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July 28, 2010

Financial Reform Bill Flawed

Category: Mortgage Lender Discussion,Mortgage News,Mortgage Reform News,Published Articles – admin – 1:44 pm

Much to the surprise of many pundits, the recently signed Financial Reform Bill did not outline guidelines for regulators to begin crafting the future of Fannie Mae, Freddie Mac, and Ginnie Mae.  Although this was viewed as an oversight by most, it was the right move because it will allow our political and financial leadership to focus on repairing the mortgage finance system.  Remember that the government loan programs Fannie, Freddie, VA and FHA loans maintain nearly 96% of the mortgage market-share yet they are exempt from most of the financial reform repercussions.   

In April, Treasury outlined their “Housing Finance Reform” objectives. The administration’s proposals will be designed to achieve four objectives.

  1. Mortgage credit should be available and distributed on an efficient basis to a wide range of borrowers.
  2. A well-functioning housing market should provide affordable housing options, both ownership and rental, for low and moderate-income households.
  3. Consumers should have access to mortgage products that are easily understood.
  4. The system should distribute the credit and interest rate risk in an efficient and transparent manner that minimizes risk to the broader economic system an does not generate excess volatility or instability

Demand for home loan financing has hovered near the 13-year low reached earlier this month, showing the lowest mortgage rates on record have yet to spur sales after the expiration of a government tax credit. It will take gains in employment and in consumer confidence to boost housing.   “The housing market is weak,” Paul Anastos, president of Mortgage Master Inc., a Walpole, Massachusetts-based mortgage lender, said in an interview before the report. “There’s good opportunity out there in the housing market, but because consumer confidence is fairly low, people aren’t really shopping. They’re worried about other things, like jobs.”

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July 7, 2010

Citi Shuts Down Wholesale Jumbo Mortgage Loan Program

Category: Loan Origination News,Mortgage Industry Rumors,Mortgage Lender Discussion,Mortgage Lending Stories,Published Articles,Wholesale Broker Discussion – admin – 11:36 pm

According Paul Muolo from Origination News online, CitiMortgage ceased closing wholesale jumbo mortgage loans a few months ago.  This devastated many mortgage brokers who counted on Citi for competitive jumbo mortgage loan products. National Mortgage News reported that CitiMortgage has started to slowly bring back their jumbo mortgage products in their retail branches. Muolo cited a former Citi jumbo mortgage loan broker that said Citi’s retail jumbo pricing “is not competitive.” In addition, to he reported that certain mortgage service companies are not approving loan modification plans unless the borrower is at least 30-days delinquent.

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May 14, 2010

Lead Planet Reports Surge in Refinance Lead Volumes

Category: Lead Buying Tips,Lead Generation,Loan Origination News,Mortgage Lender Discussion,Mortgage Lender Tips,Mortgage Marketing,Net Branch News,Published Articles – admin – 5:39 pm

For most of the year, loan companies have been searching for refinance leads with better conversion ratios.   U.S mortgage demand increased again last week, led by a rebound in refinancing applications as mortgage rates hit the lowest levels of 2010.   Bryan Dornan, the founder of  the mortgage lead company, the Lead Planet said, “Mortgage marketing has been difficult in 2010 for lenders and brokers that focus solely onhome  refinancing, because lending guidelines have tightened to a very uncomfortable level.” Finding a homeowner who qualifies for a refinance is ten times more difficult than it was just 3 years ago. 

In the article, Lead Planet indicated that refinance lead volumes surged almost 20% last week.  Apparently their lending partners utilized the increased lead volumes and new loans submitted into process increased tenfold.  A spokesman for the Lead Planet said Purchase lead volumes rose 5.75% even though nationally home loan applications had come to a screeching halt.  

Overall, mortgage demand increased 3.9% on a seasonally adjusted basis. Unadjusted, demand increased 3.4% from the week before.  30-year fixed-rate mortgages dropped from 5.02% to 4.96%, while rates of 15-year fixed-rate mortgages fell to 4.32% from 4.34%.  Interest rates on one-year adjustable-rate mortgages decreased from 7.03% to 6.86%.  Read the original article online > Lead Planet Reports Big Jump in Mortgage Refinance Lead Volumes

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May 12, 2010

Reverse Mortgage Lenders Cut Lender Fees

Category: Financial News,Loan Origination News,Mortgage Lender Discussion – admin – 11:41 am

Several reverse home mortgage lenders eliminated the origination and servicing fees on their senior home loan products, in an effort to re-brand the mortgage industry.  Changes in the Federal Housing Administration Home Equity Conversion Mortgage program, combined with lower home values, resulted in cuts in the amount of proceeds borrowers were eligible for, experts said.   Financial Freedom, now part of OneWest Bank, has created the Financial Freedom Senior Saver product, a fixed-rate home equity conversion mortgage which charges no origination and servicing fees.
The new program, the company said, will give seniors a savings of between $3,500 and $10,000 in loan costs. Borrowers still are responsible for the FHA mortgage insurance premium and third-party costs.

