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NMP Presents ... State of the Industry Roundtable Discussion

NationalMortgageProfessional.com
Mar 18, 2016

As we turn the page of the calendar and begin a new year, we enter the next 12 months with new hopes and expectations of how to grow business and enter the post-TRID mortgage marketplace. National Mortgage Professional Magazine gathered some of the industry’s forward-thinkers for a roundtable discussion on how they plan to face the year 2016. What follows is a lively dialogue between C-level executives, heads of trade associations and those on the frontlines, all sharing their goals and outlooks for the year 2016 and beyond.

About the panelists …
Rocke Andrews, CMC, CRMS

President
NAMB—The Association of Mortgage Professionals

Rocke Andrews, CMC, CRMS is broker/owner of Tucson, Ariz.-based Lending Arizona LLC. After a number of years in high-profile positions within NAMB—The Association of Mortgage Professionals, he became the association’s nationwide president in October of 2015 at the NAMB National conference in Las Vegas. Previously, Rocke served NAMB on the local level, holding several leadership positions in his home state, including statewide president, of the Arizona Association of Mortgage Professionals.


Noel Chapman
Executive Vice President
REMN Wholesale

Noel Chapman has been employed in the mortgage industry since 1986. After 12 years on the retail side of the business, Noel entered the wholesale channel in 1998. For the last 17 years, he has headed up the wholesale channel for several mid- and large-size mortgage banking firms in New Jersey, and has extensive experience with all facets of wholesale operations and credit. Currently, Noel oversees credit risk for all of REMN Wholesale, while also directing REMN Wholesale’s operations.


 

Terry W. ClemansExecutive Director
National Consumer Reporting Association (NCRA)

Terry W. Clemans serves as executive director of National Consumer Reporting Association (NCRA). Headquartered in the Chicago suburb of Roselle, Ill., NCRA serves its members in the U.S. and Puerto Rico. NCRA's membership includes two of every three mortgage credit reporting agencies in the U.S. that can produce a credit report that meets the requirements of Fannie Mae, Freddie Mac and HUD for mortgage lending.


 

Donald J. Frommeyer, CRMS
Chief Executive Officer
NAMB—The Association of Mortgage Professionals

Donald J. Frommeyer, CRMS is currently chief executive officer for NAMB—The Association of Mortgage Professional. Don is a multiple-term national president of NAMB, and has served the association’s board of directors, on many of the association’s committees. He first got involved with NAMB on the local level, serving the Indiana state affiliate of NAMB in a number of roles, including statewide president. With 30-plus years in the industry, Frommeyer has gone to bat for the mortgage professional on multiple occasions over the years, often providing insight on the inner working of the industry to many elected officials in NAMB’s trips to Capitol Hill.


 

Mat Ishbia
President & CEO
United Wholesale Mortgage (UWM)

Mat Ishbia is the president and CEO of United Wholesale Mortgage (UWM)–one of the fastest-growing wholesale mortgage lenders in the country. Under his leadership, he has taken UWM to new heights, growing the company into the nation’s No. 1 conventional wholesale lender. Ishbia is an entrepreneurial-minded executive who has excelled at blending his business acumen with an ability to build a unique workplace culture. Ishbia’s management expertise and dedication to a team-focused business approach have enabled him to intelligently grow a leading lending operation that is a highly reputable organization in the mortgage industry. Ishbia has been named one of the “Most Influential Mortgage Professionals Under 40” and one of the “25 Most Connected Mortgage Professionals” by National Mortgage Professional Magazine. Additional accolades include a spot on the Crain’s Detroit Business “40 Under 40” list; being recognized on the “30 in Their Thirties” list by DBusiness Magazine; being named a “Rising Star” and Vanguard Award winner by HousingWire; and recognition as a “Most Valuable Professional in Michigan” by Corp! Magazine.


Rey Maninang
Senior Vice President & National Sales Director
Carrington Mortgage Services LLC’s Wholesale Mortgage Lending Division

Rey Maninang has been senior vice president and national sales director of the Wholesale Division at Carrington Mortgage Services LLC since August 2013. Previously, Rey served as senior vice president and national head of sales for PMAC Lending Services Inc.


