March 2019 Issue

HOUSINGWIRE MAGAZINE ❱ MARCH 2019

GOVERNMENT SHUTDOWN The effect of the shutdown, and what another would do to the economy.

P. 34

VALUATION TECH SOLUTIONS HOUSINGWIRE MAGAZINE ❱ MARCH 2019

Class Valuation, CoreLogic, Global DMS, Valuation Partners and Veros.

P.40

Ellie Mae is Driving Innovation Home.

Join us on the journey to a true digital mortgage.

At Ellie Mae, we believe that the digital mortgage journey drives us to one destination: home. Guided by innovation, our Encompass Digital Lending PlatformTM enables you to deliver the true digital experience across your entire workflow, from homebuyer interest to loan delivery and beyond. Our technology supports every channel, from lenders to investors, all in a single system of record and always with the highest levels of quality, compliance and efficiency.

Find out how Ellie Mae can help you get people into homes faster at ellie.me/1dih03.

HOUSINGWIRE MARCH 2019 EDITORIAL

CONTENT SOLUTIONS

EDITOR-IN-CHIEF Jacob Gaffney

MANAGING EDITOR Sarah Wheeler

EDITORS Ben Lane Jessica Guerin Caroline Basile

CONTENT WRITER Alyssa Stringer

ASSOCIATE EDITOR Kelsey Ramírez REPORTER Alcynna Lloyd

CREATIVE GRAPHIC DESIGN Traci Cortez

CONTRIBUTORS David Stevens, Jim Parrott, Mark Zandi, LaRence Snowden

SALES

CORPORATE

NATIONAL SALES DIRECTOR Jennifer Watson Laws jlaws@HousingWire.com

PRESIDENT AND CEO Clayton Collins

INTERIM COO Diego Sanchez CALIFORNIA MARKETING MANAGER Christi Lingard Caren Karris clingard@HousingWire.com MARKETING CENTRAL COORDINATOR Mark Adams Lauren Neaves madams@HousingWire.com CLIENT SUCCESS SOUTHEAST MANAGER Tamara Wren Haley Hess twren@HousingWire.com CONTROLLER MOUNTAIN WEST Michelle Monroe Bill Brown bbrown@HousingWire.com

THE BATTLE WHAT STARTED AS a movement to better the lives of brokers and a fight for consumers turned into the creation of a new trade group and a battle for the broker. In this issue’s cover story, HousingWire Editor-In-Chief Jacob Gaffney takes a deeper dive into that battle, talking with key players from all sides to see what each party is after. The fight seems like it is only getting stronger as skirmishes continues, but could there be a resolution that could include everyone if all sides can set their differences aside and do what will best benefit the brokers they represent.

Our next feature details the government shutdown that lasted a full 35 days – the longest in U.S. history. Although it was only a partial shutdown, its consequences rippled across the U.S. See what economists say were the effects were to the economy, the housing market and idividuals. But was it worth it? Did it really made any kind of change? The irony of the situation is that the shutdown actual cost the U.S. more than the original $5 billion funding dispute Also, check out our commentary section this issue. Dave Stevens, former Mortgage Bankers Association CEO, and his co-authors Jim Parrott and Mark Zandi talk about GSE reform – a very relevant topic considering Congress’ recent actions to outline a path forward on the issue. Houston Housing Authority also outlines the effects of Hurrican Harvey. As it turns out, the city might need much more funing than it originally thought.

GREAT LAKES Lorena Leggett lleggett@HousingWire.com

Kelsey Ramírez Associate Editor @kels_ramirez

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Tweets From The Streets Democracy = people are the government. When the President shuts down the government he’s shutting down the people who make this democracy possible.

There is a breaking point for the federal employees held hostage, and for our democracy.

505

4.8K

17K

by @BetoORourke

© 2019 by HW Media, LLC • All rights reserved

HOUSINGWIRE ❱ MARCH 2019 5

MARCH ‘19

28

BATTLE FOR THE BROKER The battle for the broker has begun as competing entities search for their loyalty. Two trade groups face off. But is there room for both sides to exist?

By: Jacob Gaffney

34

40

THE SHUTDOWN

TECH SOLUTIONS

The recent shutdown was the longest in U.S. history, but what would another one do to the economy?

By: Kelsey Ramírez

As leaders in the industry, these five companies are driving fast, accurate valuations.

HOUSINGWIRE ❱ MARCH 2019 7

CONTENTS 12

10 PEOPLE MOVERS

Lenders prepare to face headwinds in 2019 such as rising interest rates and tight credit.

Class Valuation named Mortgage Cadence Co-Founder Michael Detwiler as its new CEO. 12

EVENT CALENDAR

ON THE SHELF

Rachel Hollis, author of Girl, Wash Your Face, releases her newest book: Girl, stop apologizing.

14 DISPATCH 1 Mortgage professionals are now adopting Amazon’s Alexa technology to enhance their business.

15

The way to reduce taxpayer risk in the mortgage market. Could GSE reform be near?

DISPATCH 2

Don’t wait for disaster to strike — test the strength of your subservicer now.

17

24 GSE REFORM

UNIQUE SOLUTIONS

Quicken Loans’ David Schroeder explains how to distill the knowledge of your best employees.

New disaster assessment calls for additional $2 billion for Hurricane Harvey recovery.

Comments overheard at at CRA and Fair Lending Colloquium on the future of mortgage tech.

19 TAKE 5 Rose Marie David is far from her first career as a professional New York City ballet dancer.

20 HOT OR NOT These loan types could be set to see a decline in 2019.

24

54 REVERSEREVIEW After a year of stellar growth, non-agency reverse mortgage products find their footing.

58 CFPB WATCH CFPB seeks permission from Congress to resume oversight of military lending.

62 INSIDE BASEBALL FHFA Acting director agrees agency is unconstitutionally structured.

66 KUDOS Freedom Mortgage gives back to troops, delivers backpacks to military families.

68 BY THE NUMBERS An illistration of the least affordable housing markets in the world.

70 Q&A 1 Lenders can now use quality control technology to increase efficiencies.

71

Q&A 2

EXOS Servicing lets consumers manage their mortgage through mobile.

72 Q&A 3

18 SOUNDING BOARD

26 HURRICANE HARVEY

The nation’s largest cities are fighting back against the rise of short-term rentals.

50 LENDINGLIFE

13

VIEWPOINTS

46 RENTWIRE

THE LINEUP

MBA Technology Solutions Conference and Expo is coming to Dallas.

14

BACK DEPARTMENT

Visionet Systems offers another option to those considering whether to build or buy.

74 KNOWLEDGE CENTER The next generation alternative to existing cascade approaches.

76 KNOWLEDGE CENTER What does farming and hunting have to do with subservicing?

78 KNOWLEDGE CENTER Five ways for lenders to increase operational efficiency with technology.

22 HOT SEAT The Ellie Mae Classic gathers sports and mortgage professionals to raise money for charity.

80

COMPANIES/PEOPLE INDEX

81

AD INDEX

82

PARTING SHOT HOUSINGWIRE ❱ MARCH 2019 9

Michael Detwiler, CEO Class Valuation

10 HOUSINGWIRE ❱ MARCH 2019

LEINER

BIANCHI LAMAR

LUNDQUIST ROMEM

L

RES Corp. promote d Audrey Clearwater to t he posit ion of senior vice president of operations. Clear water prev iously ser ved as a principle speaker for the Society of Chief Appraisers throughout 2018.

Cloudvirga hired Ashley Lundquist as vice president of talent. Lundquist has a decade of experience in talent acquisition and employer brand development, working previously at Houzz and e-commerce platform Drip.

Arbor Realty Trust appointed Howard Leiner to the position of executive vice president and chief technology officer.

Leiner most recently served as managing director and global head of private bank technology at Goldman Sachs. loanDepot appointed John Bianchi to the position of executive vice president of national sales. Prior to joini ng loa n D ep ot , Bia nch i ser ve d a s executive vice president of national retail lending for Caliber Home Loans a nd held severa l sa le s leadersh ip positions w ith Bank of America and Countrywide Home Loans.

PARKER

CLEARWATER MARSHALL

Class Valuation named Michael Detwiler CEO. Formerly, Detwiler served as the senior managing director at Accenture. He also co-founded mortgage software company Mortgage Cadence in 1999, which was acquired by Accenture in 2013.

Angel Oak Mortgage Solutions appointed Travis LaLonde to head of its recently opened Las Colinas, Texas, operat ions center. La Londe has 15 years of experience in the mortgage industry.

M r. Cooper h i r e d Ch r istopher Marshall as chief f inancial of f icer.

M a rsha l l prev iou sly ser ved a s t he co-founder and former chief financial officer of Capital Bank Financial. Prior to that, Marshall worked as chief restructuring officer and senior advisor to the CEO at GMAC, and as chief financial officer at Fifth Third Bancorp.

Trulia appointed Issi Romem as its new chief economist. Prior to joini ng Tr u l ia, Romem worked for t he Rentonomics team at Apartment List.

He also previously worked at OnPoint Analytics as an economist and served as BuildZoom’s chief economist.

LoanLogics hired David Parker as senior vice president of product management. Parker previously worked for DXC Technology as general manager in bank ing and capital markets. He

also held senior positions at Fiserv, CoreLogic, Wells Fargo Home Mortgage and was founder and CEO of mortgage consu lt ing f ir m Praxis Technology Group.

Freddie Mac ap p oi nte d Ricardo Anzaldua genera l counsel a nd corporate secreta r y. A n z a ldua joi ned Freddie Mac as executive vice president and senior legal advisor in 2018.

Prior to joining Freddie Mac, Anzaldua worked at MetLife as executive v ice president a nd genera l counsel a nd held senior positions in the legal depa r t ment of t he Hartford Financial Services Group and at the law firm of Cleary, Gottlieb, Steen & Hamilton.

Movement Bank welcomed David Rupp as its new CEO. Rupp has 30 yea rs of exper ience, most recent ly serving as Four Oaks Bank’s CEO. He also held executive leadership roles in community banking at VantageSouth Bank, Greystone Bank, First Union and Bank of America.

Gateway Mortgage Group na me d Steven Patrick its new chief risk officer. Prev iously, Patrick worked as managing director for Everett Advisory Partners. Prior to that, he worked for Federal Home Loan Bank of Chicago, Bank of America and Merrill Lynch.

Blue Water Financial Technologies added Travis LaMar to its growing executive team as its managing director and head of capital markets. La Mar brings 20 years of experience in the mortgage secondary and capital markets to the company, holding prev ious roles such as managing director at Incenter and senior trading roles at U.S. Bank and GMAC-RFC.

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Visit sagentlending.com. Call 1-844-SAGENT-7 Š Fiserv LS LLC, d/b/a Sagent Lending Technologies.

EVENT CALENDAR

MBA TECHNOLOGY SOLUTIONS CONFERENCE AND EXPO 2019 MARCH 24-27, 2019 Host: Mortgage Bankers Association Location: Hyatt Regency, Dallas, Texas Cost: $1,050 - $3,375 On the agenda: The industry’s premier technology event of the year will be held in Dallas, Texas, where attendees will learn all things fintech. The 2019 EXPO will feature a full day of live product demos, 20 targeted breakout sessions and more than 100 exhibitors in the Innovation Hub. The Mortgage Bankers Association extends an invite to tech executives, real estate investors and business professionals working within the technology sector. mba.org

DALLAS, TEXAS

ELLIE MAE EXPERIENCE MARCH 10-13, 2019 Host: Ellie Mae Location: Moscone Center West, San Francisco, California Cost: $1,595 - $3,585 On the agenda: The 2019 Ellie Mae Experience will focus on the technologies driving the digital mortgage world. Now in its 39th year, the conference will deliver industry professionals 11 program tracks including, digital mortgage, cybersecurity and executive focus. This year, Ellie Mae has enlisted several esteemed speakers including author and motivational speaker Simon Sinek, Amazon Web Services Chief Evangelist Jeff Barr and best-selling author Gretchen Rubin. experience.elliemae.com

SAN FRANCISCO, CALIFORNIA The Ellie Mae Experience will take place in San Francisco California, a city known for its exquisite restaurants. Moscone Center is just a few miles away from Sardinian eatery, La Ciccia restaurant. This local gem has been featured in a number of publications, including the New York Times, Food & Wine and Fodor's Magazine. laciccia.com 12 HOUSINGWIRE ❱ MARCH 2019

Love heights and great food? Well, Dallas’ Reunion Tower is the place for you. Located in the heart of the metroplex, this one of a kind restaurant is a top tourist location. Not only will you be able to see an aerial view of downtown Dallas, but you will do it while enjoying an exquisite menu. reuniontower.com

Your brand’s message delivered directly to industry decision makers’ inboxes every day.

ON THE SHELF

HousingWire.com/Newsletter

Girl, Stop Apologizing

BY RACHEL HOLLIS HARPERCOLLINS LEADERSHIP

Bestselling author and media company founder Rachel Hollis, who also wrote 2018 best-seller Girl, Wash Your Face, is back again, this time challenging women to stop talking themselves out of their dreams. In Girl, Stop Apologizing, Hollis identifies the excuses to let go of, the behaviors to adopt and the skills to acquire on the path to growth, confidence and believing in yourself.

In the book she gives a, "shame-free plan for embracing and achieving your goals."

Company of One: Why Staying Small Is the Next Big Thing for Business

BY PAUL JARVIS HOUGHTON MIFFLIN HARCOURT

Paul Jarvis left the corporate world when he realized that working in a high-pressure environment wasn’t his idea of success. Instead, he now works for himself out of his home on a small island off of Vancouver. In the book, Jarvis explains how you can find the right path to do the same and make it work for you, from planning how to set up shop, determine desired revenues, deal with unexpected crises and keep clients happy. This approach is centered on staying small and avoiding growth, for any size business.

HousingWire.com Moving Markets Forward

ARCH MI | SPONSORED CONTENT

Mortgage professionals are now adopting Amazon's Alexa technology to enhance their business Arch MI’s Alexa Skill leverages the growing number of users as the market for voice technology continues to rise

A

mazon has transformed the dynamic of the average American household. Today, nearly 20% of Americans have access to a smart speaker and that number continues to grow. Amazon dominates the space with 61.9% market share and their Alexa, along with other smart voice devices, are becoming an integral part of our daily lives.

Alexa-enabled device owners can buy groceries, order a pizza, make appointments and more as additional businesses adopt Alexa Skills to meet consumers’ needs – including the mortgage industry.

14 HOUSINGWIRE ❱ MARCH 2019

“In a mobile world where mortgage pros are often on the go, not at a desk, voice technology is clearly part of our future,” said Jim Jumpe, chief marketing officer at Arch MI. “Arch MI’s commitment to innovation made Alexa an obvious next step in our mission to bring customers the best of technology to enhance their efficiencies.”

Arch MI now allows mortgage professionals to utilize their Amazon Alexa device to retrieve quotes, find an account manager and call customer service.

“It lets lenders leverage the latest industry technology in a way that recognizes the multitasking so often required of loan originators with demanding workloads,” Jumpe said.

Mortgage professionals can add the Arch MI Skill to an Alexa device easily by saying, “Enable Arch MI.” After the device enables the Skill, they can then say, “Alexa, launch Arch MI,” which will enable them to make the following requests: • “Alexa, get a RateStar quote” • “Alexa, find my account manager” • “Alexa, call customer service” • “Help” “As more team members studied customer service applications for Alexa, they became enthusiastic about the possibilities,” Jumpe said. “That energy continued to build as we achieved a number of firsts – including taking our first Alexa-enabled customer service call and delivering our first RateStar rate quote through Alexa.”

Early adoption has been high among lenders who are already using an Alexa device on a daily basis, while Arch MI hopes their new Skill will encourage an even wider audience of mortgage professionals to experience the convenience of voice-directed service.

“Our commitment is to offer the industry’s best customer service, no matter which channel you use to reach us. Our goal throughout this entire rollout has been to focus on providing a simple, seamless user experience,” Jumpe said.

And Arch MI is providing just that as customers use Alexa, Arch MI’s CONNECT Portal or a direct phone call for customer service.

With more options, lenders are free to choose which channel best supports their needs.

“Today, people expect ATM-level simplicity, and we’re getting great feedback from customers who are finding the Alexa Skill useful, convenient and easy to use,” Jumpe said.

TMS | SPONSORED CONTENT

Don’t wait for disaster to strike — test the strength of your subservicer now This TMS checklist will make sure your borrowers get white-glove service at a critical time

I

t’s already too late if all your subservicer does is react to a natural disaster or crisis. You need a proactive subservicer.

Take Hurricane Michael as an example. Initial estimates from CoreLogic predicted that Hurricane Michael threatened 57,002 homes along the Florida Gulf Coast, with the storm having an estimated reconstruction cost value of approximately $13.4 billion.

Do you know if your subservicer is prepared to handle that kind of influx of borrowers with swift care and efficiency?

With hurricane season being an annual threat, you need to make sure the same type of white-glove service you gave the borrower when you were trying to win them over is given by your subservicer when they’re going through one of their most difficult times.

One of the simplest ways to test whether or not you have a subservicer that’s prepared for a crisis is to call the customer service line. If it takes them 15 to 20 minutes to pick up the phone, that’s the same experience that your borrower is getting.

Once disaster strikes, borrowers need help quickly, with anything more than a couple of minutes feeling like eternity. Calling a mortgage company is just one thing they need to get to in the aftermath of a hurricane.

To help borrowers move through the recovering process as efficiently as possible, you need to dive deeper than the initial test call to your subservicer.

ARE YOU READY FOR THE STORM? Unfortunately, natural disasters and hurricanes will happen.

It’s on you to make sure borrowers are in the best hands possible when it happens. To test the strength of your subservicer, go through this check list to see how well they’d be prepared for a future crisis. Here’s what we do at TMS. IN PREP FOR THE STORM, TMS WILL… • Suspend collection calls to the potentially impacted areas before FEMA even declares the disaster areas.

• Promptly host a series of instructor-led micro sessions for our borrower-facing team members on how to read FEMA maps, where to direct borrowers if they need help, how borrowers can file for disaster relief, and what the process is to note someone’s account if their home or place of work is impacted by a natural disaster. The sessions also train team members on how to show empathy and that TMS is their partner through this.

•

Update its interactive voice response options to make sure borrowers are connected to the right person faster. As an example, the IVR says, “If you were impacted by the recent hurricanes or another disaster, and need to speak to someone about your loan, please press 9 now.”

ONCE FEMA DECLARES THE DISASTER AREAS, TMS… • Utilizes its award-winning subservicing platform SIME to make sure all borrowers are properly being tagged in the system, along with MSP. The platform tracks borrower payment habits in real-time so agents can know if the borrower is at risk of missing a payment.

• Provides team members an FAQ for questions borrowers may have. In the case of a hurricane, agents can answer if a borrower is impacted, whether or not they qualify for forbearance and how to explain it, how they can get FEMA assistance and more.

• Suspends collection calls to borrowers who declare that they have been impacted by the event Collections will no longer take place on borrowers who are engaged in disaster assistance through the duration of their program.

• Conducts regular wellness calls to proactively reach out to those impacted to keep track of their status. The agents get in front of them to make sure they know TMS is available and wants to help if a need arises.

• Stops credit reporting for any derogatory credit to those impacted.

