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THIS MORNINGS QUICK LOOK

1.  TOUR DE MTG FINANCE – Last Week In MBS
2.  PRODUCT HIGHLIGHT – Lots Of Jumbo Guideline Changes
3.  MARKETING – Looking For The Right Who

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Tour De Mortgage Finance Learn Something New Everyday About Your Industry

LAST WEEK IN THE MBS MARKET

Inflation was the main driver last week when numbers came out on Thursday. After such a sharp hit the market did come back a little bit on Friday.

Although some analysts are still using the 3% coupon I am watching the 3.50% coupon which they will likely swap to as well but most likely already have. 

What does that mean? Well, the 3% coupon is only paying .50 as of Friday close which means at exactly 3% with no adjustments, buy up or downs that is what the investor is paying us .5 in premium for a 3% rate of return. So, if you are pricing a 3.0% coupon then that is what you are seeing on your rate sheets around 3.625%ish to allow for servicing fees and g-fees and llpa’s likely paying no margin to you. 

The 3.5% coupon ended Friday at 102.83 meaning the investor is giving us 2.83% in premium to make money around the 4.125%ish rate which does not include llpa’s, adjustments and a few other factors. Again, you cannot calculate by comparing coupons and your rates sheets. It is more complicated than that but an indicator you can kind of know pricing with.

Overall from Monday open to Friday close we lost 81 bps in the conv market and govt only lost about 35 bps so your govt pricing was not hit near as bad. Reminder each bps is $10 for every 100k in loan amount. So conv lost $810 in pricing for every 100k and govt lost $350 for every 100k.

Product & Guideline Highlight Knowledge That Gives You An Edge Over Your Competition

LOTS OF JUMBO GUIDELINE CHANGES

In honor of Valentines Day and Cupid which by the way means passionate desire, erotic love, attraction and affection I am bringing you news of jumbo changes that will cause all of these emotions in you. Or not… : ) 

ALL OF THESE TAKE EFFECT FOR APPLICATION DATES ON OR AFTER FRIDAY FEBRAUARY 18TH SO SOME YOU MAY WANT TO WAIT TO APPLY AND SOME YOU MAY WANT TO DO RIGHT NOW.

The list is much longer than this but here are the highlights.

• New dti will be up to 45% vs current 43%.
• Any gaps over 60 days in most recent 2 years must be explained and reviewed. Formerly it was 30 days.
• Returning to work force was 6 mos back to work. Still is but exceptions can be made to 30 days in certain situations like primary, no cash out, base income and good explanation on gap.
• Prjojected income starting after Note date was 60 days. We now allow up to 90 days after note date if primary, purchase or rate and term.
• Housing or parsonage allowance now allowed if received for last 12 months and likely to continue for 3 years.
• If using trust income will accept if received for 1 month vs the current 12 months required.
• Self-Employment will now be viewed the same as Fannie Mae.
• Secondary SE no longer required to be counted when primary income is W2, retirement or SS. Previously all SE had to be reviewed.
• Tax transcripts no longer required when using regular W2 income and no income from tax returns is needed.

See memo for full details.

Marketing Ideas And Opportunites Little Things That Can Make A Big Impact

THINGS TO THINK ABOUT WHO YOU WORK WITH

When deciding WHO to work with here are some key thoughts I have learned and something to think about when you are marketing.

• The best WHO is the most profitable, fastest, easiest, loyal, advocate that can help make your life great. Simple huh : ) 
• The best WHO is the one with the greatest need.
• Marketing is much more about WHO you say it to as much as what you say to them.
• The best WHO has the money, has a need and is ready to move forward. Duh Jack!
• The right WHO is 10 -12 times better than the wrong WHO borrower.
• You do not want more borrowers but more valuable clients.
• #1 mistake is going after low hanging fruit. Oh such a bad idea because that low hanging fruit becomes your business plan.
• Matching the right who with the right set of needs with your ability to solve those needs better than anyone else.
• Begin to reach the people that count vs counting the people that you reach.

Just some thoughts to get you thinking about WHO you should be working with.

Turn Times As Of This Morning Lookin Good!