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February 9, 2010

Saving Money When Refinancing Your Mortgage

Category: FHA Mortgage,Mortgage Lender Discussion,Mortgage News,Published Articles – admin – 5:54 pm

It is very important that you consider the lending costs and benefits when comparing mortgage refinance loans. Charles and Nancy Henson refinanced their home mortgage last year, and Charles Henson says it was not a difficult decision. “The mortgage rates had dropped, and we wanted to do something a little more secure,’’ he said. “Our previous rate was 5.625%. We ended up locking our home loan at 4.875%.’’ The current mortgage rates have spurred many to consider mortgage refinancing – basically replacing one loan with another. Depending on the new loan’s terms, it can save you tens of thousands of dollars.

Each refinance mortgage is its own case, due to many factors: your loan, your credit, your home’s equity, the interest rate, the cost of the refinancing, and so on. Some things to consider:

■ Interest rate. “If you can save half a point or more on your interest rate, that can be a good indicator to refinance,’’ said Kay Sandusky of Citizens National Bank of Southwestern Ohio. Sandusky added: “If it is going to cost you $2,000 to do the refinance and you are saving $200 per month, do the math and consider how long you will be in the home and if that is a savings to you.’’ “How long you’re going to be in the home is a big factor,’’ Penner said. “If someone is going to live in the house three to five years, [refinancing] may not be a great idea.’’
■ Total cost benefit. Kim Penner of Union Savings Bank said you have to consider total costs when considering refinancing. “Your lowest interest rate alone is not always your best deal,’’ Penner said. “You have to see if it makes sense to get a lower rate if your costs are high.’’
■ Short term vs. long term. “Think about what term of loan you want,’’ Penner said. “Is cash flow an issue? Are you looking at retiring?’’ He added that the sooner you pay off a loan, the more you save on interest payments. “The difference in interest could be $40,000, $50,000, $60,000,’’ Penner said. Henson is retired and his wife is self-employed, but he said they chose a 30-year rate because it was a more conservative approach, given the economic climate. They “decided we could make a 30-year into a 15 by paying more on the principal each year,’’ Henson said. “With a 30-year rate, you have the flexibility if you want to pay extra.’’
■ Credit score. Borrowers who have at least a 740 get the best terms. If your credit score is lower, you can still get a loan, but at a higher interest rate.
■ Know your home’s equity. “You have to have 20% home equity ask for a conventional home loan without private mortgage insurance,’’ Sandusky said, though there are other options. FHA home loans have mortgage insurance, but if your credit is outside of the conventional box or if you have no equity, talk to a FHA mortgage company, because these government loans may be your best option for refinancing.
■ Talk to a professional. “I ask a lot of questions about the borrower and offer options,’’ Penner said. Be careful shopping for a mortgage online. Don’t let banks obtain your credit report each time. “Multiple inquiries on your credit report in a short period of time can harmful to your credit,’’ Sandusky said. “Know your credit and tell the bank.’’

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January 27, 2010

Mortgage Rates Rise After Fed Meeting

Category: Mortgage Lender Discussion,Mortgage News,Mortgage Rate Report,mortgage rates,Published Articles – admin – 7:00 pm

Mortgage rates improved a few basis points yesterday. Home loan applications have decreased across the country over the last few weeks.  Home lenders were somewhat subdued in passing along mortgage rate improvements though. This is a function of a few reasons. First, mortgage-backed securities prices have held to a tight range over the course of the week. The second reason is a bit more obvious, the FOMC meeting ended today at 2:15pm. This was a major market event, so it makes sense that mortgage lenders would be defensive ahead of a scheduled event that had the potential to move interest rates in either direction. Before getting to the impact of the FOMC on mortgage rates, allow me to recap the day’s economic data releases. Both conventional and FHA mortgage rates ticked up slightly.

Early this morning, the Mortgage Bankers’ Association released their weekly applications index. The MBA survey covers over 50 % of all US residential mortgage loan applications taken by mortgage bankers, commercial banks, and thrifts.  The data gives economists a look into consumer demand for mortgage loans.  A rising trend of mortgage applications indicates an increase in home buying interest, a positive for the housing industry and economy as a whole.  Furthermore, in a low mortgage rate environment, such a trend implies consumers are seeking out lower monthly payments which can result in increased disposable income and therefore more money to spend on discretionary items or to pay down other debt.

The Fed keeps mortgage rates low! No Money Down Home Loans are available with VA. Finance Home Rehabilitation!  Check your eligibility for FHA 203K Loans.

