Ellie Mae, a provider of loan processing software, is creating and updating loan modification closing packages for several top mortgage lenders, the company said. Ellie Mae said that their customers are presently using the service to process more than 5,000 loan modifications per week.

The service creates loan modification packages with Web-based data entry that requires no re-keying of data. All documents are compliant with Fannie Mae, Freddie Mac and MERS requirements, Ellie Mae said. According to Ellie Mae, their service assesses the needs of the mortgage lender’s flow chart, accommodating detailed loan work-out plans while handling the recording, notary and compliance needs..

Mortgage, lead generator, Lead Planet, has noticed that many of their mortgage brokers are using Ellie Mae in conjuction with foreclosure prevention processing.  According to the Lead Planet National Sales Manager, Dan Ambrose, “Loan modification leads are being requested almost as often as FHA leads.  Ambrose continued, “At this rate, I would anticipate getting more request for loan modification leads than refinance leads in 2009.

 

HSBC’s mortgage unit will no longer accept business from mortgage brokers and mortgage banking correspondents. More than 300 employees will be impacted by the move.  HSBC Mortgage Corp. closed its indirect lending channels, according to a statement today from spokeswoman Kate Durham. 

This could have a negative impact for many brokers and mortgage lenders that depend on Household for mortgage products.  HSBC shut down their second mortgage division years ago, but completing cutting off wholesale home loans will hurt the mortgage broker world immediately.  Former Ditech mortgage executive said, “It’s a sad day in the mortgage broker world.”  Morris continued, “But rather than wallowing in the mire we need to adapt.”  Morris suggests “finding a good FHA mortgage lender or adding home loan modifications to your portfolio of financing services.”

 

Just three months after the U.S. government took over Fannie Mae, the biggest source of housing finance may need an infusion of fresh capital to stay in business.  Unfortunately for the American taxpayer, the Treasury may be forced to pump up to $100 billion to stop the company from swinging from the “conservatorship” status it acquired when the government took control of the company and its rival Freddie Mac to a “receivership” situation that would involve selling off assets to pay creditors.  The U.S. Treasury Department stands ready to inject $100 billion into each company to avert receivership. If Fannie Mae or Freddie Mac shut down, mortgage rates would soar, making it enormously difficult for the housing market to climb out of the worst slump since the Great Depression.  “Receivership is really not tenable” because of the importance of Fannie and Freddie to the economy, said Fred Cannon, chief equity strategist at Keefe, Bruyette & Woods in San Francisco.

A Treasury infusion for Fannie Mae and Freddie Mac would boost market confidence in the government’s guarantee. Debt costs would drop and market access should increase, as a result, smoothing the companies’ ability to fund mortgage purchases and help stabilize housing, analysts said.  Conservatorship aims to preserve Fannie Mae’s assets as it works toward restoring health. The company on Monday reported a record $29 billion loss in the third quarter.  “If receivership meant liquidation, that would be the last thing that the U.S. mortgage market needs,” Cannon said, adding that a capital infusion is likely before year end.  FHA home loan products have completely taken over the market–share that Fannie and Freddie once dominated. 

Conservatorship is not a long-term solution, but “I don’t see any reason to push them into receivership prior to Congress addressing the structure of Fannie Mae and Freddie Mac” in the new administration.  The U.S. seized Fannie Mae and its smaller rival Freddie Mac in early September, saying the companies were so battered by the mortgage loan meltdown that they risked being unable to fulfill their mission of aiding housing.  Unfortunately, mortgage refinance loans have become so difficult because so many homeowners have migrated towards foreclosure or a loan modification.  Any of these foreclosure prevention options hurt the mortgage lenders profits. 

Fannie Mae said its regulator, the Federal Housing Finance Agency, must place it into receivership if its assets fall below obligations, or if it has not paid debts, for 60 days.  “We do not know whether we will exist in the same or a similar form or continue to conduct our business as we did before the conservatorship, or whether the conservatorship will end in receivership,” Fannie Mae said.  If worsening housing and financial markets result in a sharp net loss again in the fourth quarter, and Fannie Mae’s assets are worth less than its liabilities at year end, the company said it will have to tap funds from the Treasury to avoid a mandatory receivership trigger under current statute.  “Unlike a conservatorship, the purpose of which is to conserve our assets and return us to a sound and solvent condition, the purpose of receivership is to liquidate our assets and resolve claims against us,” the company noted in its quarterly filing.

Treasury Secretary Henry Paulson has said that conservatorship should be viewed as a “time out” while policymakers decide the companies’ future role and structure.  Fannie Mae and Freddie Mac own or guarantee about half of U.S. mortgage loans.  “They need to be there in some form. I don’t know how you can set up something new to do their job in a reasonable period of time,” said Bill Cheney, president and chief executive of the California and Nevada Credit Union Leagues in Rancho Cucamonga, California.  “Fannie Mae’s problems aren’t so encouraging but I can’t see the government really letting them go away,” he added.  Fannie Mae warned that if it must tap Treasury for cash it will raise its expenses and delay a return to profitability.  Among the risks, Fannie Mae said, is that the Treasury’s funding commitment might not go far enough.  “If we continue to experience substantial losses in future periods or to the extent that we experience a liquidity crisis that prevents us from accessing the unsecured debt markets, this commitment may not be sufficient to keep us in solvent condition or from being placed into receivership,” Fannie Mae said.  > Read complete mortgage article. (Written By Lynn Adler)

 

MRG Document Technologies, a provider of compliance and documentation services for the financial industry, announced at MBA’s 95th Annual Convention and Expo that mortgage lenders using its MIRACLE ONLINE document preparation systems can now request loan modification agreements online.

By requesting loan modifications online, mortgage lenders can now instantly create changes to their loan document packages if workouts are necessary. These modified agreements, which have been available since the end of 2007, also enable lenders to remain in compliance with changing lending legislation and requirements. Mortgage modifications made by MRG users typically include changes to note and security agreement rates and terms.

“Providing originators with the ability to restructure terms and conditions is a necessary function in light of the current lending climate,” said Terry King, group chairman of MRG. “Having instant access to loan modification agreements is another step MRG is taking towards making the documentation aspect of lending as streamlined as possible.”

MRG offers a browser-based system for the preparation and delivery of compliant document packages for mortgage lenders nationwide. The specific needs of the individual lenders are met through customized document packages, designed by in-house legal professionals and IT specialists. MRG also offers a variety of delivery options for document packages using e-mail and Web site delivery.

 

With more and more homeowners fearing foreclosure in the current economy, a new segment of the mailing list industry has emerged. Loan modification leads, mailing lists aimed to target distressed homeowners and help them get out of their adjusting mortgages, are now in hot demand.

When it became apparent earlier in the year that loan modification leads were becoming a necessity for loan modification companies, loss mitigation companies, short sale companies, loan litigation companies, attorney based companies, real estate agents, mortgage lenders and loan officers, SalesProspects.com, a leading mailing list broker, concentrated their efforts on perfecting their loan modification leads, and creating a mailer that generates better response.

“After six months of research, we can truly say that we are one of the top providers of loan modification leads,” said Jeff Rubens, president of SalesProspects.com. “We have created two great ways to find loan modification leads that will generate better responses. Clients utilizing our loan modification direct mail letter are experiencing great response rates, and our Internet generated loan modification leads can’t be beat.”

SalesProspects.com generates Internet loan modification leads that close, with fresh leads from motivated prospects delivered daily. Their mortgage leads are filled out by homeowners that are late on their mortgage loans and are asking for help. Sales Prospects mails the best prospects — homeowners with ARMS — their perfected loan modification direct mail that has already shown clients up to a 3-5% response.