Loan Think

Thanks for checking out “Mortgage Bytes,” the new blog of Mortgage Technology magazine.The genesis of this blog, and its name, goes back more than a year ago, shortly after I came on board as managing editor of the magazine. With all of the product releases, technology integrations and company hire news coming out of the mortgage tech sector, I wanted a way to bring all of these briefs together in one place for readers to quickly get informed on the latest industry updates.

A new book from journalist Robert Neuwirth estimates that small, illegal, off-the-books businesses collectively account for trillions of dollars in commerce and employ fully half the world's workers. How much of this is going on in America is another question.

Depending on whose foreclosure data you believe, the case is that more than five million units make up the current excess housing inventory in the United States. CoreLogic reports that north of 1.6 million units are in the foreclosure process, with more than 750,000 units that are “seriously delinquent,” meaning that the attached mortgages are 90 or more days late.

When we turn the calendar to 2012, the U.S presidential race will heat up. America's housing crisis is certain to be a hot campaign issue, and we will have no shortage of suggestions to stabilize communities—from expanded programs to purchase and redevelop vacant and foreclosed properties, to assistance to either buy a home or prevent foreclosure.

When a potential homebuyer is looking for a house, many variables are taken into account, but generally location, location, location are the top three. This becomes an especially important consideration if the family involved has children who will be attending public school. Homes in school districts with the most generously filled coffers and highest ratings are always in demand, despite downturns in the real estate market.

Successful selling almost always requires the salesperson to obtain information from the prospect to facilitate a sale. Regardless of your product or service, obtaining insightful facts about the prospect’s needs, concerns and desires should serve as a guide on how to accomplish a favorable outcome. The problem that always presents itself is determining how to effectively probe and extract information without sounding like a C.I.A. interrogator whose next question might involve waterboarding.

What a surprise! A study by the Federal Reserve Board of New York found that speculative investors in real estate played a large part in the quick run-up and subsequent devaluation of housing prices, and are responsible for more of the financial crisis than previously thought. Wow! Turns out lenders were the victims after all, right?

Not so long ago, I mused in a column for this publication about the dearth of qualified underwriters available at a time when the industry is in desperate need of them. It was Hemingway who first introduced me to the concept of the Lost Generation, a situation that seems to have entered our reality today.

Safety, soundness, and compensation: These are words most often associated with the evaluation of large depository institutions. However, increasingly auditors are looking towards such standards in interpreting and implementing the newest regulations pertaining to compensation, and various guidelines applicable to nearly all financial institutions have expressly incorporated such concepts in evaluating an organization’s viability and compliance. Moreover, as a matter of profit maximization and risk mitigation, considering the balance of risk and reward in establishing compensation–especially for management–should assume top priority to an institution’s decision-makers.

Among pending mortgage industry regulatory deadlines some players could be in neglecting in 2012 are requirements for third-party MERS audits.