Mar. 1: No more chains in football? CFPB update; Whalen on multifamily lending; vendor news; Saturday Spotlight: Foundation Mortgage
Besides Elon Musk fathering 14 children, talk here in Miami, given its “melting pot” status, includes world politics. Politics are “all over the map” but here in the United States for lenders, there is no question that the policies of the Trump Administration, for better or worse, will drive the outlook for growth and inflation in 2025. Interest rates have been amazingly stable. Most expect a ramp-up in tariffs that leads to a pickup in inflation and slower investment growth partly offset by an extension of the Trump tax cuts and deregulation. For our industry, there is a lot of talk out there about 2025 being similar to 2024, although some believe that it’s going to be a bad latter half of the year for the industry if rates don’t improve or house prices don’t decrease. As a total side note, and yes, I know that this is a mortgage & economics commentary, and I know that it is baseball season (with robots now calling balls and strikes), but… The NFL will adopt automated measurements of first downs in 2025, setting aside the age-old ten-yard chain measurement system with a sophisticated Sony ball monitoring system. Refs will continue to spot the ball between plays, and the physical chains will stay on the sidelines during the year as a backup and a visual aid for the players and coaches. But no one disagrees with the savings of time and money.
Saturday Spotlight: Foundation Mortgage Corporation
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“Our mortgage solutions go beyond normal industry offerings.”
In 3-5 sentences, describe your company (when was it founded and why, what it does, where, recent growth and plans for near-term future growth).
Foundation Mortgage Corporation, an independently owned mortgage bank, was founded in 1998 and is headquartered in Miami Beach, FL. In October 2022, a new owner and executive management team joined, introducing a Wholesale channel in January 2023 and a Correspondent channel in April 2024. Leveraging the new leadership’s extensive experience in secondary markets, credit, and operations, the company transitioned from a retail mortgage banker to a rapidly expanding Non-QM Wholesale and Correspondent Lender. Over the past two years, Foundation has strategically refined its business model, achieving better execution and accelerated growth. In 2024, the company expanded its product offerings, including a portfolio Second Lien product developed through an agreement with one of the top 20 banks worldwide.
Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why.
Foundation Mortgage is deeply committed to the belief that education can transform lives. Over the years, the company has supported numerous educational initiatives, including helping gifted individuals access higher education and sponsoring schools in underprivileged areas of Central America to keep their facilities open during COVID. Additionally, Foundation sponsors children through Compassion International, actively promotes and supports foster homes and adoption services, and contributes to The Miami Project to Cure Paralysis. These efforts reflect the company’s dedication to creating opportunities and improving lives through education, healthcare, and community support.
What does your company do to help elevate your employees’ growth? Describe any mentoring programs, outside classes or training, in-house training. How does the company help people develop?
Foundation Mortgage values its employees as the cornerstone of its success and is dedicated to their growth and development. Each employee is paired with a senior mentor, independent of their manager, to provide personalized guidance and professional development opportunities. This mentorship program fosters skill enhancement, career advancement, and a supportive environment for employees to thrive.
Tell us how your company maintains its culture in a work-from-home environment, or how you plan on bringing employees back into the office, if applicable.
Foundation Mortgage operates as a 98% remote company with no plans to require employees to return to the office. The company believes exceptional talent often lies beyond its geographical boundaries and values enabling employees to remain rooted in their communities, where they have established lives, schools, and social connections. To maintain a strong culture, Foundation fosters online engagement through activities like virtual bingo, where numbers are emailed during the workday. The company thrives with self-starters and self-motivated employees, who often perform more efficiently in a remote environment.
Things you are most proud of that don’t have to do with sales.
At Foundation Mortgage, we take immense pride in our people, culture, and strong sense of community. Our "can-do" attitude and the way we support each other go beyond being colleagues—we truly operate as friends and family. This supportive environment is fostered from the top down, with senior leadership deeply committed to preserving this culture as we continue to grow.
(For more information on having your firm’s extracurricular activities, employee growth, and your charitable side featured, contact Chrisman LLC’s Anjelica Nixt.)
Protecting consumer finances: as the world turns
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Want some intelligent thought about why it may not necessarily be the best thing to make Congress, legislatively, to do away with the CFPB? Here you go.
While the Trump nominee for Consumer Financial Protection Bureau director, Jonathan McKernan, was earnestly taking questions from U.S. senators about his job this week, there were things going on! The CFPB dropped five lawsuits filed against financial institutions under Rohit Chopra. McKernan is a “shoe in” for the job running the CFPB, but as the White House moves to gut the agency, what will running it look like?
The case dismissals are very unusual: In the CFPB's 14-year history, only one other case was dismissed without garnering any relief for consumers. The dropped lawsuits include one against Capital One, filed less than a week before Trump took office, alleging the bank misled consumers over high-interest savings accounts. Another was against a company that originates mortgages for mobile homes, accused of giving loans to unqualified borrowers, another against Rocket Homes alleging it gave kickbacks to brokers, yet another against a student loan servicer for alleged unfair and deceptive practices, and one against an installment lender accused of "loan churning." All were dismissed with prejudice, which means the claims cannot be pursued again.