• Suppresses late fees for all loans in the declared area, meaning declared for “Individual Assistance.”

• Works with insurance vendors onsite in the disaster areas to help borrowers file claims and turn checks quickly to get cash in the hands of the borrowers.

Don’t settle for a subservicer who can’t check off every item on this list since we know it’s possible to execute on. TMS delivers on this through every natural disaster and crisis and is ready and equipped to help your borrowers navigate any storm.

These tactics go beyond reacting to hurricanes and following the government’s guidelines on how to treat a borrower in a disaster area.

Yes, those steps are important, but it’s important to the success of the borrower that the subservicer proactively gets in front of them. This way, they can move on to rebuilding their life.

HOUSINGWIRE ❱ MARCH 2019 15

QL® MORTGAGE SERVICES

STRONGER TOGETHER

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Catherine Lovett CMO, Intent Mortgage QLMS Pinnacle Partner Scottsdale, AZ

Call (888) 762-5035 QLMortgageServices.com/StrongerTogether Equal Housing Lender, licensed in all 50 states, NMLS #3030

UNIQUE SOLUTIONS

SPONSORED CONTENT

Quicken Loans: The Answer Understanding the mortgage business takes time and training. But what if you could distill the knowledge of your best employees and make that available to everyone all the time? We sat down with David Schroeder, senior vice president at Quicken Loans Mortgage Services, to find out how Quicken did just that with their new tool, The Answer.

Q: What prompted Quicken Loans to develop The

DAVID SCHROEDER Senior Vice President Quicken Loans Mortgage Services

Answer interactive tool?

There’s a quote by one of the founders of IBM Watson, Dr. John E. Kelly III: “In the 21st century, knowing all the answers won’t distinguish someone’s intelligence – rather, the ability to ask the right questions will be the mark of true genius.”

Computers are perfectly designed to “remember” billions of facts, guidelines, rules, etc. Humans aren’t nearly as good at that. So, what if we could design software that helps humans ask the right questions – which then leads them to the right answers?

That is the goal of The Answer.

Every shop has that one person who seems to know everything. When people like this are asked a question, they start asking questions in return. “How long has the bankruptcy been discharged? Which investor is it? What’s the FICO Score?”

The problem with that is that those people are rare and, unfortunately, they don’t work 24/7/365.

So we took our most experienced, savviest experts – loan officers, underwriters, compliance folks – and we had them get all of the knowledge they’ve accumulated over the years out of their brains and into elegant algorithms we call “trails.”

Now, anyone using The Answer is essentially accessing the collective brainpower of these experts and can do so at any time – day or night. And there’s never a need to wait for a return call or sit on hold.

The sheer power of that information and the ability to get answers is profound. It reduces the need to train endlessly. It shortens the amount of time it takes to get someone up and running. And, most powerfully, it reduces fallout. How many loans get missed every month because someone didn’t know there was a way to do the loan?

Q: How does The Answer make your loan officers more effective?

Loan officers and processors will have greater confidence and speed to get answers. That’s critical in

today’s marketplace where Realtors and clients expect real-time interactions. In collaborating with our loan officers, we know that the biggest cost for them in any given year is found in the loans that didn’t close.

Our objective with The Answer is to help our partners deeply understand options available to convert (save) more of the No’s to YES!

Q: How did you develop the questions and potential scenarios for The Answer?

Quicken Loans assigned over 40 of our top underwriters and bankers to this project, along with a specialized IT team to develop the decisioning trails within each inquiry. There are millions of different possible outcomes based on the input of a user. It’s another powerful example of how the resources of Quicken Loans can help our partners to be stronger together.

Q: What’s the benefit to potential homebuyers?

Homebuyers and Realtors value certainly and abhor surprises. The Answer is all about addressing both of those concerns in a way that positions the loan officer favorably. No more waiting to get an UW on the line to ask about a scenario when it can be accessed immediately and with certainly. That in turn builds confidence in the loan officer with all stakeholders and helps to develop referral networks for future business!

And it’s mobile friendly to help while in the field or at an open house!

Q: How does The Answer fit in to the overall mission of Quicken Loans?

Our mission at Quicken Loans is to radically transform the experience in mortgage lending. Partners have called The Answer a “game-changer” for their business. Perfect alignment in growing our partner’s business while serving mortgage clients with the best solutions. Quicken Loans will never stop innovating and providing a better experience for partners and clients alike. This is just the second inning of The Answer – we’re just getting started!

HOUSINGWIRE ❱ MARCH 2019 17

Where experts and pundits sound off on a key industry issue

AT C R A A N D FA I R L E N D I N G C O L L O Q U I U M 2 0 1 8 “Technology is changing everything, including how the banking industry is adapting, as well as consumer and market expectations. We, as a federal agency, must also adapt.”

-Mark Pearce, FDIC

“The OCC’s 2018 fintech proposals are the culmination of a two-year journey on how fintechs that offer services similar to banks could have the type of regulatory oversight that makes it safe and encourages responsible innovation.”

-Grovetta Gardineer, OCC

“Regulatory change management is quickly evolving. From a technology standpoint, everything you can do to avoid manual processes and ‘fat finger’ risk, the better off you’ll be.”

-Stevie Conlon, Wolters Kluwer “Technology has replaced the heavy focus on branch banking and physical location. We’ll have to use technology to deal with disparities increasingly.

Complaints are coming increasingly from interactions with unregulated companies.”

-David Enzel, HUD “Adaptation is the single most important skill set for compliance officers and teams. We’ve got to be agile in our development. If it hasn’t arrived, it will.”

-Greg Imm, M&T Bank “Fintech/bank partnerships allow banks to control the ultimate product offered. There’s a duty for the industry to educate fintechs on regulatory compliance issues.”

-Lori Sommerfield, TCF

18 HOUSINGWIRE ❱ MARCH 2019

Rose Marie David, HomeStreet Bank senior executive vice president and single-family mortgage lending director, is far from her first career as a professional New York City ballet dancer, but that is where Marie David learned what it means to be committed and tenacious.

1. Last concert I attended was… Ed Sheeran with my nieces.

2. The book I can’t stop recommending is…

Five Dysfunctions of a Team by Patrick Lencioni.

3. My last vacation was… Carmel-by-the-Sea. My husband and I returned to celebrate our 25th anniversary.

4. After I am finished with my career I hope people remember… I loved and appreciated them.

5. My biggest learning opportunity was… it’s easy to be great when times are great. True character is revealed by how you lead through adversity.

HOUSINGWIRE ❱ FEBRUARY 2019 19

Hot SIZZLE? Not FIZZLE? 1 1 WHY THE

WHY THE

THESE LOAN TYPES



Most mortgage originators are worried that loan production expenses will increase while volume will decline, and they’ve pinpointed five areas of the market they think present the most opportunity in the year ahead. About 28% of LOs with 10 or more years of experience think construction loans present the most opportunity, followed by non-QM, not jumbo loans at 21%, renovation loans at 19%, jumbo loans at 16% and FHA loans at 15%, according to a recent survey

by Altisource Portfolio Solutions,. The survey polled 202 decision makers working in mortgage origination.

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2



3

HOME EQUITY BUSINESS PennyMac sees opportunity in home equity lending, announcing that its loan services subsidiary will now offer HELOCs. The company said its new HELOC product will roll out immediately in five states: California, Florida, Oregon, Virginia and Washington – with expansion on the horizon. The loan will only be available to existing PennyMac borrowers, but the company said it plans to increase availability once the program grows. PennyMac said its HELOC offering will help 1.4 million borrowers access their equity.



20 HOUSINGWIRE ❱ MARCH 2019

Redfin classifies luxury homes as those that sold among the top 5% most expensive in the quarter.

According to the company, sales of homes priced at or above $2 million decreased 3.9%, the first time in more than two years that luxury home sales fell on an annual basis. Redfin Chief Economist Daryl Fairweather said this is due to economic headwinds. In fact, in the fourth quarter, luxury homes went under contract after an average of 74 days on the market, nine more days than in the third quarter of 2018.

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2

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3

ZILLOW OFFERS Zillow will begin buying and selling homes through its Zillow Offers program in nine new markets in 2019: Dallas; Houston; Raleigh, North Carolina; Riverside, California; Miami; Minneapolis-St.Paul; Nashville; Orlando and Portland. Sellers in these markets can request cash offers from Zillow to buy their home.

Zillow announced it expects the program to be fully up and running in these markets by the fall. Zillow Offers allows homeowners to request a no-obligation cash offer from Zillow to buy their home. If they accept it, Zillow directly buys a seller’s house, prepares it for showings and quickly lists it for sale.

LUXURY HOUSING MARKET

INTEREST RATE HIKES As 2019 begins, many experts and even Federal Reserve members are predicting that the Federal Reserve is done raising interest rates, at least for 2019.

Federal Reserve Chairman Jerome Powell said the U.S. central bank can be patient when it comes to further rate hikes. Powell said since inflation is low, the Federal Reserve can be patient about its rate hikes, waiting to see how economics will play out in 2019.

And St. Louis Fed President James Bullard said the Federal Reserve had “reached the end of the road” in this tightening cycle.

HOME REMODELING Home improvement and repair activity is going to slow considerably by the end of 2019, according to the Joint Center for Housing Studies of Harvard University. The center tracks the movement of this market through what it calls its leading indicator of remodeling activity index. The latest LIRA report projected that spending on renovations and repairs will decrease from 2018’s 7.5% to 5.1% in 2019. After several years of stronger-than-average increases, the pace of growth in remodeling activity is expected to fall back to the market’s historical average annual gain of 5.2%.

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Trish Gregovich Tournament Director

T

Ellie Mae Classic

The Ellie Mae Classic, which will be held at TPC Stonebrae in Hayward, California, from July 29-Aug. 4, gathers world-class golfers, top athletes from other sports and mortgage industry professionals to raise money for charity. The Ellie Mae Classic is part of the PGA TOUR’s qualifying Web.com Tour and benefits the MBA Opens Doors Foundation, the Warriors Community Foundation, Youth on Course and The First Tee. We spoke with Trish Gregovich, Tournament Director, to find out more about the Ellie Mae-PGA TOUR collaboration.

What makes the PGA TOUR a good partner for those raising money for charity?

Trish Gregovich: Supporting local charities is the “why” behind everything we do and the cornerstone of our partnership with Ellie Mae. The PGA TOUR offers a dynamic platform that brings together professional athletes, fans, volunteers and the worlds’ most philanthropic brands to rally around a common goal in the communities where we play.

Q&A

What kind of impact has the Ellie Mae Classic made on the charities it benefits?

TG: The critical benefit is consistent and reliable funding each year. In addition, we provide a platform for our charitable partners to share their mission to a broad and diverse attentive audience. By participating in the tournament each year, they celebrate existing funding partners and meet new ones, ensuring continued success in a crowded landscape. In partnership with Youth on Course, The First Tee and the Warriors Community Foundation, we support programs that create tangible positive outcomes through funding youth programs, college scholarships and mentoring for at-risk youth.

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In 2019, we are delighted to welcome MBA Opens Doors Foundation as the Ellie Mae Classic’s primary beneficiary. Last year we raised $40,000 to support their Home Grant Program, dedicated to helping families with critically ill children stay in their homes by providing mortgage and rental payment assistance.

The Ellie Mae Classic kicked off in 2009. Ten years later, what are some event highlights?

TG: We’ve had an incredible decade at TPC Stonebrae!

On the professional level, Tony Finau earned his first professional win at the 2014 Stonebrae Classic (now called the Ellie Mae Classic). Two years later, in 2016, Stephan Jaeger opened with a 12-under 58 Thursday at TPC Stonebrae, recording the lowest score ever shot in a regulation. We all freaked out – no one had ever seen anything like that in a PGA TOUR-sanctioned tournament.

In our most recent years, we’ve been fortunate to welcome NBA All-Star and Golden State Warrior Guard Stephen Curry into our professional field as a sponsor exemption. He plays with so much joy and love for the game, it’s fun to watch. From a personal point of view, the memories we make bringing together our community of fans, sponsors, volunteers and partners are a highlight and something we all look forward to each year. That’s the real magic!

How can mortgage companies be a part of the 2019 Ellie Mae Classic?

TG: There are many ways to get involved! Love golf?

Sponsor a Pro Am team at the Monday Community Pro Am presented by HousingWire. All skill levels are welcome and there's nothing like hearing your name called by the starter and playing 18 holes inside the ropes alongside the world's most talented pro golfers.

Or connect with fans and get your brand noticed with on-course branding opportunities. If you like wine and gorgeous vistas, come for the Monday “Lift a Glass, Raise a Roof” dinner in celebration of MBA Opens Doors Foundation. We are looking for partners to continue to take the tournament to the next level and love innovative ideas!

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By Jim Parrott, David Stevens, Mark Zandi

The way to reduce taxpayer risk in the mortgage market Could GSE reform be near?

With the recent turnover in leadership at the Federal Housing Finance Agency, we may be standing at the precipice of great change in the government’s role in supporting the mortgage market through Fannie Mae and Freddie Mac. As part of its effort to reduce taxpayer exposure, the new regime will likely look to reduce the government’s role in the market by reducing the role in Fannie Mae and Freddie Mac, possibly significantly.

Before wading into the debate over how to go about the effort, it is important to 24 HOUSINGWIRE ❱ MARCH 2019

take stock of how the system actually benefits from government support. With those benefits in mind, it is then worth asking whether drastically reducing the government’s role in the system is the best way to go about reducing the taxpayer’s significant risk in the space.

In the absence of government support, long-term fixed rate lending would be a shadow of what it is today. The majority of investors willing to invest in the 30-year, fixed rate loans to which Americans have grown accustomed will only do so with the government standing behind the credit risk.

In its absence, they will withdraw from the market and most Americans will wind up in adjustable rate mortgages, with their payments rising and falling with the movement of global interest rates. This will make it more difficult for borrowers

to manage what for many is their largest financial liability, particularly in a rising rates environment as we have today.

In addition to seeing swings in how much the typical borrower owes each month, we’ll also begin to see variation in rates across the country and through the economic cycle. Through their provision of the government’s support of the market, the GSEs have created common standards for mortgages made all across the country, covering everything from underwriting the loans to servicing them. The standardization allows for a large and liquid mortgage market, resulting in rates that are more consistent across the country and less volatile across the business cycle. As the government pulls back, the mortgage market will fragment according to region, credit risk and type of borrower, leading to more variation across market segments, less liquidity and more volatility.

This increasing variation will have a disproportionate impact on low- and moderate-income families. Many low- and moderate- income borrowers benefit today from a significant cross-subsidy provided in the system, with higher credit risk borrowers paying more than their risk warrants so that lower credit risk borrowers pay less.

Delivered through the level pricing of the government’s support of the system, this cross-subsidy would be much lower in the absence of that support, leading to considerably higher rates for those with higher credit risk, including many low- and moderate-income borrowers.

The variation will also come at the expense of smaller lenders. The standardization that the government brings to the market levels the playing field for all lenders, so that smaller lenders have access to the secondary market on terms that are roughly equal to those enjoyed by larger lenders, allowing them to compete on equal footing. As the government pulls back and the market sets the lenders’ terms for engagement, it will reward those with larger balance sheets and more capital, allowing larger lenders to offer rates on more favorable terms than smaller ones.

Finally, losing the government’s support

of the mortgage market will make it more cyclical. By removing the credit risk for investors in mortgage-backed securities and giving Fannie Mae and Freddie Mae access to government-backed capital, it makes the market less vulnerable to swings. Without that support, the investors that drive demand for most of the nation’s home loans, and those that provide Fannie Mae and Freddie Mac with the funding they need provide these securities, would all demand much greater returns as economic times worsen. This would drive up mortgage rates and contract the housing market at the very time when the housing market would need liquidity most.

That is not to say that the system is without problems. But the problems arise from the way that the government supports the mortgage market not from the fact that it supports it. By relying on a privately-owned duopoly to provide the lion’s share of the government’s support, we make the mortgage market beholden to institutions with an incentive to take on too much risk. Knowing that they are too important to be allowed to fail, they have every incentive to take on more and more risk for greater and greater returns.

When their riskiest bets pay off, they win big; when they don’t, it is the taxpayers that lose.

The place for FHFA to focus on reducing the taxpayer’s risk is thus in the way that the government supports the mortgage market, not so much the scale of the support. Indeed, if it were to shrink the government’s footprint while leaving the system dependent on the government-sponsored enterprises to deliver the government’s support, it will land on the worst of all outcomes: failing to address the central risk in the mortgage market while undermining the benefits that come with the government’s support. We will wind up with a mortgage market that is less competitive, less equitable, less stable and riskier.

The better course is to begin the transition to a housing finance system that can deliver the benefits of government support without relying on any privately held, toobig-to-fail institutions. This can be done

ZANDI

Mark Zandi Moody’s Analytics chief economist and on the boards of MGIC and Reinvestment Fund.

STEVENS

David Steven Housing Policy Adviser, former MBA CEO and former FHA Commissioner.

PARROTT

Jim Parrott Urban Institute nonresident fellow and Falling Creek Advisors owner.

by expanding the number of institutions that play the critical intermediary role that the GSEs play today, so that anyone can be allowed to fail without bringing the entire system down with them, or by putting their functionality into a single market utility designed to expand competition elsewhere in the market. While each has its merits, either would rid us of the structural flaw that sits at the foundation of today’s system, doing immeasurably more to reduce taxpayer risk than simply reducing government support of the system.

To move down either path of reform, the FHFA needs to build on its predecessor’s efforts to reduce the market’s reliance on Fannie Mae and Freddie Mac for securitization and for assuming the lion’s share of credit risk. It should expand the common securitization platform that the GSEs are close to completing to handle more functions and become accessible to more market participants. By expanding its utility and its reach, the platform will not only increase standardization and liquidity, but it will gradually replace the GSEs as the central intermediary between the primary and secondary markets. And to reduce the market’s reliance on Fannie Mae and Freddie Mac in assuming credit risk, the FHFA should continue to develop and deepen the channels by which most of the credit risk that they assume gets passed on to others in the market as a matter of course during normal economic times.

Expanding the credit risk transfer process, across both structured and institutional market participants and at both the loan level and the pool level, will help disperse not only the GSEs’ risk, but their market power as well.

If it really wants to reduce the taxpayer’s risk in this system, the FHFA shouldn’t simply crack down aggressively on reducing the government’s market share, as doing so will come at too high a cost and fail entirely to address the much more significant structural risk in the system.

Instead, it should focus on how the government provides that support, reducing our reliance on the too-big-to-fail duopoly that remains its centerpiece.

HOUSINGWIRE ❱ MARCH 2019 25

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By LaRence Snowden

New disaster assessment calls for additional $2 billion for Hurricane Harvey recovery Updated calculations could have implications for disaster-impacted housing nationwide

Back in 2017, Hurricane Harvey swept through Houston, Texas and the surround areas, bringing disaster upon the residents.

In fact, officials declared that Harvey dumped more water on Texas than any storm in history. It was a Category 4 storm, the first major hurricane to make landfall in the U.S. since 2005.

In addition to the lives tragically lost, original estimates showed the damage 26 HOUSINGWIRE â?ą MARCH 2019

could total in the tens of billions of dollars, according to a report, RMBS 2.0 Exposure to Hurricane Harvey Affected Counties, released by Kroll Bond Rating Agency.