 

Alexandra Rodriguez
Marketing Director
Angel Oak Mortgage Solutions
Alexandra Rodriguez is the marketing director at Angel Oak Mortgage Solutions, an Atlanta-based wholesale lender currently licensed in 24 states. Angel Oak provides alternative lending solutions for the sub-prime/non-prime industry. Alexandra joined the Angel Oak team in 2013 and has a background in marketing for multiple markets, including publishing, healthcare, and commercial real estate.


 

Tom Salomone
2016 President
National Association of Realtors (NAR)

Tom Salomone, a Realtor® from Coral Springs, Fla., is the 2016 President of the National Association of Realtors (NAR). NAR, The Voice for Real Estate®, is America’s largest trade association, representing one million Realtors® involved in all aspects of the residential and commercial real estate industries. Tom has been a licensed real estate agent for more than 40 years. He is a second generation REALTOR® and broker/owner of Real Estate II Inc., a firm specializing in residential real estate. Tom uses his experience in business and sports to serve the community through a number of different organizations, including the Boys & Girls Clubs of America. He has been a member of the Chamber of Commerce, a Coral Springs Charter School Business Sponsor, and a Water Control District Supervisor. He has coached more than 46 sports teams in local city leagues and been a member of the Amateur Athletic Union and the United States Specialty Sports Association. He volunteers with organizations to prevent heart disease and cancer and attends St. Andrew’s Church. He is the proud father of two sons, TJ and Bryce, and husband to Diana.


Theodore W. Tozer
President
Ginnie Mae

Theodore W. Tozer was appointed by President Barack Obama and confirmed by the U.S. Senate to serve as President of Ginnie Mae on Feb. 24, 2010. With more than 30 years of experience in the mortgage, banking and securities industries, Tozer manages Ginnie Mae’s $1.5 trillion portfolio of mortgage-backed securities (MBS), which has grown by more than a half trillion dollars in less than four years. At Ginnie Mae, Tozer has brought renewed focus on bringing global capital into the American housing finance market and on strengthening industry partnerships by focusing on making Ginnie Mae more customer centric. Prior to Ginnie Mae, Tozer served as senior vice president of Capital Markets at National City Mortgage Company (NCM). During his tenure at NCM, the company was consistently profitable with growth in annual loan sales from $1 billion in 1989 to $106 billion in 2003. Tozer received his bachelor of science degree in accounting and finance from Indiana University and is a Certified Public Accountant and a Certified Management Accountant. He and his wife Sandy live in Fairfax, Va.



The discussion …
How will TRID impact the industry in 2016?

Rocke Andrews: TRID is causing a few hiccups and slowdowns in the mortgage process now, but in a few months, lenders and brokers will adapt and business will be back to normal. The TRID disclosure does a better job of putting the broker on an even level with bank disclosures.

Noel Chapman: TRID’s primary impact is operational delays, which are currently at a peak. I anticipate these delays will slowly dissipate as the year wears on, and I am hopeful that by year-end, the industry will be fully adjusted to the post-TRID world. Another impact is the increased number of employees necessary in order to handle the operational complexities (both intended and unintentional) created by TRID. While it’s too early to speculate about the exact nature of the legal and enforcement impacts, it’s reasonable to assume that the impact will be meaningful.

Terry W. Clemans: TRID is creating some sleepless nights and tighter budgets, and as credit reporting companies, we have it fairly easy compared with the rest of the mortgage industry. Credit reports are specifically exempted from the fee restrictions consumers can pay prior to the Loan Estimate and the Intent to Proceed in §1026.19. That exemption, however, has not eliminated a lot of questions about the proper handling of credit reporting fees. Financial penalties for violating TRID can be huge. Willful violations, which some of the marketing plans I have heard about could easily fall under that category, could bankrupt a company if that organization falls under the wrong interpretation of a very complex ruling.

