FBC Mortgage Blog

By Richard Burnett Sentinel Staff Writer

Orlando-based FBC Mortgage LLC is expanding into the Tampa market by acquiring certain assets of First Alliance Mortgage Co., the companies said Monday.

As part of the deal, FBC Mortgage has absorbed the management, loan officers, support staff, office facilities and loan pipeline of First Alliance in Tampa, company officials said.

The deal became final last week. Financial terms were not disclosed.

With the move, FBC took on nearly 20 new employees, increasing its work force to 100, the company said. It hopes to double the size of its Tampa unit during the next year.

The company operates out of headquarters in the Plaza office towers, on Orange Avenue in downtown Orlando.

Joining FBC as part of the transaction are James Girard, Robert Pinion and Mary Pinion — a trio of former First Alliance executives.

Girard was made senior vice president and operations manager for FBC.

Robert and Mary Pinion, First Alliance’s senior managers in Tampa, will head up the Tampa operation for FBC.

FBC Mortgage LLC acquired certain assets of residential mortgage lender First Alliance Mortgage Co. in Tampa for an undisclosed price.

Among those that will remain with the company are mortgage veterans Rob and Mary Pinion, who will manage the Tampa office and help develop the Tampa Bay area for FBC Mortgage, said a news release. In addition, James Girard will join FBC Mortgage as a senior vice president and operations manager in Orlando, the release said.

“We are extremely pleased to be joining such a sound, stable and successful mortgage banking organization,” Girard said in a prepared statement. “With the support of the FBC Mortgage platform, we expect to be able to significantly increase our ability to serve the mortgage needs of the greater Tampa area.”

Orlando-based FBC Mortgage, an employee- and community-owned residential mortgage lender, is among the largest privately owned mortgage lenders in Central Florida.

Copyright 2009 bizjournals.com

 August 21, 2009

Orlando Business Journal – by Anjali Fluker Staff Writer

With a single deal, 

Federal regulators on Aug. 14 arranged for Winston-Salem, N.C.-based BB&T (NYSE: BBT) to take over the failed Alabama-based

Locally, BB&T operated 11 bank branches in Central Florida, while Colonial operated 35 financial centers here as of the Aug. 14 asset acquisition, said FDIC data.

BB&T had $288.4 million in Central Florida deposits through June 30, 2008, placing it 17th among the area’s largest banks. Colonial Bank had

$2.2 billion in total Central Florida deposits in that same time frame, which placed it fourth on the list, trailing only SunTrust, Bank of America and Wachovia.

BB&T previously had its strongest market share in West Virginia, North Carolina and South Carolina, where it ranked among the top three largest banks in those states, with Florida being one of its quieter markets.

Now, with a significant portion of Colonial Bank’s Central Florida customer deposits under its wing, industry experts speculated that BB&T’s local market share will rise considerably.

“BB&T now becomes a major player as a result,” said Jack Greeley, partner and banking attorney with the Smith Mackinnon PA law firm in Orlando. “BB&T so far has shown it can operate a very good franchise in today’s environment. When you give them more core deposits and branch outlets, that’s significant for them.”

BB&T spokeswoman Cynthia Williams said the company did not have any detailed information on plans for the Orlando market, or breakouts on any other individual markets.

Following the Aug. 14 acquisition, BB&T installed about 425 “ambassadors” in all of Colonial Bank’s branches and named seven new regional presidents in Florida and Alabama — all experienced BB&T managers.

Although it’s unknown whether all of Colonial Bank’s former retail customers will remain with BB&T, it’s more than likely those customers won’t leave, said J. Clay Singleton, a finance professor at

“It’s difficult to change banks these days, especially when you have automatic payments and those things,” Singleton said. “I don’t think retail customers see a big difference in the bank. I suspect many of them choose a bank based on convenience.”

It’s also unclear whether BB&T will take on some of the riskier business lines that Colonial Bank was known for — including warehouse lending.

Colonial Bank was one of the Orlando area’s largest warehouse lenders — where a financial institution provides a line of credit to a loan originator to fund a mortgage that’s later sold on the secondary market.

BB&T also has a small presence in the warehouse lending area and appears to be carrying on business as usual for now, said Joe Nunziata, CEO of Orlando-based

Nunziata said although nothing official has been announced, his firm has not had any interruption in business, funding a total of about $8.9 million in loans between Aug. 14-18 through warehouse lending.

