Originations

Total Mortgage Protection, West Palm Beach, Fla., has announced the formation of an exclusive referral marketing program directed at mortgage brokers and title companies.Called the Amplified Earnings System, the program offers a revenue split with mortgage brokers and title companies for referring Total Mortgage and its mortgage insurance products to new homeowners or clients after they have closed or refinanced an existing home. "This new program can increase the revenue per closing up to 25% for mortgage professionals," said Wayne Jenkins, president of Total Mortgage. The company can be found on the Web at http://www.totalmortgageprotection.com.

The Market Composite Index, an overall measure of mortgage applications, rose from 585.8 to 588.6 on a seasonally adjusted basis during the week ended Oct. 20, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey.On an unadjusted basis, applications increased 0.5% on the week but were down 13.0% from the level recorded a year earlier. The Purchase Index fell from 384.7 to 382.4 on a seasonally adjusted basis, while the Refinance Index rose from 1758.2 to 1790.4. Refinancings represented 45.6% of total applications, up from 45.0% the previous week, while adjustable-rate mortgages accounted for 26.1%, the MBA said. The average contract interest rate for 30-year fixed-rate mortgages increased from 6.33% to 6.36%, and points (including the origination fee) fell from 1.15 to 1.04 for loans with 80% loan-to-value ratios, the association reported. The MBA can be found online at http://www.mortgagebankers.org.

The Mortgage Bankers Association has announced the leadership of its 2007 Commercial Real Estate/Multifamily Finance Board of Governors, which focuses on commercial/multifamily real estate finance policy issues and initiatives.The COMBOG officers are: Edward Padilla, chief executive officer of Minnesota-based NorthMarq Capital Inc., chair; Daryl J. Carter, CEO of CharterMac Mortgage Capital, vice chair; and Steven K. Graves, chief operating officer of Principal Real Estate Investors, vice chair. The MBA also announced the addition of four new members to the 30-member board: E.J. Burke, executive vice president and group head of KeyBank Real Estate Capital; Jan S. Sternin, senior vice president of Midland Loan Services Inc./PNC Real Estate Finance; Mark Talgo, senior managing director of New York Life Investment Management LLC; and Eric Von Berg, principal of Newmark Realty Capital Inc. The announcement was made at the 93rd Annual Mortgage Banking Association Convention & Expo in Chicago. The MBA can be found online at http://www.mortgagebankers.org.

Those counting on business from adjustable-rate mortgage loans refinancing in 2007 need to pay heed to the latest statistics cited by Mortgage Bankers Association chief economist Doug Duncan.The MBA is predicting $2.12 trillion in production in 2007, down from a projected $2.46 trillion for all of this year. Refinancings will fall from $1.07 trillion in 2006 to $807 billion next year. Mr. Duncan told attendees at the MBA annual convention in Chicago the best estimates indicate that between $1.1 trillion and $1.5 trillion of ARMs will reset in 2007. There are three possibilities for those loans: refinancing, going into default, or resetting. Mr. Duncan said he thinks just $600 billion to $700 billion will refinance (which is already accounted for in the MBA's projection, he added). As for defaults, Mr. Duncan said many of those ARMs have already reset at least once, and the biggest threat of default is on the first reset. The remaining $500 billion to $800 billion of ARMs will just reset, he said. The MBA can be found online at http://www.mortgagebankers.org.

Sales of existing homes fell 1.9% in September, the sixth straight monthly decline, while home prices fell for the second consecutive month.The National Association of Realtors reported that September sales of previously owned homes fell from a seasonally adjusted annual rate of 6.30 million in August to 6.18 million in September -- down 14.2% from the level recorded in September 2005. The NAR reported that sales of single-family homes fell 1.6% in September and condominium/cooperative sales fell 3.2%. The medium price of a single-family home is off 2.5% since September of last year, and condo/co-op prices are off 2.8% from a year ago. Meanwhile, the inventory of unsold homes was unchanged at a 7.3-month supply. However, the inventory of unsold single-family homes fell by 1.4% to a 7.1-month supply, while the inventory of condo/co-ops rose 2.4% to an 8.6-month supply. The NAR can be found online at http://www.realtor.org.

