Did you know MCT’s Product and Pricing group assembles 100% of the data upon which all loan sale decisions are made?
Throughout each day, MCT’s traders and clients are provided with the full universe of possible prices when they go to commit their loans to investors. This accurate pricing is crucial to ensure that clients and traders can confidently continue to make profit when delivering on a best execution basis.
In this video interview, featuring Ben Coll, MCT’s Director of Product and Pricing, you will learn the value and services of the pricing group that provides daily and monthly reporting across the industry’s leading mortgage hedge advisory.
About Ben Coll, MCT’s Director of Product and Pricing
Ben Coll manages the Product & Pricing Group out of our San Diego headquarters. Mr. Coll boasts 20 years industry experience at depository institutions and independent mortgage bankers. He has operational experience as a former Chief Operating Officer, former Director of Lending and Chief Credit Officer and former Director of Product Development and Investor Relations.
Video Interview: White Label Rate Sheets & Mark to Market Reporting
During the most recent MCT Exchange Conference, we had the privilege of interviewing MCT’s Director of Product and Pricing, Ben Coll about White Label Rate Sheets and Mark to Market Reporting services.
Watch this in-depth interview on the group and/or view the transcript below to learn more about the mission and valued services of the Product and Pricing division.
Value of an In-House Rate Sheet & Custom Reporting
MCT’s pricing engine services add value to clients by helping them develop white-labeled rate sheets and providing daily and monthly Mark-to-Market reports.
An in-house rate sheet allows mortgage companies to target and maximize their margins and develop a consistent, positive experience with in-house product for their loan officers. Daily and monthly Mark-to-Market reporting engenders the transparency and control that mortgage companies need to be fully prepared for any market event.
Explore the services offered by our Product and Pricing group.
Contact us to see examples of White-Label Rate Sheets & Mark to Market Reporting
Interview Transcript: White Label Rate Sheets & Mark to Market Reporting Services
Below is a comprehensive transcript of the video above to give you an easy reference to the topics discussed.
- What is the purpose and mission of the Product and Pricing Group?
- Will you describe the importance of the Product and Pricing Group?
- What kind of advantage does having a Product and Pricing Group provide for MCT’s clients?
- What is the benefit of having an in-house or white-labeled rate sheet? How does it work?
- Are there any dangers or risks in not doing an in-house or white-labeled rate sheet?
- How do MCT clients gauge success?
- What is a “Day in the Life” like in the Product and Pricing division of MCT?
- What is the Product and Pricing division doing that is really unique within MCT?
- Why is having accurate data so crucial to MCT’s clients and traders?
- What can you see coming down the pipeline for the future of the Product and Pricing group?
- What is the best benefit that you have to offer clients from the product and pricing group?
What is the purpose and mission of the Product and Pricing Group?
The purpose and mission of the Product and Pricing group is to ensure that our clients’ different delivery methods with different investor executions is accurate for both their Best Executions for loans sales and also for their daily or monthly mark to markets.
Will you describe the importance of the Product and Pricing group?
The importance of accurate pricing and the importance of the Product and Pricing group doing their job properly is to ensure that clients are getting the best possible price when they go to commit their loans to the investor. Also, producing accurate Monthly Mark to Markets Reports ensures that our clients’ warehouse lines and that their accountants are satisfied with how we are valuing their open pipeline.
What kind of advantage does having a Product and Pricing group provide for MCT’s clients?
The advantage is that they are getting the best possible price for each one of their loans they are selling so they are maximizing their revenue or profit.
What is the benefit of having an in-house or white labeled rate sheet? How does it work?
The benefit of having a white labeled or in-house rate sheet product is that they can now maximize their margins, they can maximize their profits, they can really target their margins, they know exactly how much they are going to make on each loan. There is also severe operational efficiencies that are picked up in having your in-house or white labeled rate sheet product. What we do is we take our clients different executions and now what we have created is their own white labeled or in-house rate sheet which they deliver to their loan officers.
Are there any dangers or risks in not doing an in-house or white-labeled rate sheet?
There is no danger in not doing a white labeled rate sheet product, the only risk would be failure to maximize profits and continuing to exist in operational inefficiencies.
