Stage Coach Rules

LOAN OFFICER INDUSTRY STANDARDS, ITS ABOUT TIME !!!!

joanlarsen | 16 December, 2009 07:05

  NO MORE EX-THUGS AND PIZZA DELIVERY GUYS EMPLOYED BY BANKS EITHER

  

  

HUD Sets Proposed Minimum Standards for Loan Officer Licensing

December 15, 2009

The Department of Housing and Urban Development has issued a proposed rule that sets minimum standards for state licensing of loan officers and mortgage brokers. Congress directed HUD to set minimum licensing requirements for states under the Secure and Fair Enforcement (SAFE) Mortgage Licensing Act of 2008. If HUD determines a state does not meet the minimum standards, the department is charged with administering a licensing system for the state. "By introducing nationwide standards of uniform licensing for loan originators, the SAFE Act is taking an important step in returning integrity and accountability to the residential mortgage loan market," said HUD assistant secretary David Stevens. The public comment period on the proposed SAFE rule ends in 60 days.

Who Brought The U.S. Financial System Down?: Countrywide (now BofA) Tops The List

joanlarsen | 10 May, 2009 09:54

The worst of the worst mortgage lenders are below, sorry to say. This newly released list of the 25 worst lenders in the country shows who poluted the nations financial system. Again, Countrywide shows up at the top.

Bank of America purchased Countrywide last year and is now managing the toxic assets of the mess Mozilo made.

Much of Countrywide management and operations centers are still be operated as they were under Countrywide only now they are called Bank of America. As you know after the stress test Bank of America is in dire need of capital. 

The below companies and their management are responsible for the financial mess the world is now experiencing.  

 

 

 

 

400 Billion More May Be Needed by Weak Banks Per JPM Chase Analyst

joanlarsen | 20 April, 2009 17:28

Matthew Jozoff wrote in a report that banks are expected to lose another $400 billion related to bad loans, mostly those tied to defaulting real estate. Jozoff said banks expect to reserve $215 billion to increase reserves against their deteriorating $2.1 trillion in U.S. home loans. He expects losses from securities portfolios to slow because they’ve already experienced large write-downs.

Jozoff spared his bank by stating that "healthier" institutions may not need more capital and could raise it privately.

Some analysts argue that Bank of America and Wells Fargo were in need of additional capital citing their heavy exposures to risky residential and commercial mortgage loans.

Don't Expect Rates To Go Much Lower... The Floor Seems Firmly In Place

joanlarsen | 01 April, 2009 16:43

After doing this job for over a decade, you develop some intuition about what "things" are doing. After repeated attempts by the market to drive rates to below five on 30 year fixed rates ( without points ) they seem to have developed a floor that they can't break easily.

Mortgage application volume seems to have peaked even with the record low interest rates which seem to have bottomed.

Home loan apps increased just three percent for the week ending March 27 after increasing a week earlier- per the MBA.

Interest rates seem to be near their bottom, with the 30 year fixed rates witn one point charge averaging 4.61 percent last week.

The 15-year fixed slipped to 4.45 percent with .75 points.

Why Blogs Are Better Than Websites - The Search Engines Love Blogs.

joanlarsen | 13 March, 2009 10:36

Easy to use RealestateloanS.com blog helps real estate professionals achieve an internet presence and attract consumers.  

RealestateloanS.com is offering a very easy to use and free real estate industry blog for all real estate industry professionals and sectors. Real estate consumers read information and real estate professionals promote themselves by posting up-to-date real estate expertise and contact information on their blog homepage.

Smart mortgage and real estate professionals are aware of how important blogging is to their internet business but most professionals are just starting to understand the power and usefulness of a real estate blog. This site is easy to use and encourages real estate industry professionals to write about ideas, opinions and expertise on matters such as market trends, mortgages, title insurance, credit repair, legal matters, home staging and many other real estate related matters. I'm no tech perosn and there’s no need to be a techie because the site is super easy to use. All you need to get started is industry knowledge, useful advice and a willingness to write about and share your ideas- a no brainer.

 

Real estate professionals creating a blog can also use their blog homepage as a powerful professional website which allows unlimited growth and search engine optimization. Realestateloans.com will promote the sites and promote the web pages.

 

Rather than paying to create a personal websites that won't get viewed by consumers due to the lack optimization support or use a "company" website that you can't control, you can take part in an easy and free turn key internet promotion tool. 

 

The RealestateloanS.com real estate blog is free and open to all professionals in the housing industry. Whether you are a real estate agent, residential or commercial mortgage professional, title insurance company, credit repair professional, escrow officer, loan underwriter, real estate attorney, real estate appraiser or other real estate service provider you can set up a real estate homepage for free, blog as much as you want, upload video, pictures and create a online presence on the cheap that will be viewed by consumers nationally and internationally.