This directly impacts the business’s bottom line as companies have to have higher budgets for all of the additional legal, compliance, and technologies required to avoid committing a violation. With any luck, it’s only those added expenses and not the potentially devastating impact of a fine for going with the wrong interpretation of some of the more ambiguous portions of TRID or consumer litigation over a different interpretation.

Donald J. Frommeyer: I really think that it won’t impact it at all. We have had more than 90 days at this stage of going through the steps and it is really getting everyone to understand the why’s and what’s of exactly what is happening. You really need to make sure that the customer and the real estate agent knows what is going on, so with good, strong communication, we should be past all of the problems.

Mat Ishbia: I don’t think that TRID will be considered a hot topic after the first quarter of 2016–people are going to get used to it and it will be considered the normal way of doing business. The industry is constantly changing and I think lenders will need to continue investing in compliance and technology to stay ahead of the curve.

TRID has forced everyone to step up and invest a significant amount of money in compliance and technology, or risk losing business. In the past few months, many lenders have had to rely on vendors that they don’t have control over because of their lack of internal resources. Lenders will quickly realize that they either have to spend the time and money to be great or they’ll be left behind.

Alexandra Rodriguez: The fourth quarter of 2015 really served as a transition period regarding TRID. Lenders have had the chance to adjust their processes to become compliant with the new regulations, which came fully into effect this October. However, lenders and borrowers are still assimilating and adapting to the new regulation. Now that the lender assumes responsibility for ensuring compliance, re-evaluation of technology, processes and communication will be necessary to ensure TRID compliance.

The year 2016 should be significantly smoother as the industry transitions to a new normal, assuming lenders get up to speed on their TRID responsibilities and adjust processes where necessary. They should ensure that application policies are clear, understandable and easily trackable.

Tom Salomone: In the early stages, we are likely to see some bumps in the road as the industry continues to adjust to the new disclosures. NAR advised its members early on to consider longer time horizons on purchase contracts. In the long term, however, it is likely that we will see a diminished affect from Know Before You Owe as we move through the transition to the new disclosures.

Theodore W. Tozer: Since Ginnie Mae does buy or originate mortgages or issue mortgage-backed securities (MBS) directly, we are not directly impacted by TRID. However, anything that affects the housing finance industry ultimately impacts the collateral that makes our MBS possible. As a policy matter, I support efforts to make mortgage terms more transparent to homebuyers, and to give these buyers enough lead time to understand these terms prior to closing. Remember, a mortgage is the largest transaction many people will make. So, we should err on the side of safety here. Of course, the new disclosures and timeframes will affect the mortgage industry. And, as with any new set of procedures, it will take a while to fully incorporate them into the normal course of business. But it will happen, certainly during 2016.


What do you feel will be the big breakthrough product in the industry in 2016?
Rocke Andrews: I think the big breakthrough product will be allowing borrowers with past credit event problems to purchase on a more competitive interest rate … whether it is a change to FHA and GSE guidelines or a non-QM product from the growing non-conforming lending market.

Noel Chapman: It seems clear that we are heading into a purchase market, which I anticipate will cause a substantial increase in FHA’s overall market share. I don’t know that there will be a breakthrough product, but given the number of first-time buyers coming into the marketplace seeking lower downpayments and the nature of existing inventory, conditions may be ripe for a 203k “renaissance” of sorts.

Terry W. Clemans: From a credit perspective, there are two key issues for 2016: Fannie Mae’s use of trended data, slated to roll out this summer, and what we hope will be the ability to use a modern credit score for mortgage underwriting sometime soon after that.

Trended data is a whole new world for the mortgage underwriter, as it shows a much more complete picture of the consumers credit account histories other than just the on-time payment history and current balance data provided currently. One will have the ability to look back as far as two years at the balance each month, payment amount, and credit limit, including what you receive not about the payment being on time or not. As the name suggested, that added data shows the consumer’s spending and payment history trends, and how that trend impacts the consumers total credit utilization. This is a huge development that has proven very valuable in other lending sectors and mortgage lenders will be hearing more about it this as Fannie Mae nears its implementation and starts requiring the trended data in mid-2016. 

