Mortgage Banker Magazine March 2021

CFPB ON STEROIDS?

NON QM TRAINING PLAN

HOUSING’S WIBBLE-WOBBLE MARCH 2021

MortgageBanker

WE’RE WALL STREET,

darlings

MORTGAGE LEADERS EYE GOING PUBLIC WITH LUST. WHY ARE INVESTORS EYEING BACK WITH YAWNS? A PUBLIC ATI O N O F A M E R I C A N B U S IN ES S M ED IA

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March 2021

CONTENTS

Special 7

FEATURE

7

A Fluid Future

Interest rate tightening, market changes are maddening. But the housing market is still a seller’s dream

BY DREW WATERHOUSE COVER STORY

14

COMPLIANCE

8

From the Desk of the ‘Om-Bobs’Man’: Servicer Standards Under Scrutiny

Up, Down & All Around: Why Mortgage IPO Prices Are On A Rocket Ride

BY BOB NIEMI THE C SUITE

BY ROB CHRISMAN

12

15

SVP Operations, Angel Oak Lending

Investors Signal They Think The Best Of The Mortgage Market Is Past

BY DAVID FRENCH AND CHIBUIKE OGUH

Profile: Alysse Prosnick

24

Profile: Paul Beuge President and COO, Inlanta Mortgage

24

MORTGAGE REGULATION

26

Chopra At The Bit: The CFPB Is Rarin’ To Run

BY TROY GARRIS LEGAL

22

The Mortgage Counselors: Enforcement Plots A Big Comeback

BY MITCH KIDER AND MICHAEL KIEVAL

Monthly

DEPARTMENTS

4

Editor Foreword: Compliance Comes Back

5

March 2021 Authors

26

11 Mortgage Banker Calendar of Events 17 Databank 18 Mortgage Banking Lawyers 28 Regulatory

MORTGAGE BANKER | MARCH 2021 3

MortgageBanker OUR MISSION Mortgage Banker magazine is dedicated to providing quality informational/educational content that betters the mortgage process at every step. The content is oriented to help professionals progress their understanding of the residential mortgage banking business and develop their skills at improving the efficiency and profitability at all levels.

VINCENT VALVO, CEO, Publisher & Editor-in-Chief vvalvo@ambizmedia.com ASSOCIATE PUBLISHER Beverly Bolnick bbolnick@ambizmedia.com

FOUNDING PUBLISHER Ben Slayton BSlayton@ambizmedia.com MANAGING EDITOR Brian Honea Brian@ambizmedia.com SENIOR EDITOR Jill Emerson Jill@ambizmedia.com ADVERTISING David Hoierman David@ambizmedia.com GRAPHIC DESIGN Stacy Murray smurray@ambizmedia.com DIGITAL MEDIA Lucas Luna LLuna@ambizmedia.com HEAD OF ENGAGEMENT AND OUTREACH Andrew Berman andrew@ambizmedia.com INTERACTIVE DESIGN DIRECTOR Alison Valvo avalvo@ambizmedia.com ONLINE CONTENT DIRECTOR Navindra Persaud npersaud@ambizmedia.com

L ET T ER FR O M T H E EDI TO R

That One Word ...

Compliance.

A

word that is certain to illicit an adverse reaction from most mortgage industry professionals.

The level of adversity in that reaction will vary: some express anxiety, some show disgust, and for most it is not a pleasant topic.

We’ve done our best to make compliance a more pleasant topic for mortgage industry professionals. From the time this publication was launched in 2013 up until January 2020, we were known as Mortgage Compliance Magazine. In every issue, we’ve tackled the ever-changing compliance landscape within the industry by providing expert commentary on improving that aspect of your business.

For the last couple of years, compliance may not have had such a prominent seat at the table for many mortgage businesses as it had in the years immediately following the 2008 crisis. But it never really went away, as some of our experts contributing to this edition can attest.

In a feature story in this issue, Troy Garris of the law firm Garris Horn discusses what to watch out for regulatory-wise with the recent change in CFPB leadership. And speaking of experts, Felecia Bowers tells you how you can proactively assess compliance risk, and both the OmBobs-Man and Mortgage Counselors columns caution us to expect increased enforcement from regulators.

What compliance issues are you facing now that were not a concern maybe three or four months ago, and how are you handling them? We want to hear about your experiences. We are always listening. You can always drop us a line via the email address below.

USER EXPERIENCE DESIGNER Billy Valvo bvalvo@ambizmedia.com MARKETING & EVENTS ASSOCIATE Melissa Pianin mpianin@ambizmedia.com

4 MORTGAGE BANKER | MARCH 2021

B R I AN H O N E A

Managing Editor Editor@MortgageBankerMag.com

March 2021 AUTHORS Troy Garris

Troy Garris is a partner with Garris Horn LLP. Troy deals with federal and state compliance, enforcement defense, company formation, and mergers and acquisitions.

Drew Waterhouse

Drew Waterhouse is chief revenue officer of Model Match. He has over 25 years’ experience in growing and developing businesses as well as sales and leadership teams.

TROY GARRIS

Rob Chrisman

DREW WATERHOUSE

ROB CHRISMAN

BOB NIEMI

Rob Chrisman began his career in mortgage banking – primarily capital markets – 35 years ago in 1985 with First California Mortgage. Since then, he’s held a variety of high-level positions at mortgage banks across the country. Currently, he writes a daily commentary subscribed to by mortgage leaders nationally. He is on the board of directors of Inheritance Funding Corporation, a financial services company which advances capital to heirs, of Doorway Home Loans, of AXIS Appraisal Management, and of the California MBA. He is also a member of the Secure Settlements Advisory Board, an associate of the STRATMOR Group, and of the Mortgage Bankers Association of the Carolinas and its membership committee. Rob has provided expert witness services for mortgage and real estate-related cases, has lectured to groups around the country. He holds a BS from Cal Poly, San Luis Obispo, and an MBA from UC Berkeley.

Bob Niemi

Bob Niemi is a Senior Advisor for Financial Services at Bradley, a national law firm. He was formerly Ohio’s chief lending regulator . He has served as the NMLS Ombudsman, a state regulator, a mortgage leader, and now a regulatory compliance advisor.

Mitchel Kider MITCHEL KIDER

Mitchel Kider is the Chairman and Managing Partner of Weiner Brodsky Kider PC, representing mortgage lenders, banks, settlement service providers and other financial services.

