DocuSign CEO steps down as growth slows

DocuSign CEO steps down as growth slows
Dan Springer stepped down as CEO of DocuSign on Tuesday amid slowing growth, widening losses and a flagging share price.

Maggie Wilderotter, who chairs the company’s board, will serve as interim CEO as Springer “has agreed to step aside,” effective immediately, the company said in a release Tuesday. 

While DocuSign didn’t provide reasons for Springer’s departure, the announcement comes as the company struggles to perform as it did during the pandemic when consumers shifted to online transactions and deals. 

The company’s electronic signature software became a go-to product for millions of real estate agents, mortgage professionals and title agents who couldn’t attend closings during the pandemic.

Since taking on the role of chief executive in 2017, Springer took the company public in 2018. The firm priced its initial public offering at $29 per share and was valued at $4.41 billion at the time of the IPO. DocuSign’s share price closed at $59.55 on Tuesday, dropping 62% from $97.46 on January 1. 

The firm’s announcement comes less than two weeks after DocuSign reported mixed first-quarter earnings. DocuSign reported revenue of $588.7 million and earned 38 cents a share. Revenue topped analysts’ expectations of $581.9 million but fell well below analysts’ expectations of earnings of 46 cents a share.

The company’s net loss widened to $27.4 million from $8.3 million in the same period last year, sending shares to drop more than 20% to around $67.75 after market close on the day it announced first-quarter earnings.

DocuSign expects the second-quarter revenue to range between $600 million and $604 million, whereas analysts had previously projected $603.4 million.

Last month, the firm expanded a partnership agreement with Microsoft, which will integrate DocuSign technology with Microsoft’s products and services. 

DocuSign was a HousingWire Tech 100 winner in 2020.
The post DocuSign CEO steps down as growth slows appeared first on HousingWire.
Source: https://www.housingwire.com/rss

Purchase mortgage apps defy surging rates

Purchase mortgage apps defy surging rates
Despite mortgage rates reaching the highest level in 14 years, mortgage applications increased 4.2% from the prior week, according to the latest Mortgage Bankers Association (MBA) survey for the week ending June 17.

“Mortgage rates continued to surge last week, with the 30-year fixed mortgage rate jumping 33 basis points to 5.98% – the highest since November 2008 and the largest single-week increase since 2009,” Joel Kan, associate vice president of economic and industry forecasting for the trade group, said in a statement. 

Rates for mortgage loans were strongly impacted by tightening monetary policy to combat rising inflation. On June 10, the U.S. Consumer Price Index showed an 8.6% increase year-over-year in May, the highest level in four decades. Consequently, the Federal Reserve raised the federal funds rate by 75 basis points last week, a rate hike not seen since 1994. Another 0.75% hike is expected from the Fed’s meeting in July.

With mortgage rates now at almost double what they were a year ago, refinancing applications decreased 3% from the prior week and were 77% lower than the same week in 2021. Refis were 29.7% of total applications last week, decreasing from 31.7% the previous week, the survey shows.

Meanwhile, the seasonally adjusted purchase index ticked up 8% from the prior week but was 9.4% down from the same week a year ago. According to Kan, purchase applications increased for the second straight week, driven mainly by conventional applications. 

Higher rates usually cool off prices, and Kan noted a potential trend in this week’s data. “The average loan size, at just over $420,000, is well below its $460,000 peak earlier this year and is potentially a sign that home price growth is moderating,” the economist said. 

The adjustable-rate mortgages (ARM) share of applications jumped to over 10.6%, demonstrating continued popularity among borrowers. The average interest rate for a 5/1 ARM rose to 4.78% from 4.57% a week prior, according to the MBA

The FHA share of total applications increased to 12% from 11.8% the week prior. Meanwhile, the VA share went from 11.7% to 10.7%. The USDA share of total applications declined to 0.5% from 0.6% the week prior. 

The trade group estimates the average contract 30-year fixed-rate mortgage for conforming loans ($647,200 or less) increased to 5.98%, from 5.65% the previous week. For jumbo mortgage loans (greater than $647,200), it went to 5.49% from 3.25%.
The post Purchase mortgage apps defy surging rates appeared first on HousingWire.
Source: https://www.housingwire.com/rss

Opinion: Title insurance is vital to protecting the American dream

Opinion: Title insurance is vital to protecting the American dream
As someone who spent a career in the title insurance industry – both as a builder of a title business and leader of the industry’s trade group, — I am proud of the role we play in helping to protect what most Americans consider the biggest purchase of their lives.

Title insurance is imperative for lenders to ensure the borrower has ownership rights to a property, but it doesn’t just protect against problems affecting title. It plays an essential role in the economics of homeownership, ensuring that credit reaches those who need it and providing safeguards to those who lend it. The capital markets depend on the due diligence, transparency, and protection our industry provides to do its job.

In fact, our industry is so important that throughout the COVID-19 pandemic, title insurance professionals were deemed essential by the federal government. Their hard work kept a major part of the economy running during a challenging time when purchasing a home meant more than ever.

