The seasonally adjusted Conventional Index declined 0.3 percent to 953.5 from 956.4 the previous week, and the seasonally adjusted Government Index dropped 2.1 percent to 134.8 from 137.7 the previous week.

The four-week moving average for the seasonally adjusted Market Index is down 1.6 percent to 659.8 from 670.8 .  The four-week moving average decreased slightly to 409.6 from 409.7 for the Purchase Index, while this average is down 3.4 percent to 2129.9 from 2204.2 for the Refinance Index.

The refinance share of mortgage activity decreased to 42.8 percent of total applications from 44.5 percent the previous week. The adjustable-rate mortgage share of activity decreased to 18.7 percent from 19.2 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages increased to 6.16 percent from 6.13 percent, with points increasing to 1.39 from 1.25 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages increased to 5.91 percent from 5.85 percent, with points increasing to 1.15 from 1.09 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs increased to 5.88 percent from 5.87 percent, with points increasing to 0.75 from 0.72 (including the origination fee) for 80 percent LTV loans.

The survey covers 50 percent of all U.S. retail residential mortgage originations, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.
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“Most of the movement we’re seeing in structured sales is in real estate owned by baby boomers and retirees looking to turn their appreciated assets into a steady stream of guaranteed income and also an opportunity to diversify investments”  Brown said. “Appreciated assets would be real estate, whether that is commercial or residential or closely held business.” 

More clients are going the route of redistributing income and making a range of investments, according to Brown. A structured sale combines the tax benefits of an installment sale in addition to a guaranteed income stream and/or deferral.  The structured sale also eliminates the risk associated with buyer’s solvency that is common in traditional installment sales. 

“Structure sales are a way to spread out gains over time and give people assets they really want and need,” Brown said.

This type of investment also offers complete security, wealth prevention and is easy to implement when compared to the cash sale of an asset. After-tax financial perks could include Section 1031 exchanges, charitable remainder trusts and private annuity trusts.  

“By spreading the tax payments over several years, a structure sale reduces the seller’s liability, which could be somewhere between 20 to 25 percent of their overall equity, depending on the seller’s state,” Brown said. “It’s a straightforward financial planning strategy that is easy to understand and implement from both the client’s and advisor’s perspective.”

The process of a structured sale begins when sellers sell their property or business to a buyer in return for installment payments. The buyer then transfers the payment obligations to an assignment company and the cash amount is transferred to an assignment company. The assignment company funds the payment obligations by securing a guaranteed income stream from a Fortune 50 company—an advantage over a traditional installment sale which defers sellers’ taxes and redirects related income, but leaves the sellers with risks, such as the buyer becoming insolvent.

The Fortune 50 company makes payments to the seller according to the terms of the structured sale as distribution—taxable are the capital gains and return on principal.  A guarantee of performance of the assignment company is also issued. 

“Holders of appreciated real estate assets anticipating a structured sale should make certain that the broker they choose is experienced in these transactions,” said Brown. "A mismanaged or improperly handled sale could jeopardize the seller’s tax benefits.”

Capstone Bay recently launched The Capstone Bay Structured Sales Advisor Alliance to provide centralized training and support to members nationwide. This alliance of experienced and knowledgeable financial advisors was created so that members could collaborate with Capstone Bay on structured sale opportunities.

“What we are finding is that the baby boomers are experiencing a transition compared to other cohorts—many of them are ready to cash out on their real estate investments and transition into different types of investments,” Brown said. “What [we are] doing is helping these individuals make these transitions in a tax-efficient way. A lot of people look for diversity in their investments and also something that is more conservative.”
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WHO:
Richard French, CMB, vice president with SunTrust Mortgage Inc., Sunrise, Fla.

Q: Tell us about yourself.
FRENCH: I have been in the mortgage business for 14 years and currently am a production manager in South Florida. I also manage our Joint Venture business in South Florida. I have lived in Broward County, Florida for 22 years and am originally from New Jersey. My wife, Joanne, and I live in Parkland, Florida with our two daughters, Alyssa, 11 and Jillian, 4. My spare time is spent with my family and I enjoy playing the guitar as often as possible.