How this will impact the underwriting is yet to be determined since we are in uncharted territory with this new technology for mortgages. Could a person with a 750 credit score now be denied due to the new trended data exposing the consumer’s steady rise in credit consumption over the past 24 months? Supposes someone goes from a moderate credit utilization rate of 20 percent to one that is on the verge of being unsustainable at say 80 percent, yet still scores high enough to qualify under current guidelines. Prior to the trended data, you would never see that consistent debt growth, only the amount of debt and payment of the month reported at the time of the mortgage application. How this ultimately impacts decisions has not been completely disclosed, however, as Fannie Mae’s CEO Timothy Mayopoulos disclosed in his address at the October MBA Annual Convention in San Diego, it will be a new requirement for next year.

With regard to credit scores, the ability to use a credit score based on consumer spending patterns in recent times would be helpful. Currently, Fannie Mae and Freddie Mac require credit score models developed before the 2008 financial crisis. FICO 9.0 and VantageScore 3.0 are two to three score generations newer than the outdated FICO models that are now required, and both offer many benefits for both lenders and consumers. I mention VantageScore as it is a very viable option that was not available back when the last score update was implemented by Fannie Mae and Freddie Mac. As a strong believer that competition is much better for everyone, it is time for the use of a modern score and the ability for lenders to choose from either FICO or VantageScore (with the proper protections to prohibit “cherry picking” the best score) for mortgage underwriting. We hope for an announcement in 2016 with a changeover to the new score or choice of scores implemented before 2017, as this is long overdue.

Donald J. Frommeyer: There are more and more companies coming into the lending arena, so competition will surely be on the rise. Also many companies are offering one-time close construction loans, and I think that will be a great product in 2016 because more builders are starting to come back.

Mat Ishbia: Purchase-focused products will be the main focus in 2016. Beyond that, I’m a believer that Fannie Mae’s HomeReady program will be strong, as will Freddie Mac’s Home Possible Advantage program. Those are two great affordability programs that get people into their dream home with minimum down payments, along with reduced mortgage insurance.

Rey Maninang: This year, purchase programs will become the focus of the mortgage industry, as refinances begin to slow down. Last year, changes to the Federal Housing Administration’s (FHA) mortgage insurance premiums drove a large wave of refinances, but as interest rates begin to rise this year, we will see more and more activity in purchase loans. The increased focus on purchase programs will likely be greatest for those that feature low downpayments, low fees, and less cash to close. Programs like these that are especially attractive to first-time homebuyers and allow for lower credit scores will see significant activity this year.

Mortgage professionals and lenders that focus on simplifying the purchase process and providing on-time closings will put themselves in an excellent position to benefit from the growing purchase market this year.

Alexandra Rodriguez: Sub-prime! It’s not a matter of “if,” but “when,” interest rates will increase. When that happens, loan originators must look to alternative lending solutions to ensure their pipelines remain full. For subprime to maintain its momentum in the market in 2016, however, people need to understand how today’s subprime is different than in 2005 and 2006. Subprime before the financial crisis looked vastly different than the non-prime, or non-qualified mortgages (non-QM) of today.

For example, today’s non-prime loans: Have an average credit score much higher than in 2006; require a downpayment (skin in the game); must have documented ability-to-repay (ATR); and are subject to tighter regulation.

In 2016, we hope to see a change in continued understanding and continued growing acceptance as these products gain in the market. They’re a necessity for Americans who no longer fit the tight requirements needed to receive an agency loan. Because of these strict agency lending standards, so many worthy homeowners have been left out of the market; but, these subprime products are beginning to change that.

Tom Salomone: Our industry continues to evolve and improve, with Realtors® finding new and innovative ways to serve clients. In fact, so much is happening that there’s no way to single out one major breakthrough. Instead, I believe we will see developments on a number of fronts. These include greater utilization of promising technologies like drones and e-signatures, further improvements in the way Realtors® manage data, fresh ways to market to Millennials online, and a whole lot more.

