Yesterday Freddie Mac announced it's new CHOICEHome^SM program. This program is designed to bring conventional mortgage financing to factory-built homes to increase the availability of quality, affordable homes that borrowers want. It should increase borrower access to high-quality, affordable manufactured homes, while providing lenders with flexible financing options. CHOICEHome is available with Freddie Mac’s Home Possible^® low down payment mortgage.

“The current housing supply shortage makes it difficult for people to find a home in many markets,” said Danny Gardner, Senior Vice President, Affordable Lending and Access to Credit at Freddie Mac. “However, Freddie Mac operates in all housing markets at all times working with lenders big and small. More than 22 million families currently live in manufactured housing nationwide, and that number is expected to grow. CHOICEHome will help increase borrower access to quality, yet affordable homes in markets that have traditionally been underserved.”

If a factory-built home meets certain CHOICEHome specifications, it is granted CHOICEHome certification and is eligible for CHOICEHome financing. This means Freddie Mac lenders can use the same underwriting and collateral valuation flexibilities previously only afforded to site-built homes. In appraising these homes, Freddie Mac permits the use of site-built homes as comparable sales when there are no CHOICEHome sales available. Freddie Mac’s CHOICEHome offering is designed only for factory-built homes titled as real property, where the structure and land are owned by the borrower.

While we are on the topic of specialty loan programs offered by Freddie Mac, their GreenCHOICE Mortgage offering, which was rolled out in Q4 of 2018, has expanded it's current underwriting flexibilities. GreenCHOICE Mortgages enable Freddie Mac to better assess mortgage loan performance between homes with energy-efficient enhancements and includes broader financial options to help families with very low-, low- and moderate-incomes reduce home utility costs through energy-saving home repairs and improvements.

“Older homes, which are predominate in many areas of the country, tend to be less energy efficient thus raising the cost of homeownership because they can be more difficult or costly to maintain,” said Mike Dawson, Vice President of Single-Family Affordable Lending Strategy and Policy at Freddie Mac. “However, with energy-efficient home improvements, utility expenses typically decrease for the average homeowner.”

Intercontinental Exchange (ICE), the company that bought MERS last year and a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that it has entered into a definitive agreement to acquire Simplifile, LC. Simplifile operates one of the largest networks connecting the agents and jurisdictions that underpin residential mortgage records, serving as an electronic liaison between lenders, settlement agents, and county recording offices, streamlining the local recording of residential mortgage transactions.

As a pioneer in helping its customers submit electronic documents into the public record, the acquisition of Simplifile expands the ICE Mortgage Services portfolio, which includes MERS. Simplifile and MERS support the residential lending industry’s shift to digitization and will, together, help to make the mortgage closing process simpler, faster, and more transparent for a range of industry stakeholders.

[caption id="attachment_12124" align="alignleft" width="190"] Paul Clifford, Founder and President of Simplifile[/caption]

ICE will pay $335 million to acquire Simplifile, which is based in Provo, Utah and has no debt. The transaction is expected to close in the third quarter of this year, subject to the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. ICE does not expect the transaction to have any impact on its previously announced capital return plans. Upon closing, Simplifile, which has approximately 200 employees, will continue to be based in Provo and operate under the Simplifile name.

“Originators, consumers, and investors can obtain significant benefits and savings as the real estate process shifts from paper-based to digital transactions. Simplifile understood this trend early, uniquely solving for the critical aspect of submitting required documents into the public record in a seamless, auditable and transparent method,” said Chris McEntee, President of ICE Mortgage Services. “By connecting lenders, settlement agents, and counties through a robust network, Simplifile will enhance ICE’s efforts to further streamline a legacy process ripe for innovation,” McEntee added.

Simplifile was founded in 2000 with the goal of digitizing the closing process of the real estate industry. Starting with Utah County, it began the process of onboarding, one by one, all 3,594 mortgage recording jurisdictions in the U.S.  Simplifile today connects 1,922 counties in the United States, representing over 80 percent of the U.S. population. Leveraging its core eRecording product, Simplifile continues to introduce additional electronic solutions to serve the entire real estate transaction supply chain. The company has delivered a consistent history of revenue growth and has been profitable every year since its founding.

“We’ve seen how ICE has helped to transform markets going through an analog to digital conversion and has made them more transparent and efficient for all participants,” said Paul Clifford, Founder and President of Simplifile. “We are closely aligned with ICE’s vision as it applies to the residential mortgage industry and, as we become part of Intercontinental Exchange, our team at Simplifile will continue our efforts to simplify the industry for all of its stakeholders,” Clifford added.

As an indication of the increased pace of transformation of the mortgage industry, ICE and MERS announced earlier in April that the number of eNotes added to the MERS^® eRegistry during the first quarter of 2019 exceeded the total number of eNotes registered for all of 2018. An electronic note, or eNote, is the functional equivalent of a paper promissory note when created in conformity with eCommerce law requirements, and upon origination, is registered on the MERS^® eRegistry. Digital solutions such as the eNote are gaining traction and represent an important step towards a fully electronic mortgage.

Homestreet Inc (Nasdaq:HMST) announced it's quarterly earnings. The company, who recently made a decision sell most of its residential mortgage business to Penny Mac, New Residential Mortgage and  Homebridge Financial Services, had a net loss ( on both continued and discontinued operations) of $1.7M in Q1 2019  versus net income of $15.2M in Q4 2018.  Net income from continuing operations for the first quarter of 2019 was $5.1 million compared with $12.5 million for the fourth quarter of 2018 and net income from continuing operations of $1.8 million for the first quarter of 2018. Costs related to the selling of the Bank’s home loan center-based single family mortgage origination and servicing business and the related reduction in personnel added $9.6M to this quarter’s loss.

“During the past several months we have made significant progress toward achieving our long-term strategic goals,” said Mark K. Mason, HomeStreet's Chairman of the Board, President, and Chief Executive Officer. “We are executing a series of transactions that, when completed, will redefine our business. We executed an agreement to sell substantially all of our home loan centers and we sold $14.26 billion unpaid principal balance of related single family mortgage servicing rights. Negotiating and concurrently executing these transactions has been challenging, and I wish to thank our staff, partners, and advisors for their hard work.

“Our exit of the home loan center-based mortgage origination and related mortgage servicing business will significantly reduce the size and scope of HomeStreet’s single family mortgage banking business and substantially mitigate the impact of this cyclical and volatile earnings stream. Our remaining single family mortgage origination and servicing business will be much smaller, integrated with our regional commercial and consumer banking business, and will be reported within continuing operations. Going forward, originations will be sourced through our bank locations, online, and affinity relationships. We thank those employees who are part of these transactions for their tireless efforts and contributions to our success.

As for the multifamily lending business, at least one bidder is interested. Adam Sasouness, Managing Principal of Dwight Capital, sent a note to Homestreets Board of Directors saying “ I am writing on behalf of Dwight Capital to express our interest in acquiring a subset of HomeStreet’s multifamily mortgage lending business, which would consist of the Fannie Mae DUS lending operations and related mortgage servicing rights, at a premium to its fair market value.

Dwight is a private lender with a national footprint and with offices in New York City, Cleveland, St. Petersburg, and Washington, D.C. Dwight has consistently been a top-5 multifamily HUD lender by both transactions and dollar amount. Dwight also maintains mortgage servicing rights in excess of $3.25 billion”.