NMA is a Russian organization dedicated to developing common principles of the mortgage market's activities and coordinating those activities.

"The U.S. real estate finance system is very efficient and greatly contributes to the strength of this country's economy," said MBA President and CEO Jonathan Kempner. "We hope to share with the NMA those best practices and strategies that will help enhance their mortgage system thus creating the same homeownership opportunities for Russian citizens that Americans enjoy today."

The MOC was signed as part of a day-long summit on the Russian banking system hosted by the U.S.-Russia Business Council, the Association of Russian Banks and the Embassy of the Russian Federation.

In the MOC, MBA and NMA will provide guidance on developing standards for mortgage financing and implementing mortgage programs and projects in Russia and offer counsel on successful legislative and regulatory systems to support a healthy national mortgage system. Hosting joint international conferences dedicated to housing finance and construction, and a visit from a delegation of American mortgage experts to Russia and a Russian delegation to the U.S. is also in the MOC.

“We are very pleased to be a part of the U.S.-Russia Banking Conference and to explore business opportunities for MBA members,” said Paul Green, MBA's senior vice president of corporate relations. “With the MOC, we believe there is a potential to create value [in Russia] for our membership.”

MBA Chief Economist Doug Duncan spoke at the U.S.-Russia Banking Conference on basic fundamental principles of the U.S. mortgage market. He said the mortgage system is not perfect but it is efficient.

“[The fundamentals] are not indebted to any cultural or historical setting. In other words, it does not mean that the United States has the best of all principles in its loan market. In fact, ours is still developing, as are many others,” Duncan said. “[The U.S. mortgage market] is dynamic, not static.”

Some of the principles included property rights, monetary policy, economic growth and risk assessment tools as elements to have a secondary market provide capital. Capital access, risk sharing and transaction costs also help expand the U.S. mortgage system. “None of these are unique to the U.S. system but, in fact, they may apply to any system,” Duncan said. “They are basic principles that we see as efficient fundamentals of an efficient housing value system.” 

Roderick Mulcahy, principal at RCF Capital Partners, LLC, New York predicted a large number of financial institutions entering the Russian real estate market in the next three to five years. He said there is opportunity in Russia for both commercial and residential real estate finance while quoting yields of 10 percent to 14 percent on major buildings and some yields of more than 30 percent. “Yields in Russia and Moscow are very attractive,” Mulcahy said. “There is clearly a lot of momentum. The yields are there and we are very bullish.”

“To reduce vulnerability and increase investment and growth rates, the economy needs greater economic diversification,” said Randal Quarles, assistant secretary for international affairs at the U.S. Treasury Department. “A sound, competitive, and private financial sector open to foreign participation is the most efficient means for reallocating natural resource profits and household savings to the most productive uses outside of the oil sector.”

“None of these are unique to the U.S. system but, in fact, they may apply to any system,” Duncan said. “They are basic principles that we see as efficient fundamentals of an efficient housing value system.” 

Duncan noted that in the past five years, availability of roughly $700 billion or more in home equity from the housing system spurred consumer demand and economic growth.

“Economic growth feeds both supply and demand,” Duncan said. “The stronger, more stable and more durable economic growth, the more [economies] will see a growth on the demand side as household incomes increase and as confidence grows among builders in  supply. The result is household wealth growth because there can be movement among existing properties as households move up the economic chain from different kinds of property valuations.”

“Economic research has found that an open financial sector is associated with increased lending to small- and medium-sized enterprises, with the larger foreign presence associated with better access to credit,” Quarles said.

Duncan’s second order of importance in fundamentals, includes capital access, risk sharing and transaction costs. “We have gone in the United States from a depository funded mechanism twenty years ago to a capital markets funded mechanism today with much broader access through much lower cost capital by making that transition,” Duncan said. “But we are not done with that transition.”
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The Los Angeles Neighborhood Housing Service (LANHS), ACORN Housing, Hyde Park Organizational Partnership for Empowerment (HOPE) and the National Association of Hispanic Real Estate Professionals (NAHREP) are collaborating with Freddie Mac in this campaign.

