Oct. 19: Letters about housing materials, Fairway & the DOJ, housing market activity; vendor news; Saturday Spotlight: TransUnion

What is your time worth? Want to skip the lines at Disneyland on every ride, once a day? The park is now offering a $400 Lightening Lane pass. (Some lenders give out “lightning file” privileges to originators who achieve a certain pull through target, or profitability goals.) How about saving the time it takes you to sign a credit card bill? Signing a check at a restaurant or for a rudimentary purchase paid by credit card is still incredibly common, but here’s the thing: Visa, Mastercard, Discover and American Express all dropped the requirements to sign back in 2018. Despite being six years, people continue to unnecessarily sign papers that will never be read, scrutinized, seen, or even required under audit. They’re not used to stop fraud, and it’s literally fine to leave without signing. So next time you can tell the waitress or bartender, “I read it on the internet.” On to mortgage banking!

Saturday Spotlight: TransUnion.com

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“Ensuring every individual is reliably represented in global commerce.”

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).

Established in 1968 as a railroad leasing company based out of Chicago, decades of investments in technology, strategic growth, and acquisitions, and ongoing expansions into new areas like fraud, marketing and customer-driven analytics, have drastically broadened our capabilities and transformed us into the leading credit reporting agency you know today.

TransUnion offers thousands of B2B solutions designed to address the unique needs of businesses across multiple industries. Mortgage lenders choose TransUnion for our identity-focused, data-driven mortgage insights and solutions, enabling them to achieve more desirable lending outcomes in a volatile housing market.

Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why.

We strongly encourage our associates to volunteer their time and give back to the communities where we operate, providing paid time off to those who participate (in 2023, employees recorded 6,675 volunteer hours). In addition, TransUnion has an established corporate giving program through which we donated nearly $4M in 2023 to community organizations focused on the advancement of economic inclusion, education, racial equity and others, on top of matching $525K in associate donations to eligible non-profits.

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?

Our ongoing aim is to build a culture where everyone feels they’re in the right place and empowered to succeed. This includes offering tuition reimbursement, enterprise inclusion programs, and promoting participation in business resource groups. Our internal learning hub connects associates with a variety of educational programs and opportunities, in addition to offering career coaching, self-service mentoring guides and development resources.

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.

TransUnion operates as a hybrid-first workplace, and we regularly run (and action inputs from) company-wide surveys that encourage employee feedback. In the most recent survey, 86% of respondents reported being satisfied with the flexibility TransUnion offers.

Things you are most proud of that don’t have to do with sales:

TransUnion’s commitment to expanding financial inclusion is a big reason many of us are proud to work here. Our partnerships with credit unions like VyStar and non-profits like HomeFree-USA help further our goal of expanding mortgage access and education to underserved consumers. For instance, we provide credit education tools (such as our CreditViewTM Dashboard) to HomeFree-USA which aims to help people of color on their homebuying journeys. And collaborations with organizations like FinLocker and MoCaFi support efforts to empower Black Americans building credit and wealth through homeownership.

Is there anything else you’d like to share along these lines?

We always aim to meet our customers where they are, and in a mortgage market that remains tumultuous and unpredictable, helping lenders meet financial goals is a high priority. One current area of focus is preapprovals. When mortgage lenders determine consumers’ creditworthiness earlier in the approval process, they can more easily ensure their time and resources are being invested for the right buyers. This customer-centric focus plays a large role in why lenders choose TransUnion, and we aim to continue delivering on their high expectations in the years to come.

(For more information on having your firm’s extracurricular activities, employee growth, and your charitable side featured, contact Chrisman LLC’s Anjelica Nixt.) 

Discrimination: Fairway Independent, the CFPB, & the DOJ  

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The Consumer Financial Protection Bureau (CFPB) and the Justice Department (DOJ) took action this week to end Fairway Independent Mortgage Corporation’s illegal mortgage lending discrimination against majority-Black neighborhoods in the greater Birmingham, Alabama area.

From out West came, “It seems every time I read these mortgage discrimination cases, they appear to be heavy on hyperbole and very light on the actual details of how the lender discriminated. We all sure would like to see an explanation of how commission-only LOs discourage ‘Black’ applicants, or any other potential client, from applying for a loan.

