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

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.

 

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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.


What's Covered?*


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 AmtRepurchase Invoice $ AmtS&D Price (70 cents on the dollar)Total Loss after S&D saleCost to use Certified InsuranceLoss Savings with Certified Insurance
$240,000$246,389.94$168,000.00$78,389.94$13,853.60$64,536.34
This table calculates the bps value of CLP Insurance on a per loan basis—spreading the savings in losses across each loan based on past total volume purchased up until the time of the client’s first insurance claim.
Note: total volume purchased was $54,152,754 for 238 units.

Scenario 1 :
$234,000 ave loan size
Scenario 2:
$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

$13,853Total Cost

  • 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

$246,389Total Cost

  • 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
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Collaborative Webinars

Plaza Home Mortgage offers educational content that helps Patron members manage their business. Review one of our previous, Patron-exclusive sessions, "Protecting Your Loans From Repurchase Demands"—a collaborative webinar with Plaza.

Learn more about getting connected to these, and other, valuable resources.
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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.

 

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Have questions? Contact us for more details and information about your Patron incentive.

Terri Pope

Vice President > Investor Relations


tpope@capmkts.org
T: 904.373.3286     M: 904.293.9826