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TRUSTe, San Francisco, and Ernst & Young LLP, New York, released a guide titled, "How Not To Look Like a Phish" to help businesses communicate with their customers to minimize the risks associated with phishing attacks.

  The top recommendations from the guide include the following practices:
• Eliminate using instant message and e-mail to collect information, unless the customer initiates the contact.
• 2) Never use an urgent, threatening, or time-sensitive tone.
• 3) Explicitly spell out Web site links and keep the links as straightforward and descriptive as possible. Do not hypertext words like "click here" that are commonly used to mask false Web site addresses.
• 4) Personalize customer e-mail with non-threatening personal data like a first name so recipients know that the e-mail is coming from a company that knows them.
• 5) Direct customers to respond via your main home page as much as possible.
• 6) Protect your name by checking for unauthorized Web sites that use variations of your company name.
• 7) Authenticate your Web sites using digital certificates.
• 8) Be clear in communicating your anti-phishing strategy to customers.

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The First American Corp. Santa Ana, Calif., acquired Philadelphia-based Experian Real Estate Services (RES), formerly CBA Information Services. The acquisition closed March 30, for an undisclosed purchase price.

Experian RES, which has nearly 90 employees, will be organized as a subsidiary of First American CREDCO. Walt Wojciechowski, the current senior vice president will continue to manage the company as senior vice president, reporting directly to Kathy Manzione, president of First American CREDCO Mortgage. In March, The First American Corp. announced its intent to sell its Credit Information Group (CIG) to its majority-owned subsidiary, First Advantage Corp.

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The Electronic Payments Network (EPN), the New York–based ACH payments business of The Clearing House Payments Co., announced that Fiserv BANKLINK, Brookfield, Wis., adopted EPN STP 820 to facilitate straight through processing for business-to-business payments.

BANKLINK adopted EPN STP 820 for its iLINK product, a suite of Web-based cash management products for financial institutions and their corporate customers. iLINK allows institutions to provide a full suite of payments capability including remote deposit, controlled disbursements, wire transfer, ACH origination, internal transfer, cash concentration, check management, stop payment initiation, imaging and loan reporting.
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The company has established alliances with regional developers in those cities and has agreed to acquire existing centers that mirror Interactive's formula. Interactive Offices Worldwide operates in the serviced office industry (business centre owner) in Canada and the United States, and currently owns 28 business centers.

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After falling to their lowest level in the past 10 years during 2003, vacancies in retail properties along central New Jersey's four largest shopping corridors edged up to 4.1 percent in 2004, according to R.J. Brunelli & Co., Inc., Old Bridge, N.J.

Last year's performance was still the region's second best showing over the past 10 years, trailing only the 3.8 percent rate posted during 2003, and less than half of the 9.3 percent and 9.0 percent rates set in 1997 and 1996, respectively.

As reported by the firm in a separate survey, vacancies along six major corridors in northern New Jersey slipped to 2.8 percent in 2004 from 3.2 percent in 2003.

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Best Practices LLC found the tools global companies are using to train, budget and benchmark the practices of their operations and maintenance employees. The report, "Optimizing Plant Operations and Maintenance Staffing, Roles and Budget," includes study results on best practices in training.

The study found:

· Of the five top manufacturing and energy companies surveyed, three of them did not require any yearly training of their maintenance and operations personnel. However, one of participants required 180 hours of corporate training per year of its employees.

· To avoid monotony, some companies offered centralized training at a new plant every year, where the "host plant" is given flexibility on the training content.