What made matters worse, the analysis showed 52% of residential and commercial properties in the Houston metro were

at high or moderate risk of flooding, but were not in a Special Flood Hazard Area as identified by the Federal Emergency Management Agency, according to a CoreLogic analysis for the flooding which occurred due to Hurricane Harvey.

In all, only about 20% of homeowners affected by Harvey had coverage, according to Robert Hunter, Consumer Federation of America director of insurance.

After the crisis, many in the finance in-

LaRence Snowden is the board Chairman of the Houston Housing Authority. He has served on the board of commissioners at HHA since 2012. Snowden is also the assistant vice president of research for Texas Southern University.

dustry even stepped up to help. For example, Wells Faro and JPMorgan Chase each donated $1 million for Hurricane Harvey relief efforts. Fannie Mae and Freddie Mac each sent out a reminder of their disaster relief policies, urging families affected by the storm to contact their mortgage servicer.

Short-term rental site Airbnb announced it launched its Disaster Rental Program to help Texans evacuate from the hurricane.

This program offered evacuees housing in major emergency events, and encouraged its hosts to offer their homes up for free.

Also aiding in relief efforts, BB&T Corporation contributed $100,000 to the American Red Cross of Greater Houston to help those affected by the hurricane, along with sending shipments of humanitarian supplies.

Even the Consumer Financial Protection Bureau issued a public statement to encourage its supervised entities to help consumers affected by Hurricane Harvey.

The U.S. Department of Housing and Urban Development also announced mortgage and foreclosure relief as well as other assistance to some families, including to the 200,000 FHA-insured homeowners, living in the impacted areas.

And now, an innovative way to assess Hurricane Harvey damage builds a strong case for the City of Houston to receive an additional $2 billion in federal funds for housing assistance.

If awarded the funds, millions of dollars could be allocated to build more affordable multifamily properties which would help to alleviate the city’s affordable housing crisis. Houston had an affordable housing deficit of 400,000 units before Harvey. The storm destroyed an additional 311,000 units, nearly doubling the deficit.

THE OLD WAY OF ASSESSING DISASTER DAMAGE The unprecedented flood damage to the city prompted local leaders to rethink how to accurately calculate damage.

“Existing methods for calculating residential damage after a disaster are limit-

ed and have the potential to severely underestimate recovery needs,” the City of Houston report states. “Houston has had five federally declared disasters in the last three years. If damage is underestimated after each disaster, Houston is being chronically under-resourced for recovery.”

Under the old way of calculating damages, Houston was set to receive $1.17 billion for housing recovery, which did not include residents who had unreported disaster damage.

THE NEW MODEL OF DAMAGE ASSESSMENT AND CONCLUSIONS The new assessment was monumental. It was conducted by a team of data scientists, flood engineers and Houston’s Housing and Community Development staff over an eight-month period following Hurricane Harvey.

The new methodology – which identifies all impacted residents and provides a more comprehensive and accurate estimate of costs to repair impacted homes based on Houston-specific maps – shows the city has additional unmet needs that weren’t previously accounted: • $870 million more to correct for the number of households that had damage.

• $1.1 billion more to correct for the amount it costs to repair the damage.

The study found flooding devastated areas with high levels of social vulnerability, where low-income residents have the fewest resources to recover. Twelve neighborhoods were identified that have at least one census tract with very high social vulnerability, above 0.8 on the University of South Carolina’s Social Vulnerability Index, and damage above 50% of the estimated annual income of residents in the buildings that were damaged.

Persons with disabilities were disproportionately impacted. While representing 10% of Houston’s overall population, they were 15% of impacted households.

Another vulnerable group was senior citizens, who represent 12% of impacted

people. However, seniors represent 21% of damage by dollar value because homeownership is high among seniors and the value of buildings and contents are higher for this group as compared to groups with lower homeownership rates.

In the Houston study, 46% of impacted households were renters. The recovery strategy for renters relies on building more affordable rental housing throughout the city.

Additionally, after six years of declining homelessness in Houston, the city has seen a 15% rise in homelessness after Harvey.

Significant interventions after Harvey to transition more than 600 families out of disaster shelters and into apartments and other residences likely prevented the homeless rate from jumping even higher.

THE CALL TO ACTION Communities ravaged by natural disasters must turn their attention to Houston’s post-disaster response. Houston Housing Authority officials envision the authority as a catalyst for improving neighborhoods by working with area schools, clinics, merchants and economic development groups.

We hope other cities and housing authorities that suffered damages from natural catastrophes – ranging from hurricanes on the East Coast to landslides and wildfires on the West Coast – adopt this new damage assessment model to further financially assist residents who lost their homes and to help rebuild communities.

On the local level, the public, needs to be educated about the dire need for affordable housing. When residents aren’t cost burdened with exorbitant rents and mortgages, it builds a more financially-sufficient population and contribute to economic success for the community.

When Hurricane Harvey devastated thousands of families, the city banned together as one community. HHA looks forward to continuing this spirit of collaboration and compassion in the rebuilding process even as Hurricane season is now visible in the distance.

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By Jacob Gaffney

HOUSINGWIRE ❱ MARCH 2019 29

“WE ARE A COMPLETELY DIFFERENT COMPANY from when you used us back in 2016 and we would love to show you,” the account executive said. “I understand you have a few lenders that you use. I am simply asking, what do you need from me…to get back in the fight with where you are placing loans.”

“OUR MANDATE is to help brokers in any way, shape or form. That’s what a trade group does.””

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AT THE START OF THE NEW YEAR, Black Diamond Mortgage Owner David Boye received an email from an account executive representing one of the nation’s largest lenders asking for a second chance.

“We are a completely different company from when you used us back in 2016 and we would love to show you,” the account executive said. “I understand you have a few lenders that you use.

I am simply asking, what do you need from me… to get back in the fight with where you are placing loans?”

Boye’s response was swift and clear: “I wish you the best, there is no chance that we will ever do business together. NONE.” Over the next 10 years, Millennials are expected to purchase at least 10 million new homes, according to the U.S. Census Bureau and First American calculations. By 2060, it is estimated that the generation will have produced more than 20 million first-time homebuyers.

Millennial demand for homeownership was one of the biggest trends influencing the housing market in 2018, First American Senior Economist Odeta Kushi said in a recent note. This is unlikely to reverse course going into next year, the year after that or for many years to come.

While this generation is often “mistakenly portrayed” as showing a preference for renting, Kushi notes this is incorrect – Millennials still appreciate buying a home but have different motivations and delays in doing so.

“Because they grew up in the wake of the housing bust, Millennials are less likely to consider homeownership as a means of building wealth and, therefore, choose homeownership based more on whether homeownership fits their lifestyle or not,” Kushi said.

“Our research shows that, because lifestyle choices are the most important factors influencing the decision to become a homeowner, it is reasonable to expect the homeownership rate for Millennials to increase as more get married and form families.”

While the homeownership rate for young adults is currently quite low, with just over one-third of adults under age 35 owning a home, the potential for home sales is high. Kushi notes that more than half of all the purchase mortgages guaranteed by Fannie Mae and Freddie Mac in 2018 went to first-time homebuyers.

It was this data alone that prompted

the writing of this story. We set out to ask how lenders were going to battle for the borrower. The answers we received changed our minds. There’s battle happening on a much smaller scale, and that’s the battle for the broker.

In a recent interview with me, Caliber Home Loans CEO Sanjiv Das, referred to “skirmishes” in the mortgage broker space that hogged headlines in 2018.

The main one is the arrival of the newly formed trade group, the Association of Independent Mortgage Experts. The head of the group, Anthony Casa, is himself a lightning rod, posting candid comments on Facebook. He calls Quicken Loans, “Quikey,” saying it stems from a cease and desist order he once received from them.

AIME appears to be fighting the National Association of Mortgage Brokers for membership, and Casa posts regular commentary about NAMB with the same aforementioned flair, using a mixture of strategy and alarm.

“There is a marketing sense to everything I do,” Casa explained to me during lunch one recent afternoon at HousingWire headquarters in Dallas.

“Talk to any mortgage broker about their fear and mix that with people willing to put themselves out there on Facebook.”

A group of mortgage brokers, led by Casa, recently decided to stand up against the way things have always been in wholesale lending, thus creating Brokers Rallying Against “Whole-tail” Lending.

BRAWL’s basic premise is that some wholesale lenders steal clients from brokers by cross selling to borrowers through their own retail channel and are therefore unsafe, while others are “good” lenders that avoid these practices.

Then the movement started naming names, and the real conflict began as companies fought to defend their practices.

AIME also accused NAMB of not standing up for brokers and defending them against lenders on the “bad” list.

But despite the conflict between the two groups, underneath the surface, the two trade groups might just be able to get along.

Casa believes AIME can coexist peacefully with NAMB, not unlike the Mortgage Bankers Association and the American Bankers Association. And despite his social media grandstand-

HOUSINGWIRE ❱ MARCH 2019 31

Who’s who: BRAWL Brokers rallying against “wholetail” lenders. A movement started by Anthony Casa representing brokers who are tired of lenders refinancing loans they originated and cutting them out of the process.

AIME Association of Independent Mortgage Experts. A newly formed trade group, also started by Casa, which represents mortgage brokers.

NAMB Nati o n al A s s o c iati o n o f Mortgage Brokers. An existing brokers trade group and AIME’s competition. Critics claim this group wasn’t doing enough to help brokers, thus the support behind AIME.

UWM United Wholesale Mortgage.

On BRAWL and AIME’s good side. Made the list as one of the “good” lenders and supports Casa’s initiatives.

QUICKEN LOANS On AIME and BRAWL’s bad side.

Made the list of “bad” lenders but says this movement is spouting false accusations.

32 HOUSINGWIRE ❱ MARCH 2019

ing, he may have a point.

I spoke to NAMB Executive Director Valerie Saunders and Board President R ichard Bettencourt in a conversation that took a different direction than the one I had with Casa. The suite of public services NAMB offers members, and even nonmembers, is deep – office supply discounts, tech products, health care – some of which AIME doesn’t do.

Bettencourt is a champ at the lobbying game, meeting with Ginnie Mae to talk VA cash-outs and the Consumer Financial Protection Bureau to discuss QM ATR. In 2019, Bettencourt plans to tackle broker regulations on points and fees, flood insurance reform and the impact of federal regulations on condo sales in Florida.

“Our mandate is to help brokers in any way, shape or form,” he told me. “That’s what a trade group does. We’re not here to pick winners, that’s not what a trade group does.”

Casa applauds NAMB lobbying efforts and admits it’s not an immediate focus for AIME. “I personally think there are bigger priorities to focus on,” he said. “Brokers need tech if they want to survive. And what will happen to us if brokers go out of business?”

And technology is one thing both trade groups agree on. Both NAMB and AIME launched new tech tools to members.

“We are always looking for ways to make mortgage lending more efficient for brokers,” Saunders said, herself a broker since 2006.

“Pre-2008 people weren’t as concerned about keeping administrative costs low. Today, business owners are always looking for ways to keep overhead low, which includes minimal non-revenue generating support staff, greater reliance on technology and doing whatever it takes to keep your doors open.”

And while 2019 will be difficult for all lenders, not just brokers, there are rays of hope for those who are prepared.

“2019 looks like it’s going to be a year of a lot of disruption, a lot of consolidation, lots of folks getting out,” Movement Mortgage CEO Casey Crawford said when he recently acquired a big piece of Lennar’s mortgage arm, Eagle Home Mortgage. “A lot of people will be taking advantage of a lot of that opportunity in the marketplace.”

So where will the broker fit into this? In the brief video interview on HousingWire.com, Das discussed why being “deeply entrenched” in the purchase mortgage market will be key to success in 2019.

And lenders will need to be prepared to battle for the broker as competition heats up across the mortgage market. Das discussed some of his company’s principles of mortgage lending.

Not stealing refi leads, a big issue for lenders that brokers chose to partner with in 2018, is at the top of that list.

Das, who served as head of CitiMortgage from 2008 to 2013, also talks about what to expect in the looming mortgage slowdown, why nonbanks are here stay, and how to deal with interest rate volatility.

As for economic troubles on the horizon, Das explains why this “might not be such a bad thing.”

“The broker community is actually going through an interesting time right now, a transition of its own,” Das said. “For a start, we’d like to see an increase in their percentage of total mortgage originations. I think right now it’s around 9% to 10%. I don’t see why brokers can’t reach 18% of the market for originationsit’s a large market.”

“We think of brokers as our partners and we think of their customers as their customers,” Das added, referring to the fundamental problem that started the BRAWL movement.

Das is not alone in seeing a growing opportunity for working with mortgage brokers.

“Our thoughts on the broker haven’t changed,” Quicken Loans CEO Jay Farner said when I caught up to him recently. “We are here to support and help that community.”

Quicken Loans is on BRAWL’s list of “bad lenders,” however it denies any unfair treatment toward its brokers.

Farner said Quicken Loans has a three-point attack plan: offer brokers great products, strong pricing and great technology.

“From our perspective, it’s the internal efforts that make the difference,” he said, pointing to the company’s Rate Shield program that provides a 90-day rate lock, the newly launched automated application The Answer which gives answers to questions commonly asked of underwriters and the Fresh Start program which gives credit advice and assistance to clients who don’t qualify for a mortgage.

“Our model allows us to adjust by the day or week, based on current market conditions,” Farner said.

And brokers such as Boye will need all the convincing lenders have. He often feels like some lenders with big retail shops are more interested in taking loans away from him.

“If a loan is going to get botched, it tends to be with one of those big guys,” he said, adding that borrowers are changing and so is their perception of the mortgage market.

“Back in 2008, we all had to hide under our desks,” he recently told me. “Everyone fled to the safety of the big banks – they were seen as safe.”

How the times have changed.

“Consumers feel harmed by the big banks,” Boye said. “And normally my relationship will trump any internet lender. Today I can take a loan from Wells Fargo just by saying that I won’t work with Wells Fargo.”

But if the market for purchase mortgages is tough, the market for refis is even tougher.

The Federal Reserve Bank of New York’s Center for Microeconomic Data recently released a survey based off consumer experiences. The survey is the result of panel data acquired directly from consumers when they apply for credit.

The whole BRAWL initiative started in response to lenders refinancing loans previously originated by brokers, and cutting that broker out of the process. But now, it seems there are no mortgages to even refinance.

TheFed’s latest poll finds rejection rates are on the decline across all credit applications, but not for mortgage refinancing.

The survey found that more homeowners are getting their refi applications rejected. In fact, this rejection rate is the highest since the Federal Reserve began polling consumers about their credit experiences.

“The October rejection rate on mortgage refinance applications of 34.3% is the highest reading since the start of the SCE Credit Access Survey in October 2013,” the Fed reports. “For 2018 overall, rejection rates for credit cards and credit card limit extensions and for mortgage refinancing exceeded those in 2017, while those for auto loans and mortgage applications were stable.”

Of course, with interest rates rising, refinance applications are slowing down. Respondents reported a 6.8% likelihood of applying over the next 12 months in 2018, compared with 8.2% for 2017 respondents.

Further, more and more Americans also report that they don’t plan to even try to apply for a refi in the next 12 months.

Interest rates are not going through the roof in 2019. However, Capital Economics wrote in a note to clients that this remains nothing to get too excited about. For example, even as technology continues to replace processing jobs in mortgage lending, the cost efficiency has yet to translate into

more mortgages.

“The drop in mortgage applications in December, even as interest rates saw further falls, supports our view that lower financing costs will not be enough to boost housing market activity in 2019,” Capital Economics Property Economist Matthew Pointon wrote.

“A slowing economy and moderation in house price expectations will act to keep mortgage demand and home sales flat over the next year or so,” he added. “And, as it stands, there is this one, clear indication of a looming slowdown and a big potential for recession that we will be watching this year.”

According to today’s Structured Finance Credit Update from S&P Global Ratings, a recent Duke University/CFO Global Business Outlook shows roughly half of U.S. finance chiefs believe the economy will slide into recession by the end of 2019. Americans are paying 5.6% of their disposable income servicing non-mortgage debt, a figure that has been mostly rising since 2012.

Slowdown aside, United Wholesale Mortgage CEO Mat Ishbia said he believe the opportunity is now to help brokers grow their business. In 2018, UWM closed out the year with $41.5 billion in total loan volume, making up nearly a quarter of the entire wholesale industry’s market share. Also, toward the end of 2018, the company rolled out two products aimed at enhancing the way brokers do business.

“We’re known for having great products, pricing, service and technology, but the truth is that UWM is a great partner because we’re on the same team as our mortgage broker clients,” Ishbia said.

“We’re 100% aligned and tied at the hip. We’re not just a lender or an investor, we’re a partner.”

UWM was on BRAWL’s “good lenders” list, and from the start has shown its support for AIME’s initiatives to Battle for the broker.

And it looks like UWM is setting the bar even higher in 2019, as the company has recently announced plans to change its pricing philosophy.

According to UWM’s announcement, it will now provide mortgage brokers with what it’s calling “the best rates and pricing in America.”

However, in a recent video interview with me, Ishbia said he didn’t agree that 2019 would be the battle for the broker.

“It’s really a battle for the originator,” Ishbia said. “Originators are coming to the broker channel, and I don’t think it’s much of a battle anymore, I think they’re leaving in droves from retail lenders. You know, it’s a lot easier than you think.”

”NORMALLY MY RELATIONSHIP WILL TRUMP ANY INTERNET LENDER. Today I can take a loan from Wells Fargo just by saying that I won’t work with Wells Fargo.”

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34 HOUSINGWIRE ❱ MARCH 2019

lasting effect OF THE longest shutdown THE

IN U.S. HISTORY

And the potential results if it happens again Kelsey Ramírez

HOUSINGWIRE ❱ MARCH 2019 35

days.

It was the longest shutdown in government history, which came to an end only after our political leaders came to a temporary agreement.

The irony? The shutdown ended up costing the U.S. economy much more than the amount President Donald Trump requested for his boarder wall – the source of the original disagreement and the conflict that fueled the shutdown.

The shutdown began Dec. 22, 2018, after Congress and the president could not agree on $5 billion in funding for a boarder wall between the U.S. and Mexico. Trump wanted the wall, and Congress refused to fund it.

Then, in 2019, Democrats took over the House of Representatives and the new Speaker of the House, Nancy Pelosi, took Trump on, refusing to budge or compromise on border wall funding.

This standstill lasted 35 long days. Flights were delayed. Families evicted. Government workers furloughed or forced to work without pay.

Finally, an agreement was struck to open the government for three weeks and continue negotiations during that time, but not before leaving a disaster in its wake.

Reports show that federal contracts for 1,150 government-funded properties that house low-income renters expired as a result of the shutdown. This delayed repairs and even caused some families to be evicted. This represented 5% of all Section 8 programs.

In fact, the Federal Housing Administration called on all approved mortgagees and lenders to be “sensitive to the financial hardships experienced by borrowers as a result of the shutdown,” including borrowers who were subject to furlough, layoff, or a reduction in income due to the shutdown.

The more than 800,000 government workers who didn’t receive pay during that time were paid back, but many were 36 HOUSINGWIRE ❱ MARCH 2019

forced to take out loans or dip into savings during their month without pay, and it could take a while for them to recover. Also, government contract workers will not receive back pay since they didn’t work during that time – they just lost their contract work.

