Class Valuation has made an equity investment in and is partnering with InsideMaps, a technology company using computer vision to digitize the home. This partnership allows Class Valuation to develop solutions designed to meet the needs of the evolving mortgage industry.

[caption id="attachment_8871" align="alignleft" width="300"] Detwiler: InsideMap investment is latest step to modernize the appraisal business.[/caption]

InsideMaps’ technology generates 3D tours and models of the interior and exterior of homes and generates a detailed data set. Their intuitive and affordable solution can be deployed at scale and ensure consistent, high-quality results.

“We could not be more excited about partnering with Class Valuation," said George Bolanos, founder and CEO of InsideMaps. “Class Valuation's proven execution strength and entrepreneurial speed make them ideally suited to spark industry-wide adoption of this next generation home inspection process.”
Class Valuation plans to roll out the new technology in phases, with partners, to ensure it meets the needs of lenders, appraisers, providers and regulators.

“There are many benefits of having a digital rendering of the home as we modernize the appraisal process including, but not limited to, bringing consistency and credibility to the inspection of a property. Furthermore, it provides a lasting impression of the home at the time of inspection, which provides many downstream benefits--one of the most important being fraud prevention,” said Scot Rose, chief innovation officer at Class Valuation.

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The technology is designed to enhance the valuation process. “Appraisers can focus their efforts on observing and recording property data characteristics that impact loan eligibility or drive value. InsideMaps brings much needed structure and certainty to the inspection process,” said Julie Jones, senior vice president of valuation transformation and engagement at Class Appraiser. “Training for its use in the field is well underway, and Class is focused on recruiting appraisers to its Innovation Panel, comprised of early adopters that employ the technology to improve efficiencies and credibility. Our partnership with InsideMaps is an unparalleled opportunity to drive our industry forward.”

Even some traditional appraisal challenges were overcome fairly easily. For instance, through extensive field testing, Class found that appraisers using InsideMaps were able to schedule their appointments without consideration of harsh weather conditions and were able to avoid common nuisances, such as measuring around thorn bushes or clutter.

“We know our industry is on the brink of change within the valuation space, and it will take leaders in every category to bring about the future, said Mike Detwiler, CEO and partner of Class Valuation. “We are committed to being that driving force and see InsideMaps as just one way we will help the industry move towards sustainable, long-term modernization.”

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Mortgage applications increased 5.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending Feb. 22, 2019. This week’s results include an adjustment for the Washington's Birthday (Presidents’ Day) holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 5.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index decreased 3 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week. The seasonally adjusted Purchase Index increased 6 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 3 percent higher than the same week one year ago.

“Mortgage rates were little changed last week, but as we anticipated, homebuyers are responding favorably to this more stable rate environment,” said Mike Fratantoni, senior vice president and chief economist at the MBA. “Purchase applications for both conventional and government loans rose last week, with the government gain led by a 14 percent increase in applications for Veterans Affairs purchase loans. Refinance application volume increased as well, with the index reaching its highest level in a month. Borrowers with larger loans tend to be more responsive for a given drop in rates, and competition for these loans is fierce. Therefore, it was not surprising to see the average rate for a 30-year fixed jumbo loan drop to its lowest level since January 2018.”

The refinance share of mortgage activity decreased to 40.4 percent of total applications from 41.7 percent the previous week. The adjustable-rate mortgage share of activity decreased to 7.3 percent of total applications.