“As an industry we almost never meet the clients anymore, certainly not at the initial interview, fact finding call. How would any LO know the race with any confidence over the phone/email? My guess after reading this article, and so many like it, is that the LOs likely advised these folks on what they need to work on before applying for a mortgage, saving them the time and effort spent on gathering all their financials, helping them to be better prepared, possibly tips to increase their credit rating making it not only possible to qualify, but to also get a better interest rate, along with a potential hard pull on the credit.

“I remember last year when Navy FCU was hit with a discrimination case which was all over our industry news. Then after a little bit of basic checking into claims and accusations of the case, the judge dismissed the case as basic underwriting policies set by the government were followed.

“Unfortunately, most companies I believe would rather pay the penalties than go through a lengthy court process against a government organization with more or less unlimited funds. This then ends up creating an incorrect belief that discrimination is common which it is not. Good for Navy Fed for fighting it and shinning the light on the false metrics that bring these cases and showing how they have not in fact discriminated.”

There are housing material options

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Jeff sent, “Rob, thanks as always for the insightful commentary. I have only replied to you once and that was because you quoted Social Distortion. But in this case, I wanted to say thank you for bringing up the 3-D home dilemma. Truthfully, I'd love to hear others talk more about this (more industry vets, dare I say...politicians...). 

“As a nation, we continue to discuss, and to a degree, complain about housing shortages, affordable housing, HOI costs/availability, but yet we do little about it. Manufactured homes are SLOWLY becoming more popular. They are affordable and can be easily constructed with less delays. 3D homes, as you mentioned, can also be affordable and great alternatives to stick built housing with less risk of outside elements. What about container homes? Affordable while also supporting recycling and waste reduction. There are options, yet we continue to largely ignore them.

“What are others saying? I'd be very interested to hear others weigh in on this and why we are not taking advantage of the technological enhancements. Sure, financing would change. The GSEs would have to reevaluate what is considered a valid property type. But if we sit by and do nothing, we don't advance.”

Housing market temperature

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From Marin County, north of San Francisco, real estate agent Bob Ravasio writes, “This September we saw a sizable bump as listings increased nearly 20% from August. Currently there are 692 homes for sale in Marin County, far more than we had earlier this year. Only 24% of those are in contract.

“But overall sales are good. Sales for the month were down very slightly, by 2.8%. But the number most people are concerned about (pricing) held steady. It was basically flat vs. a year ago, with the average price up .4%, and the median down .5 %, so no real change in pricing, essentially flat.

“What appears to be going on is that sellers are pricing pretty smartly, for the most part. In the last week, there were 65 closed sales. And nearly half of them, 30, were above the asking price! Most of those had multiple offers, although usually only two or three, and they did not go dramatically over the asking price for the most part, usually around 3%. A few went higher, but nothing like what we were seeing last year.

“So, there are lots of multiple offer scenarios, homes going over asking, but no real change in average sale price? That means sellers, or their agents, are pricing homes very carefully, analyzing what is selling and for how much. And buyers are also analyzing data carefully, as they are not getting carried away with needlessly aggressive offers.”

Third party provider tidbits

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MISMO® announced that the Mortgage Compliance Dataset (MCD) specification has reached “Candidate Recommendation” status, which means that it has been thoroughly reviewed by a wide range of organizations and industry participants and is available for industry use. The MCD is designed to be used by state and federal regulators, with their compliance vendor, to perform compliance testing of closed loans as part of mortgage origination compliance exams. Mortgage lenders, with their compliance vendor, will also use the MCD to perform compliance testing of loans throughout the loan origination and post-closing processes. “The new dataset introduces consistency to the exchange of information used by state and federal regulators for loan portfolio review examinations,” said Acting MISMO President Richard Hill. “The MCD will ultimately reduce friction, increase accuracy, and create a more efficient process for our stakeholders involved in the oversight and regulatory process.”