Q. How long have you been a CMB?
FRENCH: I received my CMB designation in October of 2006. I have known about the CMB for years but never really thought about it for me until I decided last February to enroll in the program. At that time, I was short by about 75 points and was able to obtain many of my needed points by utilizing SunTrust University. I was also able to partner up with other SunTrust employees who were also in the process and we all were mentored and tutored by several other SunTrust CMBs.

My motivation to become a CMB was simply to take myself to the highest level possible in my industry. I feel that the CMB sets me apart from my competition and speaks to my level of commitment to my profession.

Q: How has the CMB helped your career?
FRENCH: Aside from earning accolades from within my company for the accomplishment of earning the designation, I am sure to speak about what the significance of the CMB designation is when speaking to referral partners and clients. I have received nothing but positive feedback on the distinction of the designation.

Q: What advice would you give to someone interested in pursuing their CMB?
FRENCH: Don't wait. The sooner you enroll in the program, the sooner you can complete your point requirements and the sooner you can sit for your exam. Many colleagues I know have more than enough points to sit for the exam; it's simply a matter of enrolling in the process and systematically completing each step. Don't wait.

CampusMBA designations and certifications serve a dual purpose—they tell the world what you've accomplished in your chosen profession and they put you on the path to career advancement.

For more information about CampusMBA designations, visit www.campusmba.org/IndustryDesignations.
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One special session to attend is Outlook for the Real Estate Finance Industry: A Commercial/Multifamily Servicing Perspective, May 16, 2:30-3:45 p.m. CT. 

Industry expert panelists discuss the latest trends in the commercial/multifamily industry and the outlook for the next five to 10 years. The macro-economy; capital markets; borrower, products and processes; and the industry's structure are all changing. Explore changes and what is likely to happen next. This session focuses on the impact of commercial/multifamily servicing.

Moderator:
Alan Kronovet, managing director, Wachovia Securities

Speakers:
• David Croskery, senior managing director, Holliday Fenoglio Fowler LP
• Brian Hanson,vice president of portfolio management, CWCapital
•Jan Sternin, CMB, senior vice president, PNC Real Estate Finance/Midland Loan Services

Who should attend conference?
Commercial/multifamily loan servicing and closing personnel and technology professionals should plan to attend this conference.

Register before April 30 to save; click here to register or go to http://store.mortgagebankers.org/ProductDetail.aspx?product_code=M2702020%2fREGIS.
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Centerline Capital Group provided a $35.75-million senior fixed-rate first mortgage using one of its fund management vehicles for One Financial Plaza, a downtown St. Louis class A office building. Centerline originated the loan and contributed it to a securitization in which it bought the B-piece.

“By purchasing the non-rated tranch and acting as a special servicer, we ensure that the loan won’t be sold,” said Michael Allen , managing director in the commercial real estate group at Centerline. “Centerline remains the decision-maker over the life of the loan.”

After years of stagnant development, downtown St. Louis has undergone significant public and private redevelopment, including construction of a new baseball stadium, football dome and convention center, as well as a $450-million casino and hotel project currently under construction.

Conversion of both Class A and B office buildings to residential reduced office space inventories in the St. Louis central business district (CBD). Class A space is now at a premium, making One Financial Plaza an attractive and in-demand property.

“There is considerable community interest and involvement in reviving downtown St. Louis,” Allen said. “One Financial Plaza is in a great location with respect to transportation access, entertainment and, more recently, residential development.”

Parmenter Realty Partners purchased the St. Louis portfolio.

Meanwhile, Centerline Capital Group arranged $26.65 million in financing hrough a conduit execution placed with EuroHypo Bank, New York, for the acquisition of two office buildings and a retail shopping center at the Old Mill submarket of Salt Lake City.