“We’re being told Colonial’s warehousing group was part of the acquisition and they’re answering the phones as BB&T,” Nunziata said. “If BB&T takes on this group and keeps it intact, keeps funding the same customers, it can become one of the biggest warehouse lenders in the country.”

BB&T’s Williams said the company is still evaluating its business plans and has made no decision at this time on either warehouse or commercial real estate lending.

The bank also did not detail potential layoffs that may happen because of the deal. BB&T told investors Aug. 17 that the $5 billion in expected losses in the loan portfolio it has acquired from Colonial Bank will not have a negative impact on earnings because of the loss-sharing agreement it has with the FDIC.

Under the agreement, the worst-case scenario in terms of earnings for BB&T would be a pretax exposure of about $500 million if the entire covered portfolio of the Colonial loans were to be charged off, the bank said.

If credit losses end up being less than the expected $5 billion, BB&T would have to share some of the upside with the FDIC.

BB&T Corp. is poised to become one of Central Florida’s largest banks. Colonial BancGroup Inc. from the Federal Deposit Insurance Corp., the state-appointed receiver. In the deal, BB&T acquired 346 Colonial Bank branches and $21.8 billion in assets. Rollins College. FBC Mortgage LLC, which was part of a group previously attempting to prop up Colonial Bank prior to its collapse. BB&T’s gainsWinston-Salem, N.C.-based BB&T Corp. took over the failed Alabama-based Colonial BancGroup Inc., a move expected to grow its market share in Florida. Here’s some of what BB&T garnered in the deal: Bank branches: 346 Customer deposits: $20.1 billion Loans held/other real estate: $14.2 billion Marketable securities: $4 billion Liabilities: $23.7 billion Source:U.S. Securities & Exchange Commission filing

By Mary Shanklin Sentinel Staff Writer

August 24, 2009

Borrowers are younger and are purchasing less-expensive homes as the November deadline approaches for first-time buyers to qualify for this year’s federal tax credit, according to a report by FBC Mortgage.

“Overall, the market seems to be improving, and we expect activity in the first-time buyer market to increase as the tax-credit deadline in November is fast approaching,” said Rob Nunziata, FBC’s president.

Earlier this year, the average age for home-loan borrowers was 46, but it dropped to 43 in June and to 38 in July. Other trends in the July report include an increase in government loans vs. conventional mortgages, and a decline in the proportion of refinances as activity picks up with primary mortgages. Down payments have hovered in the $40,000-to-$50,000 range in recent months, while purchase prices have been about $180,000.

Because of tougher underwriting guidelines, average credit scores have been above 720 during the past two quarters — their highest point in more than three years, Nunziata said.

Orlando Business Journal
August 7-13, 2009

Failed Colonial rescue deal may damage mortgage pipeline.

Bank plays important role in private lending.

Colonial Bancgroup Inc., a key cog in the national mortgage-loan engine, could become disabled and cause further harm to the sputtering lending industry.

A $300 million deal aimed at propping up Orlando’s fourth largest bank fell apart July 31, casting doubt on whether Colonial will survive.

Colonial provides loans to mortgage brokers closing the time between the origination of the loans and when they’re sold on the secondary market.

The possible failure of the bank “could be a big blow to the economic recovery of this state,” said Valerie Saunders, president of the Florida Association of Mortgage Bankers. “[Colonial] fills a very key role.”

Taylor, Bean & Whitaker Mortgage Co. led the failed rescue attempt The Ocala mortgage wholesaler that assembled a group of mortgage brokers to inject $300 million into Colonial in exchange for 75 percent control of the company – used the bank to complete “billions and billions of dollars worth of home loans,” chairman Lee Farkas told the Orlando Business Journal last spring.

Orlando mortgage broker Joe Nunziata, CEO of FBC Mortgage and part of the Taylor Bean consortium, said Colonial’s failure would be bad news for the private mortgage lending business. “They fund a very large portion of the nation’s non-bank mortgage loans. Without that warehouse fund, residential mortgage lenders would be greatly affected.”