“President Trump’s historic, 35-day shutdown of the federal government has had a deeply harmful impact on millions of Americans and the U.S. economy,” Chairwoman of the House Financial Services Committee Maxine Waters, D-Calif., said. “While this shutdown recently came to an end, we must not forget the recovery has just begun for a wide range of affected consumers, including federal employees, contractors, small businesses and other individuals.”

“Many of those people will not receive back pay, and many of them have various financial obligations, like a mortgage or a student loan payment, that they may have missed,” Waters said in a floor statement on H. Res. 77, a resolution to encourage financial institutions, consumer reporting agencies and other entities to do what they can to help individuals affected by the shutdown. “However, they did not cause the shutdown and should not suffer any negative consequences from it.”

The National Association of Realtors reported that 11% of its members said they had transactional delays as a result of the shutdown. Another 11% said they had customers opt out of buying or selling their home until the uncertainty clears.

Many Americans may also see delays in receiving their tax returns. While Trump said that Americans will get their money, and quickly, a government watchdog warned that the Internal Revenue Service is backed up.

The National Taxpayer Advocate, a government watchdog group that oversees the tax collector, said it could take 12 to 18 months for the IRS to catch up, saying it is

buried in millions of unanswered taxpayer letters and is weeks behind schedule for training and hiring new workers for the tax season.

Now, as the dust is beginning to settle, we’re getting our first look at the cost of the shutdown on the economy.

THE COST A new report from the Congressional Budget Office shows that the shutdown likely cost the country $11 billion in economic activity.

The CBO estimates that the country’s gross domestic product will likely be down by $3 billion for the fourth quarter of 2018 compared to what it would have been had the government not shut down at the end of the year.

But given that the government shut down toward the end of December, the greater impact will be felt in the first quarter of this year. The level of real GDP is expected to be $8 billion lower in the first quarter than it would have been if the government was open for business, according to the CBO. A new report from S&P Global Ratings suggests a similar downturn in economic activity as a result of the shutdown. S&P’s report showed the U.S. economy lost at least $6 billion dollars because of the shutdown.

This is more than the $5.7 billion that the White House requested for the border wall that was the central cause of the shutdown itself.

“The longest partial shutdown in history, which started as a minor cold, began to feel like a nasty flu that had begun to spread across the states,” S&P said in its report.

“And the overall cost is likely worse than what we had previously expected.”

While the CBO notes that some of the lost economic activity will likely be regained in future quarters, the CBO and S&P write that some of what was lost during the HOUSINGWIRE ❱ MARCH 2019 37

shutdown may never be recovered.

“Among those who experienced the largest and most direct negative effects are federal workers who faced delayed compensation and private-sector entities that lost business,” the CBO said. “Some of those private-sector entities will never recoup that lost income.”

S&P agrees, noting that some of the direct costs from the shutdown are unrecoverable.

“In particular, economic activity from lost productivity from furloughed government and contract employees won’t be recovered. The direct hit to economic activity from furloughed workers is amplified by lost spending by furloughed government and contract workers due to lack of ready income,” S&P notes. “Furloughed contract workers will not get back pay, so they are left trying to repair finances after losing five weeks of wages.”

The CBO also notes that there are some other consequences that will not likely be felt immediately, but will begin to show themselves in time.

“For example, some businesses could not obtain federal permits and certifications, and others faced reduced access to loans provided by the federal government,” the CBO wrote. “Such factors were probably beginning to lead firms to postpone investment and hiring decisions.”

“In addition, risks to the economy were becoming increasingly significant as the shutdown continued,” the CBO added. “Although their precise effects on economic output are uncertain, the negative effects of such factors would have become increasingly important if the partial shutdown had extended beyond five weeks.”

S&P also notes that the shutdown may have lasting consequences on the government employees and contractors who were basically turned into pawns in what turned out to be a pointless political standoff.

“We did not consider the effect on morale of government workers who were required to work without pay,” S&P said. “Even if they decided to show up to work, some, reportedly, have called in sick, we suspect that working in those conditions has lowered productivity rates for them as well.”

“It may also create a challenge for government agencies and contractors,

when they want to hire them back,” S&P continued.

“With worries that Uncle Sam may leave them in the lurch, with bills to pay, the next time the government decides to close, which is all too frequent, these workers may decide to opt for a job in another industry that they feel has more job security.”

And with more potential shutdowns looming, those negative effects could come sooner rather than later.

“Although this shutdown has ended, little agreement on Capitol Hill will likely weigh on business confidence and financial market sentiments,” S&P said. “For those workers who were living without a paycheck, revolving credit payments and credit scores may also take a hit.

Although this funding battle has ended, the next one starts in a few weeks, which may reduce growth expectations if businesses and financial markets begin to expect that Congress and the president will repeat the experience again and again.”

FUTURE SHUTDOWNS Lawmakers came to a temporary agreement to re-open government, but they are far from a permanent agreement.

Pelosi continues to insist there will be no border wall funding, and Trump says he will find a way to get the funding.

“If we don’t get a good deal from Congress, the government will either shut dow n again on February 15th, or I will use the powers afforded to me by the Constitution of the United States to secure the funding,” Trump said when he announced the temporary deal to reopen the government.

Shutdowns have been increasing in number. During this administration, the government shut down not once, not twice, but three times as the president and Congress were constantly at odds over funding issues.

Previously, the government shutdown in January 2018 also due to immigration-related issues – protections for young people in the Deferred Action for Childhood Arrivals program, an Obama-era program that shields young undocumented immigrants from deportation.

Congressional Democrats wanted to give them certain protections, Trump did not.

And now, with the track record on this administration, some economists are beginning to project what yet another government shutdown could mean for the economy.

Although this shutdown has ended, little agreement on Capitol Hill will likely weigh on business confidence and financial market sentiments.

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When it happened December 22, 2018 Government shuts down December 27, 2018 FEMA rules not to renew national flood insurance program December 28, 2018 FEMA changes its mind, renews NFIP January 2, 2019 Fannie Mae releases new policies for mortgage lenders during shutdown

January 3, 2019 Nancy Pelosi becomes speaker of the house January 4, 2019 Shutdown halts reverse mortgage endorsements January 7, 2019 IRS resumes income verification for mortgages January 8, 2019 FHA asks lenders to help unpaid federal workers

“The partial government shutdown had concentrated effects, with limited ramifications for the broader U.S. economy,” Moody’s explained in a report. “A second shutdown could be more severe.”

Moody’s found that the damages from the most recent shutdown “have been concentrated with limited ramifications for the broader economy.” However, that would change if another shutdown happened again soon, as it would “complicate negotiations over the debt ceiling,” sparking fears about whether the Treasury Department would delay debt payments.

And economic struggles aren’t the only thing the administration has to fear as a result of another shutdown.

Government employees are also becoming increasingly put off by the insecurity their job offers.

Government workers who spoke to TIME over the course of the shutdown about the challenges of not receiving pay say they are worried about the precariousness of their situation and are increasingly angry about their jobs being on the line because of the budget battles.

Keeping good workers, or hiring new ones, might increasingly become a problem for government offices.

THE HOUSING INDUSTRY RESPONDS Once the government was reopened, the housing industry responded by commending the government for coming to a short-term agreement, explaining the effects the shutdown had on housing, and pressing lawmakers to pass longer-term funding.

“NAHB commends President Trump and congressional leaders for working together to reopen the government for three weeks while they tackle the issue of border security,” said Randy Noel, National Association of Home Builders chairman. “At a time when the nation is facing a growing housing affordability crisis, the shutdown has exacerbated the situation by disrupting funding for important HUD housing programs.”

January 11, 2019 Democrats move to prevent evictions on unpaid government workers January 18, 2019 Fannie, Freddie issue lenders new rules for longer-term shutdown January 25, 2019 San Jose bans evictions on unpaid federal workers January 25, 2019 Shutdown ends

“It is vitally important that Congress and the White House come to an agreement on securing our southern border to ensure the federal government remains open indefinitely,” Noel said.

NAR said that while the shutdown did not have a direct effect on real estate, the economic uncertainty it caused did.

“The housing industry was already facing market challenges before any government closure,” NAR Chief Economist Lawrence Yun said. “A home purchase is a major expenditure that simultaneously involves a high level of excitement and anxiety, and the shutdown adds another layer of unnecessary complication to the home buying process.”

“It is causing tangible harm to potential buyers, the real estate market, and economic growth,” he said.

Yun estimates that the economy will see a drop of 0.5 percentage points directly related to the shutdown, saying, “The longer the shutdown, the more impact from it.”

The National Low Income Housing Coalition called the shutdown “a disgrace.”

“The shutdown was a disgrace, causing stress and hardship for our country’s lowest-income and most vulnerable people,” NLIHC President and CEO Diane Yentel said. “Over time, we will learn the extent of the longer-term damage done to the programs that serve them and to what extent the damage can be remedied.”

Some in the industry simply expressed their hope that this would not happen again.

“As it has become abundantly clear in recent weeks, the shutdown has had a real impact on borrowers and our industry,” said Nate Shultz, The Money Source vice president of government and regulatory affairs, on the day the government reopened. “Hopefully, today’s developments will lead to a lasting compromise that will ensure critical federal programs remain up and running without further incident.”

HOUSINGWIRE ❱ MARCH 2019 39

VALUATION TECH SOLUTIONS As the cost to originate a loan continues to rise, the demand for efficient and cost-effective valuation tech remains a high priority for lenders and investors.

The complicated process to get it right requires the proper mix of technology and expertise, which is why we are spotlighting these five companies in our Valuation Tech Solutions. Trusted, proven leaders in the valuation space — these companies are leveraging tech to drive accurate, fast valuations for every loan type.

Class Valuation

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Valuation Partners

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CoreLogic

Global DMS

Veros

Class Valuation VALUATION TECH SOLUTIONS

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lass Valuation has always focused on ensuring customer satisfaction at every turn. As the industry has evolved, they’ve been a strategic supporting player, helping lenders maintain compliance, while leveraging superior technology to increase speed and transparency throughout the process. And 2019 will be no different.

“We all know that the high-touch valuation space we live in today is not sustainable in the years to come. Combine that with the fact that there are major GSE initiatives to redesign forms, update data standards, and modernize the appraisal process, and we are on the precipice of change. The time is now to thoughtfully alter the way we look at home appraisals. Class will be leading the change in the valuation space and will do so while continuing to focus on our superior service model in the support of our lender customers, inspectors, appraisers and ultimately, the homeowners, to the fullest,” said Chief Innovation Officer Scot Rose.

To that end, Class Valuation is partnering with all stakeholders – inspectors, appraisers, lenders, GSEs, other investors, and homeowners – to help lead the charge in defining the future of appraisals.

“The pain point we are solving for? An arena teetering on the brink of change.

By focusing on scalable solutions that are delivered through our technology and utilized by our lender partners, our inspectors, and our appraisers, we will help keep the industry moving forward,” Chief Growth Officer Jon Tallinger said.

Class Valuation is no stranger to innovation. By optimizing their processes and analyzing the data they collect, the company has reduced turn times, improved quality, and enhanced their customers’ experience. They have done this through a variety of innovative tools, including Fast Track, a web-based tool designed for anywhere, anytime access to order status, enhanced dashboards for real-time views into order metrics, and internal business process enhancements for true optimization and getting orders in the right hands.

“Technology has always been core to our business. To further this initiative, we added a CIO, a CTO and several other key leaders to begin thinking about technology on a broader scale,” President John Fraas said.

Since the company was founded in 2009, its commitment to superior levels of customer service and streamlined processes have proved to be a differentiator, resulting in a fast-growing customer base. Through a private equity investment in March of 2018, the company will certainly lead thoughtful change as a top 5 AMC serving retail, wholesale and correspondent channels. In late 2018, it acquired Landmark Network — expanding their reach into the reverse market as well.

But even as the company grows into new channels and looks to the future of the space, their focus on the homeowner represents the company’s biggest opportunity.

For Class Valuation, the true test is making the homeowner happy. As one homeowner wrote in: “The appraisal has been this potential dark cloud looming over my plans. I was so anxious to get the results that I began bugging your customer service chat at 7 AM this morning. Your team kept me updated through the process all day!

Everyone was so sweet and helpful and made me feel like I was your ONLY client.”

“Digitizing every piece of the process is not the only answer,” Rose said. “In this already highly digital world, we know consumers want a personalized experience full of transparency. We seek to deliver on that promise, while providing lenders with tools that will assist them in the years ahead.”

Class Valuation 2600 Bellingham Drive #100 Troy, MI 48083 classvaluation.com Scot Rose Chief Innovation Officer Scot Rose joined Class Valuation in April 2018 as the Chief Innovation Officer. He has over 18 years of valuation industry experience. Prior to joining Class, he was President of Valuation Connect and served two terms as the former Vice Chair of the Colorado Board of Real Estate Appraisers. Rose is focused on the advancement of product and platform innovation and strategic vision.

Jon Tallinger Chief Growth Officer Since helping to start Class as its first employee in 2009, Jon Tallinger has played several key roles throughout the company. Under his direction, Class’s sales and marketing team helped the company grow by over 250% since the start of 2016. Tallinger and his team are planning for even bigger growth and success in 2019 and beyond. He credits the continued growth to the company’s dedication to constantly improve and find new ways to make their processes better.

John Fraas President As the President of Class Valuation, John Fraas is responsible for overseeing the day-to-day operations and aids in the execution of the company’s strategic plans. Fraas is passionate about helping the company to continue to grow through innovation and exceptional service. Fraas received his BA from Michigan State University and is a licensed CPA in the state of Michigan.

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CoreLogic VALUATION TECH SOLUTIONS

O

CoreLogic 40 Pacifica, Suite 900 Irvine, CA 92618 corelogic.com Vicki Chenault Executive of Collateral Valuation Services Vicki Chenault currently holds the role of Executive leading the Collateral Valuation Services businesses.

She transitioned to this role after leading enterprise-wide strategy and transformation initiatives, including advancing the roadmap for The Columbia Institute.

Chenault previously served as senior vice president of Escrow Services for CoreLogic.

She was responsible for leading the Flood, Property Tax and National Joint Ventures businesses within CoreLogic Mortgage Origination Services. Previous positions include vice president of operations for CoreLogic Flood. Chenault joined the company in 1997 and has more than 30 years of mortgage industry experience.

Chenault earned a Bachelor’s of Business Administration in finance from Texas Tech University and a Bachelor’s of Science in accounting from the University of North Texas.

ver the past several years, CoreLogic has significantly grown its valuations business through a series of acquisitions.

With consumers, lenders, regulators and the GSEs expecting faster and more accurate valuations, CoreLogic delivers a host of comprehensive valuation tools for a seamless valuation process.

“In a market where property insight data is fragmented, inconsistent or incomplete across multiple sources, or simply not available, CoreLogic has designed industry-leading collateral management solutions that connect lenders and vendors while providing the most reliable property data insights,” said Vicki Chenault, executive, CoreLogic Collateral Valuation Solutions.

CoreLogic Collateral Valuation Solutions (CCVS) leverages data to provide a centralized hub that successfully manages appraisal orders, AVMs, and title and closing services. These solutions are both technology platforms and integrated provider networks that connect the valuation and collateral management ecosystem — including appraisers, inspectors, agents, loan officers, underwriters, reviewers, title providers, escrow agents, notaries and more.

“Through ever-advancing digital technology solutions, we empower lenders and appraisers to deliver more accurate valuations in less time through full compliant means,” Chenault said.

CCVS automates the ordering, communication and management processes associated with collateral valuation, resulting in: • Risk mitigation • Automation of compliance tasks • Elimination of manual operation processes to reduce costs, errors and time • Configurability to meet the specific needs of any sized lender or AMC based on their specific rules • A consistent, repeatable and reliable process across their entire enterprise “By leveraging integrated systems, integrated data, automated appraisal analyses and alerts, preferred methods of consumer communication and other means of utilizing a technological advantage, our solutions hasten the appraisal order process, catch issues early and eliminate or accelerate revision cycles for faster, more accurate valuation services,” Chenault said.

With CCVS , lenders and AMCs are able to manage their valuation operations in compliance with banking regulations, all while reducing expenses and improving overall quality. The appraisal process becomes a more streamlined, efficient experience from the time an appraisal is ordered to the time the valuation is delivered.

“We work tirelessly to deliver a configurable solution that is streamlined for our clients’ specific business needs,” Chenault said. “We provide a level of service that they have relied upon for years — they know we will take care of them, allowing them to focus on their core business.”

CoreLogic plans to bring more data, analytics and technology into CCVS platforms in order to streamline and automate the collateral valuation workflow. This includes applying artificial intelligence, image recognition analytics and analytics-based property inspections to speed turn-around times and significantly improve valuation accuracy.

“We work tirelessly to deliver a configurable solution that is streamlined for our clients’ specific business needs.”

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Global DMS VALUATION TECH SOLUTIONS

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n today’s mortgage industry, more and more lenders and AMCs are leveraging a comprehensive, custom-configured workflow that will automate the valuation management process through final delivery. As the regulatory environment intensifies and the cost to originate loans increases, so does the demand for a sophisticated appraisal solution.

Global DMS, a leading provider of cloud-based commercial and residential real estate valuation technology solutions, developed a solution to manage the multitude of tasks needed to successfully collateralize a mortgage loan. Clients can custom configure eTrac to match their exact processes, using as much or as little automation as needed.

The solution is cost effectively delivered on a SaaS transactional basis that ensures compliance adherence, reduces costs, increases efficiencies and expedites the entire real estate appraisal process.

“While there are platforms on the market that offer some degree of workflow automation, most do not allow for the depth of configuration and implementation of business rules that automates everything — not just a portion of their process,” said Vladimir Bien-Aime, president and CEO of Global DMS. Automating the valuation process through proper technology saves time for lenders, banks and AMCs. eTrac’s workflow engine can be custom configured to the user’s unique way of handling appraisals, automating multiple complex events, actions and statuses using specific timelines. This leads to minimal manual intervention by staff, elimination of data errors or missing information, reduction of costs and smoother workflows.

The solution’s proprietary QC functionality ensures appraisal accuracy in the early stages of the process, where users can notify appraisers by setting reminders throughout the workflow. Additionally, eTrac automates the communication of assignments, allows for the setting of tasks and provides timely status updates.

“Our clients find the variety of workflow configurations to be key towards managing their entire appraisal operation,” Bien-Aime said. “The ability to run reports on any data field is also key to managing the overall process, while the automation of routine tasks and delivery helps optimize efficiency.”

With the entire valuation ecosystem changing, lenders are continually on the lookout for a remedy to keep costs low, maintain acceptable turn times, remain compliant and ensure the accuracy of appraisals.

Leveraging workflow-based technology solutions, such as eTrac, helps clients keep compliance at the top of their list.

“After clients implement eTrac, we hear that the workflow engine plays a significant role in streamlining the appraisal process, giving them gains in efficiency, productivity and tracking by automating notifications and file delivery to the ordering parties and borrowers,” Bien-Aime said. “Many clients say eTrac makes their appraisal process very easy and efficient, and they love knowing that their organizations are always compliant and have quality appraisals.”

