Smaller players tend to retain post-closing functions, perform them manually, and may leave issues unresolved due to time and expense to cure. Lenders are optimizing the borrower experience, but are they using that intelligence for the sale and transfer of portfolios? Larger lenders can invest in technology or engage with business processing outsourcing firms to optimize processes. Do you know your collateral risk?Ĭounterparty risk: Are you working with lenders who can deliver clean collateral files? With the increase in production and changes in regulations and requirements, we would like to discuss collateral risk in the new paradigm. Preparation, execution and recordation of accurate instruments is imperative. With volume comes collateral risk.Īre you aware of the collateral requirements to retain, service, sell or securitize loans? Are you able to re-certify Ginnie Mae pools? Are you getting the necessary trailing documents from lenders, title companies, attorneys and closing agents to complete your collateral files? Whether you are an originator, correspondent, purchaser or issuer, collateral management is crucial to successful transactions. Private label mortgage backed securities are having its biggest year since 2007, forecasted at $40 billion for 2019. Ginnie Mae MBS issuance reached $56.09 billion in November, while Fannie Mae and Freddie Mac issuance totaled $117.6 billion for single family MBS in the same month. Non-qualified mortgages are more common as government insured programs and conventional loans do not suit every borrower. New players have emerged in the market, who may not know the rules. With banks shying away from government lending programs, and non-banks embracing Ginnie Mae mortgage backed securities issuance, the stakes are high from a collateral perspective. Mortgage bankers are competing for the same borrowers, and focusing on the customer experience. Accurate and rapid closings are in everyone’s best interest, saving time and money. This shift is advantageous to the consumer and lender. The digital mortgage revolution is here with app based applications, e-mortgages, digital closings and notarization’s becoming more prevalent. Digitally enabled, arm chair buyers are empowered to shop and finance their homes online. Homeowners are aging in place longer than predicted, and millennial’s are no longer delaying household formation. Existing housing supply remains tight, and lower priced homes are scarce. The National Association of Home Builders housing market index reached its highest level since June of 1999, reflective of a positive outlook, an increase in new construction, which is expected to continue in 2020. unemployment rate dropped to 3.5% in November, a 50 year low. The 30 year fixed mortgage rate remained below 4% for 31 weeks as of the end of December, fueling purchases and refinances. In this historically low rate environment, mortgage bankers will end 2019 on a high. As seen in Mortgage Bankers Magazine written by Amie McCarthy and Meaghan Hunter-Hanley
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