Define your purpose

My coach assigned homework this week of ‘what is my purpose? Well gee, I don’t know. To make money? No…besides that (he said). What is the reason you get out of bed in the morning, and what are the things that motivate you to do what you do? Is it to support family? Contribute to the world via charity? Is it to support a family member? Or all of the above? So he challenged us to come up with specific, concrete items. I have 2 weeks. Thank goodness. This will require some thought. What is your purpose? Have you defined that lately?


In the market news:

· Stocks are down 10% from their peak, and has eased mortgage bonds (interest rates) a bit. We expect more correction, so keep an eye out
· This week the Senate passed sweeping legislation on financial reform to correct the 2008 crisis. Many of these items, if passed will have negative impacts on not only mortgage companies (so look for our margins/yields to increase) but also the consumer. Increased regulation and change means (a) more paperwork (b) more cost to mortgage companies, ie, to the consumer, and (c) mass confusion – nothing new these days! As things are approved, I will educate you on the changes. Of the 326 proposals, we don’t know which ones will survive in their current form.
· As of June 1, Fannie Mae is requiring MORE screening for lenders to perform in their QC. We must repull the credit report within 24 hours of closing, to verify no new debt has been obtained, or , if credit scores are lower. If there are changes, this could DELAY the closing, while additional conditions may have to be obtained by the borrower. In addition, we have to verify additional verifications of the borrowers occupancy plans for the property, as well as the social security number directly with the SS office. Oh yes, also, the W-2 transcripts for all borrowers, employed or self employed (used to be self employed only). Oh, and business tax returns. We used to only need those on Jumbo borrowers, but now, need them on conventional too. And….get IRS transcripts on those too. Do you have a headache yet?
· All this extra compliance sums up to one thing: Cost. The consumers will end up paying some how, for the increased legislation and regulatory requirements.

Bottom line: hang in there. Patriot Bank Mortgage is here to see you through all the changes, and continue to make things streamlined for your borrowers with our in house processing, underwriting and closing- we get the job done , accurately and on time.

Drama abounds

Drama ensued this past week. I don't mean the Citi broker that "accidentally" sold 1 billion shares of Proctor and Gamble on Thursday, sending stocks tumbling (that’s the story I heard)- but my 4 year old pushed a girl at school. That is real drama! The crying went on and on when I would not let him watch Dinosaur Train while I cooked dinner. That’s the punishment. He acts up at school, I take things away that he likes. He said I was mean and he didn't love me anymore. Poor thing. Doesn't he know that crying does not fix the punishment? So we sat and hugged, and talked about what he did, and not being a bully, etc... And ended the night with his favorite dinner: peanut butter and jelly. That made everything ok. He took it like a champ, and hopefully will not push, shove, bite, hit or pinch at school ever again. Can I only dream?

So back to the stocks. The Dow lost 900 points in 5 minutes last week, then began to rebound Thursday only ending down 348 points. Rates eased (went down) (stocks down, bond prices up, bond yields (rates) down). Today, we feared rates would go back up, as news of better jobs was expected. That IS what we got (better than expected payroll numbers), however, stocks remained low, as the fear and uncertainty of the Greek economy still looms over the market and the European Union.

Oh, and to top it off, Freddie Mac needs another few billion (yes, BILLION) to recover from losses. They lost 8 billion the first quarter of 2010. Now that doesn't sound good does it? But wait.....Freddie Mac's CEO assures investors and the government that things are turning around. That could be true, as we are seeing business increase month by month as consumer confidence returns to the market. Not to mention jobs. But, do we think they can keep rates low if they (Freddie Mac) are losing money every month? Its called ' padding the margin'. That is my theory and pure speculation on my part. What do I know? We may see the investors wanting higher margins (profit) for the loans that they do make. Only time will tell, but do enjoy these low rates while they last.

The urgency of business

"Drive Now, Text/Phone Later". That is what the marquis on 610 said today. I saw it twice. So I tried it for about 10 minutes. Pure silence. I did not even have the radio on. It was grueling! Is there such a thing as talkers anonymous? I sadly admit that I am one of them, that drives down the freeway with (at least) BOTH hands on the wheel (and I use a headset). But I must say, I know I need to stop. Its dangerous. So far I have been lucky, but do not want to learn my lesson the hard way. What is it about our society that demands such instant gratification that we must talk and respond to email immediately? We just cannot wait to reply. Its good customer service, right? But is it really if you are risking the lives of others at the same time? Just something for you to think about over the weekend.........

Speaking of instant gratification, what about in the stock market? I remember the days (15 years ago) when I began originating loans, rates changed only 2-3 times a week. Also, Credit reports still took 4 hours to generate, and came printed out on the glossy, scroll fax paper! Now rates change 2-3 times a day! Depending what investors see on CNN the last hour (literally). Information is changing at warp speed. This makes it even more difficult to quote rates, lock loans, and execute anything! You need to be sure your loan officers are skilled and knowledgeable. Your clients experience depends on it!

Rates were pretty flat this week. Monday will be interesting (possibly lower rates?), as the results of today were that the stock market fell from the news of Goldman Sachs credit downgrade and criminal investigation became official. Also the continuing bad news of the oil spill in the Gulf. Galveston beach anyone?