MortgagesUndressed

Loan Officers and Real Estate Agents are finding it tough sailing. The larger portion of the lending force have few qualifications. They feasted on refinances. A signifcant portion of the agent force did well when so many buyers and sellers were to be found.

Last year many tried to make it part time. It is getting discouraging and many are bailing out. That is good. Those who survive do so because they love the business, have proven themselves, or are so danged determined they are the type of agent you want to work with.

Just be careful that when picking an agent or lender you don’t find one half way down and not yet landed in their new career.

Can’t you just hear the guy jumping above as he yells Bonzaiiiiiiiii. Yes, that is a good one. From real estate to landscaping. I love it. lar

Am I really doing too much loan officer bashing? No. I do offer a solution, a consumer protection solution. Be careful who you put in charge of your loan. We now invite loan officers that have real estate agents that will recommend them to participate in our national initiative soon to be in beta testing.

We will be directing consumers to the agent loan officer teams that have experience with each other. Now is the time to contact us if you have that capacity. Larry@mortgagesundressed.com Cragun.

I have been challenged on a few old posts with, “what right do you have to mess with what people are charged”? “It is the market that determines that isn’t it?” “Let the market decide what loan officers should charge.”

That is all fairy tale talk. At least with the loan officers I would like to see out of the business. With rebates given for raising rates, including a pre-payment penalty clause, selling a sub-prime loan, or selling an ARM with terms favorable to the bank when the loan adjusts up it is very difficult to let the market decide the money the lender will earn.

Add to that - almost no one will go through a second application. If a liar can get you to fill out the application, you are nearly dead meat.

Add to that - if the liar or greedy loan officer can get you close to closing before you see the numbers he has got you. Too few people are willing to walk, even when getting ripped off.

Add to that - all too many borrowers are in a hurry at closing, just sign without reading.

So the bad ones, they charge as much as possible on each and every loan.

Then there are the stellar ones. The stellar ones are loan officers that are truly professional. The loan officer that can garner the trust of real estate agents. How do they charge?

First of all - they are having enough activity to know what is competitve.

Next - they believe in their hearts that the HUD 1 closing statement is an indication of their integrity. First of all it will match the Good Fatith Estimate for costs. It will match the lock sheet for rate and fees. These loan officers assume that the real estate agent for both sides of the sale, the borrower and everyone the borrower knows will some day see the HUD 1. They know that if there are thousands of dollars in rebates, someone will see them and judge them. They know their reputation is on the line, and more importantly their ability to get referrals and repeat business.

So in summary, how do good loan officers decide what to charge you? They charge what is competitive to the marketplace. The difference in a good loan officers methods, there are no tricks and there is full disclosure.

MAJOR MARKET CHANGE ALERT !!!
Effective immediately the prime market is experiencing HUGE changes to high CLTV,
reduced doc, and NOO products!  The second lien market is evaporating at record
speed and is virtually becoming nonexistent!  These changes are happening across the
market, with all lenders ... remember the industry saying "subject to change without
notice".

What does this mean to you?

*        My community 100% which allows for EAI and EAII, low M.I.
*        Flex 80/20 loans still available Full Doc with score of 700 using our C30 and
Elite Full Doc seconds
*        Flex100 loans can be used instead of 80/20's and 75/25's
*        FHA 97% loans w/gift will be used instead of 80/20's
*        VA 100% loans will be used instead of 80/20's
*        OO Full doc Alt A loans will be capped at 95% cltv
*        OO SIVA, No Ratio, SISA, and No Doc 1st and 2nds will be capped at 90% cltv
*        NOO Full doc Alt A loans will be capped at 90% cltv
*        Discontinued ... NOO No Ratio, SISA and No Doc seconds

What else may be on the horizon?

*        SIVA, No ratio, SISA, and No doc will only be available for self employed?

Dan Green reporting. click here

They say Washington State has over 10,000 loan officers. My hunch, my educated hunch is that 8,000 are struggling financially. When the loan officer is having a low income period the tendency is to make a killing on one loan.

Also, some, greedy little devils are out to take as much from your transaction as possible as just a mere course of life.

