Originations

Wells Fargo Home Mortgage, Inc. and Paramount Construction, Inc., have formed a strategic relationship that allows the latter company to offer its customers home financing products and services through the former.Customers of Paramount will receive a $500 gift certificate to Lowe's Home Improvement when they finance their new home construction or home-improvement projects via WFHM. Additionally, Paramount customers will be offered free educational seminars about financing home improvements, selecting a contractor, and avoiding home improvement pitfalls. Wells Fargo can be found on the Web at http://www.wellsfargo.com.

New York City Mayor Michael Bloomberg has obtained a temporary restraining order preventing the city's anti-predatory lending ordinance from taking effect as scheduled on Feb. 24th.A spokesman for the Mayor said the law, which bars the city from doing business with financial institutions that meet its definition of predatory lender, could result in the city being shut out of the bond markets and put it into "financial chaos." The law was enacted when the City Council overrode the Mayor's veto. A statement from New York City ACORN president Gloria Waldron said "our elected representatives overrode the Mayor's veto, and yet he continues to impede the implementation of this law. Does he understand what democracy means?" The suit names the city council and the city comptroller as defendants. A call to city council speaker Gifford Miller's office was not returned by Mortgage Wire's deadline.

Mortgage applications climbed 5.5% on a seasonally adjusted basis for the week ended Feb. 21, according to the Mortgage Bankers Association of America's Weekly Mortgage Applications Survey.On an unadjusted basis, applications fell 4.5% on the week but were up 101.3% from the level recorded a year earlier. Due to the President's Day holiday, the seasonally adjusted indexes were adjusted to allow for a one-half day holiday effect. On a seasonally adjusted basis, the Purchase Index declined from 334.1 to 309.0, and the Refinance Index rose from 5438.1 to 5969.6. Refinancings represented 75.3% of total applications, up from 72.5% the previous week, while adjustable-rate mortgages accounted for 13.3%. The average contract interest rate for 30-year fixed-rate mortgages fell to a new record low of 5.65% from 5.69%, and points (including the origination fee) decreased from 1.61 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.

Standard & Poor's has reported that it will continue to rate structured finance transactions that include mortgage loans originated under the recently-passed New York City Local Law No. 36 (2002).According to S&P, the NYC law is designed to achieve this goal without imposing penalties on passive investors in mortgage-backed securities. Therefore, Standard & Poor's believes that the law does not create the kind of negative credit impact on MBS that led it to be cautious about rating transactions affected by a different anti-predatory law passed in Georgia. S&P can be found online at standardandpoors.com.

The Option One mortgage operations of H&R Block Inc., Kansas City, Mo., posted pre-tax earnings of $262.5 million for the company's third fiscal quarter.This is up from $77.4 million for the same three-month period ended Jan. 31, 2002. Excluding a gain from sale of residual assets the company made in November, pretax earnings were $131.6 million for the most recent period. Overall, loan originations for the quarter at the company's two units, Option One Mortgage Corp. and H&R Block Mortgage Corp. were $4.5 billion, up from $2.9 billion for the same period in 2002. Mark Ernst, chairman and chief executive of Block, said "originations in our retail mortgage operations were up 41% compared to last year, demonstrating the momentum that we are building in our effort to broaden and deepen our relationship with H&R Block tax clients. H&R Block tax clients generated 10.6% of all loans originated and 42.5% of all retail loans during the quarter."

Sales of existing homes jumped 3.04% in January from the previous month as the housing market continued to roar and set new records.The national median sale price of an existing home rose 6.7% in January to $160,400. According to sales data compiled by the National Association of Realtors, existing home sales climbed to an annualized, record setting pace of 6.09 million units in January compared to 5.91 million units in December and 5.96 million units in January of 2002. "Real estate is a safe haven for investors, for households," said NAR economist David Lereah. Mr. Lereah expects home sales to remain strong throughout the year. In terms of dollars and cents, existing homes sales have a value of $1.268 trillion. NAR believes that historically low interest rates, weak equities markets, and concern over a possible war in Iraq are all fueling the record home buying activity.

A survey conducted for LandAmerica Financial Group, Richmond, Va., found that 86% of homebuyers said they had "difficulty and confusion" during the process.Over one-third said they experienced delays in closing on their purchase. The survey, conducted by Ketchum Global Research Network, found that just under half of the respondents expressed concern about the process of establishing an escrow account, while 46% said the contract negotiation process raised questions, 42% were worried if the appraisal was conducted properly and 42% said they needed more information about purchasing title insurance. Jan Alpert, president of LandAmerica, said "clearly, though they are buying homes in record numbers, homebuyers are in need of education and guidance from their real estate advisors."

