Archives for October 2007

Apology not acceptable

October 4, 2007 by 13 Comments

Last night I had someone (who I thought was a client) email me stating:

"I appreciate your time and help with this thus far, but we’ve decided to go with a different source for our mortgage needs. 

We feel going with someone more local to our area and whom already has a working relationship with our realtor is best for us.   I hope you understand and again, thank you"

Fact is…I don’t understand at all. 

I’ve met with this couple personally twice thus far and we have countless emails and phone calls back and forth at all hours of the day.  I have them preapproved for their mortgage which is a 10% down jumbo that I structured the financing to obtain the best rates for them by structuring a conforming first and second combo.   I have guided this couple and provided them with a strategy for buying their next home together. I have met every one of their mortgage needs.

They hooked up with a real estate agent who used my preapproval letter to secure their home and then did switch-a-roo to her preferred Loan Originator.  It’s a sneaky snakey pass off when everything has been done.  It’s steering the customer. 

How would their real estate agent feel if I would have steered the buyers to another agent that I work with after she has invested the same amount of time with her?  Whenever she called me, I responded immediately.  I never gave her a reason to have doubt in my abilities as a Mortgage Professional.   This is all about steering to her preferred lender.  I wonder if it’s one their company has an interest in?  I also wonder how the Listing Agent would feel if they knew that the lender who wrote the preapproval letter that was presented with the offer is not the lender being used for financing at this stage in the game?   Should a Loan Originator retract their preapproval letter in this situation?  Obviously, I’m not use to someone doing this to me and I’ll get over it.   It’s simply not how I treat people.   

I’m not sure if my bigger beef is with the real estate agent or the buyers.

Why should I understand?  I don’t.   

Filed Under: Real Estate Agents, Residential Purchase

Bad Actors

October 3, 2007 by Leave a Comment

This website was just brought to my attention.  Fraud Problem has an updated list naming individuals who have been denied a Loan Originator License for the State of Washington.   DFI posts the same information.

The largest benefit of Washington State’s licensing law for loan originators who are employed by a Mortgage Broker is that the bar of entry has been raised.  It’s true that prior to this law, one just needed to fog a mirror to be a LO.  It didn’t matter if they were a felon, had committed fraud or if they were competent.   

Over the past month, I’ve had individuals who have received bad advice and have also relied on a "bad actor" instead of a Mortgage Professional for the financing of their homes.   Here’s a link, also from Fraud Problem, on what to do if you have a complaint from working with a "bad actor".  Here is DFI’s link to file a complaint.

Since mortgage brokers and mortgage bankers are regulated by different entities, it can be tricky and take some work to find out where your complaint should reach.

I want my industry to be cleaned up.   Helping people with the financing of their home and proper managing of their mortgage is a noble profession.

If you consider that 70 are listed on Fraud Problem’s site and there are an estimated 15,000 loan originators…simple math tells you that 0.5%* of the industry were unsavory.   I’m not defending the "bad actors" in any way, I am standing up for the 99.5% of us in Washington State who are good.   

*I’m sure this figure will increase as the background checks continue…however, the good will out number the bad. 

Filed Under: Predatory Lending

MortgageIt lay-off today in their Bellevue office

October 2, 2007 by 4 Comments

Unfortunately, one of the Account Executives (Wholesale Rep) that they let go is my youngest sister, Janette.  I’m the oldest and wisest of three girls.   I understand that they laid off approximately 20 employees today with it split between AEs and support staff.

Janette hasn’t asked me to do this…but I’m pretty typical bossy, caring big sister…so here goes.

If anyone is looking for an outstanding, smart, mortgage savvy individual to hire, Janette is worth your consideration.   She has done mortgage retail processing, escrow assistant, wholesale lending…she’s very experienced and has a great personality.   

My other sister is also a Wholesale Rep…knock on wood, she’s okay with her job for now.   I work for family and so I’m hoping my job is safe (or the holiday dinners may be a bit uncomfortable for more than one reason). 

This market is amazing sucks.

Filed Under: Current Affairs

I should save this post about WaMu for a Friday Funny

October 1, 2007 by 7 Comments

This is such a joke I can’t stand it.   Washington Mutual is saying that lenders who broker to them, must adhere to tougher standards.    According to this article, from CNN:

"brokers who do business with the company must show evidence that they explained to borrowers key terms of the loans they are recommending – such as the amount, whether the interest rate or the payments may change, and if the loan has a fee for prepayments."

This should happen automatically with all loans.  I’m all for it.  The current forms that are used, such as Good Faith Estimates and Truth in Lendings could definitely stand for some improvement. This is not the funny part…the following is:

"In addition, brokers should also disclose the amount of their compensation, Washington Mutual said, adding that it would try to call every borrower represented by a broker before closing to review the loan terms."

A bank, who does not disclose what they’re compensation is "on the back end" is insisting that mortgage brokers do…guess what, mortgage brokers all ready do disclose their YSP or SRP.   Banks, like Washington Mutual do not!  In addition, Washington Mutual is stating that they will try to call every borrower to review the loan terms.   Yah, sure.  I want a Washington Mutual representative to contact my clients.   I doubt it would be to make sure they understand the terms.   I’ll bet it’s to see if they can undercut the loan originator who was sending Washington Mutual the loan in the first place.

Washington Mutual is one of the grand-daddys of the mortgage time-bomb: the option ARM. They’ve been schlepping this product to their clients for years.  And suddenly now they are going to try to improve standards of mortgage brokers when it’s banks like theirs that have created these programs and have been pushing them to Mortgage Brokers to pawn our clients for them?   

From Business Week’s Nightmare Mortgages: 

"There’s no way to camouflage what Harold, a former computer technician who asked BusinessWeek not to publish his last name, is about to face. He’s disabled and has one source of income: the $1,600 per month he receives in Social Security disability payments. In September, 2005, Harold refinanced out of a fixed-rate mortgage and into an option ARM for his $150,000 home in Chicago. The minimum monthly payment for the first year is $899, which he can afford. The interest-only payment is $1,329, which he can’t. The fully amortized payment is $1,454, which his lender, Washington Mutual (WM ), gets to count on its books. WaMu, no fly-by-night operation, said it couldn’t comment on Harold’s case, citing confidentiality issues."

Gee, wonder who’s going to counsel borrowers of loans originated by Washington Mutual?

In my seven years of working as a Mortgage Professional, I believe I’ve managed to send Washington Mutual two transactions.  Both were at the customers request.  The last one was years ago.   I don’t need WaMu and I don’t embrace their new standards.

I just may have to pull my few bucks from my checking account with WaMu (the last time I called my friend of the family to reorder my checks, I was routed to a call-center in the Philippines) and try to find some Ma and Pa Bank to keep my spare change in.

I’m not laughing anymore.

Filed Under: Mortgage

Another round of voting for the Magnificent 7

October 1, 2007 by Leave a Comment

Mag7

Please visit Larry Cragun at Real Estate Undressed and place your vote for the best  consumer real estate article.   The competition continues!

Filed Under: Weblogs
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