Tenant demand in Utah’s capital city has been strong in the last several months driven by expansion in office-using sectors, according to Centerline Capital Group.

Indeed, a recent Marcus & Millichap commercial real estate report estimates that nearly 4,800 office jobs will be added to the Salt Lake City metropolitan area this year.

Richard Olrich , senior vice president in the commercial real estate group for Centerline, said the Old Mill portfolio is located in the most sought-after office submarket in Salt Lake City.

“As this area runs out of land available for development, the properties should remain attractive to current and prospective tenants for some time,” Olrich said.

The portfolio, nearly 100 percent leased, includes the Old Mill Business Center I, a tri-level building on nearly three acres, with 20,000 square feet of office space and 14,000 square feet of retail space. The building has two tenants: a restaurant occupies the first floor retail space and an advertising firm occupies the second and third levels.

Old Mill Business Center II is a 60,000 square-foot tri-level building—fully occupied—with eight tenants, plus an antennae lease. Redundant power and fiber has been installed throughout the building, making the building attractive to office tenants with significant data operations requirements.

Old Mill Village, a 40,000 square-foot retail shopping center, consists of five buildings and a land lease. Four of the buildings are one-story structures and one building is a multi-story tower.
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Learn about all of the latest legal and regulatory developments and trends, as well as cross-cutting issues affecting the mortgage industry at this premier event. Parallel tracks, designed for lawyers and compliance officers at all levels of experience, address significant and timely issues facing the industry, including:

• Nontraditional Mortgage Products
• HMDA/Fair Lending
• Data Security, ID Theft and Privacy
• Protecting Against Mortgage Fraud
• FCRA/FACTA
• RESPA and TILA
• Servicing Developments
• State Law/Licensing Developments
• Secondary Market and GSE Issues
• Reg AB
• Class Action - Litigation Developments
• Banking Regulation/Preemption
• FLSA/Employment Law
• Legal Ethics
• Dealing with Reputational Risks
• Natural Disaster Preparedness
• Compliance Considerations

Additionally, MBA will sponsor a house building event on May 6 with Habitat for Humanity, part of MBA’s commitment to helping rebuild New Orleans, which was devastated by Hurricane Katrina in 2005. This special event takes place from 8:30 a.m.-1:30 p.m. CT.

Who Should Attend:

• In-house counsel and senior executives from mortgage banking firms, other real estate lenders and real estate secured investors

• Outside counsel with mortgage banking industry clients

• Compliance officers and managers

• Others who want to stay abreast of legal issues in the residential mortgage banking business

To download the conference brochure, go to
http://www.mortgagebankers.org/files/conferences/pdf/M2702076_brochure.pdf.

Please contact Travel Incorporated, MBA's official travel agency, to take advantage of special discounts on airfare and car rentals. You can make your travel arrangements (Monday-Friday, 24 hours/day). A proposed schedule will be sent to you immediately. Reservations will include 5-10 percent savings depending on the destination and meeting. You may also call our official air carriers and car rental agencies directly. To contact Travel Incorporated, call (800) 524-3002.

The discounted hotel rate cut-off date, April 13, does not ensure availability of rooms. If rooms are available until April 13, you receive the discounted hotel rate based on availability. After April 13, reservations are made on a space-available basis only, and you are charged the regular hotel rate. Program registrants are responsible for making their own hotel reservations. Contact the Hilton New Orleans Riverside by phone or fax. When making your hotel reservation with the Hilton New Orleans Riverside, please ask the reservation agent for the Group Code: LIR.

Hilton New Orleans Riverside (web site: http://www1.hilton.com/en_US/hi/hotel/MSYNHHH-Hilton-New-Orleans-Riverside-Louisiana/index.do)
2 Poydras Street
New Orleans, La. 70140
Phone: (504) 561-0500
Fax: (504) 568-1721
MBA discount rate: $199 Single/Double, $249 Executive Level, Single/Double.