MORTGAGE BANKER | MARCH 2021 5

6 MORTGAGE BANKER | MARCH 2021

LOA N O R I G I N AT I O N

Stable But Fluid

WHY THE FLUCTUATING HOUSING MARKET STILL LEANS TOWARD SELLERS

By D R EW WATERHOU SE, M OD EL M ATCH

A

fter a turbulent 2020, it is oddly soothing to look ahead in 2021 at a housing market that appears, at least on the surface, to be relatively neutral and balanced, albeit incredibly fluid. Lack of inventory and the higher home prices that go along with it seem to suggest a seller’s market, but at the same time, historically low-interest rates for potential borrowers seem to suggest a buyer’s market.

So, which is it?

At this point, it is really a matter of when the transaction occurs, but even in what appears to be a balanced housing market, these types of scenarios still tend to tilt toward sellers. Here is why.

RIDING THE SEESAW For homebuyers, the ability to get locked into a low rate right now is a great opportunity and a great idea. But at the same time, housing prices are extraordinarily high, so buyers are getting locked into a low rate, but the price is going to be a little bit higher than it should be until the housing market balances itself out. Either way, this dynamic tends to somewhat favor the seller because, thanks to the lower rates, buyers can borrow

more and pay less interest over the life of the loan. However, as an example, they’re also far more likely to pay $1 million for a home that might only be worth about $800,000 in a more stable housing market.

TIMING IS EVERYTHING At the beginning of this year when interest rates dropped dramatically, there was a significant rush on both new home purchases and refinance loans. Relatively early on, buyers had already jumped on most of the available inventory, but at the same time, in response to the pandemic, people who might have been thinking about selling decided instead to hunker down. Others, however, thought about moving to the suburbs in favor of more space as their homes also became offices and schools. So, between a housing inventory that was already low and that added uncertainty about the world in general, let alone the housing market, it all factors into both housing prices and interest rates. It’s all a matter of how soon and how aggressively the construction industry responds to the demand, and we’re starting to see a little bit of that already.

SOMETHING FOR EVERYONE Whether it ultimately ends up benefitting

buyers, sellers, or both, one undeniable and continuing benefit of the fluid housing market is that the mortgage industry has been and continues to be incredibly busy. When it comes to recruiting, sometimes those efforts get pushed back because it is almost always easier to fund another loan than it is to find another loan officer.

But at some point, recruiters and hiring managers are going to have to start reaching out to their contacts if they want to stay busy without sacrificing efficiency. In a fluctuating market, that makes it all the more important for them to integrate their pipelines with a technology platform that uses CRM functionality to track all of their outreach efforts in one collaborative space.

When it comes to what we can expect from 2021, the housing market isn’t much different from life in general: be hopeful and act as though things will start to get back to normal, but always expect the unexpected. Either way, the state of interest rates and the housing market in general seem to suggest that 2021 could offer a little something for everyone, if you know when and where to find it..

MORTGAGE BANKER | MARCH 2021 7

Soaring Servicer Standards Likely

T

By B OB N IEM I, BRAD L E Y

he new presilooking at new priorities, dential administhough not from changing adtration has been ministrations. Priorities mature confirmed, prias the evolution regulatory sysorities are being tems like the State Examination laid out, and all expectations System, Networked Supervision forecast a more aggressive and Standards for Nonbank Consumer Financial ProtecMortgage Servicers. State regution Bureau (CFPB) in the lators are the prudential regunext four years. The coronalator for nonbank mortgage BOB NIEMI virus pandemic has shown companies through the licenssome signs of improvement, ing and supervisory process, exbut variant strains are racing vaccine efforts aminations, consumer complaint resolution, while more American families are impacted. and when necessary, enforcement.

The CFPB acting director stated the Bureau The State Examination System or SES has will increase its supervision and enforcebeen in development for several years and ment efforts to ensure that companies derecently has added a complaint management livering COVID-19 relief meet their legal system. Through the SES, state regulators obligations and are fully protecting families. share supervisory oversight while making Fair lending has also been announced as a the process more efficient using a single top priority. system for industry and regulator. ExamiState mortgage regulators likewise are nations allow regulators to monitor activ-

8 MORTGAGE BANKER | MARCH 2021

ity and compliance to determine whether a mortgage company is operating in a safe and sound manner. The use of a single system improves efficiency and increases collaboration between states.

Networked supervision also focuses on combined efforts when licensing and renewing companies with shared review of data from the NMLS, company applications, and their financial documents. This ‘strategic approach’ is meant to leverage the collective intelligence from all state regulators. Yet, a trust gap still exists between the stated goals to reduce rather than increase regulatory burden and anxiety of wary licensees.

Like both previous topics, the Proposed Regulatory Prudential Standards for Nonbank Mortgage Servicers were first developed in 2015 under my term as Ombudsman. The state driven effort was to develop enhanced examination standards for mortgage servicers and capital and liquidity baselines. In the years since opening the discussion, increased growth and coordination has occurred. Nonbank mortgage servicing has experienced rapid market share growth and complexity of operations.

The new Prudential Standards cover areas including capital and liquidity, risk management, data protection standards, cyber risk, corporate governance, and change of control requirements. Also, increased coordination with federal agencies and the CFPB took place and inclusion of new examination processes related to forbearance and foreclosure responsibilities mandated by the CARES Act. Regulators have shared that these ‘baseline’ standards as the starting point for discussion. Yet Enhanced Standards and supervisory expectations for large entities have also been forecast for entities that require increase regulatory oversight. Application of prudential standards that beyond standards already in place through other federal agencies or guarantors. Regulators must balance the impact caused by heightened prudential standards on the cost and availability of credit for consumers.

While all these are footsteps in the evolution of mortgage regulation and supervision, the trend is for growing pains and increased enforcement.

MORTGAGE BANKER | MARCH 2021 9

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202.628.2000 10 MORTGAGE BANKER | MARCH 2021

MortgageBanker Calendar of Events APRIL 2021

JUNE 2021

JULY 2021

Tuesday-Thursday, April 27-29 2021 Mid-Atlantic Regional Conference MBA/MW + MMBBA MGM National Harbor 101 MGM National Ave. Oxon Hill, Maryland MARCMBA.org

Thursday-Friday, June. 10-11 2021 New England Mortgage Expo Mohegan Sun Resort & Casino 1 Mohegan Sun Blvd.

