Plaza Home Mortgage, a Preferred Investor of CMC, caters to your business needs with diverse products, competitive pricing and protection from repurchase demands.
Discover Why Patrons Choose Plaza Home Mortgage
Products & Pricing
Protection from Repurchase Demands
Plaza's Certified Loan Program
Plaza's Certified Loan Program was created to protect sellers from losses caused by repurchase demands. It provides optimal protection with a 100% review guarantee. Now, you have the opportunity to quantify repurchase risk, keep your focus on the pipeline, and improve loan manufacturing quality. There is no added cost to use Plaza's Certified Loan Program, and every loan is automatically considered for eligibility.
IN THE NEWS
The market shift toward more purchase mortgages, coupled with rising rates and tight inventory, is generating the consistent upward trend in defect risk.
Read the full article by Mike Sorohan at MBA.
- — Guideline Violations
- — Compliance Errors
- — Miscalculation of Income
- — Data Integrity
- — Errors and Omissions
- — Fraud
- — Employee/LO
- — Borrower/Seller
- — Real Estate Agent
- — Occupancy
- — Undisclosed Debt
- — Income/Employment
- — Straw Borrower
Some exclusions apply: Loss of employment, Death, Disability, Divorce, Non-Manufacturing, Defects, and EPD – with a Non Manufacturing Defect.
*Insurance coverage is subject to several variables including, but not limited to, actual terms and conditions of an executed policy and use of third-party mortgage underwriting.
Note: Certified Loan Process is determined by CastleLineTM and its affiliates and may be modified from time to time at their discretion.
Certified Loan Program (CLP) Case Study
Plaza is one of the few investors that provides insurance to protect lenders against financial losses caused by repurchase demands. The example below illustrates one such case in which Peoples Mortgage, a CMC Patron, exercised the Certified Loan Program insurance coverage and avoided what would have been a substantial loss.
- Repurchase Notification Date: 8/12/16
- Loan Balance at time of Repurchase Request: $240,000
- Reason for Repurchase: LP showing invalid/ineligible/incomplete
- Client able to refinance loan to avoid repurchase? No, borrower did not qualify
- Client’s Scratch & Dent Bid: $168,000 ($0.70 on the dollar)
- Original Plaza Purchase: 7/5/16
- Note Loan Amount: $240,000
- LTV 80%
- DTI 31%
- FICO 680
|Note Loan Amt||Repurchase Invoice $ Amt||S&D Price (70 cents on the dollar)||Total Loss after S&D sale||Cost to use Certified Insurance||Loss Savings with Certified Insurance|
Note: total volume purchased was $54,152,754 for 238 units.
|Scenario 1: |
$234,000 ave loan size
$291,500 ave loan size
|Ave Loan Balance based on July fundings and previous 12 month period (per Aug 2016 scorecard): $234,000|
Amt (bps) in extra value on a "per loan" basis to recoup "Loss Savings with Certified Insurance": 0.00115881
|Ave Loan Balance based on July 2016 fundings (per Aug 2016 scorecard): $291,500 |
Amt (bps) in extra value on a "per loan" basis to recoup "Loss Savings with Certified Insurance": 0.00093023
Outcome With Plaza
- Client exercised the Certified Loan Program Insurance for a total cost of $13,853.60 ($10k deductible + premium over par)
- No repurchase!
Outcome With Most Investors
- No insurance. Repurchase cost totaled $246,389.94
- Two possible outcomes: (1) client sells loan S&D for a total loss of $78,389.94 or (2) client portfolios the loan after absorbing the repurchase cost of $246,389.94
Learn more about getting connected to these, and other, valuable resources.
About Our Partnership
CMC provides exclusive offerings and value-added services to mortgage lenders nationwide. Therefore, we work together with Plaza Home Mortgage to bring tangible benefits to CMC’s cooperative membership. Our alliance with Plaza supports CMC’s ongoing commitment to continue partnering with highly-respected investors.