· Scorecards are used extensively to measure success of the training, often with metrics analyzing bottom line costs. At one of the companies surveyed, maintenance was tracked on six activities and five indicators. Indicators include "Downtime Minutes Per Failure" which this company targets at 15 minutes, and "Maintenance Costs" which this company targets at $12 per ton of input.
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MMCC arranged $7.2 million of financing on the Bayview Apartments, a 108-unit apartment building constructed in 1985 and located in Wilmington, Calif. “The refinancing of the variable-rate bridge acquisition debt provided the owners with a cash out on an investment they purchased 11 months ago,” said Rick Judge of the Newport Beach, Calif. office who arranged the financing. The property was refinanced by a private investor through a Fannie Mae lender at a 75 percent loan-to-value ratio, with a 5.10 percent interest rate. The loan is fixed for three years with a 30-year amortization.

Peter Dewes of MMCC’s Fort Lauderdale office arranged $3.5 million of financing on Rockledge Villas, a 93-unit apartment building located in Rockledge, Fla. The financing was provided through a commercial bank at a 75 percent loan-to-value ratio, with a 3.67 percent interest rate. The loan is adjustable for 30 years with a 30-year amortization. Rockledge Villas was also refinanced by a private investor.

The property is in a secluded setting overlooking the Rockledge Golf and Country Club. The property consists of four one-bedroom/one-bath units, 34 one-bedroom/one-bath units, 47 two-bedroom/one-bath units and seven three-bedroom/two-bath units.

An undisclosed conduit lender provided financing on a 2004 constructed, single-tenant net-lease Walgreens in Memphis, Tenn. The loan had a 65 percent loan-to-value ratio, with a 5.51 percent interest rate at a fixed rate for 10 years with a 30-year amortization. The property was purchased by AFT Poplar Massey, LLC and the financing was arranged through Greg Miskovsky of MMCC's Phoenix office.
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The intent in asking these questions, which registrants can freely decline to answer, is to track personal diversity information about individual members so that MBA can more accurately measure their success in achieving the strategic goal of increasing diversity in its leadership.

MBA and its 2,900 member companies are committed to expanding the pool of well-rounded and diverse professionals in the real estate finance industry. “Diversity strengthens MBA, strengthens our companies and strengthens our industry as we continue to reach out to our increasingly diverse customers,” said MBA President and CEO Jonathan Kempner.

Kempner noted that MBA specifically benefits when its leaders represent the full breadth of the markets and the richness of society and that the association’s leaders need to fully reflect the social, geographic, gender and racial/ethnic mix that is evident in our local communities.

Yet, diversity does not happen accidentally—it must be intentionally fostered. Accordingly, when MBA adopted its 2005-2007 Strategic Operating Plan, it sought to increase racial, gender and ethnic diversity in MBA’s leadership and to support and promote diversity within member companies.

As you register for meetings and conferences with MBA in the future, you can choose to either answer or decline to answer these questions. If you are not expecting to register for any conferences or meetings in the near future but would like to help MBA collect this information, you can also go to the “My MBA” website at http://mymba.mortgagebankers.org/login.aspx and answer a similar set of questions.

The use of the information MBA collects in this process will be restricted to the association. No personal information will be provided to any external organization. 

(Sheryl Pardo is a director in MBA’s Government Affairs Department. She can be reached at 202/557-2809 or at spardo@mortgagebankers.org.)
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Network with lenders and gain knowledge of how they make these programs work. The conference will feature key updates on the following issues:

• Government housing and specialty product programs
• Credit and appraisal policies
• Endorsement and complianceissues

Speakers include Keith Pedigo, director of the Loan Guaranty Service at the VA; Russell Davis, administrator of the Rural Housing Service; and an official from the Federal Housing Administration to be determined.

Breakout sessions on June 2 examine Credit Policy/Underwriting; Selling Government Housing Finance Products; Getting Your Loans Endorsed or Guaranteed; FHA and VA Appraisal Issues; and a discussion with FHA’s Homeownership Center Directors, featuring panelists Ron Bailey of the Denver Homeownership Center; Joe Bates of the Santa Ana Homeownership Center; Charles Gardner of the Atlanta Homeownership Center and Engram Lloyd of the Philadelphia Homeownership Center. Tim Doyle, a director with MBA’s Government Affairs office, will moderate this session.

