Servion Mortgage Newsletter - May 2022

MAY 2022

In This Issue Partner Updates Servion’s Lending Conference Will be Held in September!

Military Appreciation Month: $100 Discount from Servion Title Enhancing Mortgage Automation Go2Source National Realtor® Referral Network Mortgage Market Statistics Servicing FAQ: Can a Borrower Make a Large Payment and Then Re-Amortize the Loan?

Home Prices Coming Down? Don’t Count On It…Yet Vote Servion Realty as one of Minnesota’s Best!

The Buzz: Recent Feedback

PARTNERnUPDATES

The Spring housing market has been different than normal, with housing prices skyrocketing and interest rates rising. But there has still been plenty of demand from buyers, and plenty of demand for Servion Mortgage’s support. We are thrilled to welcome our newest partners and grow relationships with existing ones in March and April!

New Retail Lending Partners American Partners Federal Credit Union – Reidsville, NC Gulf Coast Federal Credit Union – Mobile, AL University of Nebraska Federal Credit Union – Lincoln, NE Union Bank and Trust – Minneapolis, MN Whitesville Community Credit Union – Whitesville, KY *Also signed up for correspondent, wholesale FHA/VA, and contract processing services

New Correspondent Partners Advantage One Credit Union – Brownstown Township, MI Linn Area Credit Union – Cedar Rapids, IA

Relationship Expansions Canopy Federal Credit Union – Spokane, WA *Expanded into correspondent channel First Trust Credit Union – Michigan City, IN *Expanded into correspondent channel Old Missouri Bank – Springfield, MO *Expanded into delegated correspondent channel R.I.A. Federal Credit Union – Bettendorf, IA *Added retail channel services

LEARN ABOUT OUR PRODUCTS & PARTNERSHIP OPPORTUNITIES

LENDING CONFERENCE

OUR

WILL RETURN IN 2022!

We are beyond excited to be hosting our lending conference just a few months from now!

For those who don’t know, we hosted a lending conference each year beginning in 2017, and it had grown into a multi-day event covering mortgage and business lending. Leaders and staff from our partner credit unions and community banks would come together to learn and explore ideas for growth. Of course, the pandemic forced us to cancel in 2020 and 2021. Now, we’re getting the event back underway!

We’ll have more details in the coming months, but here’s what you should know for now.

Mortgage Sessions SEPTEMBER 26 AND 27 Business/Commercial Lending Sessions SEPTEMBER 28 Location THE ST PAUL HOTEL 350 MARKET ST ST PAUL, MN

Whether you’ve attended the conference before or this would be your first time, we are very excited to see all of you in September! Watch your emails for your official invitation, which we’ll be sending your way in late June or early July!

MILITARY DISCOUNT 2

Servion Title salutes our troops with an exclusive discount as a thank you for their service and dedication! We welcome all Active Duty members, Reserves, Veterans and Retirees including their immediate family members.

ENHANCING MORTGAGE

AUTOMATION

Servion Mortgage recently made an exciting investment in a technology called AIQ. “AIQ” stands for automation, intelligence, quality. This solution uses artificial intelligence and machine learning to streamline the underwriting process.

Ellie Mae, which originally developed AIQ, was subsequently purchased by InterContinental Exchange, along with several other mortgage software solutions and brought together under the umbrella of a new company called ICE Mortgage Technology (ICE). ICE’s goal is to create a single digital ecosystem to handle the mortgage process from origination to final settlement. ICE provides the Encompass LOS used by Servion Mortgage.

In March of this year, Servion Mortgage’s Encompass360 team attended the ICE event in Las Vegas. This was an opportunity to further our knowledge and use of AIQ and related tech, and we are excited to bring our added knowledge and capabilities to you, our partners.

Specifically, Servion Mortgage has now integrated AIQ doc recognition, credit analyzer and income analyzer into our process, utilizing automation to shorten the overall mortgage process. The goal is to automate manual workflows, increase efficiency and productivity and reduce risk.

We look forward to implementing e-closings and additional automation throughout 2022, keeping Servion Mortgage on the forefront of mortgage automation, efficiency and service to our partners.

Tired of Real Estate Agents Sending Your Borrowers to Other Lenders?

We developed the Go2Source Realtor Referral Network to address this “steering” problem. The network includes hand-picked agents who are committed to keeping borrowers with you, not sending them elsewhere. Your borrowers should remain yours, and Go2Source helps make that happen.

Benefits for Both Retail and Correspondent Partners Go2Source agents help your borrowers search, buy, sell and save on their transactions.

Go2Source agents are local to your area and carefully vetted for professionalism and service attributes.

Go2Source agents never steer the borrower to any other financial institution.

For just $30/year, we can help you get the word out about Go2Source with customizable print and digital materials.

What To Do Next Want more information?

Contact your Servion Account Executive.

Ready to connect a lead with a Go2Source Realtor®?

Visit: myservion.com/Go2Source

The Go2Source Realtor® Referral Network is managed by The Servion Group, which locates, vets and recommends real estate agents in cities across the country who then become part of the Go2Source-branded network.

MORTGAGE

MARKET STATISTICS

We’ve selected a few pieces of data on the national housing market to give you an idea of what’s happening around the country. These are not Servion-specific numbers but rather national housing market numbers.

By mid-April, the average rate for 30-year fixed-rate mortgages was 5.25%. It was just 3.36% a year earlier.