The report indicated a 3.3% decline in purchase application activity and a 15.1% decline in refinances.  Of note, the MBA issued a rare comment: “Although rates remain low, there appears to be a smaller pool of borrowers who are willing and able to refinance at today’s rates.” I agree, mortgage rates in the low 5% range are still extremely aggressive when you look back at the history of mortgage rates, but I think a more accurate statement would have been “many borrowers want to refinance to take advantage of near record low mortgage rates, but the tightening of lender guidelines has made it too difficult for borrowers to qualify.”   Maybe that’s what the MBA was really trying to say? What is your opinion?

For more on the MBA Applications Index and the potential impact on the Fed’s intentions to exit the MBS market, check out the other mortgage news stories.  We also received another look into the strength of housing: the New Home Sales survey. This survey is primarily based on a sample of houses selected from building permits. Since a “sale” is defined as a deposit taken or sales agreement signed, this can occur prior to a permit being issued. Changes in sales price data reflect changes in the distribution of houses by region, size, etc., as well as changes in the prices of houses with identical characteristics. It takes four months to establish a trend of new home purchases.

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January 8, 2010

Mortgage Loan Originators Losing SRP Rebates

Category: Loan Origination News,Mortgage Lender Discussion,Mortgage News,Secondary Market – admin – 6:36 pm

The National Mortgage News reported that there may be a bit of a revolution happening with small to medium-sized mortgage loan originators that have been selling their servicing rights on a “released” basis in the secondary market. The revolution is this: more firms are thinking of keeping their SRPs with either in-house or assigning them to a sub-servicer. Why are they keeping the SRP? The short answer is that the price being paid by the mortgage cartel for SRPs bites.

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August 14, 2009

Mortgage Brokers Network for Net Branch Recruitment

Category: Mortgage Lender Discussion,Mortgage Lender Tips,Mortgage News,Net Branch News,Wholesale Broker Discussion – admin – 3:27 pm

Mortgage Brokers Network understands net branching, recruitment and lead generation.  As an industry leader in loan officer recruiting for the banks and net branches, Mortgage Brokers Network provides the largest network of loan officers and active net branches in the country.  MBN helps loan professionals find the lender or bank that best suits their needs and financial goals.

*    Mortgage Training and Loan Officer Education
*    Continuing Education for Loan Officers
*    Mortgage Lead Generation
*    Recruiting for Net Branches
*    Virtual Branch Locators
*    Loan Modification Companies
*    FHA, VA, Reverse, Conventional Lenders

Visit Mortgage Brokers Network online at http://mortgagebrokersnetwork.com  or call them at 815 -230-9867 to get more information.  Read the original MLV Article online > Mortgage Brokers Network for Leads and Recruiting.

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August 10, 2009

Taylor Bean and Whitaker Closing Hurts Mortgage Brokers

Category: FHA Mortgage,Financial News,Mortgage Lender Discussion,Mortgage Lending Stories,Mortgage News – admin – 8:27 am


The impact on Taylor Bean and Whitaker shutting down wholesale will be significant for mortgage brokers across the country.  Many mortgage companies used TBW for all their FHA home loans and this will hurt them.  The loss of Taylor, Bean and Whitaker as a wholesale lender is a major blow to U.S. mortgage brokers who say it means home loan applicants who were in process at the wholesaler will need to purchase new appraisals and potentially sit through new waiting periods.

Taylor Bean disclosed Tuesday that it lost its FHA approval and that its Ginnie Mae servicing portfolio was seized. Then it surprised its customers Wednesday with a notice indicating it stopped originating, closing or funding any home loans. In a news release today, the National Association of Mortgage Brokers called the Ocala, Fla.-based lender “a major channel for wholesale mortgage funding.” 

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July 21, 2009

Closing.com Prepares for RESPA Reform

Category: Financial News,Mortgage Lender Discussion,Mortgage Lender Reviews,Mortgage Lending Stories,Mortgage News,predatory lending – admin – 10:49 pm

According to a recent Inman News article, Closing.com, an online portal that enables consumers, mortgage consultants and real estate professionals to comparison-shop for settlement services online, says it will display cost estimates in the format required on the standardized Good Faith Estimate before mortgage lenders were required to use that form back on January 1st.

By the 4th quarter of this year, borrowers using Closing.com will be able to submit a “pre-GFE” to home loan originators, allowing for more reliable estimates of closing costs, the mortgage technology company said in announcing the launch of a 2.0 version of its Web site in beta testing.

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June 4, 2009

Home Refinancing with Home Affordable Refinance Program

Category: FHA Mortgage,Financial News,Mortgage Lender Discussion,Mortgage Lender Tips,Mortgage News,New Lending Products,Published Articles – admin – 5:15 pm

Do You Qualify for the hottest mortgage loan, HARP?