During this same time, our industry helped consumers take advantage of low interest rates to refinance mortgages. In a refinancing, homeowners obtain a new loan and lenders require a new title search and a title insurance policy on that loan to protect their investment. Professionals conduct the search and examine documents, with title companies regularly providing a discount, or “reissue rate” on a refinance.

Discounts also may be available if using the same lender that issued the original loan. And because the home’s ownership remains unchanged, a homeowners’ title insurance “Owner’s Policy” is valid through refinance.

Why is a title search necessary for refinancing? In short, even if someone recently refinanced, problems could have arisen that the lender must know about before approving a new loan. For instance, a homeowner may have incurred a lien from a contractor who claims they weren’t paid. Or a homeowner might have a judgment on their house due to unpaid taxes, homeowner association dues, or child support. The borrower also may have encumbered the property with loans that were not disclosed when applying for refinancing.

There are other issues that can arise between origination and refinancing:

Easements that were created by contract or through use or adverse prescription (e.g., rights of way for utilities, rights acquired by neighbors because of a fence encroachment);Building or use restrictions contained in a recorded plat, agreements, or deeds;Rights or claims arising out of bankruptcy;In certain states, unpaid parking tickets;Deeds recorded between parties that now do not reflect the ownership; orFraudulent documents recorded against the property.

Real estate is a $3 trillion industry in the United States. There has been a great deal of innovation around purchasing homes, making credit available, and closing real estate transactions. This innovation is positive for consumers. However, sometimes innovators can misrepresent products or sow confusion. They point to low claims ratios as evidence that title insurance is unnecessary. Not only is this not true, but it is a fundamental misunderstanding of what title professionals do and how our underwriting protects this work.

Low claims ratios are a testament to the work our agents do to eliminate items prior to closing. It is this work that keeps the cost of our insurance low and protects the homeowner and lender from problems that would arise if not for the work we do in advance of closing — problems that could be detrimental to the homeowner’s credit and the lender’s investment.

While this is clear to active industry participants, it may not seem intuitive to homeowners who are purchasing or refinancing for the first time. That is why we take pains to explain the process. Through the American Land Title Association and state associations, the industry continues to develop new tools to help consumers understand the role title insurance plays in the closing, the benefits of title insurance and how to shop for title insurance. The best resource for consumers is ALTA’s comprehensive home closing website, homeclosing101.org.

The work title professionals do every day is critical to protecting the American dream. And the work our industry does to make the closing process faster and easier is a critical part of the overall economy. All participants in this economy should engage in good faith conversations — with facts and data — to improve our industry’s offerings.

As the economy and housing market begins to slow, we must avoid the temptation to move away from well-regulated products that are a key part of protecting lenders and homeowners. The last housing crisis proved that strong underwriting standards are critical, especially during market downturns. But it is never the right time to take new and unknown risks that ultimately will increase the cost and be a detriment to consumers and lenders.

Mary O’Donnell is CEO of Westcor Land Title Insurance Co. and a past president of the American Land Title Association.

This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

To contact the author of this story:Mary O’Donnell at modonnell@wltic.com

To contact the editor responsible for this story:Sarah Wheeler at sarah@hwmedia.com
The post Opinion: Title insurance is vital to protecting the American dream appeared first on HousingWire.
Source: https://www.housingwire.com/rss

Forbearance rate continued to drop in May

Forbearance rate continued to drop in May
Fewer homeowners paused or reduced their mortgage payments in May, continuing the decline from April when the total number of loans in forbearance fell to a level below 1% of servicers’ portfolio volume.

The share of loans in forbearance dropped by 9 basis points to 0.85% in May from April’s 0.94%, according to the Mortgage Bankers Association (MBA).

The largest decline came from the portfolio loans and private-label securities (PLS) category, declining 29 basis points to 1.86%. Ginnie Mae loans in forbearance fell 4 basis points to 1.25% of the servicers’ total portfolio volume. Fannie Mae and Freddie Mac loans dropped 5 basis points to 0.38%. 

At the end of May, 425,000 homeowners were in forbearance plans.

The pace of monthly forbearance exits in May reached a new survey low since June 2020, when the association first started tracking exits.

“Most borrowers exiting forbearance are moving into either a loan modification, payment deferral, or a combination of the two workout options,” said Marina Walsh, vice president of industry analysis at the MBA.  

Mortgage servicers: If you’re not obsessed with customer service, you’re falling behind

In a world where disparate physical spaces are steadily merging in the central hubs of mobile devices, consumers consider their mortgages one more digital service in need of perfecting. To take full advantage of the current market conditions, lenders and servicers must obsess over customer service. 

Presented by: TMS

Exits represented 0.19% of servicing portfolio volume in May and total forbearance requests represented 0.1%. The survey shows 28.2% of total loans in forbearance were in the initial plan stage last month and 58.6% were in a forbearance extension. The remaining 13.2% represented forbearance re-entries. 

During the past 22 months, 29.4% of exits resulted in a loan deferral or partial claim, the MBA data shows. Less than 19% of borrowers continued to make their monthly payments during their forbearance period. About 17% of borrowers did not make their monthly payments and exited forbearance without a loss mitigation plan. 