Reverse Mortgage of America, Seattle, has announced the introduction of a jumbo reverse mortgage product called The Independence Plan.Designed for owners of higher-value homes, the new product can provide a higher percentage of available home equity to borrowers, exceeding the federal loan limit on reverse mortgages, the company said. The Independence Plan functions similarly to the Federal Housing Administration's Home Equity Conversion Mortgage and Fannie Mae's HomeKeeper programs, but is funded by a third-party lender. The loan provides senior citizens with more available cash than any other plan, Reverse Mortgage of America said. "For example, a HECM would provide a typical 73-year-old couple with an appraised home value of $700,000 with $206,008 in available funds," the company said. "Using The Independence Plan, this same couple would not have to pay loan fees, netting $298,200 in available funds, a difference of $92,192." The company can be found on the Web at http://www.seattlemortgage.com.

Homebridge Mortgage Bankers, New York, has announced that the company is changing its name to Refinance.com and launching a national home refinance website portal.The new website will offer easy-to-use refinancing tools and calculators, and the new name will better reflect Homebridge's corporate vision by focusing exclusively on home refinance, the company said. "With this new name comes improved service," said Nicholas Bratsafolis, chairman and chief executive officer of Refinance.com. The new website will enable interested borrowers "to 'try on' different loan products to determine which one best fits their needs," he said. The company can be found online at http://www.refinance.com.

Countrywide Financial Corp., Calabasas, Calif., has reported net income of $648 million in the third quarter, up from $634 million a year earlier.Countrywide's diluted earnings per share were flat at $1.03, the same as in the third quarter of 2005. But the company pointed out that EPS through the first nine months of 2006 reached a record of $3.29, up 7% from the same period last year. Countrywide chief executive Angelo Mozilo said that a "transitional market" put pressure on the company's mortgage earnings, which declined 40% from the level recorded a year earlier. Falling interest rates depressed loan servicing performance, and loan production earnings also declined. Moreover, Mr. Mozilo said the home loan industry continues to face challenges, saying Countrywide expects that "margins will remain under pressure and that pricing will remain competitive" in the fourth quarter. Countrywide can be found online at http://www.countrywide.com.

Government Properties Trust Inc., a real estate investment trust based in Omaha, Neb., has announced a merger agreement with Record Realty Trust, an Australian listed property trust.Under the agreement, a subsidiary of Record Realty will acquire GPT for $10.75 per common share in cash, subject to a possible reduction by an amount not to exceed $0.08 per common share based on certain contingencies, the companies reported. GPT invests chiefly in single-tenant properties under long-term leases to the U.S. government. Record Realty is an investor in structured real estate, managed by Record Funds Management Ltd., a subsidiary of Allco Finance Group. The U.S. operations of the merged business will be based in Omaha. GPT can be found on the Web at http://www.gptrust.com.

Developers Diversified, a Cleveland-based retail real estate investment trust, is acquiring Inland Retail Real Estate Trust, a nonlisted REIT, for a total price of about $6.2 billion.DDR is paying $14 per Inland share, and could pay up to $4 of this in DDR shares, the REIT said. DDR is also assuming about $2.3 billion of Inland debt, a significant part of which is to be paid off when the deal closes. Inland's portfolio totals 307 shopping centers, comprising 43.6 million square feet of leasable area, with over 70% of the portfolio located in Southeastern states. DDR has a joint venture agreement with a "major U.S. institutional investor" that will acquire 67 of the Inland properties for about $3 billion, the REIT reported. In addition, the REIT has received financing commitments of over $3 billion that could be used to fund the transaction. Scott A. Wolstein, DDR's chairman and chief executive officer, noted that the transaction gives DDR "control of some of the highest quality, market-dominant community centers in the Southeast."

