Originations

A study by Freddie Mac has found that a growing number of borrowers were looking to cut their term when they refinanced their mortgage in the second quarter of 1998.Nearly 31% of borrowers whose loan was originally a 30-year fixed-rate mortgage elected to take a 15-year fixed-rate mortgage, the highest percentage since the second quarter of 1996. In the first quarter 1998, 29% of 30-year FRM borrowers refied into a 15-year FRM. Meanwhile, 62% of 30-year FRM borrowers took that same loan when refinancing, down from 64% in the first quarter. Of the adjustable-rate borrowers who refinanced a loan, the study found 65% moving into a 30-year FRM, while 27% picked a 15-year FRM, 6% a 20-year FRM, and just 1% another ARM.

There are two new executive vice presidents at Amerin Corp., Chicago.William V. Nardiello joins the company as executive vice president, national sales and marketing director, while Albert V. Will comes aboard as executive vice president of operations. In his new position, Mr. Nardiello is responsible for developing Amerin's overall sales and marketing strategy and managing its national and regional sales organizations, marketing and communications efforts, and product development. He most recently headed worldwide business development for The Thomas Group, a management consulting firm based in Dallas. Prior to that, Mr. Nardiello was president and chief executive of Residential Information Services. Mr. Will managed the day-to-day operations of Banc One Mortgage Corp., Indianapolis, as its chief operating officer. He also served as executive vice president of Prudential Home Mortgage, Clayton, Mo.

Paul Bognanno, president and chief executive of Principal Residential Mortgage, Des Moines, Iowa, has been promoted to senior vice president of its parent company, The Principal Financial Group, also based in Des Moines.J. Barry Griswell, president of Principal Financial, pointed to the growing significance of the mortgage banking unit when he announced Mr. Bognanno's promotion. Mr. Bognanno will continue to run Principal Residential Mortgage, which will have a servicing portfolio of nearly $40 billion with the addition of the portfolio of ReliaStar Mortgage, Des Moines.

Fannie Mae has purchased a $500,000 note from the Florida Housing Finance Corp. to fund the housing agency's Down Payment Assistance Program.The proceeds will be used to fund second mortgages of up to $4,000 for qualified low- and moderate-income families. Under the program, a loan can be used for a downpayment, closing costs, appraisal fees, home inspections, and legal fees. Fannie Mae is providing the funds through its recently announced Down Payment Assistance Investment Note initiative. So far it has bought 18 such notes from housing finance agencies. Fannie Mae's website address is http://www.fanniemae.com.

Mortgage applications declined 0.9% for the week ended Aug. 14, according to the Mortgage Bankers Association of America's weekly Mortgage Application Survey.The Purchase Index fell 2.7%, the Refinancing Index rose 1.4%, the Conventional Index increased 1.0%, and the Government Index was down 8.1%, the survey indicated. On a seasonally adjusted basis, the Market Index drifted down from 406.8 the previous week to 406.7; the Purchase Index decreased from 254.7 to 251.4; the Refinancing Index rose from 1291.9 to 1310.5; the Conventional Index was up from 518.2 to 527.4; and the Government Index fell from 221.2 to 205.4. Refinancings represented 45.8% of total applications, up from 44.8% the previous week, while adjustable-rate mortgages accounted for 9.3%, up from 7.9% the week before. Overall, applications were up 51.8% compared with those for the same week last year. The address of the MBA's website is http://www.mbaa.org.

Carl W. Forsythe will become the president and chief executive of Advanta Corp., Spring House, Pa., while Walter Carter will join the company as executive vice president.Mr. Forsythe is currently executive vice president and director of corporate marketing and consumer lending at H.F. Ahmanson & Co., Irwindale, Calif. He is expected to join Advanta when the sale of Ahmanson to the Seattle-based Washington Mutual Inc. is completed, which should be sometime in late September or early October. Most recently, Mr. Carter had the title of executive vice president for Associates Home Equity Services, Dallas. Before that, he was with Household Finance Corp., Prospect Heights, Ill., for 14 years. Advanta's website address is http://www.advanta.com.

