Originations

Intellidyn, a consumer analytics and database marketing company based in Bethpage, N.Y., has unveiled a set of prospect lists tailored for the home mortgage industry."These lists are being made available after years of testing and validation," said Peter Harvey, president and chief executive officer of Intellidyn. "Our model is to deliver the highest performing prospect lists by 'skimming the cream' from the widest scope of 'bench tested' data sources." The source of the data is Intelli-Base, Intellidyn's proprietary database of "the most atomic-level storehouse of consumer data in the United States," Intellidyn said. The company can be found on the Web at http://www.intellidyn.com.

African-Americans were more than twice as likely to be denied a conventional mortgage loan than white borrowers in 2002, and Latinos were rejected more than one-and-a-half times as often, according to a study released by ACORN.The study, which analyzed data on a national scale and in 115 metropolitan areas, also found that racial disparities remain even when controlling for income. ACORN, an association of community groups, said upper-income African Americans are more likely to be rejected for conventional purchase loans than white applicants whose incomes are less than half as large. African-Americans constitute 13% of the population, but received just 5.1% of conventional purchase loans (up slightly from 2001), while Latinos make up 12.5% of the population, and received 8.5% of purchase loans, up 13.3% from 2001, according to the study. To decrease the lending disparities found in the report, ACORN said it recommends changes to the Fair Credit Reporting Act that are under consideration by Congress.

The Financial Institutions Group of InterFirst Wholesale Mortgage Lending, Ann Arbor, Mich., has announced the recent introduction of Select Queue, a private-label call center.Select Queue consists of "highly trained mortgage consultants in a call center environment" that act as customer service representatives on behalf of InterFirstlink's financial institutions, the company said. This enables participants to expand their mortgage origination capabilities without increasing overhead, InterFirst said. "Smaller community banks may not have the resources to manage a full-scale mortgage call-center operation," said Michael Griffith, group manager of InterFirstlink and senior vice president of ABN Amro Mortgage Group, InterFirst's parent company. "InterFirstlink provides all of the tools necessary for financial institutions to offer mortgages in their local markets."

Fannie Mae reported net income of nearly $2.7 billion in the third quarter, up 168% from that of the same period last year.Diluted earnings per share were up 175% to $2.69. However, Fannie Mae prefers to measure its "core operating earnings," which differ from the net income measure prescribed under generally accepted accounting principles. Core earnings were up 12% to $1.8 billion, or $1.83 per share. Net interest income totaled $3.5 billion, up 34.7%, and guaranty fee income totaled $613 million, up 32.6%, Fannie Mae reported. By contrast, credit-related expenses more than doubled to $28.6 million, and the government-sponsored enterprise reported losses of $902 million from the call and repurchase of debt, compared with $138 million in the third quarter of 2002. Chairman and chief executive officer Franklin Raines touted the results. "In a quarter marked by historic levels of volatility in the fixed-income markets, our company continued to benefit from the disciplined strategies for growth that have resulted in consistently strong financial performance through a wide range of economic and financial environments," he said. Fannie Mae can be found online at http://www.fanniemae.com.

The average 30-year fixed mortgage rate rose to 6.05% for the week ending Oct. 17 from 5.95% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from 5.26% to 5.36%, and the average rate for one-year Treasury-indexed adjustable-rate mortgages climbed from 3.69% to 3.79%. Fees and points averaged 0.5 points for fixed-rate mortgages and 0.6 points for ARMs. "Bond yields have been creeping up on an almost daily basis since the beginning of October, pushing mortgage rates up as they go," said Frank Nothaft, Freddie Mac's chief economist. "Inflation remains low, however, and we expect that to continue into 2004 and beyond. And as long as it does, we won't see mortgage rates rising very dramatically." A year ago, the average 30-year and 15-year fixed rates were 6.15% and 5.56%, respectively, and the average one-year ARM rate was 4.27%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

Home Properties of New York Inc., Rochester, N.Y., has changed its name to Home Properties Inc. and announced that its stock will begin trading under the new name (but with the same ticker symbol, HME) on Oct. 17.The real estate investment trust said the new name reflects the company's geographic growth since its initial public offering in 1994. At that time, the REIT owned nearly 4,000 apartment units, of which 85% were located in upstate New York. Today less than 25% of its more than 41,000 units are located in New York. Most are in the suburbs around Boston, Philadelphia, Baltimore, Washington, Detroit, and Chicago and in northern New Jersey, the REIT said. The company can be found on the Web at http://www.homeproperties.com.