Uncasville, Connecticut NEMortgageExpo.com

Tuesday, July 13 2020 Carolinas Connect Mortgage Expo Embassy Suites Hilton Charlotte 4800 South Tryon St. Charlotte, North Carolina CarolinasConnectMortgage.com

Tuesday, June 15, 2021 Great North West Mortgage Expo — Portland Holiday Inn Portland South 25425 SW 95th Ave., Wilsonville, OR 97070 www.greatnorthwestexpo.com

Thursday, July 22 2021 Arizona Mortgage Expo Wild Horse Pass Resort & Casino 5040 Wild Horse Pass Boulevard Chandler, AZ 85226 2021 Arizona Mortgage Expo www.azmortgageexpo.com

Tuesday, June 22 2021 Chicago Mortgage Originators Expo Holiday Inn Chicago SW 6201 Jollet Road Countryside, Illinois ChicagoOriginators.com

AUGUST 2021

Sunday-Thursday, April 11-15 2021 Regional Conference of Mortgage Banker Associations Hard Rock Hotel Casino 1000 Boardwalk Atlantic City, New Jersey mbanj.com

MAY 2021

Tuesday-Thursday, May 4-6 Mortgage Star Conference for Women Sheraton Memphis Downtown 250 N Main St, Memphis, TN 38103 www.mortgage-star.net Wednesday, May 5 Mid-South Mortgage Expo Sheraton Memphis Downtown 250 N Main St, Memphis, TN 38103 www.midsouthmortgageexpo.com

Thursday, June 3 2021 California Mortgage Expo— Irvine Hilton Irvine/Orange County Airport 18800 MacArthur Blvd.

Irvine, California CAMortgageExpo.com

Tuesday, July 6 2021 Ultimate Mortgage Expo Hotel Monteleone 214 Royal St New Orleans, LA 70130 www.ultimatemortgageexpo.com

Thursday, August 12 2021 California Mortgage Expo— San Diego Hyatt Regency La Jolla 3777 La Jolla Village Dr. San Diego, California CAMortgageExpo.com

Tuesday, May 11 2021 Motor City Mortgage Expo DoubleTree by Hilton Detroit— Dearborn 5801 Southfield Expressway Dearborn, Michigan MotorCityMortgageExpo.com Tuesday, May 18 Texas Mortgage Roundup – San Antonio Wyndham San Antonio Riverwalk, 111 E Pecan St San Antonio, TX txmortgageroundup.com

See www.mortgageconferences.com for more events.

To submit your entry for inclusion in the Mortgage Banker magazine calendar of events, please e-mail the details of your event, along with contact information, to editorial@ambizmedia.com.

All events are as of March 1, 2021 and are subject to change.

MORTGAGE BANKER | MARCH 2021 11

T HE C- SU I T E

ALYSSE PROSNICK SVP Operations Angel Oak Lending

12 MORTGAGE BANKER | MARCH 2021

What is most rewarding about your position?

Providing mortgage solutions to borrowers who do not fit the agency “box” is certainly rewarding. Over the last year, I started an operations trainee program, and it has been one of the most rewarding aspects of my career. We look for recent college grads or those whose careers were displaced due to COVID. We then put the operations trainees through a four-week class to learn the mortgage business. At the end of the class, we place the trainees in an entry level position that they help choose based on their own interest and career goals. They are expected to stay in that role for at least six months to learn the business after which they will have the opportunity to grow within the organization.

It has been such a pleasure to watch the trainees develop their skills and grow with Angel Oak. If we look 10 years down the road, I will be so delighted to see them leading different areas of the organization and helping

others to launch their careers through this program. It is part of our people first culture that makes Angel Oak a great place to work.

What do you think is the biggest challenge for the mortgage banking industry currently?

I believe the industry has struggled with the rapid pace of growth this year. It can be easy to grow, but at what cost to quality? Finding the right balance of onboarding and ensuring your current team is not burning out has been a struggle for many.

What time do you get up?

6 a.m.

What is the first thing you do in the morning?

Get ready, start a cup of coffee, and have five minutes of quiet time before waking up the kiddos.

What is your mantra?

Trust the process.

lip balm (it is the best), hand sanitizer, phone, pictures of my husband, two boys, and dog.

What is your best work practice?

Building and maintaining great working relationships.

Receiving regular feedback from my team and intently listening to their needs so I can deliver results based on their feedback.

What time do you go to bed?

10 p.m.

What is your best habit?

Regular exercise. It allows me to de-stress, feel energized, and see things more clearly.

What is the last thing you do at night?

Snuggle with my hubby.

Before unwinding for the night, I get things prepped for the next day. Clean the kitchen, pack bookbags and snacks, get the water bottles ready, and prep the coffee.

What is on your desk?

Dual monitors, Angel Oak

“PROVIDING MORTGAGE SOLUTIONS TO BORROWERS WHO DO NOT FIT THE AGENCY ‘BOX’ IS CERTAINLY REWARDING.”

Each month, Mortgage Banker magazine features two mortgage banking executives in the C-Suite.

CONTINUED ON PAGE 16

MORTGAGE BANKER | MARCH 2021 13

COVE R STORY

rs

dit: Reute

Photo Cre

GOING PUBLIC

Why Wall Street Can’t Figure Out Mortgage Stocks MORTGAGE LENDERS LOOK TO PUBLIC MARKETS, BUT INVESTORS AREN’T DAZZLED >>

By R O B CHR IS M AN, M O RTG AG E B A N KER M AG A ZIN E CON TRIB U TIN G WRITER

14 MORTGAGE BANKER | MARCH 2021

I

ANALYSIS

n business school we learned never to buy something priced above its intrinsic value. So, what does an investor buy when they buy the stock of a residential lender, especially if there is no servicing? Very few lenders think about “going public,” but there are several dozen companies involved in residential lending that investors can own a piece of if they so desire, many with billions on their books of servicing.

But is there value within these companies over the long term for investors?

First, some theory. The value to a potential buyer of a lender, whether it is the entire company or a few shares, will depend on different factors. But three main variables are typically analyzed: loan volumes, margins (including cost structure and profitability), and the current policies, procedures, and business model. Also incorporated ROB CHRISMAN into analyst’s thinking is the overall future of the overall industry, and of the U.S. economy.

When analysts are looking at the fair market value of a publicly traded lender, this can be clouded by ownership percentages. When small lenders are bought or sold, and there are minority owners, there would be a minority discount and a lack of marketability discount (reflecting a closely held entity). The combination of those two factors might reduce the selling partner’s share by a minimum of 40% and possibly as much as 75%. Indeed, some lenders have not sold the entire company to stockholders, but a small percentage.

I

SEASONS OF CHANGE n addition, in looking at general business conditions, the management of recent IPOs (such as Rocket, Guild, UWM, and Home Point Capital) has demonstrated that most of these companies are subject to the same seasonal and economic fluctuations that other lenders are. The ability to achieve consistent net income margins and sustained profitability is not evident in some cases. There are good and bad quarters, good and bad years. The fact that 2020 was a record-breaking year for most lenders in terms of volumes and profitability has nudged the majority owners of some of these lenders to want to “take their chips off the table” and sell at what they view as the high of the market.