Single-family starts rose 3% in July to their highest level in five years, according to statistics released Wednesday by the U.S. Department of Commerce.Government data show that single-family starts were at a rate of 1.306 million in July, up from 1.268 million in June. This is the highest monthly rate recorded for single-family starts since December 1993, when the rate hit 1.316 million. Year over year, single-family starts have risen more than 12% thanks to a strong housing market fueled by low interest rates and low unemployment. "This is going to be the best year for single-family starts since 1978, when we ended the year at 1.433 million," said David Seiders, chief economist at the National Association of Home Builders. "Inventories are slim and builders are just trying to keep up with the demand for housing, which accounts for these strong numbers." The NAHB's housing market index was 71 in August -- only one point below July's record-setting level -- indicating that builders across the nation are still optimistic that single-family activity will remain strong in their region. Mr. Seiders said he was forecasting 1.23 million SF starts for the year, but he said that number will have to be revised upward. "This market is remarkable," he added. "I had been looking for activity to flatten out, but the numbers continue to grow." The Commerce Department's website address is http://www.doc.gov, and the NAHB's is http://www.nahb.com.

Fleet Mortgage Group, Columbia, S.C., has announced an expanded alliance with Cybertek, a Dallas-based software application company, to develop a "next-generation" mortgage origination product.The product, Compass-LX, will incorporate the business rules and infrastructure of Fleet's proprietary Compass system into Cybertek's existing LoanXchange platform, Fleet said. The company said key members of its technical and business analysis team will become Cybertek employees with responsibility for implementing the combined system. "We have found the ideal solution to our technology needs by leveraging the best of two existing systems," said A. William Schenck, Fleet's chairman and CEO. Cybertek is a wholly owned subsidiary of Policy Management Systems Corp. Cybertek's website address is http://www.cybertek.com and PMSC's is http://www.pmsc.com.

L.Stephen Smith is being promoted to president and chief operating officer of The PMI Group Inc., San Francisco, and its mortgage insurance subsidiaries as of Sept. 1. Currently he is executive vice president of marketing and field operations. Mr. Smith joined PMI in 1979 as a regional representative, and he was placed in charge of the marketing and field operations functions in 1994. PMI's chairman and chief executive, W. Roger Haughton, said Mr. Smith's new responsibilities "recognize his outstanding accomplishments at PMI, including our remarkable market share gains this year."

Nine classes of Saxon Mortgage Securities Corp. mortgage pass-through certificates have been downgraded by Fitch IBCA Inc. The downgrades in Series 1993-8 were as follows: Group 1, Class 1B4, downgraded from B to D; Group 1, Class 1B3, downgraded from BB to B and placed on RatingAlert Negative; and Group 2, Class 2B4, downgraded from B to CCC.In Series 1994-8, Class B3 was downgraded from CCC to D and Class B2 was downgraded from BBB-minus to BB-minus and remains on RatingAlert Negative. In Series 1994-10, Class B3 was downgraded from CCC to D and Class B2 was downgraded from BBB to BB. In Pool 1 of Series 1995-2, Class 1-B5 was downgraded from CCC to D and Class 1-B4 was downgraded from B to CCC. Fitch IBCA attributed the rating actions to loss levels and high delinquencies in relation to applicable credit support levels. Fitch IBCA's website address is http://www.fitchibca.com.

Bear, Stearns & Co. Inc., New York, has priced $354 million of securities backed by Community Reinvestment Act residential mortgage loans.Fannie Mae 1998-W5, which is scheduled to close on Aug. 31, is backed by $396 million of CRA loans originated or acquired by Citicorp, Citizens Bank of Rhode Island, or Citizens Bank of Massachusetts. The transaction will carry a Fannie Mae guarantee of timely interest and principal payments. Bear Stearns said it has managed more than $1.89 billion of CRA loan securitizations in the past 10 months. "Bear Stearns is seeking to develop interest and support for loans issued to low- and moderate-income home buyers and is actively pursuing CRA loan portfolios for future securitization, including portfolios as small as $25 million," the company said. Bear Stearns's website address is http://www.bearstearns.com.

The AFS Title Search Index rose 0.4% to 210.9 for the week ended Aug. 14 from 210.2 the previous week, according to Advance Factor Service.The index averaged 211.5 over the previous four weeks, down 1.6 points from the prior week's four-week moving average. A year ago, the index stood at 162.3, 77.0% of the current level. "Current mortgage rates and the AFSTSX appear to be close to equilibrium at this stage in the refinance cycle," said AFS manager Paul Descloux. "With relatively little volatility in mortgage rates this year, and commensurate activity in title searches following their initial run-up, no great deviation from the current pace is expected near-term. After Labor Day, the perennial deceleration in housing turnover activity will weigh on the index." Mr. Descloux's e-mail address is paul.descloux@cor.dowjones.com.