The FHA share of total applications remained unchanged from 10.2 percent the week prior. The Veterans Affairs share of applications increased to 10.7 percent, from 10.1 percent the week prior. The Department of Agriculture share of applications decreased to 0.6 percent from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.65 percent from 4.66 percent, with points remaining unchanged at 0.42 (including the origination fee) for 80 percent loan-to-value ratio loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) decreased to 4.40 percent from 4.56 percent, with points increasing to 0.29 from 0.23 (including the origination fee) for 80 percent loan-to-value ratio loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the Federal Housing Administration decreased to 4.64 percent from 4.68 percent, with points decreasing to 0.48 from 0.58 (including the origination fee) for 80 percent loan-to-value loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.00 percent from 4.04 percent, with points decreasing to 0.38 from 0.44 (including the origination fee) for 80 percent loan-to-value loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 adjustable rate mortgages decreased to 3.95 percent from 4.00 percent, with points increasing to 0.4 from 0.24 (including the origination fee) for 80 percent loan-to-value loans. The effective rate increased from last week.

Ocwen Financial Corp. reported a net loss of $70.8 million, or $0.53 per share, for the full year 2018 compared to a net loss of $128 million, or $1.01 per share, for the full year of 2017, a $57.2 million improvement.

For the three months ended Dec. 31, 2018, Ocwen reported a net loss of $2.3 million, or $0.02 per share.

“We made solid progress in the quarter as we work to realize the scale and cost savings benefits of combining Ocwen and PHH and position the Company for future profitability,” said Glen A. Messina, president and CEO of Ocwen. “We are focused on executing our key business initiatives in order to address our most critical near-term business challenges, improve our financial performance, and establish a stronger foundation for the future. We continue with our disciplined and prudent approach to our integration efforts and are encouraged by the overall progress we are making.”

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Pre-tax loss from continuing operations for the fourth quarter of 2018 was $7.8 million and included a PHH post- acquisition pre-tax loss of $31.5 million. Pre-tax results for the quarter were impacted by a number of significant items, including but not limited to: $64.0 million in bargain purchase gain, $16.4 million in PHH transaction, integration and restructuring costs and $10.1 million in expense related to significant litigation and regulatory settlements.

The Servicing segment recorded $40.6 million of pre-tax loss for the fourth quarter of 2018 and included a PHH post-acquisition pre-tax loss of $21.2 million. The business was negatively impacted by lower revenue from a smaller servicing portfolio due to portfolio runoff and de-boarding of previously announced subservicing clients as a result of terminations and transfers. For the full year 2018, the Servicing business recorded $31.9 million of pre-tax loss.

The lending segment recorded $3.0 million of pre-tax income for the fourth quarter of 2018. Our forward lending business incurred a $5.3 million pre-tax loss that included a PHH post-acquisition pre-tax loss of $2.4 million. Our reverse mortgage lending business recorded pre-tax income of $8.3 million.

The lending businesses were $5.1 million favorable to prior quarter largely driven by favorable valuation changes on our reverse mortgage lending portfolio as a result of falling interest rates. For the full year 2018, the lending business recorded pre-tax income of $11.2 million, an increase of $15.6 million versus 2017. The forward lending business had a pre-tax loss of $9.2 million, which was more than offset by $20.3 million of pre-tax income in our reverse mortgage lending business.

Additional Business Highlights

• In 2018, Ocwen completed 39,545 loan modifications to help struggling families stay in their homes, 17% of which included debt forgiveness totaling over $200 million.
• Delinquencies decreased from 7.8% at September 30, 2018 to 4.9% at December 31, 2018, primarily driven by acquisition of lower delinquency PHH portfolio and ongoing consumer assistance efforts.
• The constant pre-payment rate (“CPR”) decreased from 13.7% in the third quarter of 2018 to 12.9% in the fourth quarter of 2018. In the fourth quarter of 2018, the prime CPR was 14.8%, and the non-prime CPR was 11.8%.
• For the full year 2018, Ocwen originated forward and reverse mortgage loans with UPB of $0.9 billion and $0.6 billion, respectively. The Company intends to re-enter the correspondent forward lending channel and successfully launched a proprietary jumbo reverse mortgage pilot program.
• Our reverse mortgage portfolio ended the year with an estimated $68.1 million in discounted future gains from future draws on existing loans. Neither the anticipated future gains nor future funding liability are included in the company’s financial statements.