Effective January 1, 2019, Carrington Mortgage Services, LLC (CMS) will implement the following Underwriting Fee schedule for all wholesale loan submissions:
Broker Disclosed Loans: All broker-disclosed submissions must include the updated underwriting fee listed on the broker’s initial Loan Estimate.
When Loan Setup receives a broker-disclosed submission without the underwriting fee disclosed correctly and the loan has not been locked, Setup will give the broker/AE an opportunity to pre-lock the loan with a Fee Buyout prior to rejecting the submission.
The Carrington Mortgage Services (CMS) Lock Desk will be closed in observance of President George H.W. Bush’s death on Wednesday, December 5, 2018 which has been designated as a National Day of Mourning. The financial markets will be closed and no rate sheets will be produced and no rate locks will be allowed. Normal Lock Desk hours will resume Thursday, December 6, 2018.
CMS will be staffed to carry out substantially all of our business functions on Wednesday, December 5, 2018; therefore, it should be treated as a normal business day as follows:
- Wednesday, December 5, 2018 will be included in the rescission period for refinance transactions.
- Wednesday, December 5, 2018 will be included in the seven (7) business day waiting period between the date the initial Loan Estimate (LE) was provided to the borrower and the consummation of the loan
- When re-disclosure of the LE is required, Wednesday, December 5, 2018 will be included in the four (4) business day waiting period between the date the revised LE was provided to the borrower and the consummation of the loan.
- When re-disclosure of the Closing Disclosure (CD) is required, Wednesday, December 5, 2018 will be included in the three (3) business day waiting period between the date the revised CD was provided to the borrower and the consummation of the loan.
- Disclosures mail fulfilled on Wednesday, December 5, 2018 will be considered “sent” on December 6, 2018 due to the Post Office being closed on December 5, 2018. Users must update Sent Date within the Disclosure Tracking Record.
Issues related to locks should be sent via email to firstname.lastname@example.org.
Last Week in Review:
Soothing Words Helps Rates Improve
We heard doves cry this week, when Fed Chairman Jerome Powell spoke in NYC on Wednesday. Doves are people who offer peaceful polices, so upon Mr. Powell’s soothing speech both Stocks and Bonds moved nicely higher, with home loan rates hitting their best levels in nearly two months.
Some of Mr. Powell’s market-comforting words included:
- We know that moving too fast (hiking rates) will risk expansion
- It may take a year or more to fully realize the effects of hikes
- The Fed doesn’t see “dangerous excesses” in the stock market
- The policy rate (Fed Funds Rate) is “just below” neutral
The Fed is still very likely to raise the Fed Funds Rate in December, but the markets took the speech as signs the Fed will not hike rates three times in 2019, which was the Fed’s own forecast.
Fed Fund Futures, which represent market opinion on the future of the Fed Funds Rate now suggest there will be only one rate hike in 2019.
The incoming data and more specifically, inflation, will determine whether we see more hikes in 2019.
Bottom line – the present low inflationary environment and slower global growth is helping keep home loan rates historically low.
Effective immediately, CoesterVMS will no longer be an approved AMC for new orders. Orders placed before November 27, 2018 with Coester will be accepted. For questions regarding orders, please contact email@example.com.
Last Week in Review:
Stocks crumble, yet rates go unchanged.
The old adage of “Stocks go down, Rates go down” didn’t work this past week.
Stocks started the week with the Dow Jones Industrial Average falling nearly 1,000 points through Tuesday.
Typically, as Stocks decline, we see home loan rates improve as the investment dollars find their way into Bonds. That was not the case this week. Bonds and home loan rates hardly moved.
Why? Despite the bad selloff in Stocks, nothing in the U.S. economy has changed, the labor market remains tight, wages are rising, and consumer confidence is high – these are headwinds to further improvement in rates. Remember, rates like bad news.
So, while we have seen home loan rates improve over the past few weeks, the gains may have reached their near-term limit.
Now we are going to watch whether Stocks enjoy a “Santa Clause Rally” to finish the year or if they continue to fall. If Stocks decline another leg lower, we will likely see some modest improvement in rates.
However, should Stocks bounce higher from here, it will likely be at the expense of Bonds and home loan rates could move higher quickly.
Bottom line: Home loan rates have improved nicely the past few weeks and while historically attractive, they are hovering at a near-term bottom.
Last Week in Review: Eurodrama drives “safe-haven” trade.
The long-awaited Brexit agreement was dealt a big blow this past Thursday when two top Brexit officials and four Jr Ministers quit – citing the deal Prime Minister Theresa May reached with the EU was no good.
What does it mean for housing?
The U.S. Dollar, U.S. Bonds and home loan rates benefitted from the Brexit chaos as global investors parked their money in the relative safety of U.S. Dollar denominated assets (currency and Bonds) in what is called a “safe-haven” trade.
