Loan Think

As with every issue of this newsletter I will share with you many ideas you can instantly apply to your business and your personal life. Here is an article that is particularly fitting to the changes we are currently experiencing in our industry as we move from a refinance market to a purchase market.

It appears that the state of Missouri is looking for new sources of revenue and is going after loan brokers. Donna McCallister of All Credit Mortgage reports to us that this week she received a package from the Missouri Division of Finance which is asking for a $300 “investigation fee (I guess to prove that I am a mortgage broker?)” and another $300 for licensing. To add insult to injury, the state also is asking for a $50,000 surety bond which will cost $500. Ms. McCallister says she has been in business for 13 years – eight as a HUD approved broker. She notes: “It is hard enough to keep the expenses paid and now they want more and more. It seems like they want us to fail.” I’ve been receiving similar emails for the past year. Meanwhile a new survey says that 57% of economists believe the recession is over! Tell that to all those unemployed Americans who are struggling to pay their mortgages and can’t find a decent job. Here’s one thought: what will happen to the home buying business when the federal $8,000 first time home buyer tax credit expires -- along with the $10,000 tax credit in California? And what about the “cash for clunkers” auto relief act? Congress has already voted to extend the program – but one day the sun will set. Stay tuned...

Our story today comes under the heading of "you just never know" but it got me thinking. I've been doing that a lot lately in response to requests from coaching members who want some unique and creative ideas to spark some new business.

Who says Uncle Sam doesn’t care about non-bank mortgage lenders that rely on warehouse lines of credit? Follow my logic here: Uncle owns 34% lf Citigroup which this morning revealed that it would use $2 billion of TARP money to make new warehouse lines of credit to non-bank residential funders. Now that Colonial Bancgroup’s warehouse division in Florida has been cordoned off by yellow “keep out, this is a government raid” tape that means Citigroup (thanks to Uncle) could soon be the nation’s largest warehouse lender. We called Colonial this morning to get a response but a person answering the phone wasn’t commenting. The bank’s warehouse chief wasn’t in today. Meanwhile, it appears the Federal Deposit Insurance Corp. is taking a keen interest in the warehouse issue. For the full story see the National Mortgage News website later today. And one last thing: We’re hearing some interesting things about the TARP IG probe of the Taylor, Bean & Whitaker/Colonial deal. Hear anything, drop me a line at: Paul.Muolo@SourceMedia.com...

If people who are in charge of marketing for mortgage companies don't have enough to worry about in terms of ethical perceptions by consumers, a survey by business intelligence firm Kognitio, Chicago, is just one more hurdle to overcome.

FEDERAL TRADE COMMISSION EXTENDS TIME TO HAVE RED FLAG IDENTITY MANUAL IN HOUSE TO NOV. 1, 2009

Because we are all taxed with trying to accomplish more within every 24 hour period of time, many of us have turned to innovative technology for answers. Cell phones have come a long way with the introduction of smart phones and broadband connections, which allow us to stay connected to the office where ever our travels take us. Busy mortgage executives, road warriors looking to close the next deal, and parents rushing to get their kids to practice on time have all turn to mobile e-mail and texting to stay connected while on the go. While this technology has been widely adopted and proven to be extremely effective, it can also pose significant risks.

Now that Taylor, Bean & Whitaker has hit the wall, what will become of its $78 billion residential servicing portfolio – much of which covers Freddie Mac loans? Some might recall that when American Home Mortgage of Melville, N.Y. went bust two summers ago Freddie Mac pulled its servicing rights from that shop (hiring Bank of America to temporarily service those receivables) while Fannie Mae allowed American Home to continue servicing for them. (AmHome was in Chapter 11.) For the full update see the National Mortgage News website later today. Meanwhile, I just got back from a week long vacation on the (New) Jersey shore and vacation property values seem to be holding up in certain towns like Avalon, Margate, Ocean City, and Sea Isle City. Rental prices have come down a bit (say 20% or so at worst) but units are still being rented out which means the mortgagor can still make his payments. Absent from all the freebie real estate pamphlets: mortgage advertisements from lenders that are willing to finance vacation properties. I only spotted a few...

Either you have a process of generating customers or you wake up every morning unemployed and looking for a loan. Sound familiar.

Paul Muolo is out of the office. We're running this story in place of his usual column.Can MGIC Pull a Rabbit Out of an MI Subsidiary?