“The ability to run reports on any data field is also key to managing the overall process, while the automation of routine tasks and delivery helps optimize efficiency.”

Global DMS 1555 Bustard Road Suite #300 Lansdale, PA 19446 gloabldms.com Jody Collup CMO and Director of Operations Jody Collup has more than 25 years of marketing and management experience working in both the private and nonprofit sectors, with the majority of her experience being in the mortgage industry and specifically technology. She currently serves as the Chief Marketing Officer and also Director of Operations for Global DMS, where she runs the marketing department and also manages the company’s operations, organizational structure, and long-term business strategy.

Vladimir Bien-Aime President & CEO Vladimir Bien-Aime is the President and CEO of Global DMS, which he founded in 1999 and built from the ground up. Since that time, he has grown the company into the mortgage industry’s leading provider of cloud-based, enterprise-class valuation management software solutions. A consummate technologist and constant innovator, Bien-Aime was instrumental in architecting Global DMS’ comprehensive eTrac enterprise valuation management platform.

Bien-Aime later developed a number of ancillary products and services that enhanced eTrac and made it more robust. Most recently, he launched EVO-Commercial, the next generation of commercial valuation technology.

Bien-Aime is considered a pioneer in the valuation software space and a subject matter expert who has a deep understanding of complex federal, state and local appraisal-related compliance rules and regulations.

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Valuation Partners VALUATION TECH SOLUTIONS

Valuation Partners 300 Madison Avenue, Suite 900, Toledo, OH 43604 valuationpartners.com William Fall, MAI, SRA, ASA Chief Executive Officer William Fall is responsible for the overall performance of the organization. He is a 30+ year industry veteran who leads all aspects of growing The William Fall Group and Real Estate Valuation Partners. He is General Certified appraiser in five states and has participated on experience review and disciplinary committees for the Appraisal Institute. He is a member of the Collateral Risk Network, the Industry Advisory Committee of the Appraisal Foundation, and the Executive Committee of the National Appraisal Congress.

He is a frequent speaker on industry issues.

Charles Warr SVP - Business Information Services Charles Warr is responsible for overseeing all technology-related activities including information security, software/product development and infrastructure.

He participates with the Mortgage Bankers Association, the MISMO Property and Valuation Services Workgroup and is a member of the Appraisal Institute. He has been an appraiser for over 20 years and is a principal in the firm.

Jon Forrester Vice President, Valuation Services Jon Forrester is the Vice President, Valuation Services for Valuation Partners. Forrester is responsible for overseeing the management of new valuation products for the company. Over the past 25 years, Forrester has been focused on appraisal management for the lending community, as well as the development of the next generation of valuation products. He has also been instrumental in developing independent testing solutions for the use of Automated Valuation Models. These solutions support the development of collateral assessment cascades, which include property condition assessments, AVMs, evaluations, desktop appraisal reports, as well as traditional appraisals.

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I

n today’s ever-changing lending environment, rising origination costs and regulatory burdens are prompting lenders to look for reliable solutions that leverage convenience and speed at an affordable price — especially in the valuation space. With the expertise of over 35 years in the business, Valuation Partners recognized the market’s need for a hybrid valuation solution and developed its STATS Valuation Product Cascade to meet that need.

“Lenders are hungry for an option that reduces valuation costs without sacrificing quality,” said Jon Forrester, vice president of valuation services at Valuation Partners. “Our STATS platform accomplishes this beautifully by seamlessly integrating the valuation process with bestin-class inspection data and a national repository of market data to support our process.”

Owned and operated by appraisers, Valuation Partners provides vendor management, appraisal reviews, collateral assessment, broker price opinions and appraiser-assisted products to the mortgage industry through geographically competent appraisers in every state. With STATS, Valuation Partners deploys that robust network of appraisers to gather subject field data while deep analysis is contributed by a credentialed appraiser with geographic competency.

STATS supports a fully integrated valuation workflow, promoting seamless interactions between field inspection and the desktop appraisal data. Validated data sources are deployed with confidence and supplemented by statistical analysis.

“Our system allows us to deliver STATS products with a one-day turn time,” said Charles Warr, senior vice president of business services at Valuation Partners.

The solution provides a single point of contact for an entire breadth of valuation solutions, ranging from basic AVMs to desk-tops to full appraisals.

However, unlike traditional valuation solutions, STATS can be deployed according to the lender’s risk evaluation on a loan-by-loan basis. Lenders can graduate to a more sophisticated valuation product in a seamless process, with no duplicated effort on the part of the lender.

“Lenders are often challenged in bringing on new partners for different valuation needs,” Forrester said. “Our STATS platform is an end-to-end enterprise solution for every level of valuation.”

Where many industry solutions offer a mix of multiple standalone products, the STATS platform breaks the old-school mold to provide customers a fully integrated solution that allows for compliance with all state and federal requirements, as well as regulatory guidance. And field agents and appraisers are required to complete competency-based training modules prior to completing assignments.

“Clients trust the integrity of our legendary quality being embedded throughout the process. There is a reason we have been in business for over 35 years,” said CEO William Fall. “We expect to provide dramatic productivity gains through the use of our solutions combined with deep industry talent.”

“Our STATS platform accomplishes this beautifully by seamlessly integrating the valuation process with bestin-class inspection data and a national repository of market data to support our process.”

Veros VALUATION TECH SOLUTIONS

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eros Real Estate Solutions, a developer and distributor of innovative mortgage technology, created VeroPRECISION as a superior valuation alternative to traditional AVM approaches, with particular benefits for Appraisal Management Companies (AMCs) and the home equity lending space. VeroPRECISION is the first decisioning engine that works as an AVM forerunner, determining a subject property’s suitability for AVM analysis prior to running the AVM. If it determines the property is suitable for AVM use, it immediately initiates the running of two of the industry’s top-rated AVMs, delivering the more accurate of the two.

Where an AVM is deemed unsuitable for use, VeroPRECISION forwards the property valuation request to a preselected traditional appraisal method. This not only accelerates the valuation process, but saves the lender money as well.

“VeroPRECISION gives AMCs and other valuation providers that support home equity lending applications a way to optimize and improve their property valuation analysis processes,” said VP of Sales Robert Walker, CMB CMT. “Too often, AMCs have been required to run a lenders’ preferred AVM models sequentially through a cascade in order to maximize hit rates. Unfortunately, this often compromises accuracy, as not all subject properties are good candidates for AVM analysis.”

VeroPRECISION uses decisioning logic, artificial intelligence and machine learning to create AVM suitability functionality that boosts valuation accuracy beyond anything achievable by any AVM or AVM cascade available in the market today. A top-tier AVM typically has an accuracy rate, when compared to recent appraisals, of about 65% nationally. In a test of 30,000 observations per month over a 12-month period, VeroPRECISION achieved a valuation accuracy level of over 75% nationally by limiting rendered values to properties deemed unsuitable for AVM use.

“VeroPRECISION takes the guesswork out of the valuation process by identifying upfront whether or not a property is suited for AVM use. As a result, lenders and other stakeholders can rest assured that the property values they receive are highly accurate,” Senior Vice President of Operations David Rasmussen said.

Looking ahead, Veros’ biggest opportunity is leveraging its data and analytics in combination with other data resources and artificial intelligence to create better solutions for the industry’s valuation-centric needs. These products should help Veros resellers – and especially AMCs – streamline processes and gain operational efficiencies, while reducing costs and minimizing risk. With ongoing changes in the mortgage and real estate industries, such as the potential raising of appraisal waiver limits and rethinking the use of traditional appraisal forms, Veros is uniquely poised to lead the way with innovative new ways to assess and value properties.

For example, in February the company began augmenting its VeroVALUE AVMs with natural disaster data, which allows customers to get expedited updates on how natural disasters affect individual parcels. The Disaster Data analysis tool is able to flag which pieces of residential real estate assets are directly affected and attach values to those properties so that financial service providers can better determine changes in value, if any, based on the asset’s condition following the disaster.

“Veros customers view the company as a partner that is willing to work with them to create solutions that address their concerns and needs,” President and CEO Darius Bozorgi said. “Our evolving suite of products ultimately enhances the experience for everyone — lenders, AMCs and their customers.”

Veros Real Estate Solutions 2333 N. Broadway, Suite 350, Santa Ana, CA 92706 veros.com Darius Bozorgi President and CEO As a co-founder of Veros, Darius Bozorgi is a national leader in valuation, predictive analy tics and decision-support technology applications. Under his leadership, Veros has earned numerous awards and recognitions for innovation and leadership.

David Rasmussen SVP, Operations David Rasmussen leads the operational logistics of Veros’ numerous valuation analytic and system strategies. Over the years, he has contributed significantly to Veros’ advancement of mortgage-related enterprise risk management systems and collateral valuation services.

Robert Walker, CMB CMT VP, Sales Robert Walker is responsible for leading the sales team and market strategy and for driving innovation and creating a disruptive force in the market.

He has 20+ years in the analytics and AVM space and has a solid reputation for product innovation and market insights.

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RentWire

Airbnb vs. America THE NATION’S LARGEST CITIES ARE FIGHTING BACK AGAINST THE RISE OF SHORTTERM RENTALS

BY BEN LANE

AFFORDABLE housing advocates have long lamented the rise of Airbnb and similar short-term rental platforms, arguing that short-term rentals exacerbate the growing problem of housing affordability by removing long-term housing options from the market.

And now, those affordable housing advocates have some rather large allies joining the fight against Airbnb and the like, as recently, some of the nation’s largest cities have begun to clamp down on short-term rentals.

In the last year, New York City, Boston, Los Angeles and other cities have all enacted new rules limiting the availability of shortterm rentals and taking legal action against both the platforms themselves and their users, where necessary.

In most cases, the issues come not from single-family homes, but rather from multifamily properties. In several instances, cities have already taken action against property owners, landlords and others for running “illicit hotel chains” made up of multifamily units that have turned into permanent short-term rental options.

And cities have taken direct aim at Airbnb, passing new laws commanding the platform to turn over mountains of data on its users, creating laws stipulating which properties can appear on the platform and ordering the site to do much more to police its

platform than ever before.

But the nation’s largest short-term rental platform is showing no intentions of merely giving up without a fight. And that’s set up a battlefield with several fronts. Consider it Airbnb versus America.

New York City, for example, passed legislation in 2017 that went into effect in February 2019. The law prevents landlords and tenants from illegally renting out apartments for a few days at a time to tourists.

Additionally, Airbnb would be required to provide the addresses and names of hosts to the city each month, and specify whether rentals are for a whole apartment or just a room.

Airbnb claimed that its users were on track to generate about $140 million in booking revenue in 2018, from which Airbnb takes about a 15% cut. But once the new law takes effect, Airbnb argued that its New York hosts could lose about $70 million of that revenue.

Airbnb sued over the law, claiming that the ordinance violated users’ privacy rights. Airbnb’s fight was joined by HomeAway, which sued as well, and eventually, the two lawsuits were merged into one.

The short-term rental platforms argue that the city’s ordinance is the result of a “concerted lobbying effort by rival industries HOUSINGWIRE ❱ MARCH 2019 47

“

The decision today is a huge win for Airbnb and its users, including the thousands of New Yorkers at risk of illegal surveillance who use Airbnb to help make ends meet. The court today recognized the fundamental importance of New Yorkers’ constitutional rights to privacy and the sanctity of their own homes.”

aimed at hobbling home-sharing platforms’ ability to do business in New York City.”

Specifically, the sites claim that the hotel industry “pursued a national lobbying campaign with the goal of impairing home-sharing platforms’ ability to compete with traditional hotels.”

The sites also claim that the New York City law violates the First and Fourth Amendments of the Constitution, along with federal and state law.

In January, a federal judge ruled in the short-term rental platforms’ favor, freezing the law’s requirement to disclose user data while the lawsuit is being decided.

48 HOUSINGWIRE ❱ MARCH 2019

“The decision today is a huge win for Airbnb and its users, including the thousands of New Yorkers at risk of illegal surveillance who use Airbnb to help make ends meet,” an Airbnb spokesperson said in a statement. “The court today recognized the fundamental importance of New Yorkers’ constitutional rights to privacy and the sanctity of their own homes.”

On the other hand, New York City Mayor Bill de Blasio said that the city has no plans to give up and feels that its laws are built on solid footing.

And while that case is being adjudicated, New York City is not content to sit on its hands and allow short-term rentals to multiply in the city unfettered.

RentWire

Just two weeks after being handed that legal defeat, New York City sued a group of New York City real estate brokers, claiming that they made $21 million through a series of illegal Airbnb short-term rentals in flagrant violation of the city’s laws.

According to the city, Metropolitan Property Group, its owners, and others operated at least 130 illegal short-term rentals in the city over the last several years.

The city claimed that the brokers were repeatedly warned to stop violating the city’s short-term rental laws, but chose to continue to do so, earning more than $21 million in illegal revenue from Airbnb.

In its lawsuit, the city claims that MPG operated illegal shortterm rentals in at least five residential buildings the company owns, controls, manages and operates in Manhattan for at least four years. The units in those buildings are only allowed to be used as permanent residences, according to NYC’s lawsuit.

But, according to the city, MPG’s alleged malfeasance goes beyond just those five buildings.

“Presumably through the relationships Defendant MPG and its real estate agents have allegedly cultivated, they have controlled, managed, operated, offered and advertised illegal short-term rentals within the Subject Buildings as well as at least 30 other permanent residential buildings in Manhattan since at least 2014 with an estimate of at least 130 different apartments converted from permanent residences to transient accommodations,” New York City stated in its lawsuit.

It is illegal under New York law to rent out a unit in most buildings for less than 30 days unless the tenant is present during the time of the rental, but MPG frequently rented out entire units on Airbnb, according to the city.

All in all, the city claims that MPG was responsible for almost 13,700 illegal short-term rental reservations, which generated a total of approximately $21 million in revenue from 2015 to 2018, and deceiving almost 76,000 guests who booked their accommodations through Airbnb.

And New York City isn’t the only major city that’s gone after landlords for using residential units as short-term rentals. Last year, San Francisco, which has some of the strongest laws protecting against the spread of short-term rentals in multifamily buildings, levied serious sanctions against a pair of landlords who knowingly and willingly ignored the city’s laws by running an “illicit hotel chain” of short-term rentals on Airbnb.

But New York City and San Francisco aren’t the only ones taking Airbnb head-on.

Boston also has new rules surrounding short-term rentals that were set to go into effect on Jan. 1, 2019. The rules are designed to limit the growing number of short-term rentals in the city by restricting who can list their house or apartment on a short-term rental site.

But that wasn’t all the laws did. The law also established new rules that threaten short-term rental sites with “draconian” punishments should they violate the city’s rules, according to Airbnb, which sued the city over its laws.

“This is a case about a city trying to conscript home-sharing platforms into enforcing regulations on the city’s behalf, in a manner that would thwart both federal and Massachusetts law,” Airbnb claims in its lawsuit filing. “The City of Boston has enacted an ordinance limiting short-term residential rentals by hosts. But it goes much further than that.”

“The Ordinance also enlists home-sharing platforms like Airbnb into enforcing those limits under threat of draconian penalties, including $300-per-violation-per-day fines and complete banishment from doing business in Boston,” Airbnb continues.

“Airbnb believes that home-sharing may be lawfully regulated, and it has worked with dozens of cities to develop the tools they need to do so without violating federal or state law,” the filing adds. “Boston’s heavy-handed approach, however, crosses several clear legal lines and must be invalidated.”

Regardless of what happens in Boston, the state of Massachusetts took matters into its own hands and enacted statewide short-term rental laws that went into effect late last year.

Under the state law, the state’s current 5.7% hotel tax is extended to most short-term rentals. The law also gives municipalities the option of tacking on an additional 6% onto the tax; 9% if an owner rents out two or more units in the same community.

Additionally, the law requires short-term rentals to be registered with the state. The law also requires people who rent out their rooms to obtain $1 million in liability insurance.

“Our administration has long supported leveling the playing field for short term rental operators who use their properties as de facto hotels, and I appreciate the legislature’s work to reach a compromise on this bill that adopts our proposal to avoid placing undue burdens on occasional renters,” Massachusetts Governor Charlie Baker said in a statement provided to HousingWire.

As for Airbnb, the company said that it is “deeply disappointed” in the state’s new laws.

“We’re proud of the community we’ve built in Massachusetts, with over 1.2 million travelers using Airbnb to visit the Commonwealth and nearly 2 million Bay Staters using Airbnb to travel at home and abroad in 2018 alone,” Airbnb said in a statement provided to HousingWire. “While we are deeply disappointed in the flawed bill that emerged from Beacon Hill during the lame duck session, we will continue the fight to protect our community and the economic engine of short-term rentals for hosts, guests and local small businesses.”

And if the trend continues, Massachusetts, New York and California will hardly be the only places where Airbnb has to fight for its right to operate as it wants.

HOUSINGWIRE ❱ MARCH 2019 49

50 HOUSINGWIRE ❱ MARCH 2019

DID YOU KNOW Jacob Gaffney sends LendingLife updates twice a week by email?

Go to HousingWire.com to sign up and stay informed!

Lenders prepare to face headwinds in 2019 INTEREST RATES RISE, CREDIT REMAINS TIGHT

BY JACOB GAFFNEY THIS month’s cover story is sure to be a LendingLife favorite for some time. The battle for the broker is happening in the industry and all the different takes on the subject are interesting.

In the run-up, United Wholesale Mortgage CEO Matt Ishbia appeared in a HousingWire video interview to discuss recent mortgage lending gains at the wholesale brokerage. The idea was to provide the full interviews with sources for said cover story to the LendingLife audience for them to watch and decide.

“It’s really a battle for the originator,” Ishbia told HousingWire.

“Originators are coming to the broker channel, and I don’t think it’s much of a battle anymore, I think they’re leaving in droves from retail lenders.”

But we can’t sugar coat the process of switching over to the broker space. There is a waiting period, there is licensing, there are all sorts of things to consider.

So, why make the transition to the broker space? Ishbia gives a few reasons: better rates, better technology, better service.

“You know, it’s a lot easier than you think,” he said But some disagreed with Ishbia’s point of view.

Many LendingLife readers wrote in to express disappointment in seeing a video in the LendingLife email with Ishbia. Many on

the retail side still view the broker community as a segment of the mortgage lending community as caring about money first and everything else second.

We can appreciate these comments – in the past LendingLife has been accused of being a “pay to play” news service when Ishbia graces its pages. There is simply something about a broker-focused lender that rubs people the wrong way. Nonetheless, we believe in giving a voice to those who operate in the mortgage lending space, but not everyone takes us up on the offer.

While Ishbia is putting himself out there, there are some mortgage lending executives who refused to be interviewed. So who’s really to blame during the coming slowdown? Those who duck and cover or those who are trying to get out in front?

Another question presented to the LendingLife community is based on interest rate volatility. While it’s impossible to totally predict, Capital Economics sent over an email providing guidance on rate movement for the next two years.

“With equity markets rebounding from their recent lows, economic growth solid, and core inflation close to 2%, we still think the Fed will raise rates once more, either at the April/May or June meeting,” stated Michael Pearce, Capital Economics senior U.S. HOUSINGWIRE ❱ MARCH 2019 51

•M ortgage deli quencies have consistently dropped every quarter since the fourth quarter of 2009.