Six classes of TrizecHahn Office Properties Trust commercial mortgage pass-through certificates, series 2001-TZH, have been downgraded by Moody's Investors Service.The downgrades were as follows: class C-3, from A2 to A3; class C-4, from A2 to A3; class D-3, from Baa2 to Baa3; class D-4, from Baa2 to Baa3; class E-3, from Baa3 to Ba1; and class E-4, from Baa3 to Ba1. In addition, Moody's affirmed or confirmed the ratings on nine other classes in the deal. The transaction consists of five cross-defaulted and cross-collateralized first-mortgage loans secured by 26 office properties. The portfolio experienced an occupancy decline from 95.0% at securitization to 84.9% as of June 30, 2003, Moody's said. The top geographic concentrations are in Houston, Atlanta, and Washington, D.C. "In the near term, Moody's does not expect to see significant improvement in the Houston or Atlanta markets, which together comprise approximately 52.1% of the pool," Moody's said. In addition, the poor credit of the pool's largest tenant, Continental Airlines, remains a concern, the rating agency said. Moody's can be found online at http://www.moodys.com.

First American Corp., Santa Ana, Calif., an information products provider, has announced a five-year initiative designed to help underserved Hispanic, African-American, Asian/Pacific Islander, and low- to moderate-income families become homeowners.In cooperation with The Greenlining Institute, a San Francisco based multi-ethnic coalition, FAC said it will provide underserved, nontraditional credit-score customers "a suite of alternative credit products" that so far have been available only for "grade A mortgage financing." The program will take effect in January 2004, initially in California, and later on it will be introduced nationally. FAC said it plans to serve as a catalyst to mortgage lenders, investors, Realtors, and homebuilders interested in affordable housing. Buyers will be offered bundled discount packages of title insurance and related closing services. Starting in January, FAC said it will also implement a "strategic corporate giving" plan that will facilitate the investment of at least 1% of FAC's annual pretax profit in housing finance for the underserved. (In 2002 FAC revenues totaled $4.7 billion.) First American can be found online at http://www.firstam.com.

Richard Eampietro has been named senior vice president and Western divisional manager of American Mortgage Network, a San Diego-based wholesale mortgage bank serving mortgage brokers.AmNet said he will be responsible for the division's loan production offices in Arizona, California, Colorado, Oregon, and Washington. Before joining AmNet, Mr. Eampietro was national production manager for RBC Mortgage. He was previously executive vice president and national production manager at First Nationwide Mortgage and a vice president of CitiMortgage. AmNet is the mortgage banking subsidiary of American Residential Investment Trust Inc., which can be found on the Web at http://www.amerreit.com.

The total loss on about 30,000 commercial mortgage-backed securities loans studied by Fitch Ratings is $305.7 million, the rating agency reports, with retail and hotel property-backed loans experiencing almost 79% of all losses in dollar terms.Fitch is forecasting a CMBS loan delinquency rate of 2% by year-end, and additional CMBS losses of $400 million. Retail loans had a loss severity of 46.6%, making up more than 48% of the total balance of all losses, but they account for only 29% of the CMBS loans studied. Mary O'Rourke, a senior director at Fitch, noted that the hotel sector is also seeing a "disproportionate share of losses," with hotel loans making up less than 10% of CMBS collateral, but contributing almost 30% to losses. The average loss severity for all sorts of loans -- the Fitch study also includes office, multifamily, and industrial properties -- is 33.3%. Liquidations of real-estate-owned properties resulted in the highest loss severities, while the approximately 40% of the loans with losses that were resolved by discounted payoffs resulted in "much lower" average loss severities, the rating agency said.

The compliance law firm Kirkpatrick & Lockhart LLP recently advised its clients that certain home loans may be subject to the assignee liability provisions of New Jersey's predatory lending law, even if they are not so-called high-cost loans.In certain manufactured home loans and home improvement loans, the legislation provides for assignee liability for traditional as well as high-cost loans. "The Act applies to prime loans, with penalties and potential assignee liability well beyond what one normally would find in a traditional state mortgage banking law without anti-predatory overtones," said the law firm in an e-mail alert. It advised its clients to review their agreements with mortgage investors to ensure that they do not violate any of the act's provisions relating to representations and warranties.

The Market Composite Index, an overall measure of mortgage applications, dropped to 649.6 on a seasonally adjusted basis during the week ended Oct. 10 from 817.3 the week before, according to the Mortgage Bankers Association of America's Weekly Mortgage Applications Survey.On an unadjusted basis, applications were off 20.5% on the week, and down 50.1% from a year earlier. The Purchase Index decreased from 441.1 to 359.0 on a seasonally adjusted basis, while the Refinance Index slid from 3005.5 to 2340.1. Refinancings represented 53.9% of total applications, down from 55.0% the previous week, while adjustable-rate mortgages accounted for 25.2%. The average contract interest rate for 30-year fixed-rate mortgages rose slightly, from 5.79% to 5.81%, and points (including the origination fee) decreased from 1.56 to 1.49 for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mbaa.org.