Fiserv Inc. has announced the acquisition of an equity interest in Urban Settlement Services LLC, a Pittsburgh-based vendor management company that provides title search, real estate appraisal, and closing products and services to the home mortgage industry.Details of the transaction were not disclosed. Urban Settlement is the only national minority-owned settlement services company currently certified by the National Minority Supplier Development Council. Urban Settlement serves major financial institutions such as Citizen's Bank, Bank of America, PNC Bank, and Wachovia Bank. The company is owned by Charles Sanders, who also serves as its president. Fiserv said its investment will enable Urban Settlement to expand its business portfolio among current clients and new institutions. Urban Settlement may serve as an outlet for other Fiserv lending products, while gaining the efficiencies of a much larger organization. The companies can be found online at http://www.fiserv.com and http://www.urbansettlement.com.

Stuart J. Boesky, former chief executive officer of New York-based CharterMac, has announced the formation -- in conjunction with Mariner Investment Group -- of Pembrook Capital Management, a real estate investment management company.The company's initial focus will be to provide capital to developers and owners of real estate nationally through the acquisition or origination of structured real estate debt (including commercial mortgage-backed securities) and preferred equity, Mr. Boesky said. The company said it also expects to provide "unique" capital solutions to owners and developers of underserved property sectors (such as affordable housing) and underserved geographic locations. The company can be found online at http://www.pembrookgroup.com.

The baby boom generation won't own second homes at a higher rate than their predecessors, but the cohort will own more vacation properties simply because of its sheer size, according to research released at the Mortgage Bankers Association's annual convention in Chicago."Baby boomers are not acting differently from their parents," said Doug Duncan, the MBA's chief economist. "However, the baby boom cohort is so large that even if they follow typical buying patterns, they will have significant impacts on many local housing markets." Sponsored jointly by the Research Institute for Housing in America and Radian, the private mortgage insurer, the study also found that senior suburbanites are just as likely to move to nonmetropolitan areas as to the city. The RIHA study is the second released this month having to do with baby boomers. The other, by the National Association of Realtors, found that boomers own other kinds of real estate in addition to a primary residence: 13% own land; 8% rental property; 7% a vacation home or seasonally occupied property; 2% commercial real estate; and 3% some other kind of real estate. The NAR also found that boomers are proportionately more active in the second-home market, owning 57% of all vacation/seasonal homes. The RIHA study found that 6.6 million homeowners age 50 or older already own second homes, but only a small percentage have mortgages. The MBA can be found online at http://www.mortgagebankers.org.

Mortgage applicants with little or no credit histories will be eligible for rock-bottom interest rates under a pilot program announced at the Mortgage Bankers Association Convention in Chicago.Combining alternative methods of credit reporting and scoring with extensive counseling before and after the closing, the program will enable Neighborhood Housing Services of America and its mortgage-lender partners to extend prime loans to buyers who otherwise would have been relegated to subprime rates, if they could have qualified at all. The effort is being underwritten by State Farm, which is creating a $100 million pool that will help some 5,000 homebuyers secure loans at competitive rates. Under the new "Prime-Grade Mortgage Program," NHSA will create a secondary market for loans underwritten with First American's "Anthem" alternative credit reporting and scoring products, which combine supplemental information such as utility bill payments and rental receipts with credit bureau data to build a more complete picture of an applicant's creditworthiness. "By demonstrating these consumers are not higher risk, and by providing lenders with a secondary market to sell loans post-close, our Prime-Grade Mortgage Program directly addresses the challenge faced by an estimated 50 million consumers currently locked out of appropriate mortgage financing by traditional lending standards," said Mary Lee Widener, president of NHSA.

Fannie Mae and Freddie Mac intend to win back some of the market share they have ceded to private-label conduits while laboring through their respective accounting scandals.A large part of how well the two government-sponsored enterprises will be able to duke it out with totally private entities remains to be seen, as lawmakers continue to argue whether the agencies need a new regulator and under what kind of rules they will have to operate. But whatever happens on Capitol Hill, Freddie Mac chairman Richard Syron told the Mortgage Bankers Association's annual convention in Chicago that his company is "determined to be as competitive as it can be." Mr. Syron said that for the last several years, both Fannie Mae and Freddie Mac have "been in the penalty box" and have been playing mostly defense. Private-label issuers now control an estimated 55%-60% of the mortgage-backed securities market. Fannie Mae chairman Daniel Mudd conceded that his company hasn't been innovative enough, especially while it has been dealing with its accounting irregularities. The company has also been too slow and bureaucratic, he said. But while Fannie has "been working to get our house in order," the company has also been "rethinking a lot of things, including how we do business," Mr. Mudd said. Both executives maintained that their respective companies were designed for the turbulent and changing market that lies ahead.