The U.S. Dollar had already been rising in value versus other global currencies and there are a couple of effects worth following:
- A strong U.S. Dollar tamps down inflation as it lowers commodity prices like oil. Have you noticed the recent price decline of gas at the pump? This is like a tax cut for the consumer looking to purchase a home.
- It makes U.S. imports cheaper. This along with lower oil keeps inflation down, which is good for long-term rates like mortgages.
- If the U.S. dollar strengthens further, the Fed may not raise rates as expected in 2019 because more hikes would further suppress inflation, which is already tame – again, good for home loan rates.
Bottom line – rates have improved from the worst levels of the year and it is quite possible that the highest rates of the year are behind us.
New Program Gives Originators a Distinct Advantage in the Market
ANAHEIM, Calif. (Nov. 19, 2018) — Carrington Mortgage Services, LLC (CMS), one of the nation’s largest privately held non-bank lenders, today announced the launch of its Correspondent Lending Division. The addition of the Correspondent channel complements CMS’s full portfolio of loan origination channels, which includes Wholesale and Retail.
“We have diligently built the Correspondent Division for success, and we’re now ready to hit the ground running,” said Ray Brousseau, President of CMS. “We’re committed to delivering a high level of transparency and timeliness to the non-delegated correspondent lending process. We understand that it’s all about providing our originators with the ability for further growth and profitability.”
CMS’s diverse product offering is designed to meet the needs of today’s non-delegated originators, and includes conventional Fannie Mae and Freddie Mac products, FHA and VA products, and Carrington’s proprietary Flexible Advantage™ Products which have been developed specifically to meet the needs of underserved borrowers.
“CMS has a proven track record of customer-centric service, combined with quick turn-times for underwriting and purchasing closed loans,” said Greg Austin, EVP of Lending for CMS. “Our non-delegated channel is committed to helping correspondent lenders increase their business by delivering products that allow them to work with borrowers in the underserved and non-QM markets. We also provide exceptional support for borrowers after the sale, and currently service over $60 billion in loans.”
For more information on the CMS Correspondent Program, visit: www.carringtoncorrespondent.com.
The Carrington Mortgage Services, LLC – Wholesale Lending Division Offices and Lock Desk will be closed Thursday, November 22, 2018 and Friday, November 23, 2018 in observance of Thanksgiving, which is a federal holiday. Due to the holiday, the Lock Desk will be closing early on Wednesday, November 21, 2018 at 11:00 AM PST (early market closure of 2:00 PM EST). Normal Lock Desk hours will resume on Monday, November 26, 2018.
Locks that expire on the holiday will automatically roll to the next business day. In addition, there are some important disclosure considerations associated with the holiday:
- Thursday, November 22, 2018 cannot be included in the rescission period for refinance transactions.
- Thursday, November 22, 2018 cannot be included in the seven (7) business day waiting period between the date the initial Loan Estimate (LE) was provided to the borrower and the consummation of the loan.
- When re-disclosure of the LE is required, Thursday, November 22, 2018 cannot be included in the four (4) business day waiting period between the date the revised LE was provided to the borrower and the consummation of the loan.
- When re-disclosure of the CD is required, Thursday, November 22, 2018 cannot be included in the three (3) business day waiting period between the date the revised CD was provided to the borrower and the consummation of the loan.
Issues related to locks should be sent via email to firstname.lastname@example.org.
Carrington will be exhibiting at NAMB National, December 8th-10th. Join us at Caesars Palace in Las Vegas, Nevada and stop by booth #906-907 to meet our knowledgeable Wholesale team. Find out how your go-to-lender for the toughest loans is also your one-stop shop to help pump up your pipeline with everything from Government to Conventional and flexible home loans solutions for the underserved and Non-QM markets.
CARRINGTON CAN HELP YOU CLOSE LOANS OTHERS CAN’T
Carrington recently closed this Non-QM* loan for a client. Look familiar? Did you recently reject an applicant with a similar file? We approved it!
We have a full spectrum of programs for a variety of loan scenarios, including FHA, VA, USDA, Conventional and Carrington’s Flexible Advantage℠ & Flexible Advantage℠ Plus (Non-QM) loan programs*.
See if Carrington can close that tough loan that other lenders haven’t been able to get done.
Effective Tuesday, June 5, 2018, Brokers may submit loans using lender paid compensation for Carrington Flexible Advantage and Carrington Flexible Advantage Plus products.
*Carrington Flexible Advantage product requirements vary depending on the consumer’s credit grade, LTV, DTI, and FICO scores and may require reserves from 3 to 6 months. Ask your Account Executive for additional details and requirements. Not available in MA and ND.