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News from NAMB
Wednesday, November 26
From John Councilman, NAMB President
This is volume 2 of News From NAMB. At the end of each week, NAMB will bring you a recap of the top news stories affecting the mortgage industry. If you’re as busy as I am, you often don’t get a chance to read all of what is happening throughout the week. News From NAMB will bring you up to speed in a matter of minutes. I hope you enjoy it and have a great Thanksgiving!
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Non-Bank Market Share Increasing
According to a recent article in National Mortgage News, non-banks originated 40% of the home purchase loans in 2013. The story, written by Bill Cosgrove, the current MBA chair, cites personal service and skills as the drivers. Cosgrove says it’s do it right or die. His family’s assets and his reputation are on the line all of the time. Non-banks can’t fall back on credit card revenue or auto loans. The only thing that is surprising is that the non-bank share is only 40%.
CFPB on Disability Documentation
On its blog, the CFPB reminded lenders that placing unnecessary documentation requirements on recipients of Social Security disability income, including disabled veterans, may raise fair lending concerns. To verify income for the Qualified Mortgage DTI, the CFPB says unless the award letter or similar documentation has an expiration date for payments within three years of loan origination, lenders should treat the benefits as likely to continue. The lender shouldn’t ask a consumer for documentation or about the nature of his or her disability under any circumstances.
Washington Times Says CFPB Suffers From Low Internal Morale
The Times cites an employee survey where employees’ favorable opinions declined in 41 of 75 questions asked. The agency has been plagued by very public employee discrimination complaints this year. The article says the agency’s greatest strength is its employees’ belief in the value of the work they do. More than 90 percent of employees at the CFPB feel the work they do is important.
The FHFA reminded everyone of its mission in its Strategic Plan for next year. Number one was to ensure safe and sound regulated entities, i.e. Fannie and Freddie. Ensure liquidity, stability and access in housing finance, and finally, to manage the GSE’s ongoing conservatorships. That is balancing act that would make Nik Wallenda envious.
FHFA Announces 2015 Loan Limits… Tell Interesting Story
Most of the country has the $417,000 maximum Fannie/Freddie limit. 46 counties showed a loan limit increase. None declined. A few exceed the normal $625,500 top limit. All of those are in Hawaii, toping out at $721,050 for Honolulu. Of those with the $625,500 limit, 29 are in Alaska, 11 are in California, 7 are in Colorado, 4 are in Idaho, only 2 in Massachusetts, 10 in New Jersey, 12 in New York, 3 in North Carolina. A number of other states have 1 or 2. The interesting, but not surprising, story is the number of $625,500 limits in the DC suburbs. DC has 5 extended limits in Maryland, 17 in Virginia, and even 1 in West Virginia for a total of 23, dwarfing everyone except Alaska. No shortage of jobs there.
HUD Looking for Lenders to Pay for Technology Upgrade
Tucked into the Senate version of the HUD Appropriations Act (S. 2438) is a provision that gives FHA the right to assess lenders to upgrade its computers. HUD could charge 4 basis points on total FHA origination. That would be $40,000 on every $100 million originated. NAMB feels this should be a one-time assessment at most. You are encouraged to call your senator or representative to make certain this is not another permanent increase to the cost of FHA loans.
Rates Get Thanksgiving Gift
This morning produced a slew of rate friendly data. Weekly jobless claims came in at 313K vs. the expected 286K, durable goods orders were up 0.4% vs. the expected 0.6%, income was up 0.2% vs. the expected 0.4%, outlays were up 0.2% vs. the expected 0.3%. PCE core inflation was only up 0.2% as expected. Consumer sentiment came in at 88.8 vs. the, expected 90.0, and new home sales were 458K vs. the expected 470K. A 100% score for better rates.
Monday, November 24
Well we have finally reached the week of Thanksgiving, and boy does time fly by! I would like to wish everyone a great Thanksgiving holiday this Thursday. In doing this, I really think that we are in a position that we need to give THANKS for everything that we have today. NAMB—The Association of Mortgage Professionals has fought the fight for all of us over the past 40 years and this is a good time to reflect over our jobs and what we have that is important.