Analysts apply a variety of models in their valuation analysis, but most can be grouped into three types: the Market Approach (based on market multiples derived from other publicly traded companies or actual sales of comparable companies or assets), the Cost Approach (based on the value of the underlying assets and liabilities of a business to estimate the equity value of the firm, including servicing), and the Income Approach (based on the premise that the value of a business depends on its future earnings).

Enhancing value are servicing assets, a low cost structure, or an exhibited way of doing business that competitors don’t have. Factors that detract from value include a minority ownership position (with its lack of ability CONTINUED ON PAGE 16

MORTGAGE LENDER IPO WOES REFLECT HOUSING MARKET PEAK

By DAVID F REN CH and CHIB U IKE OG U H, REUTER S Investors fueling an initial public offering bonanza are snubbing many U.S. mortgage providers’ stock market debuts over concerns that the sector might have reached its peak.

Five mortgage vendors have scaled back or canceled plans to go public in the last four months, as investors flinched at their frothy valuations. This may bode poorly for IPOs by other home loan providers such as Better.com and NewRez. Many lenders have never had it so good, as affluent professionals fleeing big cities during the COVID-19 pandemic take out large loans to buy homes in the suburbs, and as near-record low interest rates fuel refinancings.

Yet investors and analysts say IPO hopefuls in the sector have not priced in an expected housing market slowdown in 2021.

“Investors don’t like buying into a company at the start of a down cycle, and mortgage originations are an extremely cyclical business,” said Matthew Kennedy, a senior strategist at IPO-focused research firm Renaissance Capital.

LoanDepot Inc was forced to cut its IPO by 75% to $54 million this month, after investors balked at its request to be valued as highly as $6.8 billion. Home Point Capital Inc downsized its IPO by 40% at the end of January to $94 million, giving up hopes of an up-to-$2.9 billion valuation.

This is despite 62% of U.S. operating companies that went public in January having upsized their offerings on strong investor demand, according to data compiled

by IPO expert Jay Ritter, a professor at the University of Florida.

HOLDING BACK Two other mortgage vendors, AmeriHome and Caliber Home Loans, pulled their IPOs in October. AmeriHome’s owner, private equity firm Apollo Global Management, clinched a deal last week to sell the company to regional bank Western Alliance Bancorp at a 23% discount to the $1.3 billion valuation it was seeking in the IPO. The investor pushback reflects concerns about the industry outlook, as mortgage rates gradually creep up with the economic recovery, and home price inflation begins to weigh on purchases. The Mortgage Bankers Association is forecasting a 49% decline in the number of refinancings in 2021.

Other warning signs have emerged. Shares in Rocket Companies Inc, parent of America’s largest mortgage CONTINUED ON PAGE 16

MORTGAGE BANKER | MARCH 2021 15

STOCK SLUMPS, SURGES DON’T SEE MORTGAGE FUTURE

WARNING SIGNS FOR IPOS CONTINUED FROM PAGE 15

CONTINUED FROM PAGE 15

to make decisions, or even have a say in them), offering a “vanilla” product mix or service that thousands of competitors have commoditized, outstanding legal or repurchase issues, a heavy dependence on refinance activity, a high geographic concentration, and a high exposure to an increasing rate environment.

I

LIQUID LOGIC n general, lenders “going public” recently has been about providing liquidity for their existing owners.

Rocket, for example, used gross proceeds from its recent offering to buy out shares from existing shareholders rather than plowed back into the business. Guild used a small percentage of its outstanding common stock to purchase shares from certain Guild shareholders, providing an ongoing liquidity mechanism by which inside shareholders could cash out their shareholdings.

But an influx of capital can also be used to acquire and implement new technology, make acquisitions, acquire bulk servicing rights, expand with bricks and mortar into a new region, or enter a new channel. Having a lot of IPO cash can improve recruitment and retention. Ask yourself, how many of the lender IPOs in the last six months are focused on future business rather than cashing out existing shareholders?

CEOs find a loss of complete control as they find themselves reporting to shareholders and analysts instead of a small group of owners. Employees may ask themselves what the stock price is doing on a particular day rather than focusing on adding value for the coming years. Lenders and vendors may find their company’s value moving up or down based on investor’s perception of the industry rather than on the merits of the company itself. Companies may find themselves making decisions to avert risk rather than relying on the growth instincts of a strong leader.

There are already dozens and dozens of lenders and servicers involved in residential lending that investors can buy a piece of, such as Flagstar, PennyMac, Mr. Cooper, NewRez, Guild, Rocket, Home Point, and Ocwen to name a quick few.

Management at some larger, typically independent mortgage banking companies view going public as part of the normal progression of corporate development, and owners view going public as a way of cashing out after years of unexciting salaries in a strong market for both lenders and vendors.

What does it all mean for the mortgage market? The fact that the stock values of lenders (that have gone public in the last several months) haven’t gone up much, and some actually have gone down, is not necessarily indicative of their future. One can argue that the stocks were well priced by investment bankers initially, for example. Critics will suggest that the current crop of lenders have nothing special to offer investors, pay no dividends, and may instead stagnate after the owners cashed out. Current stockholders hope that superior senior management skills, remarkable marketing, and hoped-for increases in market share push prices higher.

Time will tell.

16 MORTGAGE BANKER | MARCH 2021

NewRez Chairman Michael Nierenberg is weighing options for bringing his company to the public markets. lender Quicken Loans, trade barely above the level at which the company priced its IPO in August, which was downsized by a third on poor demand.

Guild Holdings Co, which listed in October after shrinking its IPO by 24%, has reported net income for the first nine months of 2020 of $293 million, reversing a loss of $39 million in the year-ago period. Yet its shares are up 10% since the IPO, underperforming a 13% rise in the S&P 500 Index .

“Investors are saying these are earnings that are unlikely to be growing and we are not willing to give the (mortgage) company a valuation at a high price-to-earnings ratio,” Ritter said.

IPO PIPELINE Some big industry players are still hoping to tap the IPO market in the coming weeks. Online lender Better.com, backed by banks including Citigroup and Goldman Sachs Group and investors such as Activant Capital and 9 Yards Capital, has been working with bookrunners to launch an IPO in the first half of this year, according to people familiar with the matter.

A spokeswoman for Better.com declined to comment.