Howard Hanna Real Estate Services, the largest independently owned real estate brokerage in America, announced the integration of ListAssist HomeSearch, a cutting-edge technology set to redefine the way buyers search for properties by focusing on precision and personalization. With ListAssist HomeSearch, users can now simply describe their dream home using natural language in the search bar of HowardHanna.com. Whether it’s a ‘spacious kitchen with natural light’ or a ‘big backyard with a pool in a quiet neighborhood,’ ListAssist uses sophisticated natural language processing and computer vision to comprehend these detailed requests and deliver personalized results with match scores for each listing. ListAssist HomeSearch is now available on Howard Hanna’s website.

Floify announced the availability of Floify Verify, a native electronic verification of income and employment (VOIE) service powered by Argyle. Designed to streamline the mortgage origination process, Floify Verify allows lenders to verify income and employment at a cost-effective price point without the hassle of managing additional third-party vendors and can be configured easily within Floify's application and origination experiences. Because it is powered by Argyle, its reports cover 90% of the U.S. workforce and receive GSE representations and warranties relief. Floify Verify is not an integration.

Candor Technology, a leader in mortgage technology innovation, announces the expansion of its Loan Engineering System™ (LES) to include Federal Housing Administration (FHA) loans. In an industry first, Candor's LES not only automates underwriting decisions for FHA loans but also offers a warranty on income calculations and cleared conditions for funded FHA loans. Candor’s LES seamlessly integrates with lenders' loan origination software, enabling it to calculate income, assets, and other qualifying credit criteria while cross-referencing FHA guidelines. “The system generates and clears dynamic, loan-specific conditions and is backed by a warranty from an AAA-rated insurer for up to 60 months post-closing. Using advanced expert system technology, the LES can fully underwrite a loan in as little as 90 seconds, even at the point of sale, giving loan officers a competitive edge to secure borrowers faster than ever before.”

While walking down the street one day a corrupt Senator (that may be redundant) was tragically hit by a car and died.

His soul arrives in heaven and is met by St. Peter at the entrance.

"Welcome to heaven," says St. Peter. "Before you settle in, it seems there is a problem. We seldom see a high official around these parts, you see, so we're not sure what to do with you."

"No problem, just let me in," says the Senator.

"Well, I'd like to, but I have orders from the higher ups. What we'll do is have you spend one day in hell and one in heaven. Then you can choose where to spend eternity."

"Really? I've made up my mind. I want to be in heaven," says the Senator.

"I'm sorry, but we have our rules."

And with that, St. Peter escorts him to the elevator and he goes down, down, down to hell.

The doors open and he finds himself in the middle of a green golf course. In the distance is a clubhouse and standing in front of it are all his friends and other politicians who had worked with him. Everyone is very happy and in evening dress. They run to greet him, shake his hand, and reminisce about the good times they had while getting rich at the expense of the people. They played a friendly game of golf and then dined on lobster, caviar, and the finest champagne. Also present is the devil, who really is a very friendly guy who is having a good time dancing and telling jokes. They are all having such a good time that before the Senator realizes it, it is time to go. Everyone gives him a hearty farewell and waves while the elevator rises.

The elevator goes up, up, up and the door reopens in heaven where St. Peter is waiting for him, "Now it's time to visit heaven...”

So, 24 hours passed with the Senator joining a group of contented souls moving from cloud to cloud, playing the harp and singing. They have a good time and before he realizes it, the 24 hours have gone by and St. Peter returns.

"Well, then, you've spent a day in hell and another in heaven. Now choose your eternity."

The Senator reflects for a minute, then he answers: "Well, I would never have said it before, I mean heaven has been delightful, but I think I would be better off in hell."

So, St. Peter escorts him to the elevator and he goes down, down, down to hell... Now the doors of the elevator open and he's in the middle of a barren land covered with waste and garbage. He sees all his friends, dressed in rags, picking up the trash and putting it in black bags as more trash falls to the ground.

The devil comes over to him and puts his arm around his shoulders. "I don't understand," stammers the Senator. "Yesterday I was here and there was a golf course and clubhouse, and we ate lobster and caviar, drank champagne, and danced and had a great time. Now there's just a wasteland full of garbage and my friends look miserable. What happened?"

The devil smiles at him and says, "Yesterday we were campaigning, today, you voted.”

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. The current blog is titled, “Lenders and Vendors Must Pay to Play.” 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 2024 Chrisman LLC. All rights reserved. Occasional 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.)