Tommy Lee, the Boston-based investor who made a killing by selling HomeSide Lending, Jacksonville, Fla., is back in the mortgage business.Mr. Lee's TH Lee Putnam Ventures announced Oct. 15 that his private equity firm has made a "significant" investment in ResMAE, Brea, Calif., an upstart nonconforming lender founded by three former Long Beach Mortgage executives: Jack Mayesh, Ed Resendez, and Bill Komperda. (ResMAE stands for Residential Mortgage Assistance Enterprise.) So far, though, TH Lee isn't saying how much money it is putting into the new company. The investment comes at a curious time for mortgage lenders -- rates are on the rise and originations are slowing significantly, though many subprime executives think their volumes will not suffer as much as their conventional brethren's. With Lee's money, ResMAE could expand into a major competitor to Long Beach, which is now owned by Washington Mutual of Seattle. Mr. Lee's company also made a ton of money in the mid-1990s by purchasing a large stake in soft drink maker Snapple, watching those shares rise significantly and then selling before the price came back down to earth. (See the Oct. 20 issue of National Mortgage News for full details.)

Citing a downward trend in its credit statistics, Fitch Ratings has revised its rating outlook for Apartment Investment and Management Co. from Stable to Negative.However, Fitch affirmed its ratings on AIMCO's preferred stock and its $500 million bank credit facility. The rating agency said the coverage ratio of AIMCO's earnings before interest, taxes, depreciation, and amortization to its total interest expense has declined from 2.8 times as of Dec. 31, 2001, to 2.2 times for the current quarter (and below its historical average of 2.5 times). AIMCO's leverage rose to a high of 54.1% in the first quarter, and is now more than 200 basis points above its long-term average, Fitch said. AIMCO is an equity real estate investment trust based in Denver. Fitch can be found online at http://www.fitchratings.com.

The Homeownership Alliance of Nonprofit Downpayment Providers has invited mortgage bankers to attend its fall membership meeting, which is being held in conjunction with the annual convention of the Mortgage Bankers Association of America.In a recent letter, HAND chairman Joel S. Pate invited mortgage bankers to the Oct. 19 meeting at the San Diego Marriott Hotel & Marina to "begin a productive dialogue" about how to boost the U.S. homeownership rate. "Even as loan originations begin to trend downward, our members expect to generate a larger proportion of the total loan output," Mr. Pate said. "That is because our concept has created a new pool of buyers who previously were unable to acquire a home simply because they lacked the downpayment funds." HAND, which was formed about a year ago, requires members to offer homebuyer education and default management programs to their beneficiaries.

S. J. "Jay" Olander Jr. has been named president of Cornerstone Realty Income Trust, Richmond, Va., replacing Glade M. Knight, who will remain chairman and chief executive officer of the real estate investment trust.Mr. Olander, 49, is a member of the REIT's board of directors and previously served as executive vice president, chief financial officer, and president of capital markets, Cornerstone said. He will continue to serve as CFO. The REIT can be found online at http://www.cornerstonereit.com.

Prime Group Realty Trust, Chicago, has reported that Louis G. Conforti has been fired as co-president and chief financial officer for an alleged "failure to be fully devoted and committed" to the company's business goals.The real estate investment trust said Mr. Conforti's duties will be handled by Prime chairman Stephen J. Nardi and its other co-president, Jeffrey A. Patterson, until a replacement is named. The REIT can be found online at http://www.pgrt.com.

Bank of America Corp., Charlotte, N.C., has reported a tripling of mortgage banking income in the third quarter along with record earnings of $2.92 billion ($1.92 per share), an increase of more than 30% from $2.24 billion ($1.45 per share) a year earlier.Mortgage banking income totaled $666 million in the quarter, an increase of 203%, BoA said. Noninterest income increased 38% to $4.44 billion, driven by growth in mortgage banking, credit card, and investment banking income, as well as improvements in equity investments and increases in trading account profits, the company said. BoA can be found online at http://www.bankofamerica.com.

Housing affordability in California was down by five percentage points in August from the level recorded a year earlier, according to the California Association of Realtors.Housing affordability stood at 23% in August, down from 28% a year earlier and 26% in July, CAR said. The index indicates the percentage of households that can afford to buy a median-priced home in California, which cost $404,870 in August. The minimum household income needed to buy a median-priced home was $93,490, up from $82,150 a year earlier, CAR said. (The figures are based on a 30-year fixed-rate mortgage at a 5.66% interest rate, assuming a 20% downpayment.) CAR can be found on the Web at http://www.car.org.

New York-based iStar Financial has filed a shelf registration with the Securities and Exchange Commission that will allow the company to issue securities up to a $1 billion limit after it becomes effective.The line could be used to issue various security types, including common stock, preferred stock, debt securities, depository shares, and warrants, the commercial real estate investment trust said. The issuance would be subject to market conditions and the company's needs. "We have maintained a $500 million shelf over the past several years, and are increasing our shelf to $1 billion, reflecting the growth of our company," said Catherine D. Rice, iStar's chief financial officer.