Theodore W. Tozer: Perhaps not one product, but a continuation of important trends. For example, we have seen annual growth approaching 50 percent in Ginnie Mae MBS that contain reverse mortgages. These loans, backed by the FHA, are emerging as a key source of income for senior citizens who need to stretch out retirement savings over a longer life span. With the VA, people tend to overlook the importance of this mortgage program. But here’s the reality: VA loans are really popular. They represent about one-third of the loans within our annual MBS issuances. And this percentage was even higher—40 percent—until the FHA slashed its monthly premiums. As our foreign wars hopefully wind down, we expect to see more veterans re-entering the private workforce. And it’s important that Ginnie Mae be there to secure mortgage funds for them.


Do you think larger or smaller firms have the potential for greater growth in 2016?
Rocke Andrews: I think the new disclosures and marketing will put the small shops at an advantage moving forward. They can adapt to technology and guideline changes faster and get the new products out to the street, thus maintaining a competitive edge in an ever-shifting marketplace.

Noel Chapman: Now, more than ever, the keys to success are a firm’s ability to be nimble and reactive. This is much more predictive of a company’s growth potential than size.

Terry W. Clemans: This is a really tough question, and one that has sparked several great debates in the credit reporting space over the years. The power and benefits obtained from economies of scale versus the nimbleness, flexibility and high touch customer service of smaller boutique operations. There is little doubt that the ever-increasing costs of raw credit data, technology, compliance, and legal issues, combined with constantly shrinking margins are making life tougher for all credit reporting firms, regardless of size. Today, there are less than 50 companies in the U.S. that can issue a mortgage credit report that meets federal lending guidelines, compared to more than 2,500 companies 30 years ago. Because of this, even the smallest companies have now reached a much larger size than ever before, so this debate has changed greatly over the past 30 years as the industry has consolidated.

In 2016, just like other years the challenge in the mortgage credit reporting market, (which is not unlike mortgage origination or other mortgage settlement services) is the management of the business operation during the interest rate fluctuations. We all know these fluctuations can be like riding a rollercoaster, with ups, downs, and twists moving regardless of an organization’s business plan. Managing the customer service aspect during these times can be very difficult. The larger the company, the more people needed (or not needed), pending where you are at in the interest rate ride. In credit reporting, when a certain skill set is required to keep your firm out of the courtroom (from Fair Credit Reporting Act litigation), these fluctuations become even more difficult to handle and sometimes the smaller companies can adjust to the volume changes more efficiently. Personally, I believe that 2016 will be better for the smaller firms to grow, as declining origination volumes typically brings in more marginal loans that require greater efforts to close, which is the environment where these firms typically excel.

Donald J. Frommeyer: I think the company that has two or three loan originators is going to be doing more business, but as a percentage, the smaller companies will grow at a bigger percentage. The important thing to remember is that business has been getting better over the last 15 months, and it will continue to do so as we enter 2016.

Mat Ishbia: I think we’ll actually see a greater divide between larger and smaller firms in 2016, and the greatest impact will be on mid-sized companies. We’ll see more of these lenders choose to become broker firms again because that channel offers entrepreneurs and loan originators the greatest flexibility and growth opportunities. This will help the wholesale channel grow, as many mid-sized lenders won’t have the means or desire to build out underwriting staffs, compliance and quality control procedures.

Rey Maninang: As we move into a more purchase-focused market, smaller firms will have significant opportunity for growth this year. These firms can more nimbly navigate the market as it changes and provide new programs in response to shifting demand.

As more potential homebuyers move off the sidelines and into the housing market, mortgage professionals should pay close attention to demand from borrowers with less-than-perfect credit. Mortgage professionals and lenders with smaller firms will be better able to respond to increasing interest in purchase programs and create mortgage products with common-sense underwriting that can serve a wider audience. With these types of products, they will be well-positioned to serve today’s consumers as they move into the marketplace.

Alexandra Rodriguez: Smaller firms absolutely have the potential for greater growth in 2016, primarily due to their flexibility with alternate lending. While big banks may not be willing to expand their portfolios to offer programs outside those offered through the GSEs, smaller firms have the ability to add additional programs to their product offerings to spur growth in the next year.