The lending business is so complicated that you may find it difficult to catch all of the ways you get hurt and the loan officer gets a fat paycheck thanks to your naiivity.

(I inject here, that a very recent real life situation brings this article to press.)

I also ask you - do you think that $15,000 on one $300,000 transaction is a bit over the top in fees you pay the mortgage company for a loan? If you say no to this you are not to whom we right this blog. You say you would never allow that kind of expenses for a loan, say a refi. Of course you wouldn’t if you understood it was happening. But the cowards I have worked with, employed and fired, or competed against, do this under a cloak, as if they were in your bank account and you were unaware.

A competitor this week got to a dear friend. I was supposed to advize them and make sure he or I had the best program for them. I got an email, not a shot.
In one short email I felt sad for my dear friend. These people have good credit. They have enough income to qualify for a conforming (low rate) loan.

This tells me they got ripped off. “We only have a 3 year prepayment penalty.” We get to take cash out for an investment we could not have made, and that’s above the price to get the loan.”

Their ain’t no prepayment penalties in good credit. These good people got sold a subprime loan. The coward is going to make his money in rebates.

Fortunatly the subprime lenders are in a tail spin. Unfortunatley the greedy little snakes are finding unsuspecting folks that deserve conventional loans, and giving them a song and a dance, some money back, and a subprime loan.

It is disgusting. It is also one of the reasons for this blog.

I know it is more fun to look on line at homes than to learn about the mortgage tricks. It is certainly easier to tell the difference between a 4 bedroom home than a three than to know to look for an ARM Margin or if it is an ARM at all.

I try to make these mortgage and real estate blogs a bit zaney. I am a zaney kind of guy when feeling my oats. I try to make them quick and easy reads. I inject things you need to know a little at a time. This is probably one of my longer articles. I do things this way in hopes more than the 100 mostly professionals that drop by will become many more, and many that are consumers.

I guarantee regular visits will eventually get you educated enough to know what to watch out for. What I can’t guarantee is if you will be mature enough to not jump for a smooth sales pitch, or too busy to not read what you sign, or too committed to see a problem and sign anyway. If we prepare, you prepare, before it is too late, you might save 10 grand or so and a lot of headaches.

To add to the services for you, I not only write from my experiences, I search for other great writings. Thus came about the magnificent 7. I calculate that in February I read 4000 articles looking for 7 I could nominate for the 7 Magnificent in 2007. It was hard to do that few, so I am putting up nine for your review. Some are on lending some on real estate. This month they are posted on realestateundressed.com.

Product changes - effective immediately.

As you are aware, the non-prime market continues to be in a
state of flux due to economic conditions, credit concerns and
loan performance. As such, the requirements from investors and
regulators are changing rapidly, affecting both the industry and
even consumers.

At New Century our commitment to you remains. We will be here
for you in this market and in the future, and will continue to
work hard to help you navigate through this tough year of
transition.

We are committed to taking a proactive and responsible approach
as the industry works through these changes. On that note, we
met with our Wall Street investors, regulators and other
agencies that provide liquidity to the market to gain the
necessary insight to develop the product set to meet the future
demands of the market. These meetings, combined with current
market trends, have caused us to adapt our current product menu.

Due to the lack of investor demand for high LTV/CLTV non-prime
products, New Century will no longer offer non-prime niche combo
and 100% one loan products.

We appreciate your business and look forward to providing you
with excellent service for all of your traditional non-prime and
Alt-A product needs. Further, we remain committed to being here
for you and bringing you the products and services you need to
compete in this market and be stronger in 2008.

Look to the following products to help drive your business:

- 40 and 50 year loan products

- LTV up to 95% for full, limited and stated

- Jumbo loans up to $2M

In addition, please check out our current pricing specials on
www.newcentury.com.

Any impacted loans submitted to a New Century production center
after March 2, including those registered in Fastqual, will be
subject to the new guidelines.

All loans subject to underwriting approval, including credit and
property valuation. Not all borrowers will qualify. For some
loans, minimum loan amount is $50,000. Loans and specific
programs not available in all states. Terms and programs subject
to change without notice.

New Century Mortgage Corporation