The overall servicing portfolio performance that is not delinquent or in foreclosure, posted 95.85% in May, 21 basis points higher than April’s 95.64%. 

While it’s a positive sign to see improvement in shares of loans serviced, Walsh said it is worth monitoring if the rapid increase in interest rates for all loans “complicates post-forbearance workout options and puts additional pressure on borrowers in existing post-forbearance workouts.”
The post Forbearance rate continued to drop in May appeared first on HousingWire.
Source: https://www.housingwire.com/rss

CFPB to review QM rule

CFPB to review QM rule
CFPB Director Rohit Chopra

The Consumer Financial Protection Bureau (CFPB) said Friday it would take a “fresh look” at a rule that decides what mortgages are protected from some litigation during foreclosures.

The agency, in a blog post, said it would conduct a review of its Qualified Mortgage (QM) rule. The rule, under the federal Truth In Lending Act, sets standards mortgages must meet in order to have a safe harbor from improper underwriting counterclaims during a foreclosure. The move by the CFPB is part of a larger review of rules the agency says warrant scrutiny because they were inherited from other agencies, published in the first decade of the agency, or have been tested in the market for several years.

The QM rule, which finished a lengthy rulemaking process in 2020 and has yet to be fully implemented, does not fit into those categories, said Bryan Schneider, a partner at Manatt who previously led the CFPB’s ​​supervision, enforcement and fair lending division.

“It’s fair to say we’re going to be reviewing rules inherited from other agencies, or rules where there is in fact a lot of marketplace experience,” said Schneider. “But this particular rule doesn’t fit into that rubric very well, and instead leads to greater confusion.”

The revised rule removed the old rule’s 43% debt to income ratio limit, replacing it with price-based thresholds. The revised standard stated that a mortgage meets the “ability to repay” standard if the annual percentage rate does not greatly exceed the average prime offer rate for a similar loan. It also made higher pricing thresholds for loans with smaller amounts, and established more “flexible options” for lenders to verify the income or assets beyond the value of the property and the customer’s debts. The revised rule also allowed some loans that met certain performance requirements over a three-year seasoning period to gain QM status as seasoned loans.

The conclusion of an arduous rulemaking process, and the mortgage industry’s strong opposition to revisiting it, has not deterred the CFPB.

It’s not clear if the CFPB will solicit feedback from the public during its review, or if it will initiate a new rulemaking, a process that could take a year to 18 months.

A CFPB spokesperson declined to comment. 

In its bulletin, the CFPB said that it is undertaking the review to “explore ways to spur streamlined modification and refinancing in the mortgage market.” But it’s the “seasoning” provisions that the CFPB said it will be paying particular attention to.

The new seasoning provision has yet to kick in for a single mortgage loan, since less than 36 months have passed since the CFPB issued its final rule, in December 2021. But at least one current CFPB official publicly expressed misgivings about the seasoning provision from the start.

Diane Thompson, senior advisor for markets and regulations at the CFPB, has previously raised concerns about the QM rule’s “seasoning” provision. Thompson, in a series of tweets just months before the Biden administration appointed her to the consumer watchdog, railed against the CFPB’s new QM rule.

“@cfpb’s pricing proposal would say loans like theirs were absolutely, unquestionably safe, affordable, responsible loans,” wrote Thompson. “News flash: They’re not.”

For a time, mortgages could achieve qualified mortgage status — even if they exceeded the 43% debt to income threshold — as long as the GSEs’ underwriting platforms accepted them.

But in July 2021, Fannie Mae and Freddie Mac stopped extending QM status to loans that didn’t meet the new QM rule standards. Officially, however, lenders don’t have to comply with the CFPB’s revised rule until October.

Kris Kully, a partner at law firm Mayer Brown who specializes in federal and state regulatory compliance, said that the mortgage industry “might wish for more transparency” from the CFPB.

“We haven’t seen a lot of that,” said Kully. “Instead we’re left to wonder what [CFPB Director Rohit Chopra] is thinking.”

Maria Volkova contributed reporting.
The post CFPB to review QM rule appeared first on HousingWire.
Source: https://www.housingwire.com/rss

Title companies to merge after HomeServices acquisition

Title companies to merge after HomeServices acquisition
HomeServices of America, a Berkshire Hathaway affiliate, acquired real estate company Berkshire Hathaway HomeServices New Jersey Properties as well as its affiliate title company, Associated Title Agency. Associated Title will merge with Trident Land Transfer Co., affiliated title company of Berkshire Hathaway HomeServices Fox & Roach Realtors. Read on for more about the acquisitions.
Source: thetitlereport.com

HomeLight to acquire Accept.inc

HomeLight to acquire Accept.inc
HomeLight entered an agreement to acquire fintech lender Accept.inc, which offers homebuyers a way to submit all-cash offers in an all-stock transaction. HomeLight also raised $115 million in additional capital. Read on for more.
Source: thetitlereport.com

USA National Title adds DataTrace platform

USA National Title adds DataTrace platform
USA National Title Co. selected Data Trace Information Services LLC’s TitleIQ Enterprise as its primary title production platform. USA National Title expects the platform could reduce its production time by 50 percent. Read on for more.
Source: thetitlereport.com