Changes in the wind.

Author:Morse, Neil J.
Position:On the Road

MOTHER NATURE SERVED UP PERFECT late-fall weather for the final New England Mortgage Banking Conference (NEMBC) in Newport, Rhode Island, in mid-September. Balmy temperatures and sparkling sunshine bid farewell to the conference after its 13-year stint in Newport. Next year, NEMBC moves the meeting to Providence, Rhode Island, where a large convention center and ample hotel space will better accommodate the event's burgeoning attendance.

This year, on the trolley that linked the two hotels hosting exhibitors at the NEMBC, Rob Long, area sales manager for Saxon Mortgage Inc., took note of the growth and the attendant bittersweet nature of this year's continuing refinance boom. There's plenty of business to go around, Long said, but that also means an environment ripe for new brokers who don't know what they're doing." The "good" news, predicted Long, may be that with interest rates at 30-year lows, "there can't be another refi boom" for some time to come.

Also at NEMBC, Christopher Nobile, regional account manager for GMAC Bank--wholesale mortgage lending, Horsham, Pennsylvania, acknowledged the growing popularity of combination first-and-seco nd mortgages (so-called piggy-backs) that give borrowers a way around mortgage insurance. "The combos are big, especially now that more people know about MI [mortgage insurance] and want to avoid it," Nobile said. The increasing number of $400,000-plus homes has further fueled popularity of the combos, according to Nobile. "People are using [the seconds] to pay their down payments," he said.

Also at the NEMBC, Jim Bopp, account manager, Irwin Mortgage, Clifton Park, New York, was discussing a Department of Housing and Urban Development (HUD) proposal that would alter the Federal Housing Administration (FHA) 203(k) renovation assistance program. HUD wants to limit loan insurance to one-unit structures. It also seeks to cap the total rehabilitation costs it subsidizes at 20 percent of the FHA single-family mortgage limit for a one-unit structure in a "high-cost area." Bopp said the existing 203(k) program, which covers multifamily structures, is "the best product to accomplish the renovation or revitalization of a property and/or a neighborhood." A change would mean losing the ability to liquidate HUD real estate--owned (REO) properties and an inability to get some urban properties fixed up, according to Bopp.

To combat this loss of business, MI companies are offering more second-mortgage insurance "to...

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