 

Blogging has become the purest way for individuals to expand their reach. The key to success is that professionals must share their expertise in a down to earth manner, keep it local and upload content consistently by blogging three to six times a week on matters close to their heart. Consumers will find them and their expertise if the blogger is dedicated to a consistent upload and quality information. Bloggers that invite others members to join the forum will also be rewarded with increased internet presence. Growing the community means that everyone benefits.

 

Have fun!

Why Mortgage Interest Rates Change..

joanlarsen | 26 February, 2009 20:38

One of the most important things a mortgage shopper cares about is finding the best interest rate. That means trying to honestly find the lowest, most often fixed mortgage interest rates.  Let’s look at what makes mortgage interest rates fluctuate and how to monitor them. 

First, how can you monitor rate direction? Since most of us don't have access to the mortgage securities market a quick way to look into the days trading action is the 10-year Treasury bond. This financial instrument mirrors the direction of mortgage rates and is usually a great indicator into mortgage rate direction. Because most mortgages are 30 year terms but usually paid off or refianced within 10 years, the 10-year bond is a great benchmark to measure interest rate changes for the 30 year mortgage. 10 year Tbills and long-term mortgages such as 30 year mortgages ( Mortgage-Backed Securities-MBS) also compete for the similar investors.

Treasuries are 100% guaranteed to be paid back while mortgages are not and for that reason mortgages carry more risk and must be priced higher to compensate.

How will You know if mortgage rates are going up or down?

When bond rates (also known as the bond yield) go up interest rates go up too. There have been many days lately and will be periods often where mortgage rates rise faster than the bond. So just because the 10 year bond rises

What makes interest rates move up or down?

Inflation. Inflation also largely impacts mortgage rates. If inflation is up interest rates will rise, but in times when there is little risk of inflation (deflation) mortgage interest rates will most likely fall.

Mortgage rates are also more susceptible to economic activity than treasuries primarily because the average consumer or homeowner may lose their job or be unable to make their payment while the US government typically doesn’t miss payments.

For this reason, jobs reports, Consumer Price Index, Consumer Confidence and other economic data on the economy can move interest rates significantly.

And don’t forget the Fed. When they release news or change the Fed funds rate this can impact inflationary or recessionary pressures and increase or decrease mortgage rates, not directly but depending on how the economy views the decision, indirectly.

Rajendrasinh Babubhai Makwana Sets Booby Trap For Fannie Mae

joanlarsen | 16 February, 2009 12:02

A federal grand jury indicted Rajendrasinh Babubhai Makwana of Glen Allen Virginia for computer intrusion. RBW placed a malicious script on Fannie Mae’s servers.

Makwana was a contractor employee for Fannie Mae’s Maryland facility around 2006 to October 24, 2008. He was specialty UNIX programer supporting Fannie Mae’s 4,000 computer servers. He was in a programing group that developed scripts for Fannie Mae.

Makwana had access to Fannie Mae’s servers all around the U.S.

The indictment states Makwana got fired on October 24, 2008. According to reports on October 29, 2008 a Fannie Mae engineer discovered some malicious script placed in a routine program. The malicious script was removed quickly. Makwana allegedly entered the code on October 24, 2008, and programmed it to execute on January 31, 2009. The code was designed to destroy all data through the entire system.

Makwana faces a maximum of 10 years in prison.

If they can't write about their mortgage expertise, do they have any?

joanlarsen | 07 February, 2009 08:39

The mortgage industry has always been a hornets nest of subtle choices and severe consequences. We're seeing many of those consequences play out through mortgage defaults.

Are the defaults entirely the mortgage industry's fault? To be fair, I'd say a resounding NO. Consumers must take responsibility in choosing their mortgage professionals carefully. We as Americans take for granted our consumer protection laws, dedication to customer service in our own businesses and the thought that we are somehow protected by laws. The truth is that most of these ideas are accurate but they CAN'T protect us from sloppy or careless professionals. 

Mortgage seekers need to take a few minutes to look at who their mortgage person is. Most mortgage professionals still in business today should have a blog or website that tells about themselves.

Does your consultant have a blog or website that is professional looking, offering useful expertise that is accurate, timely and critical? Look at their picture, does it look like they took it in their garage or did they take the extra time to take a professional photo? Do they write short articles with lots of grammerical mistakes. Do they have enough expertise to share or are they writing mini blurbs about the same thing everyone else is?

The mortgage business has become a very technical and information intense business. Mortgage professionals must be able to communicate well and handle technology easily. 

Reading a mortgage professionals blog or articles is a terrific way to learn about his or her skill set and level of sophistication. Mortgage borrowers today need more than someone that can take an order, they need someone that can provide intelligent advice and substantive solutions.

When you read the bloggers at any professional social media please pay close attention to the way they write and the attention to detail.

