Mar. 13, 2013: Mortgage jobs, layoffs, and comp surveys; Fannie's DU addresses short sales; apps down and pipelines dropping
Rob Chrisman

Whether it is the CFPB, the OCC, or HUD, mortgage folks have to watch their step! Mortgage broker…golfer…sinkhole victim…or all three? What are the odds: “St Louis mortgage banker and avid golfer Mark Mihal was with three friends at the Annbriar Golf Course near Waterloo when he suddenly disappeared into the turf on the fairway of the 14th hole.” Maybe Mark should have been working on Friday instead of golfing:


Working at home is great. You can catch an extra hour or two of sleep, nobody takes the last of the coffee, and you can log into your company’s server from the comfort of your home office wearing your favorite Countrywide jammies…or not, as Yahoo’s CEO recently found out. The nerve of her to spy on folks on her payroll:


Some percentage of folks in our business work from home. But there are changes in the financial services employment picture. Challenger, Gray & Christmas reports the financial sector announced 21,724 layoffs in Feb., about 3x the cuts announced in Jan. and the most since Sep. 2011. Recently Regions Financial announced it reduced its staff headcount by 280 positions in 2012 or about 1.1%. PNC Financial Services (PA) said it will close 200 branches as it seeks to cut $700mm in costs. PNC has about 2,900 branches and closed 65 last year. SunTrust said it will close 40 branches this quarter as it seeks to reduce costs.


Maybe some of them can move to mortgage banks. Stonegate Mortgage will be hosting a Virtual Career Fair on Tuesday, March 19th from 11-3PM EST.  This is an opportunity to privately and confidentially talk to hiring managers in the following areas:  retail and wholesale sales, underwriting, closing, and correspondent.  To register and gather more information; follow this link:


Colonial Mortgage Service Co. of America, a mortgage banker, having celebrated its 20th anniversary, is looking for a Producing Branch Manager in the Pennsylvania Region.  Candidate should have 5-10 years origination experience, have his/her own book of business, and the ability to attract 3-5 originators.  Please contact Joseph A. Splendido, President, at, and information on Colonial can be found at


And lastly, “Thanks to the terrific reception of quality lending partners in the West,” Mortgage Services III (MSI), a wholly owned subsidiary of First State Bank, member FDIC, has opened a new Regional Operations Center (ROC) in Campbell, California. The full services ROC will facilitate the entire origination process for our Wholesale lending partners throughout the West. Mortgage Services III has the need for additional quality candidates to fill inside, Customer Service Representative positions, and additional, experienced Account Executives in select markets in Northern and Southern California.  As previously noted MSI prides itself on “Striving to be Best . . . not the Biggest” and does not flood markets with AEs.  MSI Account Executives work with all level of account approvals including Mortgage Broker, Correspondent Mortgage Banker, Banks and Credit Unions and have great latitude in tailoring a program to suit the customers’ service level needs. Interested parties should contact Jim Manley, RVP,


With all this hiring, along with talk of margin compression in 2013, companies may be wondering if and how the extraordinary performance of 2012 has impacted compensation for Loan Officers to Senior Management, and every position in between. This knowledge is fundamental to ensuring that your organization hires and retains the best talent while simultaneously controlling costs and justifying compensation to your stakeholders. The STRATMOR Group’s annual compensation survey results covering the full year 2012 provide these valuable insights as well as the ability to know what the marketplace is paying for critical positions. The survey is split into modules allowing you to choose your level of participation (Executive Management, Retail Sales, Consumer Direct Sales, Retail Fulfillment and Consumer Direct Fulfillment). And lender participant responses will be segmented for better analysis based on "Independents vs. bank-owned lenders," "Production scale brackets," and relevant position-related metrics (tenure, management scope). Special attention is being directed to obtaining incentive compensation structures and amounts so that participants can calibrate their own programs accordingly. For more information including timing of data submission and fees to participate see or email for an invitation to participate.


Technology is a part of mortgage banking – no doubt about it. And borrowers like to control their own destiny. So when you combine the two… in 2010, Mortgage Harmony Corp. rolled out HarmonyLoan Central, the web-based technology used to administer HarmonyLoan. The product, and Loan Retention Software (LRS), facilitates a useful platform for consumers, originators, and servicers. The LRS allows qualified existing customers to reset their interest rate, allows the lender to extend rate reset offerings to the borrower, gives correspondent lenders the ability to track their potential and actual annuity income, and notifies servicers of a borrower-initiated-reset. The borrower initially qualifies to reset their interest rate on their mortgage after the first six months, if there is at least a quarter percentage point advantage, as long as there are no interim late payments; they requalify every 120 days thereafter. The process is quick, done online, with minimal hassle. There is no new appraisal to order, no income or credit checks, only one document to sign, and can be assigned to conforming, jumbo, and ARM products. The LO, at origination, is paid quid pro quo, with one important feature. Through Mortgage Harmony’s MARS (Mortgage Annuity Revenue Stream), at the time of the first rate reset, the LO receives an annuity trail for the life of the loan. The sales pitch (and this is not a paid announcement!) is that the HarmonyLoan has the potential to keep the borrower happy and in place, reduce origination costs, prepayment speeds, and with resets at 50bps above market, delivering higher yields to retention portfolios. And a couple months ago Mortgage Harmony Corp. partnered with GTE Financial of Tampa, FL. Not only will GTE Financial be offering brokers in Tampa, FL the opportunity to market HarmonyLoans, but they will be extending the technology to auto loans as well. For more information visit Mortgage Harmony at



Turning to agency, bank, and investor news…


Fannie created an information sheet on its website discussing how DU treats short sales, fully documenting and aggregating the policies and treatment for this event. Posted yesterday, on Fannie’s site look for “Desktop Underwriter Clarification: The DU identification of a previous foreclosure or preforeclosure sale. Recent requests for clarification on how Desktop Underwriter® (DU®) identifies a foreclosure and a preforeclosure sale have been received. This document is being provided to clarify the DU identification of these significant derogatory events.” Go to


Friday regulators closed Frontier Bank ($259mm, GA) and sold it to Heritage Bank of the South ($1.1B, GA). Heritage gets 9 branches, assumed all deposits and entered into a purchase and assumption agreement with the FDIC. We also saw CommunityBank of Texas ($1.7B, TX) announcing plans to buy Vista Bank Texas ($605mm, TX) for an undisclosed sum.


