Primer on Current Broker Compensation Plans - BPC & LPC; Reader Input on Different Topics
Posted To: Pipeline Press The mortgage industry is filled with smart business people who just want to know "the rules of the game" rather than the uncertainty that seems to exist in many areas. For example, CG from Wisconsin writes, "I own a small mortgage brokerage that, for a plethora of obvious reasons, is attempting to make the conversion over to become a mortgage banker. I'm doing my best to follow the ever changing LO comp rules as they seem to change on a daily basis; and I know that I will need to somewhat revamp my compensation plan for this new origination structure. It is pretty apparent that I will be forced to compensate my loan officers on a 'vanilla' basis point compensation plan (ensuring that their compensation is not commensurate to the terms of the loan in any shape of fashion). So here is an idea...(read more)
MBS RECAP: Technically an Early Close, but Buyers Never Showed Up
Posted To: MBS Commentary MBS Live : MBS Afternoon Market Summary After a morning fraught with volatility, MBS finally bounced just after the noon hour. Even then, such a bounce wasn't really indicative of much more than an automatic buying point being reached when MBS spreads had finally blown out wide enough. In other words, in the midst of planning the day filled with avoiding buying MBS, perhaps some trade desks left notes for whoever was left manning the desk to 'only buy if spreads get this wide.' Everyone else was off for the weekend, especially after 11am. The fact that we only got a moderate handful of negative reprices today helps paint that same picture. Given the volatility, we'd almost always expect more reprices that we got, but when combined with yesterday's rate sheets being weaker than MBS losses suggested...(read more)
Mortgage Rates Hold Steady Ahead of 3-Day Weekend
Posted To: Mortgage Rate Watch Mortgage rates finally paused their relentless push higher today, holding at unchanged levels compared to yesterday's latest rate sheets on average. Some lenders were slightly better or worse, but none of them by a wide margin. Data and events were limited and markets were in holiday mode. The most relevant market to mortgage rates, MBS, had a volatile day, but the volatility didn't transfer to rate sheets as much as it normally does, likely due to the shortened trading day and 3-day weekend ahead prompting lenders to price more conservatively yesterday. This would go a long way toward accounting for our observation yesterday that rate sheets were worse in the morning despite trading levels not being appreciably weaker. (If you missed this week's big news for rates, or want a refresher: Why...(read more)
MBS MID-DAY: Negative Reprices in the AM: Breakfast of Champions
Posted To: MBS Commentary MBS Live : MBS Morning Market Summary Please not the timestamp on the price table below as Fannie 3.0s are currently down 3 ticks at 101-19, but had been as low as 101-13 earlier this morning. Negative reprice alerts on MBS Live went out at 11:20am, 11:56am, and 12:20pm. Treasuries have had a calm morning while MBS had a mini-meltdown, moving to the lowest prices of the year, resulting in several investor reprices. Durable Goods data had relatively little effect and instead the lack of liquidity in MBS began taking its toll just after 10am. Buying triggers look to have been tripped at the lows (or "wides" in terms of MBS spread vs Treasuries). Volatility was a possibility from the outset given the shortened trading day and the Quadruple Witching options/futures expirations in equities markets...(read more)
Delinquency Rate Hits Post Housing Crisis Low for Freddie Mac
Posted To: MND NewsWire Freddie Mac said today that its total mortgage portfolio i ncreased by $951 million in April to $1.949 trillion , an increase of 0.6 percent. This was the second straight month the portfolio has increased. Purchases totaled $47.3 billion compared to $52.0 billion in March, liquidations were ($45.7) compared to ($44.85) billion and sales were ($627) million, up from ($617) million. The year to date growth in that portfolio is (1.1) percent and the annualized liquidation rate is 29.2 percent. The Mortgage-Related Investments Portfolio declined from an unpaid principal balance of $534.2 billion in March to 528.3 billion in April, a change of 13.2 percent . Purchases totaled $15.0 billion compared to $13.57 billion in March. Liquidations increased from ($10.10) billion the month before to ($10...(read more)
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HIGH FICO FHA INCENTIVE