Zacks Equity Research, Chicago, has initiated coverage of Thornburg Mortgage with a Hold rating.Zacks said Thornburg had a "mediocre" quarter, citing "intense competition and a still-flat yield curve" that have suppressed margins. Conditions will "continue to worsen" over the next six months, and Thornburg "will have difficulty covering the dividend" next year, Zacks predicted. "On the other hand, originations in the third quarter were robust, and the company is on target to exceed last year's origination volume by 10%," the research firm said. "In addition, the company's [adjustable-rate mortgage] portfolio has an excellent credit profile, where default risk is minimal." Zacks can be found online at http://www.zacks.com.

Experian Group Ltd., Costa Mesa, Calif., has brought its Hunter fraud detection product to the United States, the company announced at the Mortgage Bankers Association annual convention in Chicago.The product has been available in the United Kingdom for the past 10 years. It was originally developed to combat mortgage fraud, but has expanded to other credit applications as well, KC Akerman, senior product manager of Experian Fraud Solutions, told MortgageWire. It has not been introduced in the United States until now because Experian redesigned it from a client-based application, and it is now available as a hosted application. Its primary use is to catch application fraud in the prefunding stage by looking for red flags using a customized rules engine. It can use both shared and third-party data that the user has access to, Ms. Akerman said. In the U.K., she noted, users of Hunter share data findings with each other as part of their fraud prevention efforts.

The new chairman of the Mortgage Bankers Association is calling for an "industrywide commitment to personal responsibility."Taking over the reins of the MBA at the group's annual convention in Chicago, John Robbins said the "industry must take a leadership role so our customers receive the best information possible, allowing them to make an educated decision on the mortgage program they have selected." If the business chooses to abdicate that responsibility, Mr. Robbins warned in opening the three-day conference, "then we deserve to be subjected to the unending stream of punitive legislation and regulation [that's] sure to follow." The chairman of American Mortgage Network, San Diego, said lenders should have the borrower's best interest at heart, not their own. The "simple litmus test" should be to "always make sure borrowers have what they need to make the right choice," he said. Unlike those who blame the news media for the black eye lenders have received from news stories about predatory lenders, the new MBA leader said the real culprits are those who wrote the loans. "They obviously put their personal compensation ahead of their borrowers' well being," he told the convention. Mr. Robbins also said the MBA could lose its well-earned credibility with news organizations, lawmakers, and regulators if its members don't hold themselves to a higher standard. There should be laws to punish the "few bad apples ... that will always exist in any group, no matter the profession." he said. The MBA can be found online at http://www.mortgagebankers.org.

Angelo R. Mozilo, chairman and chief executive officer of Countrywide Financial Corp., has agreed to continue as chairman and CEO through the end of 2009, the company has announced.The terms of the new contract were not disclosed. Stanford L. Kurland, who was once considered a possible heir to Mr. Mozilo as CEO, resigned from the company recently as president and chief operating officer and was replaced by David Sambol, a 21-year veteran of Countrywide. Mr. Mozilo had indicated that he planned to stay on as chairman, but it was unclear whether he would remain as CEO beyond the end of this year. The company can be found online at http://www.countrywide.com.

Gladstone Commercial Corp., a real estate investment trust based in McLean, Va., has announced the pricing of 1.0 million shares of 7.50% cumulative redeemable preferred stock at a $25 liquidation preference per share.The industrial and commercial REIT said the underwriters of the series B preferred stock have been granted an option to buy up to 150,000 additional shares to cover any overallotments. Ferris, Baker Watts Inc. was the sole book-running manager and co-lead manager of the offering, and Robert W. Baird & Co. was the other co-lead manager. The REIT can be found on the Web at http://www.gladstonecommercial.com.