McKernan is a fairly traditional Republican, who most recently served on the FDIC board. Since Elon Musk posted "CFPB RIP" on X on February 7, which critics say is because of his computer payment system that X is launching and is regulated by the CFPB, hundreds of CFPB employees have been fired. The agency's acting director, Russell Vought, ordered nearly all work stopped and its headquarters are shuttered. McKernan told senators that he would enforce the law as statutorily required (something that has become a concern in the current administration.) But will anyone be left at the CFPB to do it?
Politics: don’t throw the lending baby out with the bathwater
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Chris Whalen, Chairman of Whalen Global Advisors LLC, had some observations about the current environment.
“The housing finance complex has generally welcomed the election of Donald Trump as a relief from four years of progressive oppression and extortion. The fines levied against mortgage lenders during the tenure of Rohit Chopra at the Consumer Financial Protection Bureau are a classic example of regulatory excess and political partisanship. Under Chopra, mortgage lenders and servicers were essentially forced to accept extortionate fines and settlements that should have been challenged in court, but suing the government is too costly for all save the largest financial firms.
“Chopra's team at the CFPB sized the penalties to the firm, often, in this writer's opinion, picking firms for enforcement actions based upon their ability to pay big fines. It's unclear how any of this helps consumers since often there is often no finding of consumer harm mentioned in the Chopra-era enforcement actions.
“While the overall reaction of the industry to Trump is still very positive, there are some troubling signs that the imperative of finding cost savings is sometimes causing serious problems. For example, Elon Musk and his department of government efficiency (DOGE) claimed to have found $1.9 billion at HUD that was "misplaced."
"$1.9 billion of HUD money was just recovered after being misplaced during the Biden administration due to a broken process," DOGE posted on X. Unfortunately, this is incorrect. The "misplaced" funds are actually just the budget authorization for Ginnie Mae to support the two standby servicers, Selene Finance and Carrington Mortgage Services, in the event that a government issuer defaults.
“If the funds are not available, then the default of a Ginnie Mae issuer could lead to a default by the United Stated on its guaranty of timely payment of principal and interest on government-insured MBS. ‘These funds were earmarked for the administration of financial services, but were no longer needed,’ Musk's DOGE taskforce falsely claimed.
“HUD Secretary Scott Turner apparently ‘helped’ Musk fix the ‘problem’ at HUD with the $1.9 billion in missing funds. But, in fact, there is no problem and, more importantly, there are no budget savings, contrary to Musk's statement. Turner then announced the creation of a DOGE task force within his agency just before announcing major layoffs.
“The Trump Administration announced major cuts at HUD, more than 40% of total headcount that were reported to be primarily focused on personnel engaged in financing for multifamily housing. Together with the GSEs, HUD provides significant support to the multifamily sector and at far higher loan-to-value rates than are available from private lenders.
“Conservatives have long wanted to force the government-sponsored enterprises and HUD out of financing for multifamily, which will result in some serious credit problems in red and blue cities around the country. Many of the assets financed by HUD and the GSEs are smaller properties with high LTVs that cannot be financed privately. Outside of federally supported lending, small multifamily is a hard money, cash market, which further compresses valuations.
“A reduction or withdrawal of HUD and/or GSE credit cover for multifamily assets is going to create a big mess, both for investors and banks alike. Bank multifamily is about $600 billion in unpaid principal balance, while non-bank multifamily loans (including the GSEs) are another $1.6 trillion in UPB, for a grand total of $2.12 trillion. The GSEs alone are two-thirds of the non-bank market in multifamily real estate.”
Mr. Whalen went on. “When the Trump FDIC gets around to disposing of the rest of the rent stabilized assets from the estate of Signature Bank, the market for low-end rent-stabilized multifamily assets could be even more adversely impacted. Again, the financing market for rent-stabilized properties in New York is very limited and consists of mostly cash investors. And there are other banks in New York that hold mortgages on other rent-stabilized properties.
“In my upcoming book to be released this May by Wiley Global, "Inflated: Money, Debt & the American Dream," I compare President Trump to President Andrew Jackson (1828-1836). He eliminated the central bank and required all payments for taxes or land purchases be made in gold, decisions that left the nation in a deflationary crisis just prior to the Civil War.
“Although President Trump has relied upon the judicious use of financial leverage to advance his career in commercial real estate, many of the conservative policies being put into effect today in Washington have a certain 19th century or perhaps even New Deal perspective. The idea of withdrawing funding for the credit backstop of Ginnie Mae or eliminating support for over $1 trillion in multifamily real estate seems a tad extreme.
“But there's more. HUD Secretary Turner says that he plans to be the ‘quarterback’ of a cross-governmental effort to privatize Fannie Mae and Freddie Mac. Before Turner gets too excited about releasing the GSEs from 16 years in conservatorship, however, he should talk to Elon Musk and President Trump (or the folks at Heritage Foundation) about how much narrowing will occur in the GSE business models prior to release.
