Loan Think

There are two schools of thought on how rising mortgage rates will affect the application market. One camp suggests it will kill all mortgage deals, including both purchase and refinancings, while another maintains a spike in rates is forcing some home buyers to get off the fence and buy a home now before rates rise even more.

Even though Nancy Friedman is known as the Telephone Doctor, she has come out with a list of ground rules for customer service that are to be applied whether or not a client comes in the door or calls in.

HUD has issued its new mortgagee letter ML 11-02. The requirement is all Direct Endorsement lenders must update their respective quality control plans to include review of Sponsored Third Party Originators and the FHA insured loans they generate. The update shall document the methodology used to review the sponsored TPO’s, review all TPO loans that go into default during the first six months (i.e. become 60 days past due within the first six payments.) (ml 2011-2)

THIS JUST IN: First off, what we've been hearing regarding a change to Fannie Mae, Freddie Mac and GNMA servicing fees is all preliminary. But rest assured, government proposals (if you can call them that) soon will be revealed. And which agency might do the revealing? Well, that's a different matter.

We continue to hear reports from industry officials about how International Business Machines is jockeying for market position as regulators make it less enticing for the nation's megabanks to hold mortgage servicing rights on their balance sheet. But despite several reports in National Mortgage News about all the MSR contracts IBM's Wilshire division is handling for JPMorgan Chase, IBM continues to be totally mum regarding its mortgage plans.

Well, it had to happen: with all those foreclosures and consumers losing their homes and flocking to apartments, multifamily units have been filling to the brim. It's not quite as bad as the turn of century (two century turns ago) when immigrants were sleeping 10 to a room in Lower East Side tenements in Manhattan, but some housing experts believe all this demand for rentals will spark a housing boom: for multifamily, that is.

Did you forget about the $8,000 tax credit for military and certain federal employees? A little-known (and mostly forgotten) provision of the Home Buyer Tax Credit bill that became effective on Nov. 6, 2009, is that certain military personnel and Foreign Service employees have an extra year to purchase a home and qualify for the tax credit.

Although some mortgage lenders — such as GMAC and Flagstar — are still actively recruiting new loan officers, we're beginning to hear rumblings that certain top ranked lenders are carefully taking a head count, and plan to make job cuts during the next few weeks unless new applications begin to pickup steam.

One of the biggest questions Sue and I get from our subscribers at www.reversemortgagesuccess.com is “Please tell us what your 'best' reverse mortgage marketing strategy is?” or “If you could only do one thing to get new business what would it be?

We heard an interesting story the other day about poor servicing practices on payment option ARMs and the Internal Revenue Service. The story, not yet confirmed, goes like this: a servicer down in Texas is processing POA loans, improperly reporting to the IRS how much interest a consumer is paying on his mortgage. Why might this be a problem? Answer: mortgage interest payments are tax deductible and if a servicer is incorrectly reporting interest paid that means the U.S. Treasury could be coming up a little short (or maybe getting paid too much) in revenue. Will this be the next 'shoe to drop' in the national mortgage servicing scandals? Will a powerful House or Senate Committee chairman take this issue by the horns and launch a full scale investigation into POA servicing practices? Don't hold your breath…