On June 3, breakout sessions discuss Managing Audits and Avoiding Indemnifications; Using Neighborhood Watch/Avoiding Credit Watch; and Specialty Product Sessions on Renovation Lending, Reverse Mortgages (HECMs) and Section 502 Guaranteed Housing Products.

The conference takes place at the Capital Hilton, 16th & K Streets, Washington, D.C. 20036. Program registrants are responsible for making their own hotel reservations by calling 1-800-HILTONS or 202/393-1000. Conference room rates start at $169 for single or double per night. The hotel cut-off date is May 2. MBA has also arranged airfare and car rental discounts.

For more information, go to the Conference Web Site at http://events.mortgagebankers.org/fha2005/default.html.
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For more information, please contact Renee Rappaport at (202) 557-2758 (rrappaport@mortgagebankers.org).
 
SEC Holds Roundtable on Reporting Internal Controls
On April 13, MBA member Rob Miles, controller at Washington Mutual, was one of 54 panelists who addressed questions posed by the Securities and Exchange Commission (SEC) during a daylong roundtable meeting on the benefits and costs of the internal control reporting requirement imposed by Section 404 of the 2002 Sarbanes-Oxley Act. 
 
The panelists, who appeared on a succession of six panels throughout the day, represented a cross-section of audit committee members, auditors, public policy officials, corporate financial managers, academics, investors and others with knowledge of the impact Section 404 is having on businesses and the economy. Participants included the Comptroller General of the U.S., the CEO of the New York Stock Exchange and members of the audit committees of Microsoft, Coca-Cola, Dow Chemical and several other Fortune 500 companies. The resounding message delivered by the majority of the panelists was that the costs of implementing Section 404 have far outweighed the benefits to companies and their investors.
 
The observations and recommendations made in MBA's February 25 letter to the SEC were repeated by a variety of individuals, including some investor representatives. MBA was the first trade association to send a letter to the SEC regarding the high costs of Section 404, and MBA's letter was the 14th of 150 the SEC received to date.
 
MBA will continue to urge the regulators at the SEC and the Public Company Accounting Oversight Board (PCAOB) to take action to address the need for a reduction in the costs of reporting on internal control. Toward this end, a meeting among MBA and PCAOB representatives is scheduled for late May. 
 
For more information, please contact Alison Utermohlen at (202) 557-2864 (autermohlen@mortgagebankers.org).
 
FHA Publishes Up-Front Mortgage Insurance Premium Remittance Rule
On April 13, FHA published the Schedule for Submission of One-Time and Up-Front Mortgage Insurance Premiums; Final Rule in the Federal Register.
 
The rule provides for a 10-calendar-day remittance period from the date of closing or disbursement, whichever is later, before it is considered late. The rule also sets a six-month implementation period to give lenders time to change their systems. The new 10-day remittance period will be implemented October 11.
 
The rule is consistent with MBA's October 11, 2002 request for a seven-business-day remittance period. MBA has also advocated that FHA give greater lead time in implementing changes that affects systems.
 
For more information, please contact Tim Doyle at (202) 557-2860 (tdoyle@mortgagebankers.org).
 
MBA Member Group Drafts TBA ARM Standards for Discussion
In a conference call last week, MBA members completed a lender side review of parameters for a TBA ARM product. With GSE ARMs assuming a more prominent portion of agency MBS volume, the tremendous upside potential prompted the current project, which reprises earlier attempts to define a TBA ARM. A committee of dealers under the joint auspices of MBA and The Bond Market Association will discuss the parameters at a later date.
 
For more information, please contact Kathy Gibbons at (202) 557-2870 (kgibbons@mortgagebankers.org).
 