The 30-year mortgage rate hasn’t been this high since August 2009.

Purchase lock volumes rose 31% from February to March as buyers raced to lock rates before they climbed higher.

Purchase application volume has dropped about 41% compared to a year ago.

Refinance application volume has dropped about 60% compared to a year ago.

Homes are overvalued in 88% of metropolitan statistical areas, according to Standard & Poor’s.

For historical perspective, this graph from Freddie Mac and the St. Louis Federal Reserve shows the average 30-year mortgage rate since the early 1970s.

Sources: https://www.nationalmortgagenews.com/news/homes-overvalued-in-88-of-metro-areas-s-p https://www.nationalmortgagenews.com/news/home-buyer-loan-locks-jump-amid-decade-high-rate-hikes https://www.cnbc.com/2022/04/06/surging-interest-rates-push-mortgage-demand-down-more-than-40percent-from-a-year-ago.html https://www.cnbc.com/video/2022/04/11/30-year-mortgage-hits-5-point-25-percent.html https://fred.stlouisfed.org/series/MORTGAGE30US

SERVICING

FAQ The Servion servicing department fields hundreds of questions every day from partners and borrowers. In this month’s newsletter, we wanted to tackle one of the questions that has been coming up regularly in recent weeks.

Can a borrower make a large principal payment and re-amortize the loan to lower their monthly payment?

If a borrower makes a substantial principal curtailment, he or she may request that the mortgage balance be re-amortized over the remaining term of the loan to reduce the mortgage payment. (Note: FHA/VA loans cannot be re-amortized).

There is a fee of $250 for a reamortization and the minimum principal payment accepted for a re-amortization is $20,000.00. The funds must be in the form of a cashier’s check or certified funds and must be accompanied by a written request.

NEW LOANS There are no payment history requirements for portfolio loans.

Fannie requires the borrower to make at least three payments.

EXISTING LOANS The borrower may be delinquent at the time of the request; however, the funds must be used to first bring the loan current and any remaining monies are to be applied towards the principal.

Borrowers may remit the $250 fee, principal reduction, and written request to: SERVION INC. ATTN: LOAN SERVICING 500 MAIN STREET NEW BRIGHTON, MN 55112 Upon receipt of the request, Servion, Inc. will draft a modification/ re-amortization agreement to be executed by the borrower(s). The new principal and interest payment will become effective with the borrower’s next monthly payment.

Home Prices Coming Down?

DON’T COUNT ON IT... YET.

Don’t hold your breath for home prices to return to “normal.” Prices aren’t likely to head lower any time soon, according to Daryl Fairweather, chief economist at Redfin.

“It is hard to imagine prices going down,” she said in a mid-April interview with CNN Business. “But I think we are nearing the end of the period where homes are going for $100,000 over asking price.”

She was quick to caution that this is not like the last housing crisis, where many homeowners had mortgages they could not afford. “We learned a lot last time and we don’t have those same risks,” Fairweather said.

New lending laws put in place after the housing crisis were designed to better regulate the financial sector and protect consumers. Most homeowners have fixed rate mortgages now, and there are not so many balloon payments to worry about, she said. Also, lending standards are much stricter.

“Current homeowners had to show they have lots of assets to get the mortgage and they have lots of equity,” said Fairweather.

“There hasn’t been much predatory lending the way there was before. If anything, there

is a lack of access to credit for those who have less-than-perfect credit scores.”

Critically, any shift in the housing market is not likely to significantly impact the wider economy as it did last time, said Christopher Mayer, a real estate professor at Columbia Business School. “This should not show up in the financial system, but it will show up in other places.”

While prices might not come down any time soon, they likely will eventually, he said.

“I don’t think the risk is like what we saw from 2008 to 2010 or that prices are going to collapse,” said Mayer. “But it is perfectly reasonable that they could go up in the next year, and then go down. I could see prices being 5% to 10% lower three to five years from now. And you could end up selling for a little less than you bought it for.”

That means those looking to buy now should focus on a home they can reasonably afford and remain in for a while, said Fairweather.

Ultimately, buyers can tame that “fear of missing out” feeling, said Fairweather, by buying a home they can stay in and grow in for the next five years or longer.

Source: https://www.cnn.com/2022/04/07/homes/us-real-estate-bubble-homebuyers/index.html

Servion Realty has been nominated as one of

Minnesota’s Best Real Estate Companies!

We’d love to have your vote!

Scan the QR Code to vote. You can vote once a day!

Polls close May th. #MNBEST

votemnbest.com/servionrealty

I wanted to say thank you to the whole team for completing this request so fast and on such short notice. You all ROCK!

My member couldn’t say enough about the excellent service you provided and how quick all the communication was.

Thank you so much for taking such good care of our members!

THE

BUZZ

Hear what our partners are saying about us!

Thank you for coaching me in documentation on this file and having wonderful attention to detail.

Thank you so much for your quick underwrite on this file. We pulled it from another investor, so we really appreciate how quickly Servion moved on this – amazing!

Servion will be closed on Monday, May 30 for the Memorial Day holiday as we remember those who have given their lives while serving in the U.S. military. Thank you to every service member and military family for your sacrifices.

651-631-3111 • myservion.com Servion Mortgage is a DBA of Servion, Inc. NMLS #1037. Equal Housing Lender.