J. Grant Smith has been named senior vice president and chief financial officer of Clarkston State Bank, a Clarkston, Mich.-based bank that plans to enter the mortgage banking business.Mr. Smith, 35, has been vice president and CFO since joining Clarkston State Bank in 2001, the bank said. He was previously executive vice president and CFO at New Century Bancorp. Dawn M. Horner, president and chief executive officer of the bank, said Mr. Smith is "essential to our continued growth and success as we enter new areas such as mortgage banking and Internet banking." The bank can be found on the Web at http://www.clarkstonstatebank.com.

Two classes of DLJ Mortgage Acceptance Corp.'s commercial mortgage pass-through certificates, series 1997-CF1, have been downgraded by Standard & Poor's Ratings Services.The downgrades were as follows: class B-1, from BB-plus to B and placed on CreditWatch with negative implications; and class B-2, from CCC to D. S&P attributed the downgrades to interest shortfalls resulting from the disposition of a real-estate-owned lodging asset in Savannah, Ga. The $3 million loan on the property was liquidated at a 100% principal loss, S&P said. "Interest shortfalls resulted because the proceeds from the liquidation were not sufficient to cover outstanding advances against the asset, which totaled $2.36 million," the rating agency said.

To expand on its 10-year affordable housing partnership with the Neighborhood Reinvestment Corp. of Atlanta, Freddie Mac is offering a new five-year, $2 million grant, part of which will be used by the NRC Training Institute to research housing issues.During its first decade, the alliance's NeighborWorks Campaign for Home Ownership program has helped over 67,000 low- to moderate-income families become homeowners. The grant will be used to build new NeighborWorks branches, expand services offered by existing centers across the country, and to help more Section 8 renters qualify for the HUD Housing Choice Voucher program. Finally, Freddie will be a lead sponsor of the quarterly symposium on community development organized by the Training Institute. "Freddie Mac's support of the NeighborWorks network -- both through direct funding and creative flexible, affordable mortgage loan options -- is instrumental to the unprecedented success of the NeighborWorks Campaign for Home Ownership," said NRC executive director Ellen Lazar.

American Equity Mortgage, St. Louis, has introduced CreditRight, a new credit information service aimed at helping customers ensure the accuracy of their credit history.The company said serious credit errors can lower a credit score by 100 points or more, which could raise a homeowner's monthly payments by more than $200 on a $100,000 mortgage. "This new service provides a way to effectively understand, manage, protect, and correct your personal credit rating," said company chief executive officer Deanna Daughhetee Vinson. "CreditRight is available not only to our existing customers, but to anyone who needs assistance understanding or fixing their credit, or just wants to monitor it." The service also helps customers prevent identity theft, the company said. American Equity Mortgage can be found online at http://www.americaneqmtg.com, and information about the service can be found at http://www.mycreditright.com.

FNB Corp., Asheboro, N.C., has agreed to acquire Dover Mortgage Co., Charlotte, N.C., for an undisclosed amount.FNB, the holding company for First National Bank and Trust Co., said Dover ranks among the top mortgage originators in North Carolina, with over $300 million in loan volume in the past two years. It also has a correspondent program under which it buys mortgage loans from community banks, thrifts, and mortgage brokers. "Dover's extensive product line will expand the offerings for First National Bank and Trust, particularly in FHA and VA loans, and Dover's presence in dynamic markets gives our banking subsidiaries opportunities for geographic expansion as well," said Michael C. Miller, FNB's chairman and president. The companies can be found on the Web at http://www.fnbnc.com and http://www.dovermortgage.com.

Spencer Haber, president of New York-based iStar Financial, has been named president and a director of iStar Strategic Capital Inc., a wholly owned subsidiary of iStar Financial, effective March 31.In that capacity, Mr. Haber will be responsible for evaluating new business expansion and business development opportunities for iStar Financial, the company said. Upon becoming president of iStar Strategic, Mr. Haber will step down as president and director of iStar Financial. The parent company, which provides structured financing to private and corporate owners of real estate nationwide, can be found online at http://www.istarfinancial.com.

Mortgage applications declined 0.1% on a seasonally adjusted basis for the week ended Feb. 14, according to the Mortgage Bankers Association of America's Weekly Mortgage Applications Survey.On an unadjusted basis, applications were up 1.2% on the week and 100.5% from the level recorded a year earlier. On a seasonally adjusted basis, the Purchase Index climbed from 328.8 to 334.1, and the Refinance Index fell from 5470.3 to 5438.1. Refinancings represented 72.5% of total applications, down from 73.8% the previous week, while adjustable-rate mortgages accounted for 13.2%. The average contract interest rate for 30-year fixed-rate mortgages inched up from a record low of 5.68% to 5.69%, and points (including the origination fee) decreased from 1.65 to 1.61 for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mbaa.org.

