The overlap between federal and state laws and regulations becomes very apparent once there is an examination and/or an enforcement action. With COVID dominating our work environment over the past two years, not many audits or exams were scheduled by state regulators. That is all about to change. They are way behind and will begin the process of catching up sooner than you may be ready for. In many cases where mortgage companies get caught …
With the new URLA behind us…along comes the next major change in residential lending. Fannie Mae and Freddie Mac (aka the GSEs) have provided an update on the new URAR. Yes, the Uniform Residential Appraisal Report is undergoing some major changes. Here are just a few highlights: Input was gathered from 107 stakeholders across the industry in designing the new form. The key benefits of the new form are: Dynamic output with commentary placed within each …
With rates going up, refinance volume quickly heading south and originators looking for the next shiny thing, we are bound to see movement in the industry. That means mergers, buyouts and some companies closing. Migrating originators can be a tricky challenge for the next employer. There are two issues that may surface; who owns the customer and how were the originators compensated? I’ll save the former for another time. Last week I received a call …
Real estate transactions are the easiest way to launder money due to the size of the transactions and the amount of money that can be “cleaned”. All financial institutions are required to comply with the Bank Secrecy Act. Money laundering may also involve tax fraud as well as other potential crimes. All “financial institutions” must comply. According to the Bank Secrecy Act, a “financial institution” includes an exhaustive list of entities, including but not limited to: …
You wouldn’t know we were in the middle of a pandemic based on the housing market. That conforming limit keeps creeping up. It all seems crazy from when I started in the mortgage business in 1994, the conforming loan limit was $225,000. Fast forward 26 years…the 2020 limit was just increased another 9.0% to $548,250 for 2021. Checkout the Loan Limit Geocoder. Now, all we need to know is…what will Fannie and Freddie be doing come …
My analogy to guidelines these days is they are like trying to hold jello in the palm of your hand. Squishy, slippery, moving; slipping through your fingers! Patience is a virtue! We need to understand that underwriters spend MUCH more time determining the amount of income that can be used for qualifying, how consistent it is or will be, the job status of employees, viability of employer’s business and documenting the file to meet secondary …
Recently a mortgage loan originator in another state contacted me for help. He was stuck with an underwriter and was challenged by how to calculate the self employment income. In that conversation he told me how helpful it would be to originators to have a “loan advisor” to consult with. He encouraged me to set up Advisory Sessions and they are now available to any originator who knows the value of time. In addition to …
April 29, 2020 – The CFPB issued an Interpretive Rule today titled: Application of Certain Provisions in the TILA-RESPA Integrated Disclosure Rule and Regulation Z Right of Rescission Rules in Light of the COVID-19 Pandemic. The rule allows for COVID-19 to be a “financial emergency reason for borrowers to WAIVE the TRID closing waiting period and the three-day right of rescission. “The Bureau understands that the COVID-19 pandemic could pose temporary business disruptions and challenges …
26,000,000 people filed for unemployment in the past several weeks; and it’s not over! The Coronavirus is causing serious financial issues for states. For the first time ever, independent contractors are eligible under the CARES Act , even though unemployment taxes may not have been paid in. When the states start looking at all the workers who were 1099, what action will they take? The IRS is just as interested in independent contractors, even more …
Every customer should receive a written analysis; it helps take emotion out of the equation. I do it for all my purchases and refinances. Yes, we have lots of long discussions, but hearing and seeing are two different things! The point of an analysis (particulary for refinances) is for a consumer to know the interest costs and principal reduction between a new loan and the original loan at it’s current balance. (you may need to …