MReport April 2017

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TH E M R EP O RT | 55 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T DATA THE LATEST Borrower Satisfaction, Types of Loans Changing Borrower satisfaction dipped but is expected to bounce back, while banks report a greater likelihood of originating non-QM loans than independent originators. O ver the course of 2016, borrower satisfaction dropped, and lenders sought more changes to their post-TRID underwriting practices, according to the Feb - ruary Stratmore Group Insights report released in late February. Borrower satisfaction, which measures customer experiences through the mortgage lending process, dropped to an index of 88, after a four-month run at 90, Stratmore reported. That was the lowest number since January 2016. "It seems clear that time-off during the Holiday season took its toll on borrower satisfaction," the report stated. "We anticipate a recovery by February, as oc - curred during 2016." Last February's borrower satis- faction index hit 89.5. Overall borrower satisfaction accounting for roughly 105,000 loans in 2016 was 89. According to Stratmore, 82 percent of bor - rowers reported experiencing no problems. They reported satisfac- tion scores of 95. Of the 18 percent who did ex- perience a problem, 13.4 percent said the problem was resolved, with 4.7 percent reporting that the problem was not resolved. The satisfaction score plummeted to 77 for that 13.4 percent and to 35 for the 4.7 percent. This, the report stated, put lenders "at risk to getting negative reviews by such borrowers to friends, rela - tives, and on social media." According to the report, banks and underwriters were more likely to originate—or more likely to plan to originate—non- QM loans in 2015. Fifty-six percent of banks responding to Stratmore's survey said they were significantly more likely to originate non-QM loans than independents (41 percent). This difference, Stratmore reported, "reflects the ability of banks to internally fund non-QM loans, e.g., Jumbo ARMs." Lenders also shifted how their employees worked. Two thirds of lenders, for example, offer work- from-home options as a recruiting incentive or as an incentive to retain seasoned underwriters. "This practice is often used when the talent pool has been ex - hausted in a particular geography or as a way to quickly expand or contract capacity in line with demand," the report stated. The typical compensation package for a processor's salary in 2015 was just shy of $38,000 to $56,000. The upper 10 percent of earners made about $73,000 that year. Third-party originators (TPOs) were least likely to pay processor incentives (75 percent). "For a TPO lender, the role of processor tends to be more of a consolidator role versus the retail processor," Stratmore reported. "Because the TPO lender is often receiving more complete files, the emphasis on productivity is diminished and may lead to a lower incidence of incentives." Processor incentive was primar - ily based on a per loan payout (65 percent), the report stated. Another 22 percent of the incen- tives were based on the achieve- ment of pre-defined objectives. "These objectives might include file quality, team per- formance, and customer satisfac- tion," Stratmore reported. "These drivers … indicate that lenders care about throughput and pro- ductivity, but also care about file quality, team performance and other lender specific objectives." Which State Capitals Are Most Livable? Austin, Texas comes in first, while Jackson, Missouri lands at the bottom of the list. T hough state capitals are recognized as the hub of law making and bureaucracy, many capitals are thriving and livable metropolitan centers. In Febru - ary, WalletHub composed a list of the best state capitols to live in based on affordability, economic well-being, quality of education and health, and quality of life. Quality of life is measured by fac - tors such as number of attractions, millennial newcomers, number of coffee shops and restaurants, traffic congestion, and walkability, among other factors. At the top of the overall list is Austin, Texas, which ranks nine out of 50 in affordability, second in economic well-being, seventh in quality of education and health, and 16th in quality of life. Following Austin in the top five overall rank - ing is Boise, Idaho; Bismarck, North Dakota; Lincoln, Nebraska; and Madison, Wisconsin. Jackson, Missouri comes in last in the overall ranking, at 37th in affordability, 49th in economic well-being, 47th in quality of education and health, and 49th in quality of life. Coming in as the most afford - able capital for housing is Jefferson City, Missouri, whereas Honolulu sits at the bottom of the affordable housing list. Six capitols tied for first in lowest unemployment rate; those capitals are Denver, Colorado; Honolulu, Hawaii; Boston; Helena, Montana; Lincoln, Nebraska; and Concord, New Hampshire. With the highest cost of living, Honolulu is the least affordable capital in the nation but also has the highest quality of life ranking. Juneau, Alaska has the highest median household income, which is adjusted for cost of living. Behind Juneau are Cheyenne, Wyoming; Bismarck, North Dakota; Austin, Texas; and Concord, New Hampshire. Speaking to WalletHub, Abraham Unger, associate profes - sor of government at Wagner College said, "The primary benefit of living in a state's capital city is that a state capital is always undergoing economic develop - ment, such as the construction of new government buildings. That kind of ongoing development often brings with it agglomeration of other support services such as hospitality and professional services." Unger said the top five indica - tors when evaluating state capitals to live in are, in order of impor- tance, crime rate, employment variation outside of government, rate of growth of current resi- dential development and of what kind, whether or not a competitive university is located there, and at- tractions and hospitality options. We invite all leaders in the mor tgage industr y to the second annual Five Star Institute Diversit y Symposium hosted on May 11 in Dallas, Texas. This will be a day-long event featuring keynote addresses, roundtable discussions, and panels covering topics in strategic and responsible lending, inclusive leadership, supply-chain diversit y, unconscious bias, and many more. For more information including registration, full agenda, and speaker line-up, visit Diversit or contact BREAKING DOWN BARRIERS. INFLUENCING AN INDUSTRY. MEMBERSHIP SPONSORS: MEDIA SPONSORS: PROPERTY SERVICES LUNCHEON SPONSORS: BREAKFAST SPONSOR SANDRA THOMPSON Deputy Director of the Division of Housing Mission and Goals Federal Housing Finance Agency DWIGHT ROBINSON SVP Human Resources and Chief Diversity Officer Freddie Mac Don't miss the opportunity to hear from the 2017 Five Star Diversity Symposium keynote speakers THE 2017 FIVE STAR DIVERSITY SYMPOSIUM MAY 11, 2017 | FAIRMONT HOTEL | DALLAS, TEXAS

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