Geof Longstaff, chairman of Mercantile Capital Corp. in Altamonte Springs, uses warehouse lenders during the placement of commercial mortgage loans. Although he doesn’t do business with Colonial, he said the bank’s role is important. “Loans don’t get closed if the warehouse lender isn’t there. We’d be out of business if we didn’t have warehouse lines.”

Montgomery, Ala.-based Colonial needed $300 million in capital, which was offered by the group led by Taylor, Bean & Whitaker, to qualify for $530 million in federal bailout funds. Colonial said in its quarterly report that without the capital, it might not survive. When contacted for additional comment about the situation, a Colonial spokeswoman said there was nothing more to say.

Nunziata said the Taylor, Bean & Whitaker deal fell apart last month after Colonial failed to get a commitment from the U.S. Treasury Department for the release of bailout funds.

In its second-quarter report released a week ago, Colonial – which reported a loss of $606 million – warned there’s now “substantial doubt” about its ability “to continue as a going concern.” The report said it was reducing costs, selling assets and talking with “strategic acquisition candidates,” but would have nothing more to say unless a “satisfactory agreement” is reached.

Unless Colonial finds a solution to its financial problems quickly, it could be closed by regulators, said Orlando banking attorney Joe Greeley of Smith Mackinnon PA.

Colonial could take steps before that might happen. Last month, it sold its branches in Nevada, and it could continue to unload property, he said. But it’s operating under two cease-and-desist orders from the Federal Reserve and the Federal Deposit Insurance Corp., and if it fails to meet deadlines for improving its bottom line, a takeover is possible.

If that happens, other institutions likely would bid for Colonial’s business, and regulators would look for the best deal for the government.

The bank is a big commercial lender with a large portfolio of Florida real estate loans. Colonial holds paper on more than $668 million in non-performing assets in the state, and more loans are in jeopardy of going bad. Regulators recently required Colonial to build its capital reserves to steel itself against defaults.

Recent regulatory changes to the Federal Reserve Board Truth in Lending Regulation, which apply to loan applications filed on or after July 30, 2009, subject lenders to new disclosure requirements for mortgage loans.

Key points include:

• The new requirements apply to all mortgages secured by a borrower’s home, including primary and second homes and refinancings. Investor loans continue to be exempt.
• Lenders must give good faith estimates of mortgage loan costs within 3 business days after the consumer applies for a loan (early disclosure). The lender may not collect any fees before the disclosure is provided, except for a reasonable fee for obtaining a credit report.
• The closing may not take place until expiration of a 7 day waiting period after the consumer receives the early disclosure.
• Consumers may shorten or waive the 3‐day and/or 7‐day waiting periods for a “bona fide personal financial emergency,” but only after receiving an accurate TILA disclosure. In the final rule’s preamble, the Fed stated that it “believes waivers should not be used routinely to expedite consummation for reasons of convenience.” The Fed decided not to insulate lenders from liability even where a consumer modifies or waives the waiting periods.
• If the annual percentage rate (APR) changes by more than 0.125 percent, the lender must provide a corrected disclosure to the borrower and wait an additional 3 business days before closing the loan. The APR includes not only the interest rate on the loan but certain other costs related to settlement, so it will be important for any fees that affect the APR to be as accurate as possible, as early as possible, to minimize the need for a corrected TILA disclosure.

Source: NAR

How important is your credit score?

- Extremely Important!

Your credit score usually determines the price you pay for your money and everything that goes with it, (your mortgages, your auto loans and leases, your credit cards, signature loans and business loans-just to name a few.).

The most significant part of your credit report is obviously the score itself. Credit scores range from 350 to 850, with 850 being the best possible credit score you can receive and 350 being the worst.

There are five primary factors that determine your credit score:

1. Your Payment History – 35% impact on your credit score.

2. The Balance You Owe vs. Your Available Credit Lines – 30% impact on your credit score.

3. How long your accounts have been opened – 15% impact on your credit score.

4. Type of credit that you currently have opened – 10% impact on your score.

5. Recent inquiries made by creditors – 10% impact on your credit score.

(We’ll go over each of these areas in more detail below.)

1. Your Payment History:

Paying your debts on time and in full has a positive impact on your score, where as, late payments, judgments, charge-offs, collection accounts and bankruptcies have a negative impact. The worst account to have a late payment on is your mortgage. Late payments on your mortgage have the greatest negative impact on your score within the 12 month period preceding the origination of your credit report. In reverse, timely mortgage payments have the most positive effect on your score and are one of the most important factors lenders look for when evaluating your credit history.