NewRez, a mortgage lender and servicer, said in November it had filed confidentially for an IPO. Its owner, real estate investment firm New Residential Investment Corp, has recently expressed apprehension about its listing prospects.

“It is on the table. It is just one of those things that we just want to make sure before we do it, that it is going to be something that is worth it for our shareholders,” New Residential Chairman Michael Nierenberg said on the company’s quarterly earnings call this month.

MortgageBanker

DATABANK

Consumer Confidence

Financial Vulnerability for Low/Middle Income Share of consumers who said they could cover basic expenses for less than a month if they did not earn a way or receive unemployment insurance

110

Recession

100 90 80 70 60 50

2000

2005

2010

2015

2020

Source: University of Michigan Index of Consumer Sentiment

Source: Morning Consult, January 22, 2021

Conventional 30-Year Mortgage Rate

Home Sales in the U.S. Millions of Units SAAR

15%

8

12% 6

9%

4

6%

Existing Homes

2 0 New 2005

Homes

2010

2015

3%

2020

0% 1982

1987

1992

1997

2002

2007

2012

2017

2020

Source: Federal Reserve

Source: U.S. Census Bureau, National Association of Realtors

Bank Noncurrent Residential Loan Rates

Share of Mortgage Loans in Forbearance 8.6%

10%

8%

First Lien

8%

6%

6%

Second Lien

4%

5.4%

4%

2%

2%

Home Equity

0% 1991

1996

2001

2006

Source: Federal Deposit Insurance Corporation

2011

2016

0%

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Source: Mortgage Bankers Association

MORTGAGE BANKER | MARCH 2021 17

L EGAL

MORTGAGE BANKING LAWYERS These attorneys are universally recognized by their peers as setting the highest standard for the legal profession, excelling in all fields – knowledge, analytical ability, judgment, communication, and ethics.

Thomas F. Vetters II Managing Partner

Mitchel H. Kider Managing Partner

Thomas E. Black, Jr. Managing Partner

Ja Mort

tvetters@ravdocs.com 512-617-6374

kider@thewbkfirm.com 202-557-3511

tblack@bmandg.com 972-353-4174

jbrod

Thomas Vetters is the managing partner of Robertson Anschutz Vetters, LLC (“RAV”) where he has spent his entire legal career developing a comprehensive expertise in the mortgage lending and compliance industry and helped develop the firm’s 50-state document software Docs on Demand®. Thomas is Board Certified in Residential Real Estate Law by the Texas Board of Legal Specialization.

In his 35 years as a practicing attorney, Mitch has represented banks, mortgage companies, residential homebuilders, real estate settlement service providers, credit card issuers, and other financial service companies in a broad range of matters. Mitch represents clients in investigations and enforcement actions before the Consumer Financial Protection Bureau, Department of Housing and Urban Development, Department of Veterans Affairs, Department of Justice, Federal Trade Commission, Ginnie Mae, Fannie Mae, Freddie Mac, and various state and local regulatory authorities and Attorneys General offices. In addition, Mitch acts as outside general counsel to smaller companies and special regulatory and litigation counsel to Fortune 500 companies.

Thomas E. Black, Jr. is managing partner of Black, Mann & Graham, LLP. Founded in 1997, the firm has offices in Dallas, Flower Mound, and Houston, Texas. Tom practices in the area of residential real estate law representing many of the nation’s largest banks and mortgage companies. He has been admitted to the practice of law in New York, Texas, Iowa and Washington. In 1976, Tom received a B.A. degree from the University of Notre Dame. He received his J.D. degree from the University at Buffalo in 1979 and an M.B.A. degree from The University of Notre Dame in 2008. After holding senior positions with a number of national mortgage companies, he returned to the practice of law in Texas in 1995. A frequent mortgage industry lecturer, he taught more than 25 years in the Mortgage Bankers Association’s School of Mortgage Banking. He is active in community service and held a variety of board positions, and serves as a Trustee of the University of Buffalo Foundation and of Saint Mary’s College, Notre Dame, Indiana.

James Br the comp litigation matters f Brody’s e legal issu originati loan secu bankrupt indemnifi his B.A. i from Dra his J.D., in Advoc of the Pa of Law. H American Whitney practice been adm the Unite the Centr Southern addition, lead litig mortgage related d and feder or on a p FL, MD, PA, TN, a

Thomas currently serves on the Board of Directors for the Texas Mortgage Bankers Association and previously chaired their Regulatory Compliance Committee, Education Committee and served on their Executive Committee.

Thomas has prepared and presented papers on Texas Home Equity, Privacy, Safeguards, Loan Originator Compensation, ATR/QM and the TILA/ RESPA Integrated Disclosures. He is admitted to practice in the State of Texas and the U.S. Western District of Texas. RAV’s offices include Houston, Austin, Plano, and The Woodlands.

18 MORTGAGE BANKER | MARCH 2021

ames W. Brody, Esq. tgage Banking Practice Group Chair dy@johnstonthomas.com 415-246-3995

rody actively manages all plex mortgage banking n, mitigation, and compliance for Johnston Thomas. Mr. experience centers on those ues that arise during loan ions, loan purchase sales, uritizations, foreclosures, tcy, and repurchase & fication claims. He received in International Relations ake University and received with a certified concentration cacy, from the University acific, McGeorge School He was a recipient of the n Jurisprudence BancroftAward. He is licensed to law in California and has mitted to practice in front of ed States District Courts for ral, Eastern, Northern, and n Districts of California. In , Mr. Brody has served as gation counsel for numerous e banking and commercial disputes venued in both state ral courts, in a direct capacity pro hac vice basis, in AZ, CA, , MI, MN, MO, OR, NJ, NY, and TX.

Marty Green Attorney marty.green@mortgagelaw.com 214-691-4488 ext 203 Marty Green leads the Dallas office of Polunsky Beitel Green, one of the country's top residential mortgage law firms. Mr. Green is an accomplished attorney with more than 20 years of experience in the legal, banking and financial services industries. He is the former Executive Vice President and General Counsel for Dallas’ CTX Mortgage Co. and previously worked with the Baker Botts law firm in Dallas as Special Counsel. In his role as leader of the firm’s Dallas office, Mr. Green advises clients on the latest rules and regulations covering residential lending, in addition to building on Polunsky Beitel Green’s long tradition of delivering loan closing documents with speed and accuracy. Mr. Green is admitted to practice before all Texas state and federal district courts in addition to the U.S. Court of Appeals for the Fifth Circuit. An honors graduate of the University of Texas School of Law, he earned his undergraduate degree at Southern Utah University. Texas Monthly has selected him as a Super Lawyer multiple years.