“If the Trump Administration is thinking of pulling the GSEs out of multifamily lending, and also second homes and second lien mortgages, which will impact profitability. Pulling HUD and the GSEs out of multifamily lending is going to create a crisis in the residential housing markets, this is just at a time when Turner wants to encourage the building of more affordable housing.
“As just about everybody in housing knows, you cannot build affordable housing in the US without some form of public subsidy. The idea of using the GSEs as a source of revenue is equally suspect. House Republicans are reported to be considering an increase to guaranty fees for Fannie Mae and Freddie Mac to pay for tax cuts and/or a taxpayer dividend.
“Norbert Michel of Heritage noted in a 2019 commentary that releasing the GSEs may not generate any net income for the Treasury and, in fact, may require yet another bailout to reduce the mounting obligations of Fannie and Freddie to the US taxpayer.
“The Trump Administration should stop pretending that the GSEs are an endless cash cow and start worrying about how the GSEs will manage in the coming housing downturn. As the world reacts to the protectionist agenda from the Trump Administration, a weaker dollar and higher long-term interest rates could spell big trouble for the US housing finance market.” Thank you, Chris!
Call them vendors or third-party providers…
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Just don’t call them late for dinner! What lender could originate home loans without third-party providers? Let’s see who’s doing what out there, in no particular order.
“Did You Miss One of Our Most Engaging Webinars Yet? American Heritage Lending recently hosted an exciting deep dive into our Bridge Star Loan, a powerful solution for borrowers looking to transition into their dream home. This was one of our most engaging webinars, featuring a dynamic Q&A session where we shared real-world examples of how we’ve funded some very unique scenarios. The discussion didn’t stop there, the overwhelming engagement and insightful questions expanded to our LTV Stacking Program, exploring how stacking Broker fees, discount points, and Realtor fees into the loan can provide even greater flexibility and value for your clients. As part of our Originate MORE! series (webinars, blogs, resources), we provide valuable insights, strategies, and tools to help you grow your business. Click here Originate More - ahlendtpo.com to view the webinar and other resources. We’re here to help, reach out to Jamie Gueltzow.”
Mortgage data and advisory services firm iEmergent has released four new market intelligence dashboards that allow lenders to slice, visualize, export and share historical and forecasted loan production, real estate listing and demographic data. Designed to help data experts and non-experts alike quickly uncover insights that support strategic planning and day-to-day mortgage operations, the four dashboards, Profiles for Loan Officer, Lender, Real Estate Agent and Builder, can be exported and shared with colleagues and partners with the click of a button. iEmergent plans to launch even more dashboards concurrent with the release of 2024 HMDA data in March. More detail about the first four dashboards can be found in the full press release.
Argyle and nCino have teamed up to boost loan pull-through and quality for mortgage lenders by embedding consumer-powered income and employment verifications directly into the mortgage point-of-sale workflow. Income and employment data can now be retrieved directly from applicants' payroll providers and then continuously synchronized across all mortgage systems of record, including the nCino Mortgage point-of-sale (POS) solution, lenders' loan origination systems (LOS), and the GSEs' automated underwriting systems. This unprecedented level of system interoperability gets loans through the origination process faster without compromising the data accuracy or completeness lenders need to obtain GSE rep and warrant relief. For a fuller description of the Argyle-nCino integration, check out the full news release or watch this explainer video.
Blend Labs, Inc. and Truework announced their partnership to bring intelligent verification of income and employment directly into Blend’s suite of consumer banking and home lending products. “Through this collaboration, lenders gain a comprehensive, fully integrated verification solution that enables faster borrower approvals and significantly broader income and employment coverage… Truework’s verification service is embedded directly within Blend’s borrower and loan officer experience. Based on a few borrower inputs, income and employment data is automatically pulled from multiple data sources and populated back to the application. Fully vetted and complete income reports are provided, removing extraneous or duplicative efforts that historically weigh down internal teams. Additionally, Blend customers maintain the ability to submit income and employment reports to Freddie Mac's Loan Product Advisor® (LPA®) and Fannie Mae's Desktop Underwriter (DU) to assess eligibility for representation and warranty relief.”
Following the advice of his doctor, Mr. Johnson moved to Florida.
When he arrived in his new Florida home, Mr. Johnson met his next-door neighbor. His new neighbor was a man around his age, but he had a full head of hair and appeared to be very strong.
"Hello," Mr. Johnson said to his new neighbor. "Is Florida as healthy as my doctor says it is?"
"Let me tell you something," said the neighbor. "When I first arrived here, I was completely bald, and I was so weak that I had to be lifted out of bed. I could barely even move across my own bedroom. And look at me now!"
"Amazing! How long have you lived here?"
"Oh, I've lived here my whole life."
Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you're interested, visit my periodic blog at the STRATMOR Group web site. This month’s piece is titled, “Natural Disasters and Economic Resilience. ” The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).
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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2025 Chrisman LLC. All rights reserved. Occasionally paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman. The views and opinions in this newsletter are mine alone unless otherwise specifically stated herein.)