Thursday, June 22, 2006

DSI: Generic HELOC programs a snap

If rates go up much more it won't make as much sense for originators to use a 20% LTV HELOC as a piggyback solution for a 100% LTV loan. I'm hearing this a lot lately from private mortgage insurance companies who have their fingers crossed that rates will rise a bit more and make MI a more attractive solution for borrowers who don't have large downpayments.

National Mortgage News reported in its Daily Briefing today that the average rate for five-year Treasury-indexed hybrid adjustable-rate mortgages was up from 6.23% to 6.32%, so maybe that day is coming.

In the meantime, lenders are pushing HELOCs hard, juggling terms and teaser rates to get borrowers' attention, whether or not the homeowner plans to use the financing option to buy a new home.

Over the past couple of years, we've seen a number of doc prep companies working to make HELOC documentation simpler for lenders to customize. In today's Compliance Wizard newsletter, Document Systems Inc. announced access to 8 generic HELOC programs through its DocMagic software. A wide range of terms and fees can be customized at no additional charge. Changes are generally made to DSI loan programs the same day.

The functionality is bound to be attractive to companies interested in easily making changes to HELOC programs for marketing purposes.

For more information about Compliance Wizard, one of the best mortgage industry compliance publications available, surf to the company's website.

Wednesday, June 21, 2006

Martopia: New tool for brokers

Marketing is key to what brokers must do to keep business rolling in the door. It's tedious, expensive and essential. In today's market, events are beginning to conspire (I say beginning because housing starts rose again last month, which flies (again) in the face of pundits who say the market is cooling) to make marketing more important to brokers, even as brokers are becoming more important to wholesale lenders.

Lenders are competing for broker attention now as they realize that third-party originators are key to softening the fall as mortgage applications continue to decline. Lenders are offering all kinds of things to brokers to win their loyalty. Some of their ideas actually benefit brokers.

What brokers really need right now is co-of advertising, i.e. their message out to their target market financed by a lender. Lenders have offering to help brokers market loans in the past, but mostly its their loans and (more importantly) their brands. Part of the reason for this is that lenders need to advance their own national brands, but a lot of it is that it's just not economical to pay for print runs for brokers all over the country. Paying to have customized post cards printed for every originator the lender wants to work with is prohibitively expensive. Or is it?

Martopia will be marketing a new program to wholesale lenders who attend the National Association of Mortgage Brokers annual convention in Philadelphia later this month. In partnership with a high-tech print production company, Martopia will help lenders print up massive runs of high-quality direct mail marketing material that can be customized on the fly for different originators in the wholesale lender's broker network.

According to Michael Hammond, vice president of business strategy at Martopia, "The Broker Marketing Engine program enables authorized brokers to utilize a password-protected website and customize marketing materials with their colors, photos, logos, contact information and text choices."

I'll be hanging out with Michael at NAMB as he pitches this new program to lenders and brokers at the show. I'll let you know how it is received, but I anticipate it will represent a welcome opportunity for many.

PMC2006: A great show

I've attended a lot of shows over my years as a journalist covering financial services. There are a number of organizations in this space that do a great job of putting on good shows. Having been part of a company that hosted them, I can tell you it is no easy undertaking.

I'm always happy to see new organizations do a good job at putting on a new show or a vendor hosting a truly valuable users conference (as opposed to a great way to sell more stuff to existing customers while making them pay for the travel and entertainment).

I recently attended the 2006 Predictive Methods Conference in Dana Point, Calif. Hosts Veros Software and First American Real Estate Solutions have built this annual show into a valuable, must-attend event for those actively working in the risk mitigation and business forecasting divisions of financial services firms.

A great lineup of speakers, a good mix of show sponsors and a great venue all helped make this a suprisingly good show. If you missed it, surf to the website. Shortly, you'll find information about the program, slides and some podcasts we produced with folks at the event.

Simplifile:the last mortgage mile

We're getting closer to the paperless mortgage. Investors are beginning to understand it, which is opening the doors for more lenders who want to take advantage of the lower operating costs made possible by going electronic. But for much of the country, the mortgage process still ends by papering out.

The hitch is the County Recorder's office. Despite some great work by organizations like the Property Records Industry Association (PRIA) and the Real Estate Information Professionals Association (REIPA) along with the inspired leadership of some of the nation's foreward-thinking County Recorders, it's not easy to get your documents recorded electronically.

While some of the country's largest counties have spent six figures on systems to make it possible to electronically record and index public records, homeowners who don't live in the most populous counties may never get away from the paper. At least that's been the conventional wisdom, but at least one company is out to change that.

I met the guys from Simplifile, Provo, Utah, at the American Land Title Association's (MERs setting up to act as electronic depository for notes, with the blessing of the MBA, it's up to the Recorders to really enable end-to-end paperless mortgage lending. If Simplifile can deliver on its promise, which depends upon the network of counties it can establish, the industry might cross that hurdle sooner than expected.