Transnational Financial Corp., San Francisco, has reported net income of $309,000 for the second quarter, up from $108,000 a year ago.Transnational, a wholesale and retail mortgage banker that originates residential mortgages in California, completed an initial public offering on June 24 that added $7.6 million to its stockholders' equity, the company said.

Paul Rigdon has been promoted to the new position of executive vice president for the retail division of New Century Mortgage Corp., a subsidiary of New Century Financial Corp., Irvine, Calif. Rigdon, 37, has been senior vice president for retail lending at New Century Mortgage since February 1997 and a director since May 1997.

J.G. Wentworth, Philadelphia, has announced the sale of its fifth package of whole-loan private mortgage notes into the secondary market. Wentworth chairman Gary Veloric said the company is finding "a strong appetite among banks and other financial institutions for this product, which is gaining a ready market as a securitized asset with strong credit quality and predictable cash flows." He said the growing market segment "allows many consumers to eliminate the uncertainty of holding a private, uninsured note while getting the cash now to invest in a business, pay for an education, or meet one of life's emergencies." J. G. Wentworth is the largest buyer of structured settlements arising from personal injury litigation and the largest originator and servicer of securitized deferred obligations in the U.S., the company said. Further information is available from Michael Goodman at mgoodman@jgwfunding.com.

Norwest Asset Securities Corp., Frederick, Md., has announced the offering of approximately $800 million of securities backed by fixed 20- and 30-year non-relocation mortgage loans.Credit enhancement for NASCOR Mortgage Pass-Through Certificates, Series 1998-23 will be provided through the use of a senior/subordinated structure. The underwriter is PaineWebber Inc., and the transaction is scheduled to settle on Sept. 29. Issuance and post-issuance information will be available after settlement from the SecuritiesLink Advanced Information Services website (http://www.securitieslink.net).

Prudential Mortgage Capital Co. LLC, Newark, N.J., has priced its first securitization, a $1.15 billion deal managed by Prudential Securities Inc. Prudential Mortgage, the commercial mortgage conduit subsidiary of The Prudential Insurance Co. of America, contributed $368 million in collateral to the deal.The majority of the collateral was originated by the national PruExpress advisor network, the company said. Clay Lebhar, president and CEO of Prudential Mortgage, said the deal was a milestone for Prudential and expressed satisfaction at the reaction from rating agencies and investors "notwithstanding challenging domestic fixed-income market conditions." Prudential Capital Group and Prudential Mortgage have originated about $2.8 billion in commercial mortgage loans in 1998, Prudential Mortgage said.

National Rehab Properties Inc., New Orleans, has announced the receipt of a $2.5 million loan commitment from Realty Money Center, Las Vegas, for the purchase and rehabilitation of homes.Richard Astrom, president and CEO of NRPI, said the credit facility is "especially attractive" because the mortgage for each home is assumable by the eventual homebuyer. NRPI is rehabilitating homes in New Orleans and selling them to first-time homebuyers via affordable housing programs. The company is converting many two-family homes to single-family residences. Its website address is http://www.nrpi.com.

The Office of Thrift Supervision has approved the merger of Golden State Bancorp Inc., Glendale, Calif., with First Nationwide (Parent) Holdings Inc., Los Angeles.Golden State is the parent of Glendale Federal Bank and First Nationwide is the parent of California Federal Bank FSB. The merger, announced in February, will create the second-largest thrift in the nation, to be named California Federal Bank at the operating level and Golden State Bancorp at the holding company level, Golden State said. A special Golden State shareholders meeting is scheduled for Aug. 17 to approve the merger. Glendale Federal's website address is http://www.glendalefederal.com.

Star Bank NA, Cincinnati, and The Ohio Community Reinvestment Project of the Coalition on Homelessness and Housing in Ohio have announced they will join forces to improve affordable housing opportunities in the state.The partnership with the OCRP will also include efforts to foster small businesses, community development grants, housing and credit counseling, and other initiatives. Under the terms of the agreement with the OCRP, Star Bank will increase its community development grants to local groups such as affordable housing advocates, community and economic development organizations, and fair housing agencies. Housing and credit counseling will be provided to potential creditworthy homebuyers in conjunction with Star Bank mortgage products. Star Bank's website address is http://www.starbank.com.