Cornerstone Realty Income Trust Inc., Richmond, Va., and Merry Land Properties Inc., Augusta, Ga., have entered into an agreement valued at approximately $136 million under which Merry Land will merge into a wholly owned subsidiary of Cornerstone.The total consideration consists of Cornerstone stock valued at about $42 million and the assumption by Cornerstone of Merry Land debt totaling about $94 million, the companies said. The proposed transaction will be structured as a tax-free merger and is subject to approval by Merry Land's shareholders. The merger will "significantly enhance Cornerstone's Southern presence," adding direct ownership of nine properties in Charleston, S.C., and Savannah, Ga., Cornerstone said. In conjunction with the merger, Cornerstone said it will enter into agreements with a newly formed private company, Merry Land & Investment Co. LLC, for the development of three additional class A communities in Savannah and Charleston. Cornerstone, a real estate investment trust, can be found online at http://www.cornerstonereit.com, and Merry Land can be found at http://www.merryland.com.

The average 30-year fixed mortgage rate dipped to a survey-record low of 5.84% for the week ending Feb. 21 from 5.86% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate fell from 5.26% to a survey-record low of 5.21%, while the average rate for one-year Treasury-indexed adjustable-rate mortgages dropped from 3.89% to a survey-record low of 3.81%. Fees and points averaged 0.6 points for fixed-rate mortgages and 0.7 points for ARMs. "Despite forecasts to the contrary, January housing starts marked a 16-year high, according to the Commerce Department," said Frank Nothaft, Freddie Mac's chief economist. "Current record-breaking mortgage rates are keeping demand for housing strong, even as the overall economy stumbles sluggishly into the first part of the new year." A year ago, the average 30-year and 15-year fixed rates were 6.81% and 6.28%, respectively, and the average one-year ARM rate was 4.96%, Freddie Mac said.

America West Airlines, Phoenix, and Nationwide Advantage Mortgage Co., Des Moines, Iowa, have launched an incentive program that offers frequent-flyer miles for program members who borrow from Nationwide Advantage.Members of America West's FlightFund program who borrow from the mortgage company will receive 1,000 miles per $10,000 in principal amount borrowed, the airline said. To celebrate the launch, Nationwide Advantage is offering an additional 3,000 miles for borrowers financing a home purchase in 2003. The airline said the program features 10-minute approvals, low rates, reduced fees, and a "dramatically simplified" application process. The program can be found on the Web at http://www.flightfundmortgage.com.

Kyle Chaney has been named senior vice president and product manager at Stewart Mortgage Information, Houston.Mr. Chaney has 12 years' experience in the mortgage industry, and was most recently a product manager for GHR Systems, SMI said. SMI, a wholly owned subsidiary of Stewart Information Services Corp., can be found on the Internet at http://www.smiservices.com.

Phoenix-based Bank One has announced a $12.5 billion commitment to finance, in partnership with Fannie Mae, affordable housing and rehabilitation projects in Arizona's rural areas, Indian reservations, and trust lands.The initiative will target low- to moderate-income families among minorities (who will receive about 25% of the total fund), woman-headed households, immigrants, and people with disabilities. Bank One said it is "lowering the threshold" to homeownership for these borrowers by providing customized products that require little or no downpayment, feature flexible credit requirements, and do not require mortgage insurance. Financing applies to both single-family and multifamily properties. Initially funds will be offered in Phoenix, Detroit, and Chicago, and then will be expanded into other areas in Arizona and 14 other states where the bank operates. In cooperation with Fannie Mae and local nonprofits, the bank will also provide homeownership counseling and education.

Countrywide Home Loans Inc., Calabasas, Calif., has introduced a new loan that allows qualified homeowners to skip up to two monthly payments per year and up to 10 payments over the life of the loan.The PaymentPower Mortgage option, available on conventional 30-year fixed-rate loans, offers the payment flexibility in return for a one-time upfront payment or a fee of $100-$230 per skipped payment, depending on the original loan amount, the company said. Skipped payments are capitalized and added to the remaining loan balance, resulting in a recalculated, "slightly higher" monthly payment, Countrywide said. "Increasingly, we are seeing that the ability to manage home loan debt has great appeal to homebuyers," said Vijay Lala, senior vice president of product development and support at Countrywide. "People also want flexibility in their monthly mortgage payments for the times they need it." Countrywide can be found online at http://www.countrywide.com.