Part 2 of comp FAQ & answers; NAMB asks for 4/1 extension; Apps & home prices falling

January 26th, 2011 · No Comments






For some folks, including an ex-wife of a billionaire, $1 million a week is simply not enough. A $100 million house?

Something else that isn’t enough is mortgage applications in the U.S., which fell to their lowest level since November 2008. The weekly MBA figures showed that apps decreased 13% in the week ended Jan. 21, with refi’s down 15% to the lowest in a year while purchase applications fell almost 9% to the lowest level since October. Obviously some of this may be due to the MLK holiday. On the “good news” side of this, less supply and decent investor demand should lead to good MBS prices on a relative basis. FULL STORY AT MND

Of course, what tends to happen, with “normal” business and revenue dropping, companies will often take another look at “off the run” products. Management and secondary staffs will tend to listen to producers asking about products like 203(k), or Home Path, etc., especially if it means a potential increase in revenue. But they will often run up against a government agency offering a program but investors not doing so due to ‘risk versus return’ issues, and as you know, volumes have to justify the effort. A trout will only expend energy if the food drifting by will gain more calories than it uses up. So most companies don’t feel the need to gear up and jump through hurdles for programs where volume is limited.

NAMB, which is either the National Association of Mortgage Brokers or National Association of Mortgage Professionals, spread the word that it learned that “the Federal Reserve Board is working on a compliance guide for small entities on the LO compensation rule, pursuant to Section 212 of the Small Business Regulatory Enforcement Fairness Act (SBREFA), and it will be published in the immediate future. NAMB will ask for a significant delay on the April 1st deadline in order for Office of Advocacy Small Business Administration to interpret and implement any guidelines coming from the Federal Reserve board at such a late date.” READ MORE AT MND

In the meantime, Optimal Blue, mostly known for its decision making technology, announced it has “released the first phase of its Loan Officer Compensation functionality…which includes configuring mark ups, fees, and compensation for the loan officer to ensure lenders are compliant with the forthcoming Federal Reserve Bank regulations.” “Being ahead of the curve and releasing this functionality gives our customers the confidence they will be in full compliance when the regulation takes effect,” said Larry Huff, co-CEO of Optimal Blue.

Yesterday I passed along Part 1 of a Q&A dialog between the MBA and Federal regulators (although SunTrust distributed it to its broker clients). Here is Part 2 in a series of several:

Q4: Assuming a creditor establishes a fixed percentage of loan amount compensation for a particular type of loan, how frequently may the creditor adjust the compensation to the originator?
A. Fed Response - Over any reasonable period of time that would support a finding that compensation requires adjustment, provided such adjustment does not lead to loan-by-loan adjustment; not more frequently than every two weeks.

to continue reading 6 more questions, also fraud in IL, home price indices, rates, economy MBS, and Joke of the Day – click here.

Tags: Commentary · Mortgage Market · Rob Chrisman

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