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Single Women See Twice As Much Growth In Home Purchases As Single Men

D

espite the fact that the coronavirus-driven recession disproportionately impacted women in 2020, single women purchased 9% more homes in the fourth quarter than a year ago, compared with a 4.5% uptick for single men.

Single women purchased 8.7% more homes in the fourth quarter of 2020 than a year earlier. That’s a larger increase than single men, who purchased 4.6% more homes in the fourth quarter than a year earlier. Couples bought 11.5% more homes than a year earlier.

Single women made up 15.7% of total home purchases nationwide in the fourth quarter of 2020, compared with 15.3% a year earlier. The share has remained stable between 14.8% and 16.1% over the past eight years.

Single women bought more homes at the end of 2020 than the year before and the share of home purchases by single women held steady throughout throughout the year, even as the pandemic-driven recession forced women out of the workforce at a greater rate than men, especially women of color. Even before the pandemic, women earned just 82 cents for every dollar earned by men. The recession hit women-dominated industries—including restaurants, retail and healthcare—hardest, and many women have

20 MORTGAGE BANKER | MARCH 2021

By DAN A A N D ERSON , Redfi n chosen to leave paying jobs to take care of children.

“This is another illustration of America’s uneven financial recovery,” said Redfin Chief Economist Daryl Fairweather. “While millions of women have lost their jobs during this recession, the impact has largely been on lower-income women. Meanwhile, most women who were able to afford homes before the pandemic are likely still able to afford homes, and low mortgage rates—especially at the end of 2020—have been incentivizing them to buy.”

INSTITUTIONS & OTHERS Single men made up 18.1% of home purchases in the fourth quarter, essentially flat from 18.3% a year earlier. The share of home purchases by single men also hasn’t varied much since 2012, spanning from 17.8% to 20.1%.

Couples—two (or more) people buying a home together—made up 49.4% of purchases in the fourth quarter, up slightly from 46.9% the year before.

The remainder of home purchases were either made by institutions or they fall into the “other” category.

“I was originally saving for a down payment with a goal of buying my own home in 2021, but interest rates dropped so much with the pandemic that I was able to buy a condo over the summer,” said Sarah Stecker, who

bought a two-bedroom condo in Los Angeles in July. “The down payment was the biggest hurdle, but now my monthly mortgage, including HOA fees and property taxes, is just slightly more than I was paying in rent on an apartment in the same neighborhood, and my condo is twice the size. Now, instead of paying my landlord’s mortgage, I’m building equity for my own bank account. I hope to eventually use some of the equity to buy a bigger home for myself and hold onto the condo as a rental property.”

Women tend to buy less expensive homes than men. The typical home purchased by single women in the fourth quarter sold for $294,000, up 15% year over year. That’s compared with $310,000 for single men, up 17% year over year, and $430,000 for couples, up 15%. The median monthly mortgage payment for single women was $1,052 in the fourth quarter, compared with $1,125 for single men and $1,535 for couples.

Single women made up more than onequarter of home purchases in Boston in 2020 Single women make up a larger share of homebuyers than single men in just two of the 43 metro areas included in this analysis.

In Boston, single women made up 25.4% of home purchases in the fourth quarter, compared with 23.3% for single men. And in West Palm Beach, single women made up 16.8% of home purchases, versus 15.6% for single men.

Boston also had the highest share of home purchases by single women last year of any metro. Forty-seven percent of women in Boston have a college degree or higher, the fourth-highest share of any major metro in the U.S., behind San Francisco, San Jose and Washington, D.C. Boston also has a lot of well-paying jobs that tend to be dominated by women, such as higher education and healthcare.

Boston is followed by Providence—located just about 50 miles away from Boston—where single women made up 21.2% of home purchases in 2020. Next come Detroit (20.6%), Atlanta (19.4%), Cleveland (18.9%) and Philadelphia (18.9%). The median sale price of homes purchased by single women in 2020 was less than $400,000 in all six of those metros, and it was under $200,000 in Detroit and Cleveland.

L EGAL

Perpetual Burn

ENFORCEMENT MAY BE BACK, BUT COMPLIANCE NEVER LEFT

W THE MORTGAGE COUNSELORS Mitchel H. Kider is the chairman and managing partner and Michael Kieval is a partner with Weiner Brodsky Kider PC.

22 MORTGAGE BANKER | MARCH 2021

ith the change in presidential administrations, some in our industry are asking whether compliance is “back.” In fact, while enforcement may be back in the sense that we expect it to increase soon, the need for strong compliance never left.

To understand why this is so, consider how enforcement and other liability tends to happen. After the last financial crisis, the political climate at the state and federal level, along with private suits that tried to shift the costs of the crisis, led to a significant increase in perceived compliance risk.

But the alleged compliance violations that were the subject of enforcement and litigation starting around 2009-2011 included lots of conduct that had occurred years earlier. In other words, the compliance risk was already largely baked in.

The same is true now. It is, in a sense, too late to avoid compliance failures and regulatory violations that may already have occurred, and which will now be subject to a more aggressive enforcement approach. That is why it is so important for companies to take compliance very seriously even at times when the perceived enforcement risk may be lower.

The risk of compliance failures does not

go away. Even when a presidential administration or federal regulator may be taking a less aggressive approach to enforcement, it is all but certain that the pendulum will swing back when there is a change in power at some point in the future.

We do anticipate a significant increase in enforcement at the federal level, after the usual lull that comes with a change in administrations, especially an increased focus on fair lending issues. And we expect that enforcement will seek higher penalties and more consumer redress than has been the case recently.

The good news for companies in our industry is two-fold: first, most of you have been doing a much better job of compliance for the last four years than companies were doing before Dodd-Frank and the CFPB changed the regulatory landscape. Second, it is never too late to refocus on and improve your compliance. Improvements you make now, before the regulators come knocking, can make a big difference in how regulators respond to any shortcomings you may have had in the past.

Companies who think compliance never left are well-prepared for what is to come.

But if you perceive that compliance is “back,” be sure to bring it back at your company as quickly as possible.

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MORTGAGE BANKER | MARCH 2021 23

T HE C- SU I T E

PAUL BUEGE

President and COO Inlanta Mortgage

24 MORTGAGE BANKER | MARCH 2021

What do you find most rewarding about your job?

The greatest reward of my job is also its greatest challenge: it’s about meeting the high standards expected from a leader, while working to meet the expectations set by ownership, customers, partners, and team professionals. Fostering a business culture where teams and processes come together to produce positive results, especially for our customers, is one of the more exciting aspects of my role.

