THIS MORNINGS QUICK LOOK

1.  TOUR DE MTG FINANCE – FED Balance Sheet Runoff
2.  PRODUCT HIGHLIGHT – No Restitution
3.  MARKETING – Beware Of Pulling Credit

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FED BALANCE SHEET RUNOFF

In light of the major news recently causing rates to continue to rise due to FED comments on raising rates and speed of runoff of their balance sheet I wanted to share what the balance sheet looks like.

In the pic below we are currently at 9 trillion. 9 Million x1 million = 9 Trillion in case you are curious.

You can tell that the FED has been using quantitative easing (buying bonds to create false demand) since 2008 during the bubble. They did this until 2014 and maintained and then in 2020 went on a buying frenzy to keep rates low.

The blue is treasuries which is 5.8 trillion of the 9 trillion they have on their balance sheet.

In May they begin quantitative tightening (creating less demand by purchasing less bonds) to the tune of 60 Billion wind down of treasuries and 35 Billion in MBS.

After 3 years the impact should be a reduction of balance sheet from 9 Trillion down to 6 Trillion. 

This will be a long process and who knows if they will be able to continue to do so but we shall see. Hang on for the ride.

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

NO RESTITUTION ON BROKER LOANS

If you are not a broker then congratulations you can skip todays article for this section.

One of the killers of providing for a family and company revenue is restitutions. Nobody likes them and usually they are unwarranted but they add up.

They add up to a lot. Trust me, I get a report showing how much we pay in restitution each month and unless you look at an aggregate report for the year you may not realize how much is spent on restitutions.

At Flagstar we eat all restitutions on all broker loan files period. We do this because we believe the lender comp rule states the broker must make their set amount and since it is our system that generates the LE with our checks and balances then we are ultimately responsible for what comes out of our system.

Just thought I would share a little tidbit that some may not be aware and bring more revenue to your company and family.

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

PREPARE BORROWERS AFTER CREDIT PULLS

I received a call from an existing client asking for some guidance about another lender calling on his leads and acting like they were with him.

Now the second part I can assume was a rogue sales person on the phone line as I know the large lender that was making the calls and am doubtful that is policy.

Most people do not know this but the credit reporting giants Equifax, Transunion and Experian are data collectors and data sellers. 

Not only do they sell credit information to you for credit reports but a huge portion of their profits is selling data to lead service companies and lenders. 

One of two things is happening right now. You are either cutting back on your expenditures like marketing and leads or you are ramping them up and the ones with a big bank account are ramping it up.

One of the best leads you can get right now is someone actually looking for a mortgage so one of the best leads to buy is people who have had a mortgage credit pull. 

As soon as you request a mortgage credit pull in your system that data is now available for sale by the credit agencies. 

In this scenario, he pulled their credit and the next day he received a call from a lender in the local area but National saying they understand they are in the market for a mortgage and they work with this particular persons company. Oh my! That is the part that I am sure was not policy. But either way they knew they were n the market and they knew who pulled their credit.

I believe he managed to keep the deal but just a heads up when you pull credit someone may be buying leads in your market so make sure you let your clients know that nobody should be talking to them with the exception of you from your company and maybe warn them of what is happening behind the scenes.

Be careful you do not freak them out with the big brother is watching mindset. A lot of people are very concerned about their information and who or what has access to it. 

Education is one of the best defenses to make sure your clients stay with you.

Turn Times As Of This Morning Lookin Good!