MBA Convenes Meeting to Bridge Mismatch in Government ARM Caps
MBA held a conference call on April 14 to discuss options regarding a mismatch in Government ARM caps. Currently, FHA has implemented viable caps (6/2/2) for its 5-year+ hybrid ARMs. However, the VA ARM program (6/2/1) is not compatible for pooling in the same Ginnie Mae pools.
 
During the call, MBA brought together representatives of Ginnie Mae, FHA, VA, and members of the Loan Production and Secondary and Capital Markets Committees to discuss the options available for changing the VA caps, which will require a statutory amendment, and how to handle the government ARM product in the interim. 
 
For more information, please contact Tim Doyle at (202) 557-2860 (tdoyle@mortgagebankers.org) or Kathy Gibbons at (202) 557-2870 (kgibbons@mortgagebankers.org).
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The Mortgage Bankers Association’s 2005 National Policy Conference begins this Tuesday, April 19, at the Mayflower Hotel in Washington, D.C.

Featured speakers include:

• Michael Petrie, CMB, Chairman of MBA and President of P/R Mortgage and Investment Corp., Carmel, Ind.
• Rep. Barney Frank, D-Mass., ranking Democrat on the House Financial Services Committee;
• Sen. John Kerry, D-Mass., who ran as the Democratic Presidential nominee in 2004;
• Sen. Chuck Hagel, R-Neb., Chairman of the Senate Banking Securities and Investment Subcommittee;
• John Snow, secretary of the U.S. Department of the Treasury;
• Steven Bernstein, senior advisor in the Treasury Department’s Office of International Affairs;
• John Courson, president and CEO of Central Pacific Mortgage Co., Folsom, Calif., and chairman of the board of the California Housing Finance Agency;
• Alphonso Jackson, HUD secretary;
• Sen. Evan Bayh, D-Ind., member of the Senate Banking Committee;
• Jonathan Kempner, president and CEO of MBA;
• Tom Jones, vice president of Habitat for Humanity International and managing director of the Washington D.C. Office of Habitat for Humanity International;
• Regina Lowrie, MBA chairwoman-elect and president and CEO of Gateway Funding Diversified Mortgage Services, Horsham, Pa;
• Ann Coulter, legal reporter for Human Events; and author of High Crimes and Misdemeanors: The Case Against Bill Clinton and Treason: Liberal Treachery from the Cold War to the War on Terrorism; and
• Donna Brazile, chair of the Democratic National Committee's Voting Rights Institute, an adjunct professor at Georgetown University and author of Cooking with Grease: Stirring the Pots in American Politics.

Additionally, MORPAC, MBA’s political action committee, will hold several events as part of the conference.

For those of you who cannot attend, MBA NewsLink will provide complete coverage. For more information on the conference visit: http://events.mortgagebankers.org/npc2005/default.html

Meanwhile Petrie will also testify at a Senate Banking Committee hearing on Tuesday, April 19 on "Proposals for Improving the Regulation of the Housing Government Sponsored Enterprises (GSE)." Petrie will appear on an industrial panel on behalf of MBA. The hearing begins at 3:00 p.m. EDT in room 538 of the Dirksen Senate Office Building.

The next day, April 20, the Banking Committee holds another GSE hearing, with testimony expected from Daniel Mudd, interim CEO of Fannie Mae; Richard Syron, chairman and CEO of Freddie Mac; and Ray Christman, president of the Federal Home Loan Bank of Atlanta on behalf of the Council of Federal Home Loan Banks. The hearing begins at 10:00 a.m. EDT in 538 Dirksen.

No let-up the next day; the Senate Banking Committee returns to GSE reform on Thursday, April 21 with a hearing on “Regulatory Reform of the Housing Government-Sponsored Enterprises.” Among those scheduled to testify are Armando Falcon Jr., outgoing director of the Office of Federal Housing Enterprise Oversight; Ronald Rosenfeld, chairman of the Federal Housing Finance Board; David Walker, comptroller general of the U.S.; and Douglas Holtz-Eakin, director of the Congressional Budget Office.