(Many times a single late mortgage payment within the 12 month period preceding the origination of your credit report can hold up your approval process or possibly even cause you to be denied. It could also spell the difference between being offered the best market interest rate available or a considerably less attractive, unfavorable rate.)

This is not to say that your mortgage is the only debt you should pay on time. Your payment history on other debts (installment loans, credit cards, lines of credit, etc.) is also given a lot of weight.

The credit scoring systems evaluate how many late payments you have had and whether they were 30, 60 or 90 days late. It also takes into account whether your accounts are currently in default (greater than 90 days late). Additionally, the systems look at whether the late payments were consecutive, commonly referred to as “Rolling Lates.” If you only have one or two minor late payments on your report with no other derogatory marks, your score will not be too terribly affected but it will be affected somewhat. You will have a hard time getting over that critical 720 level and will be negatively affected in the first few months following the late occurrence.

- Bankruptcies and judgments are another major area of importance.

 If you have had any bankruptcies within the last 7 years, it will seriously affect your ability to borrow or establish new credit accounts. Additionally, if you have had any judgments within the last several years, it is very important that you pay off the judgment and get a “satisfaction of judgment” from the court. Any unsatisfied or recent judgments will make a bad dent in your credit score and adversely affect your ability to borrow. Usually, judgments and liens must be paid prior to the closing. However, in some cases, they can be paid out of the loan proceeds.

- Four practical steps that you can implement to improve your credit score:

1. Make all your payments on time.

(Past dues on any account will destroy your score – bring your delinquent accounts current immediately. A 30 day late payment one month ago is worse than a 90 day late payment three years ago.)

2. Pay your bills before they go to a collection agency if they are in a delinquent status.

3. Check your credit report for accuracy on a regular basis; and make sure that disputed bills are not negatively affecting your credit score and have been updated by the credit bureaus.

You can accomplish this by accessing www.annualcreditreport.com once a year for a free copy of your report which gives you the ability to dispute items online.

4. Keep your balances on your revolving accounts, i.e. credit cards and lines of credit below 50% of the available credit limit. Keeping your balances below 30% has an even better effect on your credit score.

2. The Balance You Owe vs. Your Available Credit Lines:

Keeping your credit balances below 50% of your available limit is very important. Keeping your balances below 30% of your available credit is even better. This is perhaps the single most misunderstood part of credit scoring. There are a lot of misinformed people that don’t understand how the credit scoring systems work, and yet they insist on pretending to be experts in this area.

- Four common myths regarding calculation of your credit score:

1. You should close all your credit accounts if you are not using them.

2. You should not have credit accounts appear on your report after they have been closed.

3. You should not have any open credit card accounts at all.

4. You should not have high limits on your credit lines.

(First of all, the credit scoring system looks at the percentage of debt that you owe compared to your overall credit lines – not the amount of credit that you have available to you. For this reason, most of the time it is better to leave your credit accounts opened. By not using the credit that is available to you, the system regards you as having enough financial restraint and discipline not to overload on debt.)

Remember, the credit scoring system looks at the percentage of debt you owe compared to your overall credit line.

(For instance, if you owe $10,000, and you have $100,000 of credit available to you, you are only using 10% of your available credit line. On the other hand, if you owe $10,000 and you only have $20,000 of credit available to you, you are using 50% of your available credit line. This is negatively interpreted by the credit scoring system as being a strong dependence on credit. Furthermore, if you owe $10,000 and you only have $10,000 available to you, you have “maxed out” your available credit and your credit scores will be very negatively impacted.)

Therefore, it is not how much you owe, but how much you owe compared to what you are able to borrow. Additionally, if you have no debt and no credit lines open or available to you, you will end up with a lower score than someone who has no debt and a few lines of credit available to them. Financing is a game of percentages and ratios. The credit scoring system does not look at the dollar amount of debt you have; only the balance you owe, compared to how much credit is available to you.

- 3 practical steps to improve your credit score in the area of Revolving Accounts:

1. Do not close your credit accounts unless it is necessary to do so. It is better to have many open accounts with little or no balance than to have just one or two accounts regardless of the balance.