Those firms that are nimble and willing to expand their product offerings to include non-agency loans stand to experience significant growth. There is a subset of Americans over 100 million strong that are underserved in the mortgage market. They simply don’t meet the strict QM guidelines and therefore represent a tremendous opportunity for lenders capable of satisfying their needs.

Tom Salomone: The current economic environment presents challenges and opportunities for a range of business models, both large and small, and I wouldn’t handicap one over another. Rather, I believe that firms of all sizes stand to benefit from historically low rates and an improving economic condition relative to the recession we saw just a few years ago. Of course there are challenges ahead, but there are also plenty of opportunities that can benefit large and small firms this year.

Theodore W. Tozer: In percentage terms, smaller lenders will always have the growth advantage. Certainly, in recent years, we have seen the Issuer base of Ginnie Mae MBS move towards smaller lenders with different operating models. And in the conventional market, we have seen federal regulators and Congress create a more level playing field of competition through standardized guaranty fees. Thus, the edge going forward seems to favor smaller lenders. The one caveat: With smaller or no balance sheets, smaller lenders will need continued access to credit lines and otherwise remain liquid.


How has the current regulatory environment impacted your bottom line?
Rocke Andrews: Increased regulations have increased origination costs and the time of the loan spent in the pipeline. This has impacted everyone, and in return, these costs must unfortunately be passed onto the consumer.

Noel Chapman: The MBA estimates that the average cost to produce a loan increased $1,600 from 4Q12 to 1Q15. Obviously, TRID will significantly add to this. The cost of compliance is hard to quantify, but clearly it’s substantial … and eventually, will be borne by the consumer.

Terry W. Clemans: It has certainly made tight profit margins much tighter. The actual cost of the new compliance requirements is still unknown, but clearly growing. Not only does the current regulatory environment have an impact to the bottom line, its impact is this combined with the constantly increasing consumer litigation from baseless claims. This combination has been a one-two punch to the bottom line of the mortgage credit reporting industry.

Donald J. Frommeyer: You are always going to have increased costs when it comes to compliance because it takes more time and effort to both monitor regulations and abide by these mandates. These continued costs are driving profits lower and the overall cost of compliance will play a major factor in driving down profit in 2016 and beyond. The only thing that you can do to combat the necessary cost of compliance is to produce more closing volume.

Mat Ishbia: UWM might be an outlier on this, but the current regulatory environment has actually helped our bottom line. We spent the time and money to invest in compliance and technology up front, so we’ve been able to grow our business. Contrary to what others have been experiencing, we’re able to close loans faster than we could before. As crazy as it sounds, UWM is closing loans in an average of 23 business days post-TRID compared to an average of 24 business days before TRID. The current regulatory environment shows that you can make compliance a competitive advantage for your business.

Alexandra Rodriguez: Our products and processes have always taken into account the compliance regulations that are imposed on all mortgage lenders. While a regulation like TRID might change some processes, it has not negatively affected our turn times or our production. If anything, it makes it easier for both us and for our broker partners since we now take on the responsibility of issuing the Loan Estimate to the borrowers.

Furthermore, today’s strict QM lending guidelines play right into our business model, which focuses solely on non-prime mortgage products. We’re targeting borrowers that have been locked out of getting a mortgage because of those regulations.

Tom Salomone: The National Association of Realtors® enjoys a strong working relationship with the federal agencies that oversee our industry. We recently hosted senior leadership from the Consumer Financial Protection Bureau, the Small Business Administration, and the Federal Housing Administration on a range of issues important to Realtors®, and we’re pleased with the working relationship we share with our partners.

Of course, that doesn’t mean there isn’t work ahead. For example, we believe that FHA should consider additional measures to ease burdensome condo rules; that the CFPB should remain mindful of its commitment to show “sensitivity” towards good faith actors adapting to Know Before You Owe disclosures; and that it’s important to protect rules and provisions that help make real estate such an attractive investment, including the mortgage interest deduction. In the year ahead, we’ll be looking towards these and other major policies to advance the business of Realtors®, support consumers, and make homeownership a more attainable dream for creditworthy borrowers.