• I n the subprime risk tier this improvement was particularly noticeable, dropping to 18.62% from 20.44% over the same period the previous year.

HERE’S THE IMPORTANT STUFF FOR LENDINGLIFE READERS:

•M ortgage originations decreased by 0.4% annually, continuing a trend of declining originations since the second quarter of 2017. Consumerlevel delinquencies continue to improve, dropping every quarter since the fourth quarter of 2009.

economist. “Further ahead, however, we expect a sharp slowdown in economic growth will force the Fed to cut rates by 75 basis points in 2020.”

Mortgage application activity cooled off in mid January after starting the new year with two consecutive weeks of sizable increases, said Joel Kan, Mortgage Bankers Association vice president of economic and industry forecasting.

“Both purchase and refinance applications saw declines but remained at healthy levels, with the purchase index remaining close to a nine-year high, and the refinance index hovering near its highest level since last spring,” Kan said. “Reversing the recent downward trend, borrowers saw increasing rates for most loan types last week, as better-than-expected unemployment claims, easing trade tensions and stabilization in the equity markets ultimately led to a rise in Treasury rates.”

Despite the near-term interest rate rises, mortgage credit availability increased late last year according to the Mortgage Credit Availability Index, a report from the MBA. The MBA analyzes data from Ellie Mae’s AllRegs Market Clarity business information tool and derives an index to chart the ease of mortgage credit. A decline in the MCAI shows that lending standards are tightening, while increases in the index are indicative of loosening credit. The MCAI increased 2.5% to 186.7 in October, the highest since 2008, when the housing market crashed.

However, the government share has decreased slightly, at 0.4% lower, but that is the only area of credit decline. Of the component indices of the Conventional MCAI, the Jumbo MCAI increased by 6.3% while the Conforming MCAI increased by 4.6%.

“Reversing a trend from last month, lenders made more conventional and low down payment programs available to prospective borrowers,” Kan said.

“This increase in supply was likely in response to a growing 52 HOUSINGWIRE ❱ MARCH 2019

•D elinquencies declined to 1.7% in the third quarter of 2018, compared to 1.9% at the same time the year before.

This was largely driven by drops in the near prime risk tier, where delinquencies dropped by 15% year-over-year, and the subprime risk tier which declined 9% year-over-year.

•O f the largest metro areas, Seattle, New York City and Boston experienced the largest declines in delinquencies while Houston, Dallas and St. Louis experienced the smallest declines in delinquencies.

number of first-time home buyers in the market, as home price appreciation has slowed and wage growth has picked up,” he said. “Jumbo credit availability also expanded last month, with the jumbo index increasing again to its highest level since the survey began.”

As the mortgage market continues to slowdown, for many reasons, there is one area where consumers are getting their credit reports pulled more than since the recession: the subprime mortgage market.

While banks may remain reluctant to penetrate the below 620 credit score market, other lenders are less cautious.

According to TransUnion’s survey of third quarter credit reports, the subprime mortgage risk tier saw modest origination growth

“

This increase in supply was likely in response to a growing number of first-time home buyers in the market, as home price appreciation has slowed and wage growth has picked up. Jumbo credit availability also expanded last month, with the jumbo index increasing again to its highest level since the survey began.”

of 3.4% year-over-year. This represents the largest volume of subprime loans originated in the second quarter post-recession.

There are five mortgage lending trends in the survey, which also includes info in personal, auto and credit cards financing.

“The decline in mortgage originations is likely the impact we’re seeing from a combination of rising interest rates, steep home prices appreciation and limited starter home supply,” said Joe Mellman, TransUnion senior vice president and mortgage business leader.

“On the refinance side, as interest rates rise, many consumers will no longer have an incentive to refinance their mortgages,” Mellman said. “On the purchase side, those rising interest rates coupled with rising home prices lead to a ‘double whammy’ for consumers interested in ‘moving up’ into a more expensive home, leading many to decide to stay in place. This in turn puts pressure on starter home supply. This trend will likely continue into the near future.”

So where does this leave the lenders not mentioned in this issue’s cover story? The big banks, for example. Well, the Federal Reserve released the latest Senior Loan Officer Opinion Survey on bank lending practices late last year.

The survey gets it data from 70 national banks. The seven categories of residential home-purchase loans that banks are asked to report on are GSE-eligible, government such as FHA, VA, USDA,

QM non-jumbo non-GSE-eligible, QM jumbo, non-QM jumbo, non-QM non-jumbo and subprime.

Economists use the report to gain knowledge on consumer behavior, as the report includes all forms of lending.

For the third quarter of 2018, banks reported easing their standards on most categories of residential real estate loans, even while experiencing weaker demand for the products overall.

Standards and the demand for auto and credit loans remain unchanged, by way of comparison. At the same time, banks reportedly left their standards unchanged on most categories of commercial real estate loans, while demand reportedly weakened for most categories of such loans.

Overall, banks reported they were less likely to approve such consumer loans for borrowers with FICO scores of 620 in comparison with the beginning of the year, while they were more likely to approve such consumer loans for borrowers with FICO scores of 720 over this same period.

The big question is in regard to the yield curve. If long-term interest rate products such as mortgages begin to yield at rates lower than short-term interest rate products, the yield curve is said to invert. This is often viewed as a predictor of a coming recession.

“Significant shares of banks indicated that they would tighten their standards or price terms across every major loan category if the yield curve were to invert,” noted the Fed report.

HOUSINGWIRE ❱ MARCH 2019 53

ReverseReview

54 HOUSINGWIRE ❱ MARCH 2019

DID YOU KNOW Jessica Guerin sends Reverse Review updates twice a week by email?

Go to HousingWire.com to sign up and stay informed!

ReverseReview

Proprietary reverse mortgage market continues evolution AFTER A YEAR OF STELLAR GROWTH, NON-AGENCY REVERSE MORTGAGE PRODUCTS FIND THEIR FOOTING

BY JESSICA GUERIN

THIS past year, the reverse mortgage industry witnessed unprecedented growth in the non-agency, proprietary reverse market. A number of innovative new products emerged in 2018, including a reverse HELOC, a second-lien reverse and a reverse for borrowers as young as 60.

Just a few years ago, there was just one of these private jumbo loans on the market. Now, there are seven.

According to lenders, there’s been real interest in these products from older homeowners with high-value homes looking to access their equity in cash.

But with months of proprietary originations on the books, unexpected borrower trends have emerged.

For one, borrowers are older than many predicted. The Federal Housing Administration’s HECM product and all but one of the proprietary reverse loans currently available have a minimum

borrower age of 62.

But according to American Advisors Group, which recently released a survey of 250 proprietary borrowers, the average age is 77.

AAG also said its proprietary borrowers have higher-value homes than originally expected.

Most of these loans don’t have a limit on property value but have a maximum claim amount of $4 million. By comparison, the HECM only accommodates properties valued at $726,525 or under.

Many lenders in the space predicted that the sweet spot for these non-agency loans was for homes valued around $850,000.

This represents borrowers who were shut out of the HECM by just about $125,000, and needed to find another way to access their equity.

HOUSINGWIRE ❱ MARCH 2019 55

ReverseReview AAG shared the main reasons why borrowers opted to pursue its jumbo reverse mortgage.

Here are the top 10 reasons:

1 2 3 4 5 6 7 8 9 10

To make home modifications or repairs

To buy an investment property or a vacation home

To help children purchase a property

To provide children with an early inheritance

To create college funds for grandchildren

To establish a trust fund

To cover in-home care costs

To have more financial liquidity

To maintain their current lifestyle To pay off other debts

56 HOUSINGWIRE ❱ MARCH 2019

But as it turned out, AAG revealed this was not the case. The company shared that its average proprietary borrower had a home valued at $1.7 million, and held an average loan amount of $665,000.

AAG said it has seen significant traction with the loan thus far, while other lenders also report that jumbos are becoming a growing share of their business.

“Consumer response to the jumbo product has exceeded all of our expectations,” an AAG spokesperson said. “There seems to be a real market for reverse mortgages with affluent seniors, especially those seeking to liquidate some of their real estate wealth.”

REASSESSING THE FEATURES But while the response has been positive, the introduction of these non-agency reverse mortgages hasn’t been without a few hiccups.

Just two months after introducing the HomeSafe Select, the only proprietary HELOC on the market, Finance of America Reverse withdrew a key feature of the loan.

Originally, FAR offered reverse borrowers up to 25% of their proceeds upfront and made the remainder available through a line of credit that had a 5% growth rate. Through the offering, this line of credit could be drawn upon or repaid at anytime. It was feature that was not available with any other proprietary reverse mortgage.

“HomeSafe Select can help people leverage part of their home equity today, while at the same time growing their available funds for future needs,” FAR President Kristen Sieffert said at the time.

But Finance of America Reverse discontinued the feature. Now, while borrowers can establish a line of credit, it will no longer grow.

In mid-December, FAR issued a notice saying it decided to discontinue this feature. And aside from discontinuing the feature, the company also made a number of other signiicant changes to the product, including raising the minimum origination fee from $2,500 to $5,000, lowering the lifetime interest-rate cap from 5% to 3% above the initial rate and eliminating the 25% upfront draw requirement.

For one California-based senior who was about to close on a HomeSafe Select just as the changes were announced, the news was disappointing.

“Suddenly, without any prior notice, my broker notified me that the lender had decided to suspend that program, even to those applicants ready to close!” the borrower told HousingWire. “I went through all of the requested procedures, obtained an appraisal, paid fees and provided the requested documents.”

“It changed everything for me and my financial basis for doing the reverse mortgage,” the borrower said, adding that she was considering not moving forward with the loan. “That was an ex-

ReverseReview

“

Consumer response to the jumbo product has exceeded all of our expectations.”

tremely important option for me and I am sure for many others.”

Britany Luth, FAR vice president of best practices, told HousingWire that the lender collected feedback from borrowers, partners and stakeholders following the Select’s launch, and that product adjustments became necessary to ensure its long-term viability.

“With the limited investor pool in the market right now, FAR made the decision to remove some features that were originally included, but we were also able to make an improvement in the interest rate cap,” Luth said. “Based on borrower feedback, and how important it was for them to protect their equity over time, we believe this outcome was a net positive.”

A PROMISING FUTURE Roadbumps aside, many in the reverse mortgage space agree that the greatest promise for a struggling market right now lies with these non-agency loans.

As the HECM continues to see declining volume in the wake of massive program changes, these proprietary offerings give lenders an edge on competition - a chance to recapture profitability in a tough market.

Jason McNamara, CEO of Celink, the nation’s largest reverse mortgage subservicer, explained that the development of a private reverse mortgage market, which is not hindered by persistent government regulation, is essential.

“Right now, the HECM program is trying to serve all needs and types of borrowers, and it was never intended to do that,” said McNamara. “We need a healthy product mix of private and public home equity solutions for many different scenarios and consumers.”

McNamara added that more products will be coming to market in 2019.

“The highlight of 2018 was clearly the return of private capital to our industry,” he added. “Ultimately, these developments will help the HECM program find its way forward, as well as allow us to help more Americans use their own home equity for retirement, thus reducing the need for additional taxpayer-funded programs.

WHAT JASON AND BRITANY HAVE TO SAY Jason McNamara Celink “Right now, the HECM program is trying to serve all needs and types of borrowers, and it was never intended to do that. We need a healthy product mix of private and public home equity solutions for many different scenarios and consumers.”

Britany Luth Finance of America Reverse “With the limited investor pool in the market right now, FAR made the decision to remove some features that were originally included, but we were also able to make an improvement in the interest rate cap. Based on borrower feedback, and how important it was for them to protect their equity over time, we believe this outcome was a net positive.”

HOUSINGWIRE ❱ MARCH 2019 57

CFPB Watch

58 HOUSINGWIRE ❱ MARCH 2019

CFPB Watch

CFPB set to resume oversight of lending to military members SEEKS COMPLIANCE AUTHORITY ON MILITARY LENDING

BY CAROLINE BASILE, KELSEY RAMÍREZ

THE Consumer Financial Protection Bureau is changing course on its previous decision to stop supervising lending to active duty service members.

Kathy Kraninger, the recently confirmed director of the bureau, sent a letter to Congress, asking for “clear authority” to supervise for compliance with the Military Lending Act, an act which protects military service members from predatory lending.

This turnaround comes several months after Mick Mulvaney, who served as acting director of the CFPB prior to Kraninger’s confirmation, decided that the bureau would stop supervising lending made to active duty service members, much to the dismay of congressional Democrats, who pushed the CFPB to retain oversight.

In August 2018, Mulvaney internally announced the bureau would cease supervisory examinations of the Military Lending Act, saying the law did not explicitly grant the CFPB authority to examine financial institutions for compliance.

Under Mulvaney’s changes, the CFPB relied solely on complaints from service members and their families to trigger investigations. Mulvaney reportedly expressed that the bureau had overstepped its authority by proactively looking into cases against military members without receiving complaints.

Previously, the CFPB actively examined lenders’ records in order to ensure they complied with the Military Lending Act. After Mulvaney changed the CFPB’s

stance, 49 Senate Democrats called on the CFPB to continue actively supervising lenders to ensure they are complying with the act.

Ranking Member of the Armed Services Committee Sen. Jack Reed, D-R.I., along with 48 other senators, sent a letter to Mulvaney in an effort to protect soldiers from abusive financial practices.

From the letter: We write regarding reports that the Consumer Financial Protection Bureau (CFPB) will no longer protect servicemembers and their families by including the Military Lending Act (MLA) as part of the CFPB’s routine lender examinations due to a purported lack of auHOUSINGWIRE ❱ MARCH 2019 59

CFPB Watch

thority. These reports are puzzling because the CFPB already possesses the authority to enforce the MLA and examine many types of lenders for the purposes of “detecting and assessing risks to consumers and to markets for consumer financial products and services.” The CFPB should not be abandoning its duty to protect our servicemembers and their families, and we seek your commitment that you will utilize all of the authorities available to the CFPB to ensure that servicemembers and their families continue to receive all of their MLA protections.

The letter was signed by all Senate Democrats at the time and one Independent, Sen. Bernie Sanders, I-Vt. Several experts stepped up to applaud the efforts of these senators, saying predatory lenders seek to target military members and pull them into death traps.

“Given the opportunity, predatory lenders will target military service members and pull them into horrific debt traps,” said Scott 60 HOUSINGWIRE ❱ MARCH 2019

Astrada, Center for Responsible Lending federal advocacy director. “The bipartisan Military Lending Act has helped put an end to these shameful practices.”

“We applaud these senators for calling on the CFPB to fulfill its obligation of stopping loan sharks from preying upon service members and their families,” he said.

Now, Kraninger sent a proposal to clarify the CFPB’s authority to supervise compliance with the Military Lending Act to Vice President Mike Pence and Speaker of the House Nancy Pelosi.

The proposal outlines a case for spelling out clearly what authority the CFPB would have over supervising military lending and proposes amending several sections of the Consumer

CFPB Watch

jurisdiction comply with the Military Lending Act so our service members and their families are provided with the protections of that law. That’s why I have asked Congress to explicitly grant the bureau authority to conduct examinations specifically intended to review compliance with the MLA.” The announcement acknowledges the recently introduced House legislation, H.R. 442, which would directly grant the Bureau supervisory authority over the MLA. “The requested authority would complement the work the bureau currently does to enforce the MLA,” Kraninger said. “I was pleased to see legislation proposed recently in the House of Representatives [H.R. 442] that is intended to grant the bureau such authority. My hope is that bipartisan legislation advances as quickly as possible in the 116th Congress.”

In the letter, Kraninger wrote: Dear Speaker Pelosi, Enclosed please find a draft legislative proposal for consideration by the Congress. This legislative proposal would clarify the Bureau of Consumer Financial Protection’s authority to supervise for compliance with the Military Lending Act. In accordance with Section 1012(c)(4) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, please note that this legislative proposal does not necessarily reflect the views of the President or the Board of Governors of the Federal Reserve System.

“

The bureau is committed to the financial well-being of America’s service members.”

Financial Protection Act of 2010 to outline that, according to the draft, “the bureau shall have nonexclusive authority to require reports and conduct examinations” in regard to lending to military service members.

“The bureau is committed to the financial well-being of America’s service members,” Kraninger said in a statement.

“This commitment includes ensuring that lenders subject to our

The letter also includes suggested draft legislation the bureau sent to the U.S. House of Representatives and the U.S. Senate. The draft legislation would amend the Consumer Financial Protection Act to include a section providing the bureau “nonexclusive authority to require reports and conduct examinations on a periodic basis” for the purposes of assessing compliance with the Military Lending Act, obtaining information about the compliance systems or procedures associated with the law and detecting and assessing associated risks to consumers and to markets.

This latest proposal from Kraninger indicates she’s steering the ship of the CFPB differently than her predecessor. This isn’t the first time Kraninger has back-pedaled a decision made by Mulvaney.

When she took over at the bureau, Kraninger halted the namechange debacle that plagued the agency for months.

However, the CFPB may not be resuming its oversight just yet, according to law firm Buckley. It might still take an act of Congress to make that happen, as it seems the bureau is still waiting for permission from legislators to move foward.

“The bureau’s request that Congress grant it authority to examine for compliance with the MLA suggests that it does not intend to do so unless Congress acts,” the firm stated.

HOUSINGWIRE ❱ MARCH 2019 61

Inside Baseball

62 HOUSINGWIRE ❱ MARCH 2019

Inside Baseball

FHFA will not defend its constitutionality in court ACTING DIRECTOR OTTING AGREES AGENCY IS UNCONSTITUTIONALLY STRUCTURED

BY BEN LANE, KELSEY RAMÍREZ

THE Federal Housing Finance Agency revealed it will no longer defend its own structure, calling its structure unconstitutional.

Back in July, the Court of Appeals for the Fifth Circuit ruled that the federal government’s regulator of Fannie Mae and Freddie Mac is not constitutionally structured. The FHFA ruling deals with the agency’s leadership structure and whether a single director that wields as much authority as the FHFA director is a violation of the Constitution’s separation of powers.

Then in August, the FHFA appealed this ruling under former FHFA Director Mel Watt, petitioning for a rehearing en banc, meaning it wanted the entire court to hear the case.

But Watt’s term recently expired, and a new director is stepping up to the helm. Going forward, the FHFA will be led by Comptroller of the Currency Joseph Otting, who was picked by President Donald Trump to serve as acting director of the FHFA while Mark Calabria is awaiting Senate confirmation to replace Watt on a permanent basis.

HOUSINGWIRE ❱ MARCH 2019 63

Inside Baseball

“

We hold that Congress insulated the FHFA to the point where the Executive Branch cannot control the FHFA or hold it accountable.”

And now, Otting is moving a different direction, telling the court that the FHFA is under new leadership, and will no longer defend its structure. In a filing to the fifth circuit, Otting urged the court to dismiss the case and leave the previous judgement intact.

From the filing: Under prior leadership, FHFA petitioned for rehearing en banc seeking consideration by the full Court of the Panel’s holding that FHFA’s structure, in particular its leadership by a single director removable only for cause, unconstitutionally limits the President’s ability to supervise FHFA. As of January 7, 2019, FHFA is led by a new Acting Director, who has reconsidered the issues presented in this case. For the reasons discussed herein, it remains FHFA’s position that it is unnecessary for this Court to reach the constitutionality of the Housing and Economic Recovery Act’s (“HERA”) for-cause removal provision in order to resolve this case and affirm the dismissal of Plaintiffs’ claims.