2. Do not concentrate large balances on just a few accounts. Pay outstanding debt down as close to zero as possible and evenly distribute the remaining balance across all your open credit lines. The key is to keep the balances down below 30% or at the very least 50% of your available credit lines.

3. Call your credit card companies and try to increase your available credit lines if they can do so without pulling a new credit report.

3. How long your accounts have been opened:

The longer your accounts have been opened, the higher your score will be; newly opened accounts will bring your score down. It is better to have numerous open accounts that have been open for a long period of time with low or zero balances than to close all of your old accounts. Here are 3 practical steps to help you improve your credit score in this area:

 - 3 Practical Steps on how to improve your credit score in the area of length of time accounts have been opened:

1. Do not close your credit accounts. If you have too many department store credit cards, close the newest ones – do not close the old accounts. If you keep your accounts open and use them every once in a while your score will improve over time.

2. Think twice before jumping on that latest 0% credit card offer or opening a new card just to get a 10% discount at a department store.

3. If you don’t have much of a credit history, and you are planning on taking out a mortgage in the future, it would probably be a good idea to establish a few open credit lines with little or no balance on them. Although newly opened accounts tend to lower your score initially, they will improve your score once they have been open for awhile, somewhat active and paid off with little or no balance.

4. Type of credit that you currently have opened:

A good mixture of auto loans and leases, credit cards and mortgages is always best. Too many credit cards are not a good thing and having a mortgage definitely increases your score. Just as many financial advisors direct their clients in the financial market to diversify, the same holds true in the world of credit reporting. It is always better to diversify and have various open accounts in the areas of revolving, installment and mortgage debt. Here are some practical steps to improve your score in this area:

1. Having 3-5 revolving credit cards open is optimal.

2. Having a good mix of auto loans, credit cards and mortgages is positive for the score; rather than having a concentration of credit cards only.

5. Recent inquiries made by creditors:

 Inquiries affect the score for one year from the time the inquiry is made. Personal inquiries do not count toward your score. In other words, you can check your credit report as often as you like and that won’t affect your score. The score is only affected if a potential creditor checks your credit. Potential creditors include credit card companies, auto finance companies, department stores and mortgage companies. The reason that inquiries impact your credit score is because the scoring system assumes that if you have many recent inquiries, you must be strapped for money and in some type of “panic” mode, trying to get credit wherever you can find it. The system also assumes that these inquiries will eventually result in new accounts being opened, and as stated before, the system doesn’t like you to open new accounts and punishes you by giving you a lower credit score.

- 3 practical steps that you can take to improve your credit score in the area of inquiries:

1. Multiple auto and mortgage inquiries are treated as only one inquiry if made within 45 days of each other. So, it is better to shop for a car or a mortgage over a two week time-frame rather than to prolong it over a longer timeframe.

2. Don’t apply for a lot of credit or open multiple credit cards at the same time.

3. If you are thinking of applying for a mortgage within the next 90 days or so, it would be wise to wait until after your mortgage closes before you apply for any new credit.

This report was designed through the resources available to the mortgage professionals employed at FBC Mortgage, LLC and should only be relied on as a guide to assist consumers in better understanding how the credit scoring system works and the possible steps they can take to improve their credit scores. FBC Mortgage, LLC and its affiliates are Licensed in the area of Mortgage Lending and are not be relied upon as Consumer Credit Reporting Agency. Please refer to the three National Credit Bureaus Equifax, TransUnion and Experian for more detailed information.

http://orlando.bizjournals.com/orlando/stories/2009/07/13/story9.html?jst=pn_pn_lk

The Nunziata brothers, who run Orlando-based mortgage brokerage firm FBC Mortgage LLC, received full approval in April to underwrite Federal Housing Administration loans, which are considered stronger in today’s market.
Since that designation, the firm closed on 405 loans in the second quarter, a 48 percent jump from the 272 loans closed just one quarter prior and 72 percent more than the 235 loans that closed in second-quarter 2008.

Orlando Business Journal – by Anjali Fluker Staff Writer

http://www.bizjournals.com/orlando/stories/2009/04/06/story4.html

Orlando Business Journal – by Anjali Fluker

http://press.fbchomeloans.com/crisisturnshomeownership.pdf

Orlando Sentinel – March 2009
Article by Beth Kassab