Affiliated Mortgage announced that it re-released its Fixed-Rate DU Refi Plus product on March 4th for properties in AR, CO, FL, GA, IA, ID, IN, KS, KY, LA, ME, MN, MO, MS, MT, NE, OH, OK, OR, SC, SD, TN, TX, UT, VA, WI, WV, and WY.  The product allows limited cash-out refinances of existing FNMA transactions and is not currently accepting loans that require mortgage insurance.  Correspondent lenders are not required to be the current servicer of the loan.  As a reminder, all loans must be underwritten through DU and receive an Approve/Eligible.


M&T Bank has issued a reminder that all FHA and VA transactions with registrations dated February 27th or after are subject to a tax service fee, which must be absorbed by the lender.  This applies regardless of seller concessions, and the fee must be quoted on the GFE and listed on the GFE and listed on the HUD-1 as lender paid outside of closing.


As of February 28th, M&T is allowing amortization terms of 16-30 years for FHA Streamline refinances without prior approval from the Secondary Marketing department.


M&T has upgraded a number of the guidelines in the Agency Underwriting and Eligibility Standards guide and Treasury EUS guide.  The revisions cover asset documentation, including large deposits; the inclusion of real estate taxes in the mortgage amount of rate/term and cash-out refinances;  30-day charge accounts that reflect monthly payments on the credit report; living trusts; and principal curtailments.


The Wholesale Lending Division of Carrington Mortgage Services announced a new program offering 30-day loan closings for purchases. Designed to significantly reduce closing times compared to industry averages, the new program applies to FHA and conventional purchase loans. Effective immediately, Carrington commits to process any qualifying loan from the time that a file is submitted to underwriting to the time that it funds within 30 calendar days, or the company will apply a $995 closing credit to the loan at the time of closing.


(In 2012, the mortgage industry’s average time to close a purchase loan was 46 days, while the average time to close a refinance loan was 49 days according to an Ellie Mae Origination Insight Report. In many cases, processing can take longer – up to 60-90 days.)


Compared to all this, the market continues to snooze. Traders report a significant drop in sales volumes. And indeed, the MBA reported that last week’s retail applications dropped 4.7%, with refi’s dropping 5.2% and purchases down 2.5%. Refi’s now account for 76% of all residential applications. And this is from days prior to Friday’s jobs numbers, with the 10-yr yield finishing 23 basis points higher on the week - pipeline's volumes have definitely slowed as borrowers are clearly holding off for primary rates to head south.


The good news, of course, is with supply dropping and demand steady, fixed income prices were pushed higher and thus rates lower. Prices on 30-year FNMA 3.0s and 3.5s rose 6+ ticks and 4+ ticks, respectively, as 10-year notes rallied 10/32nds with the yield declining to 2.02% from Monday’s 2.06%. Today for potentially market moving news we had Import Prices (Feb), twice as strong as expected at +1.1%, and the more important Retail Sales for February which also came in very strong at +1.1% (ex-auto +1.0%) along with some back month revisions higher. We also have a $21 billion 10-yr note auction. The strong Retail Sales number may nudge rates higher, but for now we’re unchanged on MBS prices and at 2.02% on the 10-yr yield.



(Yes, a repeat, and parental discretion advised.)
Aer Lingus Flight 101 was flying from Heathrow to Dublin one night, with Paddy the Pilot, and Seamus the co-pilot. As they approached Dublin airport, they looked out the front window.
"B'jeesus" said Paddy "Will ye look at how fookin short dat runway is."
"You're not fookin kiddin, Paddy" replied Seamus.
"Dis is gonna be one a' de trickiest landings you're ever gonna see" said Paddy.
"You're not fookin kiddin, Paddy" replied Seamus.
"Right Seamus. When I give de signal, you put de engines in reverse" said Paddy.
"Right, I'll be doing dat" replied Seamus.
"And den ye put de flaps down straight away" said Paddy.
"Right, I'll be doing dat" replied Seamus.
"And den ye stamp on dem brakes as hard as ye can" said Paddy.
"Right, I'll be doing dat" replied Seamus.
"And den ye pray to de Mother Mary with all a' your soul" said Paddy.
"I be doing dat already" replied Seamus.
So they approached the runway with Paddy and Seamus full of nerves and sweaty palms. As soon as the wheels hit the ground, Seamus put the engines in reverse, put the flaps down, stamped on the brakes and prayed to Mother Mary with all of his soul. Amidst roaring engines, squealing of tires and lots of smoke, the plane screeched to a halt inches from the end of the runway, much to the relief of
Paddy and Seamus and everyone on board.
As they sat in the cockpit regaining their composure, Paddy looked out the front window and said to Seamus "Dat has gotta be de shortest fookin runway I have EVER seen in me whole life."
Seamus looked out the side window and replied "Yeah Paddy, but look how fookin wide it is".


If you're interested, visit my twice-a-month blog at the STRATMOR Group web site located at The current blog is how "Basel III Could be a Game Changer for Lenders and Servicers." If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what's going on out there from the other readers.


(Check out or For archived commentaries or to subscribe, go to Copyright 2013 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)




Copyright - Rob Chrisman