Loan Think

As most of you know, I publish an e-zine that keeps loan originators (and their staff) updated on the new rules and regulations that have occurred over the last 30 days.One of the ways that I get the word out is by using Twitter.You know that just one rule update from Fannie could be 15 pages long and could have 12 rule changes in just one announcement.

With FICO requirements rising all around that means some consumers (with equity) won't be able to refinance. I received this email from a financial services employee this morning: "My rate is 5.25% on the original balance. If I could streamline to 4.5% on my paid down balance this would reduce my payment by $500 and I could spend it in the economy."

We all knew it was coming; it’s been a topic of conversation at industry meetings for some time. There were questions and there was speculation, but now we know the details. While there don’t seem to be any big surprises, there are some changes and being on top of this will keep your reverse mortgage originations running smoothly.First of all, no need to panic. There are some additional steps to be taken and some additional information that will be provided to the senior, but keep in mind that the more informed the senior borrower is, the better for all of us.The new protocol requires that the senior be provided with certain pieces of information prior to the counseling session. In anticipation of these changes, some reverse mortgage originators have been gearing up. Instead of burying your head in the sand and ignoring the changes, be proactive, get a copy of the protocol from the HUD counseling handbook if you like, or speak with your lenders, they should have this information as well. If you’d like a copy, send a message via this article.

As we all know, the U.S. government will run annual budget deficits for as far as the eye can see. There's been plenty of talk from both sides of the aisle about ways to raise revenue (read: more taxes) or cut spending (like Social Security). And then there's the oldie but goodie: eliminating or capping the mortgage interest deduction.

While the lessons of a survey Mintel Comperemedia reported on this past spring applies specifically to banks, there are messages to learn for mortgage originators (of which many people place in the same boat) as well.Mintel said the "secret weapon" for banks to combat distrust by consumers is the social media. The company cited a survey which found less than half of respondents said their bank is a company they can trust, and 50% said they had less trust in banks than they did two years prior.However, 22% of respondents in the same survey said they thought social media sites helped them make good decisions about their purchases, with an equal number saying social networking sites helped them to make good decisions about life in general.

The financial reform bill protects consumers from the home-lending abuses that led to thousands of foreclosures in Silicon Valley by establishing the Bureau of Consumer Financial Protection. The provisions establishing the Bureau grant the Bureau rule making authority and provide the Bureau with supervisory authority over nondepository-covered persons. This includes any person that engages in offering or providing a consumer financial product or service and any affiliate of such person if the affiliate acts as a service provider to such person.

Apartment renters in Las Vegas are in the driver's seat. According to a report in the Review Journal, apartment rents are down 9.1% in the past year with the vacancy rate falling to 9.9% in June, the first reading of under 10% which means landlords are aggressively cutting deals.

THIS JUST IN: I'm starting to hear anecdotal stories about certain mid-sized nonbanks that are targeting (or soon will) high performance loan officers working for some of the nation's mega banks, including Bank of America Home Loans, and Wells Fargo & Co. It could be bluster, but one West Coast manager said word is beginning to leak out to some of the healthier nonbanks (yes, they're out there) that certain LOs are not happy with their present compensation. "And it's not just about money," this one source said. "It's how long it takes to get loans processed. It's driving some of these guys crazy." If you have any intel on this drop me a line at: Paul.Muolo@SourceMedia.com. Feel free to comment on-the-record or off...

Some recent press reports have suggested that $10 billion in nonperforming residential loans have changed hands the past year, leaving some players in the market scratching their heads. "I don't see it," said one West Coast based buyer of NPLs.

Have you been through changes recently?If you are in the mortgage business and haven't gone back to selling pizzas the answer is yes. Successful entrepreneurs do not wait until “The muse kisses them and gives them a bright idea, they go to work.”