To register online, visit http://events.mortgagebankers.org/legalissues2007/register.

Conference sponsorship is the ideal vehicle to grab the attention of this important audience and position your company as a leader in the industry. All sponsorships include a tabletop exhibit opportunity, but space is limited. For more information, contact Mark Brady at mbrady@mortgagebankers.org or call (202) 557-2790.
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Just added to the program: Democratic National Committee Chairman Howard Dean and Sen. Chuck Hagel, R-Neb., both of whom will address the Opening General Session on April 25.

As chairman of the Democratic National Committee, Dean is making the Democratic Party competitive in every race, in every district, in every state and territory. His election to this post in 2005 is the most recent chapter in a life dedicated to shaping the future of the Democratic Party. Dean served two terms as governor of Vermont and in 2004 founded Democracy for America, a grassroots political organization dedicated to recruiting, training, promoting and funding progressive candidates at all levels of government.

Hagel, Nebraska’s senior senator, is serving his second term. His duties include membership on four Senate committees: Foreign Relations; Banking, Housing and Urban Affairs; Intelligence; and Rules. Prior to his election to the U.S. Senate, Hagel worked in the private sector as the president of McCarthy & Co., an investment banking firm based in Omaha, and served as chairman of the board of American Information Systems.

Featured luncheon speakers include Mark Shields and Tucker Carlson. Shields is a nationally known columnist and commentator with unmatched credentials as an analyst of the U.S. political system. He is best known for his work as moderator on CNN's Capital Gang where he has debated policy issues with Robert Novak, Al Hunt, Kate O'Beirne and Margaret Carlson, and for his novel about the 1984 presidential campaign, On the Campaign Trail.

Carlson is the host of MSNBC’s Tucker, a fast paced, no-holds-barred conversation about the day’s developments in news, politics, world issues and pop culture. Carlson joined MSNBC in February 2005 from CNN, where he was the youngest anchor in the history of that network. A longtime magazine and newspaper journalist, Carlson has reported from around the world, most recently from Iraq and Lebanon. He has been a columnist for New York magazine and Reader’s Digest. He currently writes for Esquire, The Weekly Standard and the New York Times Magazine.

The conference gives MBA members and others in the mortgage industry opportunity to show their commitment to investing in America’s communities. Washington insiders, policymakers and industry authorities will discuss real estate policy; additionally, conference participants will have an opportunity to meet with members of Congress and engage in talks to help shape laws that would impact the future of America’s real estate finance industry. All individuals in the mortgage industry, especially MBA members, are encouraged to attend this important event.

Final registration date is April 11. For hotel reservations, call the Mandarin Oriental Washington at (888) 888-1778 or (202) 554-8588 and mention you will be attending MBA’s National Policy Conference 2007. Program registrants are responsible for making their own hotel reservations. Contact Travel Inc. at (800) 524-3002, MBA's official travel agency, to take advantage of special discounts on airfare and car rentals. Once you register, a proposed schedule will be sent to you immediately.

You may also call MBA’s official air carriers and car rental agencies directly—refer to http://events.mortgagebankers.org/npc2007/travel/ for promotional discount codes on airlines and car rental.

For more information on conference, registration, and travel, visit http://events.mortgagebankers.org/npc2007/default.html.
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Information Assurance-5 Steps to Security By using a five-step model, Information Assurance provides a larger scope on regulatory compliance directed towards information assurance and information security. It will present how to address your companies' risks and vulnerabilities from a comprehensive perspective as oppose to targeting only individual laws ands risks.

For more information or to register, visit the CampusMBA registration site
http://www.campusmba.org/products/default.aspx?product_code=E2701880/REGIS.
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The K.K. Birla Group, a multi-million dollar conglomerate based in Chennai, India, is providing financial-backing for MortgageHub, Conshohocken, Pa., a wholesale, correspondent and retail lending system for mortgage lenders, which recently acquired the Norcross, Ga.-based Fair Isaac mortgage software division, and more than 150 mortgage customers with more than 700 vendor partners through its BridgeLink network.