To the extent the Court concludes it is necessary to reach the constitutional issue, FHFA will not defend the constitutionality of HERA’s for-cause removal provision and agrees with the analysis in Section II.A of Treasury’s Supplemental Brief that the provision infringes on the President’s control of executive authority.

While the FHFA submitted its filing saying it will no longer defend its structure, and that it urges the court to reject the case since the issue provides no basis for awarding any relief to the plaintiffs in the case, the court can still decide to go forward with the hearing.

If the hearing does go on, and the court decides to rehear arguments on the FHFA structure and its constitutionality, the agency said it will not defend itself.

The FHFA explained that the claims it previously submitted to the court for an appeal have already be rejected by every other court that has considered them, including five of the Court’s sister circuits and more district courts.

The agency explained it will not offer any arguments that have not “already been thoroughly and repeatedly analyzed, discredited and rejected.”

64 HOUSINGWIRE ❱ MARCH 2019

The case originally comes as the result of a lawsuit brought by Fannie and Freddie shareholders who challenged both the structure of the FHFA and the so-called “Third Amendment Sweep.”

HousingWire Editor Ben Lane explained that, over the years, many observers have questioned whether it was necessary for the federal government to modify its conservatorship agreement with Fannie and Freddie to sweep all the profits from the government-sponsored enterprises into the government’s coffers, an arrangement referred to as the “Third Amendment Sweep” or the “Net Worth Sweep.”

At the time, the government claimed that the GSEs were on the brink of collapse, and amended the terms of the GSEs’ conservatorship to ensure that the government had enough money to bail them out again if necessary.

In the aftermath, a series of Fannie Mae and Freddie Mac shareholders sued the government, claiming the “Third Amendment sweep” was not only unnecessary but illegal as well.

The Preferred Stock Purchase Agreements were modified late last year to allow Fannie Mae and Freddie Mac to hold some capital, $3 million for each entity, to “cover other fluctuations in income in the normal course of each Enterprise’s business,” but that still didn’t stop the lawsuits from making their way through the courts.

In this case, Patrick Collins, Marcus Liotta and William Hitchcock, referred to in the court case as Fannie Mae and Freddie Mac shareholders, challenged the FHFA’s structure and the “Net Worth Sweep.”

The Court of Appeals held that the FHFA was not constitutionally structured but ruled that the agency was within its statutory authority when it enacted the net worth sweep.

As for the net worth sweep, the court cited several other previous rulings in other courts as background for a similar decision to uphold the sweep.

“The shareholders’ statutory claims mirror the claims made against the FHFA that the D.C., Sixth and Seventh Circuits have all rejected. We reject the shareholders’ statutory claims based on the same well-reasoned basis common to those courts’ opinions,” the Court of Appeals ruling states.

On the other hand, the Court of Appeals ruled that the shareholders were correct when they claimed that the FHFA is unconstitutionally structured.

“We hold that Congress insulated the FHFA to the point where the Executive Branch cannot control the FHFA or hold it accountable,” the ruling reads. “We reach this conclusion after assessing the combined effect of the: (1) for-cause removal restriction; (2) single-Director leadership structure; (3) lack of a bipartisan leadership composition requirement; (4) funding stream outside the normal appropriations process; and (5) Federal Housing Finance Oversight Board’s purely advisory oversight role.”

Inside Baseball

If the previous decision remains unchanged, the the ruling would stand that the FHFA director should be removable at will, but leaves the remainder of the FHFA’s previous actions, including the Third Amendment Sweep, intact. Thus, in the eyes of the court, the FHFA “survives as a properly supervised executive agency.”

This is the third time in recent memory a government agency borne out of the housing crisis has been declared unconstitutional by a federal court. The first two times it was the Consumer Financial Protection Bureau.

The CFPB was initially ruled unconstitutional in a majority opinion authored

by Supreme Court Justice nominee Brett Kavanaugh. That initial ruling was later overturned by the full Court of Appeals, which ruled the CFPB’s structure to be constitutional.

But the CFPB wasn’t out of the woods just yet. In mid-2018, District Judge Loretta Preska of the New York Southern District declared the CFPB unconstitutional, citing Kavanaugh’s ruling repeatedly.

Kavanaugh’s ruling in the CFPB case, which stemmed from a lawsuit from PHH Corp., comes into play frequently in the FHFA ruling.

Later on, in a majority ruling, the Court of Appeals for the Fifth Circuit ruled that the CFPB is unconstitutionally structured.

And this also isn’t the first time a leader of Trump’s administration turned against a government agency in recent months.

Back in March 2017, the U.S. government unexpectedly switched sides on the CFPB when it filed an amicus brief in the PHH vs. CFPB case, a case which questions the CFPB’s constitutional structure, asking the court to rule the CFPB’s leadership structure unconstitutional and grant Trump the authority to fire the CFPB director at will.

HOUSINGWIRE ❱ MARCH 2019 65

Kudos GIVING BACK • FREEDOM MORTGAGE DELIVERS BACKPACKS TO MILITARY FAMILIES Freedom Mortgage gave back to active-duty troops, veterans and their families through its Team Freedom Cares program, which collected more than 2,600 backpacks and school supplies for military families across the country and sent over 1,000 handwritten notes to traveling troops through United Service Organization airport lounges in 2018.

The team also participated in Skating for Service, which raised more than $11,000 for the Liberty USO, and hosted a 5K run/fun walk that raised $5,000 for Liberty USO and Homes for Our Troops.

“Working with Liberty USO has been truly gratifying,” said Stanley Middleman, Freedom Mortgage founder and CEO. “I wholeheartedly support their mission of enhancing the quality of life of the U.S. Armed Forces personnel and their families.”

• GATEWAY MORTGAGE GROUP DONATES $30,000 TO LOCAL CHARITIES Gateway Mortgage Group donated to local nonprofits through its Charity Challenge, which rewards the highest-ranking branches by donating to the organizations of their choice.

Through the challenge, Gateway has donated $90,000 to support families and communities in the last three years.

This year, branches in Ada, Oklahoma; Stillwater, Oklahoma; McPherson, Kansas; and Matagorda, Texas, won the challenge, pledging their support for several nonprofits,

66 HOUSINGWIRE ❱ MARCH 2019

including homeless shelters, food pantries and after-school programs.

“We are happy to honor our hardworking team members by giving them recognition for their dedication and empowering them to share that success with people in need,” said Hobie Higgins, Gateway chief community engagement officer. “The holidays can leave families strapped for cash, so we hope our donations will let them focus on their loved ones rather than a lack of resources.”

• ARMCO LAUNCHES EMPLOYEE DONATION MATCHING PROGRAM Financial risk management solutions provider ARMCO launched the ARMCO CARES program to match employee donations to non-profit charities.

At the end of 2018, the company announced it would match employees’ charitable donations dollar-for-dollar to the organization of their choice.

ARMCO said it plans to expand the program in 2019 to include employee wellness and community involvement programs.

“This program is great because it extends employees’ reach for the causes that they’re passionate about,” said Avi Naider, CEO of ARMCO. “ARMCO’s success is based on our commitment to bettering the lives of others, and ARMCO CARES is a natural extension of that. In just a couple of months, ARMCO CARES has grown our family-friendly company culture of giving, which ultimately benefits both our employees and our customers.”

• DOCMAGIC PURCHASES ART BOXES FOR PATIENTS AT CHILDREN’S HOSPITAL LOS ANGELES DocMagic purchased 100 custom-designed art boxes from Art To Grow On Children’s Art Center, which delivered the boxes patients at the Children’s Hospital Los Angeles.

Each art box contained a master artist lesson inspired by architect Frank Lloyd Wright, a holiday frame, a journal, a sketchbook, colorful markers, wooden cars, hearts or animals for coloring and decorating and foam snowflakes or snowman with holiday stickers.

“DocMagic is proud to be a part of having a very unique and positive impact on the lives of these children, opening up a new world of creativity and imagination that they themselves construct,” DocMagic President and CEO Dominic Iannitti said.

Kudos

AWARDS • FREDDIE MAC CREDIT RISK TRANSFER EXECUTIVE GINA HEALY NAMED ONE OF THE MOST INFLUENTIAL WOMEN IN RE/INSURANCE Gina Healy, Freddie Mac vice president of credit risk transfer, has been honored by Intelligent Insurer as one of its 2018 Influential Women in Re/insurance.

Healy co-leads Freddie Mac’s credit risk transfer program and is responsible for developing

strategies to transfer a portion of the credit risk on more than $1 trillion in single-family mortgages.

She was instrumental in spearheading several innovative credit risk transfer initiatives and developing programmatic offerings to reduce risk in Freddie Mac’s mortgage portfolio and

offer diversification and growth opportunities to carriers.

Prior to joining Freddie Mac, Healy served as CFO of NASDAQ Europe and held management positions at Vantive Corporation and Ernst & Young. She is involved in a number of professional organizations that support female career advancement opportunities.

• NEW AMERICAN FUNDING EARNS BBB TORCH AWARD FOR ETHICS New American Funding received the Better Business Bureau’s Torch Award for its commitment to ethics and trust in the marketplace.

The BBB established the Torch Awards to recognize organizations that stand out for their ethics. The winners are selected by an independent panel of volunteer community leaders based on categories that include the communication of ethical practices, unifying leadership practices and an organizational commitment to community.

“The Torch Awards have given us the opportunity to show the community our commitment to integrity and our customers,” said Rick Arvielo, CEO of New American Funding. “We have placed the highest priority on conducting business with fairness and honor and are extremely pleased the Torch Awards has recognized our efforts in this commitment.”

LAUNCHES • WFG NATIONAL TITLE LAUNCHES CYBERFRAUD AWARENESS INITIATIVE WFG National Title created a cyberfraud awareness team to help educate consumers and companies that are engaged in home buying and mortgages about the dangers of online and mail fraud.

The effort was spurred by a

Portland-area WFG borrower, Aaron Cole, who lost $123,000 due to an email scam in a phishing attack just days before he was scheduled to close on a home.

The email was designed to look like it was from WFG but it was actually from a scammer who requested money as part of the mortgage transaction. By

the time Cole discovered it was fake, his money had traveled to an account in Florida and then to four other banks before it was transferred out of the country.

The crime put Cole’s ability to close his loan in jeopardy, but WFG was able to help the family and was inspired to launch an initiative to educate others about cyberfraud.

“While Aaron’s story has a happy ending, most borrowers scammed by email hackers generally wind up with an unhappy ending,” WFG Chief Compliance Officer Don O’Neill said. “We believe people will pay attention to Aaron’s story because they can relate to other consumers who are in the process of transferring funds while purchasing a home.”

HOUSINGWIRE ❱ MARCH 2019 67

BY THE NUMBERS

LEAST AFFORDABLE HOUSING MARKETS IN THE WORLD Four cities in the U.S. made the list of the world’s least affordable housing markets. No surprise, three are in California.

Among the top 10, San Jose ranked No. 5, Los Angeles No. 6 and San Francisco No. 8. on a list compiled and released this week

by urban planning consulting firm Demographia.

For the ninth consecutive year, Hong Kong claimed the top spot as the least affordable city in the world. The median property price in that city climbed to 20.9 times the median household in-

Vancouver, Canada – 12.6X Median home price: $1 million

San Francisco, California – 8.8X Median home price: $1.61 million

come in 2018.

Each of the cities have high populations of people living in poverty, while many others are millionaires. To look at both versions of each city, you would never know you were talking about the same placce.

Toronto, Canada – 8.3X Median home price: $764,000

San Jose, California – 9.4X Median home price: $1.1 million

London, England – 8.3X Median home price: $620,000

Los Angeles, California – 9.2X Median home price: $687,000

Honolulu, Hawaii – 8.6X Median home price: $672,000

POPULATION LIVING BELOW POVERTY LINE: HONOLULU, HAWAII

LOS ANGELES, CALIFORNIA

SAN JOSE, CALIFORNIA

SAN FRANCISCO, CALIFORNIA

VANCOUVER, CANADA

TORONTO, CANADA

LONDON, ENGLAND

10.9%

20.4%

11.3%

10%

13.2%

17%

27%

68 HOUSINGWIRE ❱ MARCH 2019

DID YOU KNOW...

HONG KONG, CHINA 1 in 7 residents are millionaires n n n n n n n VANCOUVER, CANADA Known as the providence of millionaires SYDNEY, AUSTRALIA Preferred destination for millionaire migrants MELBOURNE, AUSTRALIA Rated safest country in world for women – a 92% correlation with wealth

92%

Hong Kong, China – 20.9X Median home price: $688,000

SAN JOSE, CALIFORNIA Tech hub has second highest concentration of millionaires in U.S. LOS ANGELES, CALIFORNIA Holds the highest number of millionaire households AUCKLAND, NEW ZEALAND Singled out as one of world’s key urban hubs for rich people

Sydney, Australia – 11.7X Median home price: $1.1 million

Auckland, New Zealand – 9X Median home price: $547,000

Melbourne, Australia – 9.7X Median home price: $882,000 MELBOURNE, AUSTRALIA

HONG KONG CHINA

SYDNEY, AUSTRALIA

AUCKLAND, NEW ZEALAND

13.3%

20%

13.2%

21%

SAN FRANCISCO, CALIFORNIA Number of billionaires in Bay Area hits third highest in world HONOLULU, HAWAII About 8% of city’s population are millionaires LONDON, ENGLAND Holds more multi-millionaires than any other city in the world TORONTO, CANADA Holds more than 25% of Canada’s millionaires

$$$

HOUSINGWIRE ❱ MARCH 2019 69

SPONSORED CONTENT

Phil McCall President, ARMCO

Lenders can now use quality control technology to increase efficiencies while reducing risk Phil McCall explains ARMCO’s DataSure, a robust data validation technology for greater lender efficiency Q: What sort of risk do lenders face when it comes to data integrity?

A: Lenders usually feel the pain of data errors when they go to sell their loans.

The GSEs require uniform data sets, so when documents have inconsistencies or missing data, the purchase process is delayed until those issues are addressed.

Data integrity issues often lead to price adjustments. Bottom line, lenders are often losing money because of incorrect data.

Another big risk is from the regulatory agencies, who are pushing back on lenders and making them fix errors on loan application records as far back as three years.

This could put a major strain on resources because this type of re-submission usually needs to be completed with a three- to four-month period. A mid-size lender taking in 25,000+ applications per year could be required to research, re-validate and re-enter data for 75,000 applications or more.

No lender has those resources available and outsourced resources who handle these types of situations are costly. It’s hard to put an exact dollar amount on that work, but it’s significant and real.

Q: Why is this risk rising?

A: As the industry evolves to digital mortgages, lenders are processing new data sources virtually every week, but those 70 HOUSINGWIRE ❱ MARCH 2019

data sources don’t all speak the same language. So, lenders are manually keying information into their LOS, multiplying the risk of errors.

Lenders need a translator that standardizes and compares all of these data sources, then systemically identifies errors. That’s why ARMCO launched DataSure. DataSure improves the accuracy of a lender’s data while shortening pre-funding and post-closing timelines.

Q: How does DataSure improve data quality?

A: DataSure assures that the data in the loan file accurately reflects the data on loan documents by automatically parsing and evaluating data on virtually any type of loan document, cross comparing that data to the lender’s source system and automatically communicating all corrected data fields back into that system.

Lenders usually handle this process manually using the “stare-and-compare” method, which of course, isn’t just error-prone, it’s also a tedious, time-consuming strain on some of lenders’ most costly and skilled staff positions.

Q:How does DataSure increase lenders’ efficiency?

A: First, it virtually eliminates manual and repeat activity in the data validation process. As we worked with our pilot clients, we’ve seen DataSure improve the core efficiency of personnel by more than

50%. Almost all lending shops have a post-close department where people complete the data validation process, often using a manual checklist where they compare data from documents and fields in their LOS and make sure it all matches. You might have 15 people whose job is just cleaning up the data at the end of the loan process, and they still couldn’t get through all the loans at that point.

But often, the loan gets moved to another area — say, capital markets — and that team doesn’t trust the work being done on validation and so they review the initial review! DataSure has multiple triggers throughout the whole manufacturing process so 75% of all the data is already validated by the time it gets to the end of the process.

Secondly, DataSure streamlines the process because it uses business rules to make decisions on which data is correct when there is a discrepancy.

Our engine is driving the answers, instead of a human making decisions.

Lenders don’t need to hire experienced mortgage industry professionals to analyze loan data.

DataSure does the same type of review every time in a repeatable process that happens the same way for every loan that gets reviewed. Lenders using DataSure are able to increase the efficiency of their employees and reduce FTE expenses while solving their long-term risk.

SPONSORED CONTENT

Dave Worrall President, LoanCare

Kiran Vattem Chief Digital and Technolgoy Officer, ServiceLink

EXOS Servicing lets consumers manage their mortgage through mobile Dave Worrall and Kiran Vattem discuss the benefits of self-serve technology

Q: How does EXOS Servicing engage consumers throughout the closing process and into servicing?

A: Dave: The EXOS Servicing app provides complete continuity from closing to servicing so that a user doesn’t notice a difference between the interface when originating loans.

If you use EXOS during the closing process and then for servicing, the consumer can be in the same place throughout that process.

Kiran: EXOS provides an end-to-end consumer digital journey that compliments or augments a lender or servicer’s digital strategy. As part of that consumer journey, lenders can now extend the digital journey from loan origination to life of the loan servicing through our mobile/ web/voice technology.

The consumer has a seamless and single interface from the time they apply for the loan to the time they close and into the life of the loan mortgage servicing journey.

Q: What are some of the innovations EXOS brings to servicing?

A: Dave: The most important thing, beyond presenting it for consumers digitally, is its unmatched ability to allow consumers to manage various aspects of their mortgage. The way that mobile and web technology has been configured in the past is for consumers to be able to view

it, but when there’s an actual problem, the consumer has to make a call or send snail mail. It’s the last thing a customer wants to do.

What EXOS does is give consumers a long list of things they can do to manage their mortgage — things like setting up an ACH account and downloading their billing statements.

These are things that allow the consumer to interact with their mortgage company on their own terms, versus having to call the company.

The other advantage of EXOS Servicing is that it brings mortgage information to your mobile devices.

EXOS is the most comprehensive solution in servicing right now. It provides a platform for expansion in the digital space with Amazon Alexa, Google Home and wearable technology.

It’s something that no one else in the space can offer their consumer; the immediate capability to interact with their personal financial information.

Kiran: The primary innovation that EXOS provides goes beyond the functionality of mortgage payments, bank set up, loan details, escrow and tax.

What we provide on top of that is the servicer’s ability to have significantly higher portfolio retention through analytics and consumer communication via push notifications.

EXOS could provide real-time offers to

the consumer based on behavioral analytics from app usage and portfolio analytics in the background.

The other significant aspect of EXOS Servicing is that it is omni-channel and will always cover most or any of the interfaces that the consumers prefer to use, including web, mobile, voice (Alexa and Google home) and wearables.

Q: Why is now a critical time for this kind of innovation?