How do MCT clients gauge success?
MCT clients gauge their success based on what their expected profit is. One way is expected lift over the Best Efforts price and another is to compare their actual profits to their anticipated profit margin before the execution. For example, if a client was expecting to make 40 basis points on a particular loan, they gauge their success in MCT’s ability to aid them in fulfilling that goal successfully.
What is a “Day in the Life” like in the Product and Pricing division of MCT?
In the Product and Pricing group, our morning starts with accumulating all the different investors. The first thing we do is accumulate all of the different rate sheets, mandatory executions, and AOT Calcs for every investors and every client.
Next, we ensure that all of that pricing is pushed into MCTlive! and our pricer. This precedes our traders’ and clients’ days in regards to loan sales. Once all that pricing and data is up the traders are able to start running executions for loan sale. After the morning rush is over, then we capture reprices and then refresh all the pricing.
If you have a volatile market and there is quite a bit of movement, you will have quite a few investors repricing and the frequency of those reprices can increase depending on volatility. If traders and clients are running their best executions in the middle of the day and, in a volatile environment, pricing is changing, the Product and Pricing group ensures that the clients and traders are seeing the most accurate price being provided by the investors.
What is the Product and Pricing division doing that is really unique within MCT?
The Product and Pricing division has the unique task of providing unfailingly accurate data while sorting through the most voluminous data set.
The sheer volume of pricing data is the largest in the company.
Additionally, the data must be communicated back through the best execution and most importantly done in an accurate manner.
Why is having accurate data so crucial to MCT’s clients and traders?
A lot of the reporting for the entire company is based off of what the Product and Pricing group does each day.
The data provided by the Product and Pricing group is the foundation for which all Best Execution and loan commitment decisions will be made by clients or traders. The pricing must be accurate because if our information is wrong then the traders and clients are making decisions based on erroneous information. It is critical that we have accurate information.
Secondarily, the pricing group prepares the critical Mark to Markets reports that are sent out daily or monthly. These invaluable reports allow our clients to measure their profitability and deliver the information to other counter parties, like warehouses, warehouse lenders, and investors. Again, our clients depend on the pricing group for accuracy of those mark to markets and evaluations to drive their business.
Tell us about the future of this division – what can you see coming down the pipeline for the Product and Pricing group?
The future of the Pricing group is building out more tools within MCTlive! to accelerate when pricing is displayed to our clients and traders. This will be done by increasing the number of tools that are available to our clients within the Best Execution tabs.
In the future, we plan to build out a couple of other pricing products in addition to expanding upon the rate sheets.
We will extend our reach by working with warehouse banks, banks, credit unions, and depositories on providing them fair value evaluations. Now that we have this asset called accurate pricing, we will seek to understand how we can serve any of their needs whether it may be because of FASB accounting rules, call reporting with their regulators, their pipelines, their Best Efforts pipelines, or their warehouse pipelines, etc.
What is the best benefit that you have to offer clients from the product and pricing group?
One of the biggest assets that the P&P group provides is education. We help cement that relationship that the salesperson and the trader have with the client. Especially with the rate sheet generations, a lot of clients don’t necessarily understand what’s behind the actual pricing and why pricing changes so drastically from one day to the other.
One example is this – One of our clients, they are not the capital markets individual but they run one of the divisions under capital markets that use the rate sheet, was under the impression that mortgage rates were driven based on the tenured treasury and what that did and whether that went up or down. It was very rewarding to spend 30 to 40 minutes on the phone explaining to them this is exactly how pricing works. We gave them some screen grabs of MBS pricing and then over time what we started to do was engage them on a weekly basis to walk them through any new investors may be changing their pricing methodologies.
It is really just the education piece, elevating our clients knowledge, we find that is actually the most rewarding piece of the business.
Behind-the-Scenes at an Industry-Leading Hedge Advisory Firm
As a leader in capital markets education, MCT’s mission is to remove the veil on complex concepts to help make mortgage bankers successful. With each opportunity we seek to provide sustainable education to our clients on our own processes to increase the effectiveness of their team members.
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