Water is a powerful force: just check out this time lapse storm surge video from Ft. Meyers in Florida. Turning to metaphors, Sun Tzu said, “If you wait by the river long enough, the bodies of your enemies will float by.” Some investors and lenders may have adopted that phrase. We’re staring at the autumn and winter, and its ugly out there. Cutting costs fast enough? Best Capital, Finance of America’s retail division going to G-Rate (as reported earlier this week in this commentary) and perhaps closing its wholesale channel (with its low margins and high perceived risk warrantying all the broker business). AnnieMac (American Neighborhood Mortgage Acceptance Company LLC) “as a result of worsening market conditions, has made the difficult decision to cease Wholesale Operations effective October 31, 2022…” (Those impacted by mortgage companies downsizing can post their resume for free here and employers can view them for the nominal fee of $75.) Reports are trickling through about the level of pricing for “scratched and dented” loans. Whereas banks and credit unions can shift those over into their portfolio, independent mortgage banks have to sell them. If an IMB has a 3 percent, 30-year fixed Agency loan closed six months ago that is kicked back due to whatever reason, despite the borrower making their payments, they’re seeing prices around 65-70 cents on the dollar. A reminder to watch the underwriting and processing! (Today’s podcast is available here and this week’s podcast is sponsored by AIM-Port, an appraisal management platform built to reduce costs and elevate the borrower experience for lenders managing appraisal operations. Go to aim-port.com for more information or click here to reach out to a team member today!)