FHA refinance loans aren’t always attainable for self-employed borrowers looking for fixed rate refinancing, because HUD requires full income documentation.  Loan modification plans can be nearly impossible for borrowers in high cost regions like California, New York and Florida who have jumbo mortgage loans.  Mortgage relief is often easier said than done.


When the stimulus package passed, millions of homeowners felt they were dissed. While the new mortgage relief program focuses on homeowners in foreclosure, it offers nothing for the homeowner who is responsible and current with their home loan payment. To compensate for this oversight, the U.S. Department of Treasury recently launched the Home Affordable Refinance Program (HARP). “HARP was created specifically to provide access to reduced-cost home refinancing for responsible homeowners with no equity in their home. Millions of Americans have lost their home equity due to the decline in home prices,” said Joe Engle, president of Loan Smart, Inc. in Thousand Oaks, California.

 

Presently, millions of homeowners find themselves in the unsettling predicament of having to sit on high mortgage interest rates that are not affordable or about to rest to a higher payment that will tip the budget negatively.  Most good borrowers are unable to refinance their homes and take advantage of historically low interest rates, because of the declining home values.  

Through the Home Affordable Refinance Program 4 to 5 million responsible homeowners will have the opportunity to refinance their homes, even if they owe more than 80% of their property’s value. “With low fixed rate mortgage refinancing, many families could see a reduction in their mortgage payments by thousands of dollars per year,” said Engle. Unfortunately, not everyone qualifies for Home Affordable Refinance Programs. This refinance program only benefits homeowners with home mortgages owned or guaranteed by Freddie Mac and Fannie Mae, which are Government Sponsored Enterprises. “At Loan Smart, we can assist homeowners with determining if they qualify for HARP by researching to find out if their loan is owned by either Freddie Mac or Fannie Mae,” commented Engle.   Engle points out that HARP will offer a huge advantage to homeowners with first and second mortgages. HARP will allow for refinancing of the first mortgage up to 105% of the current home value, with the second mortgage remaining in place.

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May 28, 2009

Loan Modification Leads Still Hot but Foreclosure Scams on the Rise

Category: FHA Mortgage,Financial News,Mortgage Lender Discussion,Mortgage News,predatory lending,State Home Financing Law Updates – admin – 9:52 am

Most mortgage industry insiders believe there is still a 12 to 18 month window of opportunity left for foreclosure prevention services like loan modification and loan workouts.  Loan modification leads are still hot in the mortgage marketing circles.  Foreclosure scams continue to run rampant and that makes consumers very weary. 

New measures are being implemented to take aim at what consumer groups say is a surge in fraud by entities offering to help struggling homeowners modify their home mortgage loans or avoid foreclosure.  “There are a lot of different scams going on right now,” said Martha Lucey, president of ByDesign Financial Solutions, a nonprofit credit-counseling agency. “Homeowners are struggling with affordability and many are desperate. When consumers are desperate, they’re willing to pay for unrealistic financial solutions.”

The most common allegations involve struggling homeowners who make up-front payments, often in the thousands of dollars, to firms that promise to work with their mortgage lender to renegotiate their mortgage and lower their monthly home loan payments. The mortgage loans are never changed and the money is gone.

A bill by state Sen. Ron Calderon, D-Montebello, would prohibit firms from charging advance fees for mortgage loan modification services. Supporters say the bill would prevent people in bad financial straits from becoming even worse off.

In addition, the legislation would require for-profit firms to tell potential customers that they could get free assistance from various nonprofit counseling agencies.   “The federal fix is going to take care of a lot of the problems we’re experiencing on the foreclosure side of things,” Calderon said. But people looking for help need to be protected, he said.

The California Association of Realtors opposes the bill. The organization objects to the measure’s blanket prohibition on advance fees.  Assemblyman Kevin Jeffries, R-Lake Elsinore, said he is open to more foreclosure-related safeguards, up to a point.”  My view is that the federal government is getting pretty pro-active in cleaning up the lending industry,” he said. “There’s no reason to duplicate what’s happening at the federal level.”

Several other bills build on parts of SB 1137 dealing with rental tenants in foreclosed properties.  One measure would make the buyer of a rental property at a foreclosure sale responsible for returning the tenants’ security deposit.

According to Jim Miller, another bill would give renters up to a year to leave properties that revert to the lender after foreclosure. The renters would have to move if new owners want to move in.  “We think having a family there is much better for all parties involved,” said Ronald Coleman, legislative director of the low-income advocacy group Association of Community Organizations for Reform Now, known as ACORN. Vacant homes get run down and attract vandals, he said.

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