There is nothing more rewarding than seeing what happens when team members become centered and focused together. Then I love to see the energy that develops when team professionals recognize that they are trusted, empowered, and valued.

Ultimately, what drives me is being able to help people realize all their potential.

That’s the best part of my job!

What do you think is the

biggest challenge for the mortgage banking industry currently?

Getting out of the here and now and shifting focus to what’s up next!

This last year was historic by nearly every measure and it’s hard not to want it to continue. We all understand that markets change and it’s important to keep an eye on what’s ahead. We are seeing an exciting crossover point inside our industry where our professionals and our clients all recognize the importance of a high touch service experience supported by a digital delivery. It will be a careful blending of each.

What time do you get up?

5:30 a.m., my day starts early.

That’s what I like.

What is the first thing you do in the morning?

My day begins with a large cup of coffee, a digital read of my top news publication, and then time on the treadmill to get in my daily exercise

before business starts.

What is your mantra?

How we work together matters the most. All team professionals know this, it’s true and it’s part of our company’s secret sauce to success.

What is on your desk?

It’s clean and has a laptop and a phone, with a note pad and a big cup of coffee or matcha green tea. Superefficient and not distracting.

What is your best habit?

Learning by listening, watching, reading, and being open to input and perspectives shared by others.

What is the last thing you do at night?

Reflect with gratitude and thanks for everything.

What time do you go to bed at night?

With my Kindle in hand by ten.

“FOSTERING A BUSINESS CULTURE WHERE TEAMS AND PROCESSES COME TOGETHER TO PRODUCE POSITIVE RESULTS, ESPECIALLY FOR OUR CUSTOMERS, IS ONE OF THE MORE EXCITING ASPECTS OF MY ROLE.”

Each month, Mortgage Banker magazine features two mortgage banking executives in the C-Suite.

CONTINUED ON PAGE 16

MORTGAGE BANKER | MARCH 2021 25

CO M P LI A N C E

A Not-So-Closet Makeover

P

THE NEW THROWBACK CFPB

By T R OY GA RRIS, G A RRIS HORN L L P

resident Biden, on February 13, 2021, officially announced the nomination of Rohit Chopra to be Director of the Consumer Financial Protection Bureau, sending the nomination to the Senate Committee on Banking, Housing, and Urban Affairs. If confirmed, Chopra would be the third Director of the agency, following Richard Cordray and Kathleen Kraninger.

As of this writing, a nomination hearing has not yet been scheduled.

However, given that Chopra was confirmed by the Senate in 2018 as a Commissioner of the Federal Trade Commission, holds Ivy League credentials, and the Democrats generally control the Senate, TROY GARRIS most observers anticipate that Chopra will be confirmed.

Chopra’s roots go back to the early days of the CFPB. He was part of the original implementation team. Once the agency was organized, Chopra worked under Director Richard Cordray as the agency’s first student loan “point man”. In that capacity, Chopra worked on several different student loan issues, including a report indicating that student loan overcharge schemes directly harmed military servicemembers. The agency also put two large post-secondary schools out of business while Chopra worked at the agency.

In D.C., however, no one is confirmed until they are confirmed.

Meanwhile, the CFPB marches on. Current Acting Director Dave Uejio’s activities and announcements suggest that the agency intends to be forwardly assertive even while awaiting a confirmed Director. In just under a month since Uejio assumed the title of Acting Director, the CFPB has had 13 postings on its blog, four

by Uejio himself. And certain items posted during the prior

26 MORTGAGE BANKER | MARCH 2021

administration have been archived, including the last five postings

by Director Kraninger. In his first blogpost, Uejio incorporated an internal message that he had sent to the CFPB staff thanking them for their hard work to date and announcing a change of direction. In that posting, Uejio reiterated that his priorities are: • Relief for consumers facing hardship due to COVID-19 and the related economic crisis, and • Racial equity.

HE ALSO NOTED CONCERN, AND STATED THAT THE BUREAU WOULD ACT IMMEDIATELY, REGARDING RECENT FINDINGS THAT:

of today, it is the official policy of the CFPB to supervise lenders

with regard to the Military Lending Act. And we are planning to rescind public statements conveying a relaxed approach to enforcement of the laws in our care.

It’s also time for the CFPB to take bold and swift action on racial equity. I know this is close to the hearts of many of you. The

THE COUNTRY IS IN THE MIDDLE OF A LONG OVERDUE CONVERSATION ABOUT RACE, AND AS WE ALL KNOW, PRACTICES AND POLICIES OF THE FINANCIAL SERVICES INDUSTRY HAVE BOTH CAUSED AND EXACERBATED RACIAL INEQUALITY.

• Mortgage servicers gave consumers incomplete and inaccurate information about CARES Act forbearances, failed to process forbearance requests, and collected and assessed late fees despite having approved forbearances.

• Servicers withdrew money even though consumers were in deferment.

• One student loan servicer denied thousands of forbearance extensions because the loan holder never responded.

• Companies across markets misreported accounts to credit bureaus and violated CARES Act amendments that added protections to the Fair Credit Reporting Act. • Some banks set off stimulus payments and unemployment insurance benefits to cover bank fees and other debts.

• Examiners found that the widely used policy of banks only taking PPP applications from pre-existing customers may have a disproportionate negative impact on minority-owned businesses.

UEJIO’S MEMORANDUM ALSO STATED, IN PART:

I directed the [Supervision, Enforcement, and Fair Lending] division to always determine the full scope of issues found in its exams, systematically remediate all of those who are harmed, and change policies, procedures, and practices to address the root causes of harms. For the Prioritized Assessments that do not already do this, [Uejio noted he wants] Supervision to follow up to ensure it is done, without conducting new follow-up exams. Companies that have not already received instructions from our examiners should expect to receive letters in the mail soon.

Over the coming weeks, we will also be reversing policies of the

last administration that weakened enforcement and supervision. As

country is in the middle of a long

overdue conversation about race, and as we all know, practices and

policies of the financial services

industry have both caused and exacerbated racial inequality. I

am going to elevate and expand existing investigations and exams and add new ones to ensure we

have a healthy docket intended to address racial equity. This of

course means that fair lending enforcement is a top priority and will be emphasized accordingly.

But we will also look more broadly, beyond fair lending, to

identify and root out unlawful

conduct that disproportionately impacts communities of color and other vulnerable populations.

In subsequent postings, on February 4

and February 10, Acting Director Uejio

made similar statements regarding his vision for changes in policy and structure in the coming months at the Division of Research, Markets, and Regulations and Division of Consumer Education and External Affairs.