A: Dave: Because consumers now, more than ever, expect to be able to do business on mobile. When you want to check a balance or make a payment or do something with any type of service, you look for a mobile app first.

Q: What benefits are servicers seeing by using EXOS? A: Dave: What servicers see is a higher level of consumer satisfaction with the service they offer. EXOS Servicing reduces the cost of servicing loans because it encourages customers to do more self-service.

Kiran: For those servicers that use EXOS Servicing, we are seeing reduced call volumes, more and more consumers logging in to make payments, update contact information, etc.

Overall, we see higher levels of consumer satisfaction, reduced operating costs and increased portfolio retention.

HOUSINGWIRE ❱ MARCH 2019 71

SPONSORED CONTENT

Alok Bansal Managing Director, Visionet Systems

Steps to avoid risk and invest in zero-cost technology Think you need to choose between building or buying when it comes to new technology? Alok Bansal explains how Visionet Systems offers a third option Q: What are some of the challenges for lenders as they consider whether to buy or develop new technology solutions?

A: Lenders today are battling with high-interest rates, declining loan applications, and higher cost of compliance. All of this is leading to an increase in the cost of producing a loan. In fact, many originators are reporting a net loss on each loan that they originate.

Technology seems to be the savior, as it can help streamline and automate operations while reducing costs. But selecting the right technology to buy or develop can be a challenge in itself. If you buy, you have significant upfront costs and there will be a significant time gap until you start reaping the ROI. Moreover, there is an inherent risk in any new technology solution you buy in terms of the return on investment.

If you decide to develop, there is a good chance that the technology won’t be ready for use for quite some time. Many smaller-size lenders may not have the internal IT resources or budgets.

Besides, in a changing environment, you need to make large investments continuously to ensure that you are getting the latest innovations in the technology.

Q: What is missing when lenders only consider these two options?

A: Whether you purchase technology or build, you need to think about how the technology fits into your enterprise solu72 HOUSINGWIRE ❱ MARCH 2019

tion. Creating seamless integration with your new technology purchase can also be very expensive and take many months to deploy.

With either of these options, you end up losing time over the decisions you need to make and there is no guarantee that you will be able to recognize your projected ROI. Besides, you will need to continue paying for the maintenance contracts, upgrades for the technology, etc.

Q: How is Visionet Systems changing this paradigm?

A: After working in the industry for 20 years, Visionet understands the challenges of the SME and have introduced a ‘pay per use’ or ‘zero upfront cost’ technology model. It means that the companies are able to use the latest digital technologies without having to incur any initial or recurring costs.

We are also a domain expert, which means that mortgage companies can rely on Visionet’s digital workflow platform to squeeze greater productivity from operations with high accuracy.

The advantages of partnering with Visionet are obvious: • There are no upfront costs, so your investments are not stuck.

• No time is spent evaluating solutions, you are up and running from day one.

• You see ROI from day one – you can start leveraging the technology

•

from day one, so your business can benefit.

You take no risk on what technology can yield for you – we take care of end-to-end delivery which includes technology and the service, so that you can focus on growing your business.

Q: What is zero upfront cost technology and how do businesses benefit from it?

A: Visionet is the first company offering “zero upfront cost technology” as part of its solutions across multiple domains, including title and settlement, underwriting, AMCs and lenders. Your business benefits from day one, there are no upfront costs and there are no minimum volume commitments.

Q: Why is it so important to look beyond just the technology piece?

A: Reducing cost per loan is every lender’s priority and there are certainly more paths to that outcome than just pure technology.

Speeding up loan processing without sacrificing quality and accuracy and managing all the back-office volumes with a variable priced team can help you significantly in driving better margins for your business.

More than 50 of the top 200 mortgage companies have already chosen Visionet as a trusted partner to combat increasing operating costs.

June 13-14, 2019 | Charlotte, NC

A summit to bring marketers of all experiences into the same space to build relationships, identify best practices, and gain the necessary knowledge to execute a successful marketing strategy.

LEARN MORE! engage.housingwire.com

Knowledge

Center

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W H I T E PA PE R: Veros

| SPONSORED CONTENT

Knowledge Center

An alternative to the traditional AVM cascade CHOOSING AVM ACCURACY AND SUITABILITY OVER EXISITING APPROACHES

HOME equity lending has again become attractive to mortgage originators, including banks and credit unions, as they struggle to maintain volumes in a market where purchase money mortgages will dominate and mortgage refinance loans are projected to comprise just 25% of origination volume. With homeowners staying in their homes longer, the opportunity to lend against their equity will enable some lenders to perform well even with the marked drop in originators.

In the first quarter of 2018 home equity lines of credit increased by 18% from the previous quarter and 14% from the same quarter in 2017. In first three months of this year, nearly 350,000 borrowers took out new HELOCs. This constitutes a fantastic opportunity for banks and credit unions, especially since many traditional mortgage lenders do not participate in the home equity market.

Both home equity loan products and second liens have benefited from the speed and reduced cost of alternative valuation methods for many years now. The opportunity for lenders to save both time and money originating these products has never been greater. All lenders need to do now is determine what valuation method will meet their risk appetite.

affordable tools have become more sophisticated and are now an important risk and valuation tool used throughout the loan cycle, most notably in the home equity lending business.

In the early days, AVMs were fueled by pubic record data exclusively, which meant that some performed well in one part of the country, and not as well in another. Cascades were the answer at the time. A well designed AVM cascade allowed lenders to obtain higher hit rates as they attempted to value properties across the country.

Starting around 2010, AVMs began incorporating data on a large scale from multiple listing sources. As you might expect, the inclusion of housing “supply side” data contributed to a continued rise in AVM accuracy, especially among the large national brands. In time, additional data sources became available along with improved algorithms and better analytics. Then, more powerful computers made it possible for AVM modelers to capitalize on big data. Performance from quality AVMs steadily improved.

All of these improvements have led many to question whether traditional AVM cascades are still appropriate more than 15 years after their original implementation.

THE DEVELOPMENT OF THE MODERN AVM Far and away, the most affordable valuation method for real estate is the Automated Valuation Model (AVM). Over the years, these

To read the entire white paper, visit the Knowledge Center at knowledge.housingwire.com.

HOUSINGWIRE ❱ MARCH 2019 75

Knowledge

Center

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Knowledge Center

W H I T E PA PE R: TM S | SP ONSOR E D CON T E N T

Are you a farmer or a hunter?

AND WHAT DOES THAT HAVE TO DO WITH SUBSERVICING?

HISTORY 101: EVERYTHING WE KNOW ABOUT BUILDING RELATION- new business development. But then you need to tend to the busiSHIPS STARTED WITH THE NEOLITHIC REVOLUTION ness of cultivating and nurturing relationships with your cusIf you know history, then you know that for hundreds of thou- tomers. Especially if you’re thinking about handing them over sands of years, our ancestors hunted for survival. Although the to a Subservicer. nomadic hunter-gatherer way of life was effective for acquiring For instance, do you want to turn your precious customers over food on a daily basis, it wasn’t very efficient because hunting to an antiquated bill/pay platform and robot-like call center that required an enormous amount of energy and resources. Hunters doesn’t really care? Or would you prefer to hand them over to followed their food source and when their food source dried up another likeminded “farmer of subservicing” who’s interested in or moved, they moved along with it. As a result, they experienced tending to the community you’ve spent so much time cultivating? very little interaction with other tribes and civilization didn’t When you’ve invested years of time, effort and money into buildadvance. ing your business, why would you gamble on someone who may or Then, somewhere around 10,000 years ago, hunters began may not provide the stellar level of service and care your company communing and they transitioned from food collectors to food is known for? Think about it: within the word “Subservicing” is producers. This was the Neolithic Revolution and it was a turning the notion of “Service.” point in our history. Hunters realized that, by joining forces and The lending industry should take note. If you’re going to work focusing on the long-term, they became less consumed with, well, with a third-party Subservicer, you want to be assured that it’s consumption and where their next meal was coming from. They someone who seamlessly blends into your company/brand and were able to put down permanent roots, establish a reliable food treats your customers as you would, because your customers don’t supply, cultivate lasting relationships and build communities know your Subservicer isn’t you. To your customer, there’s no together. Farming communities flourished and so did invention “sub” in customer service. and civilization.

WHAT DOES THIS HAVE TO DO WITH SUBSERVICING? Plenty. There’s a time for hunting as you develop leads and stalk

To read the entire white paper, visit the Knowledge Center at knowledge.housingwire.com.

HOUSINGWIRE ❱ MARCH 2019 77

Knowledge

Center

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W H I T E PA PE R: Si m pleNexus | SP ONSOR E D CON T E N T

Knowledge Center

5 ways for lenders to increase operational efficiency with technology LENDERS NEED THE RIGHT TOOLS TO STAY COMPETITIVE AND PROFITABLE

2018 has proven to be a tough year for those in the mortgage industry. Lenders are battling a perfect storm of rising interest rates, strong home price appreciation and tight housing supply, driving lenders in Fannie Mae’s Q2 Mortgage Lender Sentiment Survey to report a negative net profit margin outlook for the seventh consecutive quarter.

IT’S NOT HARD TO SEE WHY. CONSIDER THAT: • The benchmark 30-year fixed mortgage interest rate climbed to 4.88% in mid-September, and that was before the Federal Reserve’s September rate hike.

• The median existing-home price in July was $269,600, up 4.5 percent from July 2017. This marks the 77th straight month of year over-year gains.

• Nationally, the inventory of homes for sale was down 6.1% year-over-year in June,4 and supply is reaching critical levels in some very hot markets.

In August, Lawrence Yun, chief economist of the National Association of Realtors, summed up the situation of buyers across the country. “Too many would-be buyers are either being priced

out, or are deciding to postpone their search until more homes in their price range come onto the market.

That reality leaves lenders competing for each and every loan, when origination costs are still at almost historic highs.

Origination costs pushed lenders into negative territory in the first quarter of 2018 for only the second time since 2008, averaging a net loss of $118 per loan. Performance improved in the second quarter, rebounding to a net gain of $580 on each loan, but profits were still down on a year over-year basis.

The silver lining to this dark cloud is that those net gains in the second quarter were largely from changes lenders made to their own processes.

“Mortgage originators evidently responded to first-quarter losses by reducing their expenses in the second quarter, as production expenses dropped by over $1,000 per loan,” said Marina Walsh, MBA Vice President of Industry Analysis.

To read the entire white paper, visit the Knowledge Center at knowledge.housingwire.com.

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HOUSINGWIRE MAGAZINE ❱ MARCH 2019

INDEX COMPANIES A

GOVERNMENT SHUTDOWN The effect of the shutdown, and what another would do to the economy.

P. 34

VALUATION TECH Class Valuation, CoreLogic, Global DMS, Valuation Partners, Veros HOUSINGWIRE MAGAZINE ❱ MARCH 2019

P.40

BROKERS

Entities battle to earn broker business. p28

Ellie Mae............................................12, 22, 52, 81 Everett Advisory Partners............................10 EXOS Servicing....................................................71

M M&T Bank..............................................................18

Development......................................................27 United Wholesale Mortgage.......32-33, 51,

Merrill Lynch.........................................................10

V

F

MetLife....................................................................10

Valuation Partners..............................1, 40, 44

Altisource..............................................................20

Facebook..............................................................30

Metropolitan Property Group ������������������49

VantageSouth Bank........................................10

Amazon.............................................. 12, 14, 71, 82

Fannie Mae......24-25, 27, 30, 39, 63-64, 79

Mortgage Bankers Association....5, 12, 30,

Veros.................................................... 1, 40, 45, 75

American Advisors Group............................ 55

FDIC..........................................................................18

.............................................................................44, 52

Visionet Systems...............................................72

American BankersAssociation �����������������30

Federal Emergency Management

Mortgage Cadence...........................................10

Angel Oak Mortgage Solutions ����������������10

Agency ..................................................................26

Movement Bank ...............................................10

Apartment List...................................................10

Federal Home Loan Bank of Chicago....10

Movement Mortgage......................................32

Warriors Community Foundation...........22

Arbor Realty Trust.............................................10

Federal Housing Administration ������36, 55

Mr. Cooper ............................................................10

Wells Fargo....................................................10, 33

Arch MI.................................................................... 14

Federal Housing Finance Agency............63

National Association of Home Builders ...

WFG National Title...........................................67

ARMCO...........................................................66, 70

Federal Reserve....................20, 33, 53, 61, 79

.....................................................................................39

Y

Association of Independent Mortgage

Fifth Third Bancorp..........................................10

National Association of Mortgage

Experts...........................................................30, 32

First American....................................................30

Brokers............................................................30, 32

First Union.............................................................10

National Association of Realtors ������37, 79

Accenture..............................................................10 Airbnb....................................................... 27, 47-49

B

W

Youth on Course............................................... 22 Z

Fiserv........................................................................10

National Low Income Housing Coalition

Bank of America................................................10

Four Oaks Bank..................................................10

.....................................................................................39

BB&T Corp.............................................................27

Freddie Mac............. 10, 24, 27, 30, 63-64, 67

National Taxpayer Advocate ���������������������37

Black Diamond Mortgage...........................30

Freedom Mortgage.........................................66

New American Funding ................................67

PEOPLE

G

O

A

Gateway Mortgage Group...................10, 66

OCC...........................................................................18

Anzaldua, Ricardo............................................10 Arvielo, Rick..........................................................67

Blue Water Financial Technologies.........10 BuildZoom............................................................10 C

Zillow......................................................................20

Ginnie Mae............................................................32

OnPoint Analytics.............................................10

Caliber Home Loans................................ 10, 30

Global DMS...............................................1, 40, 43

P

Astrada, Scott....................................................60

Capital Bank Financial...................................10

GMAC.......................................................................10 Goldman Sachs..................................................10

PennyMac............................................................20

B

Capital Economics.....................................33, 51 Celink.......................................................................57

Greystone Bank..................................................10

PHH Corp..............................................................65

Baker, Charlie......................................................49

Praxis Technology Group..............................10

Bansal, Alok.........................................................72

Q

Barr, Jeff...................................................................12

Center for Responsible Lending ��������������60 CitiMortgage........................................................32

H

Bettencourt, Richard.......................................32

Class Valuation.................................1, 10, 40-41

Hartford Financial Services Group...........10

Cleary, Gottlieb, Steen & Hamilton..........10

HomeAway..........................................................47

Cloudvirga.............................................................10

HomeStreet Bank............................................. 19

S

Bien-Aime, Vladimir........................................ 43

Congressional Budget Office ���������������������37

Houston Housing Authority �����������������������27

S&P Global Ratings...................................33, 37

Blasio, Bill de.......................................................48

Consumer Federation of America...........26

Houzz.......................................................................10

Society of Chief Appraisers �������������������������10

Boye, David..........................................................30

Consumer Financial Protection Bu-

I

T

Incenter...................................................................10

TCF............................................................................18

Internal Revenue Service..............................37

The First Tee....................................................... 22

K

TMS....................................................................15, 77

Calabria, Mark....................................................63

TransUnion...................................................52-53

Casa, Anthony............................................30, 32

Trulia........................................................................10

Clearwater, Audrey...........................................10

reau.....................................................27, 32, 59, 65 CoreLogic..............................1, 10, 15, 26, 40, 42 Countrywide Home Loans ��������������������������10 D DocMagic.......................................................66, 81

Kroll Bond Rating Agency...........................26

Drip............................................................................10

L

DXC Technology.................................................10

Lennar.....................................................................32

E

loanDepot.............................................................10

Eagle Home Mortgage...................................32

80 HOUSINGWIRE ❱ MARCH 2019

LoanLogics...........................................................10 LRES Corp..............................................................10

Quicken Loans...............................17, 30, 32, 81,

U

Bianchi, John........................................................10

Bozorgi, Darius...................................................45 Bullard, James...................................................20 C

Cole, Aaron...........................................................67 Collins, Patrick....................................................64

U.S. Bank................................................................10

Collup, Jody......................................................... 43

U.S. Census Bureau..........................................30

Crawford, Casey.................................................32

U.S. Department of Housing and Urban

Curry, Stephen.................................................... 22

AD INDEX D

Mulvaney, Mick...........................................................59

Das, Sanjiv.....................................................................30

N

David, Rose Marie.......................................................19

Naider, Avi......................................................................66

F

Noel, Randy..................................................................39

Fall, William..................................................................44

0

Farner, Jay...................................................................... 32

O’Neill, Don................................................................... 67

Forrester, Jon...............................................................44

Otting, Joseph.............................................................63

Fraas, John..................................................................... 41 G

P

Patrick, Steven.............................................................10

H

Pearce, Michael........................................................... 51

Hollis, Rachel.................................................................13 Hunter, Robert............................................................26 I Iannitti, Dominic.........................................................66 Ishbia, Mat..................................................................... 33 J

Pelosi, Nancy............................................... 36, 39, 60 Pence, Mike.................................................................. 60 Powell, Jerome...........................................................20

Rose, Scot....................................................................... 41

Jumpe, Jim.....................................................................14

S

K

Sanders, Bernie......................................................... 60

Kan, Joel......................................................................... 52

Saunders, Valerie...................................................... 32

Kavanaugh, Brett......................................................65

Schroeder, David.........................................................17

Kelly, John E....................................................................17

Sheeran, Ed...................................................................19

Kraninger, Kathy........................................................59

Sieffert, Kristen...........................................................56

Kushi, Odeta.................................................................30

Sinek, Simon..................................................................12

L

T

LaLonde, Travis...........................................................10

Tallinger, Jon................................................................. 41

LaMar, Travis.................................................................10

Trump, Donald.................................................... 36, 63

Leiner, Howard............................................................10

W

M Marshall, Christopher...............................................10 McCall, Phil...................................................................70 McNamara, Jason......................................................57 Mellman, Joe............................................................... 53 Middleman, Stanley................................................66

Ellie Mae............................................................................... 4

Romem, Issi...................................................................10

Rupp, David...................................................................10

Luth, Britany.................................................................57

E

Reed, Jack.....................................................................59

Jarvis, Paul......................................................................13

Lundquist, Ashley......................................................10

DocMagic.............................................................................. 6

R

Rubin, Gretchen...........................................................12

Liotta, Marcus.............................................................64

D

Pointon, Matthew..................................................... 33

Jaeger, Stephan.......................................................... 22

Lencioni, Patrick..........................................................19

AIME....................................................................................2,3

Parker, David.................................................................10

Gregovich, Trish.......................................................... 22

Hitchcock, William....................................................64

A

G Genworth............................................................................. 8

M MGIC.......................................................................................21

Q

Walker, Robert............................................................45 Warr, Charles................................................................44

Quicken Loans...................................................................16

Waters, Maxine...........................................................37 Watt, Mel.......................................................................63 Worrall, Dave.................................................................71 Y

S

Yentel, Diane................................................................39 Yun, Lawrence.....................................................39, 79

Sagent Lending Technologies.....................................11 HOUSINGWIRE ❱ MARCH 2019

PARTING SHOT â?ą DISRUPTION This industry went from being a highly disconnected system to one forged upon key relationships, and will evolve to being completely interconnected. Interconnected, all inclusive giants such as Amazon are also a looming reality that is already making advances towards disrupting the mortgage and real estate industries.

82 HOUSINGWIRE â?ą MARCH 2019

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