Is anyone listening out there? Maybe: Treasury Secretary Timothy Geithner said he expects a U.S. housing regulator in the coming weeks to detail mortgage refinance programs that could help the battered housing market. "My sense is, based on what I've seen...it's going to be meaningful enough to make a difference…(the FHFA) is looking at a range of things and you'll see more details in a couple of weeks," Geithner said.

The Senate Committee on Banking, Housing and Urban Development has voted to confirm former Ohio Attorney General Richard Cordray as director of the Consumer Financial Protection Bureau. The committee approved the nomination by a party-line vote of 12-10, with all Republican members voting against, as the Republicans have repeatedly vowed to do until the CFPB is restructured. The nomination must now come to a vote before the full Senate to complete Cordray’s confirmation. But Senate Minority Leader Mitch McConnell has united the Republican caucus to block the nomination until the CFPB is restructured.

Flood insurance is on the minds of many in real estate and mortgage banking, and enough so that Wells Fargo put out a “Risk Advisory Bulletin” to provide Sellers with a full understanding of Wells Fargo’s flood insurance practices, the risks associated with insufficient coverage, and possible actions to minimize those risks. Wells will require borrowers be fully informed of flood insurance related issues and starting 1/1 “generic non investor-specific flood coverage language is required to be incorporated into lender disclosures provided to the borrower at or before loan settlement.” As always, it is best to read the actual bulletin, in this case several pages. But, “The Flood Disaster Protection Act (FDPA) requires federally regulated lenders to ensure that adequate flood insurance coverage is in place for any property used as collateral for a loan that has a building (dwelling, structure, or improvements) located or to be located in a Special Flood Hazard Area (SFHA). Special Flood Hazard Areas are defined by FEMA as any flood zone A or V. Federally regulated mortgage lenders are required to determine whether or not a property is located in an SFHA, thus determining the need to purchase flood insurance. For both originating and servicing lenders, there is a great responsibility to monitor the need for flood insurance and ensure adequate coverage is maintained on subject properties. For servicing lenders, this also means ensuring sufficient coverage is maintained over the life of the loan.”

In Wells’ case, Wells Fargo Funding’s flood insurance coverage requirements align with published Fannie Mae and Freddie Mac requirements, as well as the minimum compliant coverage amount as defined by FEMA Mandatory Purchase Guidelines, defined as the lesser of: unpaid balance of the loan, or replacement Cost Value (RCV); or National Flood Insurance Program (NFIP) Maximum Coverage Limit of $250,000. “During the time a loan is serviced by Wells Fargo Home Mortgage, however, it is our servicing policy that flood insurance be carried at the maximum amount available, meaning flood coverage must be equal to 100% of the Replacement Cost Value (RCV), up to the NFIP Maximum Coverage Limit of $250,000. Because hazard insurance is required to equal the full Replacement Cost Value, the amount of hazard coverage is generally used to determine adequate flood insurance coverage.”

Equifax has launched “the industry's most comprehensive borrower misrepresentation solution for hidden debt. Lenders who use Equifax's premier undisclosed debt monitoring solution can now gain access to an exclusive insurance program, offered through Arthur J. Gallagher & Co. By covering losses tied to loan repurchases resulting from undisclosed debt, this solution enables lenders to reduce taxable loan loss reserves and improve the confidence level of originators, investors, and mortgage insurers in the underwriting process.”

Optimal Blue, the Web-based platform that couples pricing and secondary marketing automation with content management for the mortgage industry, announced it had acquired Sollen Technologies, whose assets, among other things, includes a business process patent. OB will begin “executing on the integration of the two companies’ products, customers and employees immediately, ensuring a smooth transition that maximizes the value inherent in the acquisition.” OB started in 2002, but Sollen’s been around about 12 years, and was the first Web-based product eligibility and secondary marketing automation platform introduced into the mortgage market.

How much is a lot of money? $3.14 trillion is a lot, and that is about where senior home equity stands. This equity was measured by the National Reverse Mortgage Lenders Association (NRMLA) / RiskSpan Reverse Mortgage Market Index (RMMI). Unfortunately the number, for those 62 years and older, has slid and is at its lowest level since 2004 and down $63 billion from the first quarter of 2011. The president of NRMLA noted, “While the senior equity level is 22% off of its Q2 2006 peak, the equity level of the overall population is down 38% from its Q1 2006 peak” due to “the relatively fast growth and lower mortgage debt levels of the senior population.”

What is the public supposed to think about mortgage professionals when they see headlines like, "Suit alleges banks and mortgage companies cheated veterans and U.S. taxpayers"?
http://www.washingtonpost.com/politics/suit-alleges-banks-and-mortgage-companies-cheated-veterans-and-us-taxpayers/2011/10/04/gIQATp4RLL_story.html?hpidz5

Wells Fargo wholesale, GMAC wholesale, and other investors, spread the word that, “Legislation passed and was signed by the President to delay the VA funding fee percentage decrease from Oct. 1 until Nov. 18, 2011.”