If they aren't taking the time to present themselves professionally to the world, do they really care about the details that go unnoticed in your loan file?

Bank America Contending With Possible Appraisal Issues

joanlarsen | 26 January, 2009 15:53

HBSS law firm is conducting an initial investigation into whether or not Bank of America improperly appropriated certain processing fees from mortgage borrowers, going against RESPA and TIL mandates. Mortgage companies are not supposed to mark up their cost for services such as appraisals and credit reports when charging consumers. Big banks should not be treated differently.

It seems that borrowers were being charged for full appraisals when in reality the bank conducted only limited reviews using automated valuation tools. In lay speak, this means that an appraiser never visited the property but rather the banks underwriter reviewed comparable sales through their computer software and determined the homes value from their desktop.

I have no problem with Bank America making a profit if the client and the mortgage process is served well and the rules aren't applied arbitrarily from bank to broker to small regional bank. Everyone should play by the same decent rules.

My concern as to this particular matter is the fact that the industry and consumers are NOT being served well. Automated valuation systems are a simplistic and faulty way to determine someones property value. Not only is the borrower poorly served, resulting in more loan declines or home value "cuts", but the client is paying for a service they never received. 

The automated system would be ok if the charge to the end customer was also reduced. Why should a customer potentially lose out on a new loan, the benefit of a reduced payment or home ownership because the bank chooses to cut corners?

Bank customers utilize big bank services because they have confidence in their expertise and safeguards. Whether Bank America is at fault or not, consumer protection standards in this industry need to be equal for all companies. No bank should be able to skirt consumer safeguards or RESPA guidelines because they are under financial pressure.

HBSS statement:

"Hagens Berman is investigating Bank of America and Lender Processing Services based on homeowner reports that the companies conspired to overcharge homeowners for appraisals in perhaps hundreds if not thousands of transactions.

HBSS is investigating reports that BOA charges homeowners upwards of $400 for routine home-purchase appraisals, but through a deal with Lender Processing Services pays much less for the work, pocketing the difference.

The process, if true, allows BOA to gain giant profits on the difference without disclosing the deal to home purchasers. Some reports indicate BOA can make as much as $200 per transaction, which totals to hundreds of millions of dollars.

Hagens Berman wants to hear from anyone who purchased or refinanced their home through Bank of America. Please contact attorneys by joining this investigation, e-mailing bac@hbsslaw.com or calling (206) 623-7292".

Fed to Start Buying Mortgage Backed Securities in January

joanlarsen | 30 December, 2008 16:21

We have finally received the news the mortgage market has been waiting for. The Fed is going to start purchasing MBS's from Fannie, Freddie and Ginnie. The details are still trickling out but apparently it will be through private intermediaries supported by additional reserves created for the Fed.

"The Fed said it "has selected private investment managers to act as its agents in implementing the program," which is "separate and distinct from the U.S. Treasury's program." The purchases will be financed through the creation of additional bank reserves, the Fed said."

Full article 

Loan Regulators Love Donuts and Processors

joanlarsen | 14 December, 2008 16:10

Several months ago I was asked to sit in on a state audit of a mortgage company. I was there not as a consultant on the day the auditor arrived but as an "employee". The auditor didn't even know I was a consultant. We recorded everything the auditor did and said.

The owner of the mortgage company wanted to get the office in good shape, and be prepared for the day the auditor would come. We did a fine job and the office was impeccable. I was hired to consult his staff on how to organize all the files, make sure things were in order and insure compliance.

Normally, mortgage offices get audited once every few years and sometimes not at all. I can tell you, I wish mortgage companies were audited every six months without being pre-warned. The amount of personal information that these entities hold is remarkable, and the way some of them manage it, is terrible. I've been in offices where there was no shredder in sight, files were stacked up in the hall and anyone that wanted the personal information in the files could grab it at will.

There are many issues auditors should address if they are competent, two of which are: The paper trail of disclosures to consumers on loan terms and service provider relationships- these two are the ones we'll talk about. More disclosure to come.

Anyway, the day arrived when the state auditor came to the business. My mouth dropped. He looked like he spent the morning napping at the donut shop. He was poorly dressed and sloppy. His persona was that of an uneducated person pushing beaurocratic guidelines that he didn't understand clearly himself. The two days that he was there were a colossal waste of time and money. There were obvious shortcomings, like there are in all businesses, which he didn't catch or even make small recommendations on. This is what our tax dollars are going to. If someone complains, the beaurocrats turn their wrath on the complainer not the issue of the complaint. It's pathetic.

The two issues which have concerned me most in the recent few years are; the full disclosure of loan terms and costs, and service provider relationships.