Hopefully, Acting Director Uejio will also keep in mind that

industry best follows the rules and serves the public when the

rules are clear, guidance is provided where requested, and there is limited whipsawing back and forth in approach, not just between

administrations but also between leaders in the same administration.

Regardless, these communications suggest a much more

Cordray-style approach to engagement; even Cordray in recent public appearances states so. Mortgage industry participants would

do well to keep these issues, and the revised posture of the agency, in mind when conducting business in this newly retro world.

MORTGAGE BANKER | FEBRUARY 2021 27

CO M P LI A N C E

REGULATORY CORNER FEDERAL COMPLIANCE HUD: FHA COVID-19 MORATORIUMS EXTENDED

HUD recently announced extensions of the FHA’s foreclosure and eviction moratoriums. Additionally, there is an extension of the initial start date of a COVID-19 forbearance. Forbearance is an option mortgage servicers use to provide homeowners with a pause to their monthly payments for a limited period of time during a COVID-19 induced hardship.

Also, the Office of Public and Indian Housing plans to announce similar relief for Native American and Native Hawaiian homeowners assisted under the Section 184 Indian Home Loan Guarantee Program and the Section 184A Native Hawaiian Housing Loan Guarantee Program.

To address the ongoing need to expand mortgage payment assistance solutions for homeowners, for all FHA-insured forward mortgages, HUD: • Extended the timeframe for homeowners to request the start of a COVID-19 forbearance from their mortgage servicer through June 30, 2021, which provides homeowners with additional time to request a forbearance from their mortgage servicer.

• Expanded the COVID-19 forbearance to allow up to two forbearance extensions of up to three months each for homeowners who requested a COVID-19 forbearance on or before June 30, 2020. These additional extensions will provide relief to homeowners in this situation who will be nearing the end of their maximum 12-month forbearance period and have not yet stabilized their financial situation.

28 MORTGAGE BANKER | MARCH 2021

• Expanded the use of FHA’s streamlined COVID-19 loss mitigation home retention and home disposition options to all homeowners who are behind on their mortgage payments by at least 90 days. This expansion will require mortgage servicers to assess more homeowners for a streamlined waterfall of loss mitigation home retention options, starting with FHA’s COVID-19 Standalone Partial Claim.

To assist seniors with reverse mortgages, the FHA has extended the timeframe for the start of an initial COVID-19 HECM extension through June 30, 2021. For HECMs that entered an initial extension period on or before June 30, 2020, up to two additional three-month extension periods are available.

HUD: DISCRIMINATION BAN ENFORCEMENT

HUD issued a memorandum announcing that it will administer and enforce the Fair Housing Act to prohibit discrimination based on sexual orientation and gender identity. HUD’s action follows an Executive Order issued by President Biden on January 20, 2021 addressing the Supreme Court’s decision in Bostock v Clayton County, which held that the prohibitions against sex discrimination in the workplace contained in Title VII of the Civil Rights Act of 1964 extend to and include discrimination because of sexual orientation and gender identity. HUD’s General Counsel has concluded that the Fair Housing Act’s sex discrimination provisions are comparable to those of Title VII and that they likewise prohibit discrimination because of sexual orientation and gender identity.

FANNIE MAE/FREDDIE MAC: LOAN ORIGINATION FLEXIBILITIES EXTENDED

The FHFA announced that Fannie Mae and Freddie Mac will extend several loan origination flexibilities through March 31, 2021. The extended flexibilities include: • Alternative appraisals on purchase and rate term refinance loans; • Alternative methods for documenting income and verifying employment before loan closing; and • Expanding the use of power of attorney to assist with loan closings.

HUD: MISSOURI APARTMENT OWNER FACES DISCRIMINATION CHARGE HUD announced it is charging Dahms Investments, LLC, the owner of duplex apartments in Hamilton, Missouri, and their property manager, with violating the Fair Housing Act by refusing to grant a prospective tenant with a mental health disability a reasonable accommodation to waive the required pet deposit for her assistance animal. The HUD charge specifically alleges that the property manager told the woman that she would have to pay hundreds of dollars in pet fees and that she did not look like she had a disability. The charge further alleges that the property manager told the woman that rules related to assistance animals only applied to individuals who are blind and/or deaf.

FHFA: FORECLOSURE AND REO EVICTION MORATORIUMS EXTENDED The FHFA announced that Fannie Mae and Freddie Mac are extending the moratoriums on single-family foreclosures and real estate owned (REO) evictions until March 31, 2021. The foreclosure moratorium applies to Enterprise-backed, single-family mortgages only. The REO eviction moratorium applies to properties that have been acquired by an Enterprise through foreclosure or deed-in-lieu of foreclosure transactions. The current moratoriums were set to expire on February 28, 2021.

The FHFA also announced that borrowers with a mortgage backed by Fannie Mae or Freddie Mac may be eligible for an additional forbearance extension of up to three months. Eligibility for the extension

is limited to borrowers who are on a COVID-19 forbearance plan as of February 28, 2021, and other limits may apply. Further, COVID-19 Payment Deferral for borrowers with an Enterprise-backed mortgage can now cover up to 15 months of missed payments.

COVID-19 Payment Deferral allows those borrowers to repay their missed payments at the time the home is sold, refinanced, or at mortgage maturity.

FHA: WAIVERS OF MORTGAGE CONTACT REQUIREMENTS ISSUED

The FHA announced it has issued a series of waivers of provisions in its Single Family Housing Policy Handbook 4000.1 that would normally require in-person contact between mortgage servicers and borrowers, including seniors with FHA-insured Home Equity Conversion (HECM) reverse mortgages. The waivers allow important mortgage servicing activities to continue, but in a manner that allows for safe social distancing to help combat the COVID-19 pandemic.

The waivers put in place these provisions through December&nbsp:31, 2021: • Allowing alternative methods for servicers to conduct borrower interviews for FHA-insured forward and HECM mortgages when performing early default interventions for borrowers in danger of foreclosure; • Waiving the $5,000 property charge payment arrearages cap on recalculated repayment plans, allowing servicers to help more HECM borrowers who are behind on their property charge payments; and • Eliminating the requirement for servicers to obtain a signature on an occupancy certification from a HECM borrower.

FFIEC: 2020 CRA DATA FILING INFORMATION

The FFIEC posted the latest version of the CRA Data Entry System for the calendar year 2020 CRA data due March 1, 2021, on its Software page. Each software version is year-specific; for example, 2019 reporting requires 2019 CRA DES and not 2020 CRA DES. The software must be installed locally on a hard disc. It is NOT network compatible.

MORTGAGE BANKER | MARCH 2021 29

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