GMAC Mortgage announced that it has teamed up with the Loan Value Group (LVG) to offer the Responsible Homeowner (RH) Reward program to a group of Veterans Administration customers who are current on their mortgage payments but have seen a significant decline in the value of their homes. “The program returns a portion of their lost equity in exchange for continued, timely mortgage payments. RH Reward is designed to encourage homeowners to avoid default and possible foreclosure by offering a cash reward when specific payment milestones are met.  The program creates an incentive without changing the terms of the original mortgage note, or requiring additional documentation or disclosures by the homeowner. Participation in the program is completely voluntary and there is no cost to the homeowner.”

In North Carolina Select B&T will acquire Gibsonville Community Bank from the Bank of Atlanta.

Don’t forget: Monday’s a holiday! Some companies are closed, some are open but not taking locks, some are taking locks (watch that pricing since the markets are closed!). For example Stearns Lending will not be accepting locks, producing rate sheets, or funding loans on Monday.

Mountain West Financial alerted brokers that, regarding county limits, “FHA-to-FHA-insured refinance transactions may exceed the new loan limits if the new mortgage complies with standard product guideline requirements and ALL of the following requirements are met: The maximum loan amount (including financed UFMIP) of the new FHA-insured mortgage, including all fees, closing costs, mortgage insurance premiums (MIP), interest, etc., must not exceed the original principal amount of the existing FHA-insured mortgage. Should the maximum loan amount (based on the original principal balance of the existing FHA mortgage) be insufficient to cover allowable interest, MIP, closing costs, fees, etc., the borrower shall provide cash to cover the costs that exceed the allowable maximum loan amount. The new FHA-insured mortgage may not have a term of more than 12 years in excess of the unexpired term of the existing FHA-insured mortgage. The monthly P&I and monthly MI payment due under the new FHA-insured mortgage must be less than the P&I and monthly MI payment that is due under the existing FHA-insured mortgage.”

In August, it was initially reported that the U.S. economy created zero net new jobs. (""Mr. Blutarsky - 0.0.": http://www.youtube.com/watch?vyroKIGCtcwY&featurerelated) The employment gains in professional and business services, along with education and healthcare, were offset by a pullback in employment in the local government and information sectors. And this is the week that we see lots of employment data from September: nothing too exciting. But the labor market woes have not been shared evenly across groups. Unemployment since the start of the recession has risen disproportionately for men, so much so that the recession has been dubbed by many as a “mancession.” Decomposing the headline unemployment rate of 9.1 percent, joblessness stood at 8.5 percent for women compared to 9.6 percent for men in August. This has come at a time when male participation in the labor force has fallen sharply, accelerating the long-term decline since the mid-1950s. And in this recession historically male industries (construction & manufacturing) have been harder hit than other sectors such as education and health services. There are signs that these unemployment numbers are changing as different sectors expand & contract, but it is interesting to watch.

The Census Bureau notes that differences are also visible when looking at race and ethnicity. “Black joblessness, at 16.7 percent, stands more than 7 percentage points above its prerecession rate and is more than double the unemployment rate for white workers (8.0 percent). Furthermore, unemployment for black teenagers is staggeringly high at 47 percent, making it difficult for this group to gain valuable work experience early in their working years. Unemployment among Hispanics, at 11.3 percent, falls in between the rate for whites and blacks. However, due to a higher participation rate, Hispanics and whites have roughly equal rates of employment relative to their populations at 59 percent. Black employment-to-population is notably lower at 51 percent.”

Turning to the bond markets, Treasuries sold off again yesterday as investors felt comfortable adding risk with the ECB's announcement regarding bond purchases in order to stave off a recession. 10-year notes dropped about .75 in price and closed around 1.99%, and current coupon mortgages worsened by about .25 in price. Helping, of course, was news that in the first three days of the MBS purchase program, the Fed bought $3.95 billion - 88.6%, or $3.5 billion, in 30-year 3.5% and 4% coupons, and 11.4%, or $450 million, in 15-year 3.0% and 3.5% coupons. All were for November and December settlements. Over this same period, mortgage banker selling totaled nearly $7 billion, which means the Fed covered 58.1% of the supply.

Overnight we learned that Moody’s downgraded 12 UK banks, citing a decrease in the likelihood of gov’t support being provided in the future. And today we had the employment report for September. Expectations were for Nonfarm Payrolls to be +60k while the Unemployment Rate held steady at 9.1%. Jobs were up by 103k, and the rate did indeed hold steady at 9.1%. There were significant July & August revisions upward, however, suggesting a little steam in the jobs picture. So after the news rates moved higher, with the 10-yr moving up to 2.08% and MBS prices worsening about .250-.375.

Ole died. So Lena went to the local paper to put a notice in the obituaries.

The gentleman at the counter, after offering his condolences, asked Lena what she would like to say about Ole.
Lena replied, "You yust put 'Ole died."
The gentleman, somewhat perplexed, said, "That's it? Just 'Ole died'? Surely, there must be something more you'd like to say about Ole. If its money you're concerned about, the first five words are free. We must say something more."
So Lena pondered for a few minutes and finally said, "OK. You put 'Ole died. Boat for sale.'"