The Fair Isaac e-commerce network can deliver imaging, title, property valuation and inspection services into an LOS through a standard extensible markup language (XML) data schema, which is being standardized for the mortgage industry by the Mortgage Bankers Association's MISMO group

The K.K. Birla group of companies established its presence in textiles, agri-inputs, financial services, food processing, furniture, engineering services and information technology. ISGN, a company in the K.K. Birla Group, now plans to use MortgageHub as the vehicle for a platform that would take a mortgage loan from point-of-sale to servicing with construction lending and default management.

“We are investing in developing the industry’s most comprehensive platform of integrated products and services that will remap how lenders market, originate, service, and manage mortgages in the U.S.,” said Krishna Srinivasan, CEO and vice-chairman of ISGN. “As ISGN is positioned to transform the mortgage industry through technology and business processes, MortgageHub will be the vehicle for that transformation.”

David Demster, president of the mortgage products division at MortgageHub, is most familiar with the technology. He was vice president of the mortgage business unit at Fair Isaac and former president of the London Bridge Group. In 2004, Fair Isaac started its mortgage banking division when it acquired London Bridge Software Holdings plc, which developed decision technologies for collections and recovery.

“Construction, point of sale through full processing, closing, underwriting, secondary marketing, servicing, default management—all of those pieces are part of a solution set,” Demster said. “We have the full life cycle for a loan.”

Demster said MortgageHub will grow organically and through acquisitions, including a strategy geared toward Wall Street and an announcement expected for sometime this month.

"We are looking at technology that will help us predict default and being able to go to those clients early on in the process," Demster said.

Meanwhile, GHR Systems, Wayne, Pa., continues to develop its LOS system behind capital from Milwaukee, Wis.-based Metavante Corp., which split off last week from Marshall & Ilsley Corp., also based in Milwaukee. Both firms will become public independent companies.

At the end of 2006, Marshall & Ilsley Corp. had $56.2 billion in assets and $820 million in net operating income (NOI). Metavante Corp. increased its revenue share more than 15 percent last year, leading to $160 million in net income.

“With $1.5 billion in revenue in 2006, Metavante Corp. now has three times greater annual revenues than it did seven years ago," said Frank Martire, president and CEO of Metavante.

Martire said that since 2004, Metavante made 17 acquisitions and product investments, as it balances between banking and payments technologies.

In February, Metavante announced the Consumer Loan Origination System (CLOS), which allows lenders to support all of their consumer and personal loans on one integrated platform. The CLOS, a licensed system that supports home equity, home equity lines of credit (HELOC), auto loans, recreational vehicle loans and secured and unsecured credit, also has credit reporting, VMP loan documents, FannieMae’s Desktop Underwriter, FreddieMac’s Loan Prospector, Sherman’s credit insurance service and settlement services.

"Having the backing of Metavante has been valuable since they bring a customer base of over 8,500 financial institutions, many in need of lending automation," said Cy Brinn, president of Metavante Lending Solutions.  "They have provided us with the resources of a larger marketing and sales organization and the capital to continue to invest in our products. 

Circle One Mortgage, the mortgage company for First National Bank of Colorado, based in Fort Collins, Colo., also licensed the complete Loan Origination Studio from GHR Systems in February. In March, Metavante announced an exclusive partnership with Geneva, Switzerland-based Temenos, to sell its core banking service to American banks through the Metavante U.S. distribution network.

Paul Danola, group president at Metavante Enterprise Solutions, said the software should be attractive to large U.S. banks with mainframe systems and aging platforms.

“Because the TCB solution is platform independent, it can be deployed in COBOL as well as Java in a J2EE environment,” Danola said.

And, like the K.K. Birla Group, Metavante plans to have a greater impact in the international market.

“This platform will be one cornerstone of Metavante’s growth strategy for serving large financial institutions and expanding business internationally,” Martire said.
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