Since borrowers of home mortgage loans or refinance loans only experience the real estate loan process maybe three to five times in there lives, they won't know what disclosures they should be receiving. Governments mandate disclosures for the security of the consumer. If an auditor doesn't know what disclosures should be signed by the consumer, like the above auditor, how is the consumer protected? Why is the government mandating disclosures that have zero effect on protecting the consumer? Again, it's pathetic.

The good faith estimate can't hold a lender to their exact terms, but if a lender has given you a commitment in the way of locked rates, then the good faith estimate should be considered as a serious commitment. Hold the lender to the terms after the point where the loan rate and terms were locked, or complain a great deal to your state regulating body. Maybe the regulators put down their donuts and start asking questions.

The next disclosure I will mention is the "service provider relationship disclosure". Often it is not filled out fully, or accurate. If you are buying a home and you are obtaining the mortgage from an "in-house" lender, then the lender MUST disclose that the real estate brokerage is profiting directly from the loan. Often times the sales person won't let the buyer know that they ay be able to get a better loan with an outside lender, for fear of losing incentives for steering the business to the in-house lender. These "incentives" are almost always illegal for obvious reasons. To me this is the most commonly ignored regulation in the business today, and consumers are being taken to the cleaners.

Watch those disclosures and don't get deceived.

Throw Them In Jail. Enough Is Enough.

joanlarsen | 24 November, 2008 17:05

What the H$@% is going on with our system? Why aren't we throwing some of these Wall Streeters in prision or fining the heck out of them to take back the money they made off the backs of our retirement accounts.

I'm sorry but the public has been scammed and we are being treated like sheep people. To date I've seen two hedgefund managers charged with wrong doing. Don't tell me more of these bass turds don't belong in jail.

I was watching the cspan house finance hearings and the emails the subcommittee turned up made me sick to my stomach. The ratings agencies in cahoots with the securities dealers in a ratings scam. Enough is enough this was criminal and now the country is going broke because of it. We're letting the ship go down to save a few rotten pigs.

Fitch, S and P, Moodys they were all in on the take. They were rating junk at AAA when they new that this stuff couldn't be properly rated.

I WANT SOMEONE TO GO TO JAIL. TAKE THEIR HOMES AWAY LIKE THEY ARE TAKING MY 401K AWAY. NOW.

DAMN YOU BARNEY FRANK, CHRISTOPHER COX, ALAN GREENSPAN, THE WHOLE LOT OF YOU.

 

VA Loans 100% financing with Great Rates

joanlarsen | 20 November, 2008 12:32

In 1930 The Federal Government created the Department of Veterans Affairs in order to provide special benefits for Veterans. One such benefit was home ownership assistance through the VA home loan program.

It's important to know, Like FHA, the government does not fund the loans. The government's role primarily, is to; create the terms, monitor rates but not set them, create the underwriting and offer a form of insurance to the banks against default. Direct lenders and mortgage companies that are approved to do VA loans actually fund and manage the loan process.

Most Veterans are able to qualify for these home loans as long as they are in good standing with their "Certificate of Eligibility". This Certificate of Eligibility is the first step in obtaining a VA Loan and can and should early on in the process be obtained by the Veteran directly from the VA.

The Cert tells the mortgage provider whether the Veteran is (obviously) eligible to buy a home and for how much. The current limits are $417,000 in most areas and more for high cost areas. VA home loans can be a great alternative to sub-prime loans with higher rates, since VA underwriting allows for some dinged up credit. Technically, credit scores are not a factor but if a client is showing a pattern of poor judgment then they may be ineligible for this loan.

VA loans can be used to also refinance a home with the original VA Funding Fee prorated back to the borrower. The terms can be either fixed or adjustable. Like FHA, VA offers fairly safe adjustable programs, as safe as any adjustable/variable loan can be. Typically VA adjustable have reasonable caps on their adjustable. With the current rate market, looking at both fixed and adjustable is worthwhile.

If a Veteran still owes money to the Government for another obligation, the Cert will provide proof of that information and the Home loan will be adjusted accordingly. VA loans are for primary residences for all occupants on the loan application.

VA home loans have some wonderful features to them, such as: They are more lenient when it comes to credit scores and they require zero money for the down payment. In most cases the seller can also pay for the Veterans closing costs.

VA loans do come with a one time VA Funding Fee (VAFF), which is very similar to Private Mortgage Insurance. VAFF is a one time fee that can also be financed and is a form of payment which is used by the Department of Veterans Affairs to pool money in reserves to offset loan defaults.

Once a Veteran is ready to purchase a home they will sit with a lender to be qualified just like any other borrower. The lender will look at income, debts and credit. The lender will pull the package together and obtain a certificate of commitment which lasts for six months, after which time the lender will have to request an extension.

The process is not difficult and we recommend that all home buyers or loan seekers gather all the necessary paperwork early in the process and remain very organized. We also recommend that Veterans find experienced loan officers that offer fair terms and have an impeccable record of ethics.