2010 Government & The Mortgage Industry

   Well here we are and 2110 has the Feds making major changes to the Mortgage Industry and the entire industry has stopped.  You can bet the farm on January loan submissions being way down.  The new GFE or Good Faith Estimate has caused complete chaos.  So I spent several days reading and rereading the 2010 guidelines and I have found multiple ambiguous explanations leaving me to lean on the Lenders for further explanation since they make the loan products available.  I have spoken to many different Lenders both big and small and have not heard the same understanding of the new 2010 guidelines and disclosures yet.  How can this be?  I thought this was to make things easier for everyone involved. 

   The new Good Faith Estimate does not even show the borrower how much money is needed to close their loan.  I can only feel for any new home buyer when it comes to the close of escrow on their new home.  I am not sure freaked out would cover it.  The plan here is to hand cup Loan Officers that will take advantage of people.  As usual a few bad people have hurt us all and most of all Banks & Feds have hurt us the most.  I will list a few examples below for you.

  •  Bank AE’s, Account Executives, would come into our office and tell us to bring them loans and they will pay us up to 3 points back to the L/O, Loan Officer.  These were Bank Employee’s going to multiple Broker’s Offices I am sure telling them all the same thing.  Why didn’t this get into the Media?
  • Politics demand that someone is to blame whenever there is a problem and the Bank’s have shifted the blame perfectly to the Brokers.  I will debate any Banker that would like to about this issue as they all know it is not true!
  • The Media took the story that the bank’s told them and printed it and reprinted it until people began to believe that Brokers are what caused the Mortgage Meltdown.  What about the Real Estate Agents, Bank L/O’s, the Bank’s themselves and borrower’s that used their homes like an ATM machine? 
  • Brokers still to this day, Brokers can only offer loan programs that Bank’s make available to Brokers.  So with that said, how is it possible that Broker’s caused the melt down?  If you do not know about the Bank’s “Disco System” then you are not informed enough to answer. 
  • Andrew Cuomo single handily hurt the first chance of Real Estate Market recovery with the introduction of the HVCC.  Cuomo himself has acknowledged the problems with the HVCC process that he setup but is unwilling to fix it if Brokers speak directly to the appraisers.  The answer here is simple, Let the borrower’s order the appraisals and use the uniform 1004 form that already exist.  Cuomo does not like this idea, why?  Why would anyone want to pay an additional fee to an appraisal management company?  So why will Cuomo not budge?  Someone should investigate Cuomo to see if somehow he is invested in appraisal management.   
  • Barney Frank can not seem to keep his trap shut!  This man clearly has no working knowledge of the Mortgage Industry as his comments back up my statement.  Enough said. 
  • This is the difficult issue; Obama himself keeps talking about loan programs that will help thousands of people.  Well the problem here is that none of the banks will do any of the Obama loan programs.  How can this be, the answer is simple, the banks can not sell these loans once they are done.  Banks to not portfolio or hold the loans in house like you would think.  401K fund managers, Hedge Funds, Equity Funds, Bond Funds, HUD, Fannie Mae, Freddie Mac and now the Fed’s actual are the holders of the actual Mortgage Bonds.  Most people do not realize this.     

  I can go on and on but I think you get the picture.   Big Government is hurting the Mortgage Industry and everyone that has spent a lifetime working to payoff their home only to have their nest egg destroyed.  It makes the idea of the American dream of home ownership difficult to get behind.

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