A poll says only 75% of Texans would vote to stay in the United States. The other 25% thought the U.S. was actually a part of Texas.

MERS, a classic “behind the scenes” vendor in the mortgage business,  made the headlines last week: http://www.nytimes.com/2009/04/24/business/24mers.html?th=&emc=th&pagewanted=all And tonight, when you’re tucking the youngin’s into bed, you can show them this graphic of the process: ImportMedia/images/2009/04/24/business/24mers-graf01.jpg.

In a Bloomberg news story, Bank of America announced that they will be dropping the Countrywide Financial name. “The company is promoting Bank of America Home Loans as it retires the Countrywide image 10 months after buying the company, starting two days ago at branches in California. Bank of America wants to send consumers a message along with the name change, hoping to build on “very strong momentum” after writing $85 billion of mortgages last quarter.”

This Friday the HVCC is scheduled to be “implemented”. Of course, many originators are saying that they will “get around it” by having their client or realtor talk directly to appraiser, which apparently is allowed. I can’t answer that one, but this has been in the works since mid-December, so lenders have had ample to time to prepare and have their questions answered. Bank of America/Countrywide, for example, “will require all appraisals for Conventional (conforming and non-conforming) loans submitted for sale to comply with the HVCC as a condition for Countrywide purchase. Accordingly, with respect to any Conventional loan submitted to Countrywide for purchase where the loan application date is on or after May 1, 2009, the following new requirements apply: 1. Upon sale of the loan to Correspondent Lending, each correspondent lender (“Client”) will be deemed to represent and warrant to Correspondent Lending that the appraisal process and the appraisal report complies with the HVCC, and 2. If the appraisal is in the name of another lender and was transferred to the Client, the loan file must contain a fully completed and executed HVCC Compliance Lender Acknowledgment form (see link below). If the appraisal was not assigned from another lender this form is not required, but remains recommended as a way to acknowledge compliance with HVCC. 3. The loan file must include documentation that reflects the date and method of delivery for each appraisal report sent to the borrower and used for any one loan.”

On Friday the FDIC closed the First Bank of Beverly Hills, the first in CA since early February, along with three other banks in Georgia, Michigan, and Idaho. The cost is estimated to be $700 million.

And for anyone who likes names, UBS AG fired Jerker Johansson (the head of its troubled investment bank).

As opposed to last week, this week is a busy economic news week. No news today. But tomorrow at 7AM PST Consumer Confidence. On Wednesday we have the 1st Quarter GDP number, the most important number of the week and expected -6.3%, but more importantly perhaps will be the FOMC rate decision. (Don’t look for over night Fed Funds to increase from the current 0-.25% level, but there could be other items in the announcement that will help give clues about the “insider’s view” of the economy.) On Thursday we have Personal Income and Consumption, along with Jobless Claims, the Employment Cost Index, and the Chicago Purchasing Manager’s Survey. We finish the week with the Michigan Consumer Sentiment survey, Factory Orders, and the ISM Index. On top of the news, the Treasury will be auctioning off $101 billion in new 2, 5, and 7-yr securities. That is a lot of new supply hitting the market.

Getting back to the Fed announcement, no change in rates is expected at Wednesday's Fed meeting. At the last meeting in mid-March, the Fed came out with an aggressive expansion of its mortgage-backed securities (MBS) purchase program by more than doubling the size of it. Will the Fed reveal new measures or expand existing ones to stabilize the financial system or boost the economy? All that being said, most expect interest rates to stay in their current range unless we get any big news shocks. We currently have the 10-yr back down to 2.93%, and the 5-yr Treasury and mortgage prices are both better by between .125 and .250 from Friday afternoon.

A young boy enters a barber shop and the barber whispers to his customer, “This is the dumbest kid in the world. Watch while I prove it to you.”

The barber puts a dollar bill in one hand and two quarters in the other, then calls the boy over and asks, “Which do you want, son?” The boy takes the quarters and leaves the dollar.     
“What did I tell you?” said the barber. “That kid never learns!”
Later, when the customer leaves, he sees the same young boy coming out of the ice cream store & says, “Hey, son!  May I ask you a question? Why did you take the quarters instead of the dollar bill?”
The boy licked his cone and replied, “Because the day I take the dollar, the game's over!”

Rob

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