That hearing begins at 10:00 a.m. EDT in 538 Dirksen.

The House Financial Services Committee holds two hearings of interest this week. On April 19, Treasury Secretary John Snow leaves MBA’s National Policy Conference to testify before the full committee on “The State of the International Financial System." That hearing begins at 3:00 p.m. EDT in room 2128 of the Rayburn House Office Building.

On April 21, the committee holds a hearing on “The Impact of the Sarbanes-Oxley Act.” MBA is expected to provide written testimony at this hearing, which begins at 10:00 a.m. EDT in 2128 Rayburn.

Senate hearings can be heard live over the Internet at www.capitolhearings.org. House Financial Services Committee hearings can be viewed live over the Internet at www.financialservices.house.gov.

Upcoming Reports/Events:

April 18 : NAHB/Wells Fargo Housing Market Index
April 19-20: MBA National Policy Conference, Washington, D.C.
April 19: New Residential Construction, Commerce Department
April 19: Producer Price Index, Labor Department
April 20: MBA Weekly Application Survey
April 20: Consumer Price Index, Labor Department
April 20: Beige Book, Federal Reserve
April 25: Existing Home Sales, National Association of Realtors
April 26: New Residential Sales, Commerce Department/HUD
April 26: Consumer Confidence, The Conference Board
April 27: MBA Weekly Application Survey
April 28: Gross Domestic Product, Labor Department
April 28: Housing Vacancies and Homeownership, Commerce Department
May 1-4: MBA National Secondary Market Conference & Expo, San Francisco
May 4-6: Commercial Asset Administration & Technology Conference, Chicago
May 10: Campus MBA: Creating New Customers, Chicago
May 10-11: CampusMBA Default Best Practices Workshop, Chicago
May 11-12: CampusMBA Real Estate Appraisal for Mortgage Lenders, Dallas
May 15-18: MBA Legal Issues & Regulatory Compliance Conference, Phoenix
May 15-20: CampusMBA School of Mortgage Banking Course I, Philadelphia
May 17-18: CampusMBA: The Next Step in Combating Mortgage Fraud, Atlanta
June 2-3: FHA/VA/USDA Housing Finance Conference, Washington, D.C.
June 5-8: MBA Presidents Conference, Palm Beach, Fla.
June 8-10: MBA Subprime Lending & Alternative Products Conference, Washington, D.C.
June 12-17: CampusMBA School of Mortgage Banking Course II, Denver
June 15-17: CampusMBA eMortgage Workshop, San Francisco
July 10-15: CampusMBA Commercial School of Mortgage Banking, San Diego
July 17: CampusMBA: Essentials on Employment Law Compliance, San Francisco
July 17-22: Campus MBA School of Mortgage Banking Course I, Washington, D.C.
Aug. 14-19: CampusMBA School of Mortgage Banking Course III, Chicago
Aug. 24-25: CampusMBA: Detecting and Avoiding Mortgage Fraud, San Francisco
Sept. 7-9: MBA Regulatory Compliance Conference, Washington, D.C.
Sept. 11-13: MBA Document Custody Conference, Miami Beach, Fla.
Sept. 18-23: Campus MBA School of Mortgage Banking Course II, San Diego
Sept. 19-20: MBA Quality Assurance Conference, Chicago
Sept. 20-21: CampusMBA: Handling Fraud Files, San Diego
Oct. 23-26: MBA Annual Convention & Expo, Orlando
Nov. 10-11: MBA Residential Underwriting Conference, Coronado, Calif.
2006
Feb. 5-8: MBA Commercial Real Estate Finance/Multifamily Housing Convention & Expo, Orlando

Information about MBA Events can be found at the MBA Web site, www.mortgagebankers.org; and at the CampusMBA Web site, www.campusmba.org.
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