Theodore W. Tozer: It has put pressure on our cost structure, as we seek to monitor new kinds of risks being posed by the Issuer base for Ginnie Mae MBS. We have seen traditional banks, our traditional Issuer, move out of the mortgage market, largely to due to repurchase risk posed by federal regulators and other government entities. As a direct result, independent mortgage banks have filled the void in the primary market. Indeed, independent mortgage banks now represent the majority of our Issuer base. However, the transactions they engage in are more complex than those of traditional banks. Thus, we have more points of risk to monitor, and across a larger book of business. Over time, that will drive up our costs.


Any closing comments?
Rocke Andrews: The economy and the housing market is recovering and will hopefully return to once robust levels. The year 2016, in my opinion, will be a good year to be a mortgage loan originator.

Terry W. Clemans: I have two. First, I encourage everyone to take notice of the information that will be coming out in the near future about Fannie Mae’s movement to trended data as discussed earlier. This will change the reports more than any development since the use of credit scores. Second, become more aware of and familiar with rules about the proper use, storage and disposal of credit information. Too often, business people who are very busy can get complacent with the credit data of which they are entrusted allowing for the unintended, but improper use of the credit data that can be devastating to both the consumer and the mortgage originators company. Data breaches are very costly and can be done in both digital and paper forms. These can lead to identity theft, which everyone knows is a major problem today. We all need to be better stewards of this consumer data that drives our businesses. Please take extra steps in 2016 to make sure your systems and paper waste are not used to fuel the identity theft problem.

A way to be a better steward of the data is through NCRA’s Fair Credit Reporting Act (FCRA) Certification Program for mortgage company employees, who are referred to as the “end user” of the credit data. The FCRA and other federal and state laws have some very specific responsibilities for the proper use of credit reports that are not only important to fighting identity theft, but also in the proper handling of consumer disclosures when a less than best lending decision is made based on that credit report. Even people that have been in the industry for decades need to make sure they are doing things properly and we encourage everyone in the mortgage industry who has access to credit data become FCRA certified. Any NCRA member can help your staff become SAFC-MLP certified, which stands for the certification of Safe Access for Credit–Mortgage Loan Professional.

Donald J. Frommeyer: I really feel that 2016 is going to be a great year. The economy is growing stronger, and you can see a lot of people starting to look at building homes, looking to upgrade their homes and looking to sell their homes. We really need a larger number of homes to hit the market because we have customers who can find the home they want and fulfill their dreams of homeownership.

Rey Maninang: We expect that 2016 is going to be a positive year for the mortgage industry. Although refinances are likely to slow down some, the corresponding uptick in purchase business will bring new homebuyers to the market. We anticipate continued interest in purchase opportunities from consumers with lower credit scores, as well as expanded competition from lenders to serve those borrowers who have credit scores below 620.

Alexandra Rodriguez: Angel Oak is excited and ready for 2016 to take off. We expect the industry to thrive and to become more open to the possibilities of alternative lending.

Tom Salomone: I’d simply add that although there are challenges ahead, I believe the future is bright for real estate, both for those of us in the industry and for consumers. A lot of good work has been done to move forward on some important issues, and I believe consumers and those of us in the industry will see continued opportunities for success in the year ahead.

Theodore W. Tozer: For Ginnie Mae, we are trying to keep up with business growth and the transformation within our Issuer base. For example, in fiscal year 2015, Ginnie Mae surpassed Freddie Mac in total MBS issuances, and we even outpaced Fannie Mae during certain months. Why? The constituencies we serve—middle-class families, military veterans, underserved communities—have increasingly turned to the FHA, VA and other government mortgage programs, and we need to support all of them. So we expect our business volumes to remain high. With MBS investors, there is incredible demand for our securities, so we need to protect the integrity of the government guaranty. Lastly, we are working to implement a risk-management approach that can better support independent mortgage banks, enable a robust market for mortgage servicing rights, and otherwise ensure the safety and liquidity of the government mortgage market.

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