SURVEY NOTICE: Responses are pouring in for the annual National Mortgage News/American Banker residential lending and servicing survey ritual. Results will wind up in the eMortgage Industry Directory as well as the two newspapers. There is still time to give us your numbers. If you're a mortgage lender/servicer send an email to
MUST ATTEND CONFERENCE: National Mortgage News/SourceMedia's third annual servicing conference is gaining a lot of sign-ups. The show will be held April 6 and 7 at the Marriott Dallas/Fort Worth. Larry Litton of Litton Mortgage and many others are speaking. Topics include REO, loss mitigation and much more. For more information call: 800-803-3424.
DATA NOTICE: The Mortgage Industry Directory is still available as well as the online version of the book, the eMID. If you need rankings on the top 400 lenders and servicers, loan brokers and much more this could be your product. Order the MID and receive a free Quarterly Data Report, too. The MID/eMID also provides executive names and telephone numbers, mailing addresses, delinquency info - and news updates (the eMID only). Buy the book and receive a free Quarterly Data Report. For more information e-mail