NAMB is continually trying to find out how we are doing on training as an industry. For those of you involved in compliance and training and don't mind taking a short survey, we all know the cost of compliance has increased over the past several years and one of those costs, specifically, compliance training, can be viewed as a negative or a positive depending upon how a company utilizes it. While it is an upfront cost it will, if done correctly and over time, help to reduce a company's overall compliance cost by having more educated employees. The Consumer Financial Protection Bureau (CFPB) reviews a company's compliance training program as a part of their examination. We are starting to see a trend in many state exams as well, especially with anti-money laundering (AML) training. Companies need to be developing comprehensive training programs based on the size of their company. I have had conversations with many companies to determine how they are going about developing their compliance training programs and have created an informal survey to determine the allocation of time, costs and resources that companies are dedicating toward compliance training and what kind of a positive/negative impact they are seeing.
I have been contemplating something new and I am going to start something new about letting all of you get to know people in the NAMB organization. I am thinking about highlighting a short introduction on these individuals every two weeks so that you get an idea of who we are and what we do in our normal everyday lives. I am developing a set of questions to be completed and this information will be shared with all of our members. These will begin in December and run throughout next year. I really look forward to letting all of you get to know these people that work so hard for you, the NAMB member. Remember, all of these volunteers work a tremendous amount of hours for no pay. They do it to make our profession a better place to work and to protect your jobs. All that I ask is that if you ever are given the chance to say thank you to these people, you do. I will also be including an e-mail address for these people and that would be a great time to drop them a line to just say “thanks!”
Being NAMB’s CEO has also been a challenge to get started. I have been working on a few items to get out and my first priority has been to put together an ongoing education (if that is what we call it) class for all future leaders of this association. It is not going to be something that will be a “run the organization this way,” but a synopsis of what each one needs to make their future as NAMB’s president more successful. Every president of NAMB will put their mark on the association themselves, but there are things that must be done in order to make sure the organization runs smoothly. This will be a benefit to all of these people. We have a lot of great individuals who are up and coming, and I just want to share this information with them as they progress. My goal is to involve a few past presidents to round out the class.
And speaking of future leaders, a few months ago I asked that if you know of anyone who might want to get involved in the organization as a future leader, to let me know. As the first of the year is right around the corner, we will be asking for nominations for the board of directors. As the chairman of the NAMB Nominations Committee, I want to open the door to anyone who has any aspirations of moving up to step up to a leadership position. I have actually discussed this with many of NAMB’s state past presidents and these are excellent candidates to step up. But there are also many others from NAMB state affiliates who may want to step up. We need people, not only on the board, but on committees … we need you! The way you learn is by participating. PLEASE, PLEASE, PLEASE step up. Let me or any other board member know of your interest today. Let us put you on a committee. Every committee has teleconferences and you do not need to fly somewhere to attend these meetings. We have a lot of committee members who never leave the confines of their office and do a great job for us. And you get the satisfaction of being an active participant in your profession. The only requirement that we have is you have to be a member of NAMB. So what are you waiting for? Join the association today and get involved. You have opinions, and we want to know what we can do to make this a better organization. Send an e-mail to me at firstname.lastname@example.org or e-mail NAMB President John Councilman at email@example.com and let us know how you want to become involved. I look forward to hearing from you and let us all work together to make our association better and working on our mission.
As a final thought, I mentioned earlier that Thanksgiving is this week. America has a large and diverse group of people, both adults and children who are homeless and others who are going to group homes and churches and food pantries for their food for this holiday season. In an effort to give thanks, drop off a bag of food to one of these places or donate your time to one of these places. Every city has shelters and pantries, so you should not have a problem finding one. We need to give thanks and give back. It may be a gesture of love or respect, but we do live in the greatest country in the world and we do have the best jobs, even with the large oversight, that allow us to make very good money. Make this Thanksgiving a meaningful one and give back. THANKS!!!
Until next week!
Donald J. Frommeyer, CRMS, CEO
NAMB—The Association of Mortgage Professionals