Another day, another 50 brokers trained. With the unprecedented state of our industry, helping originators better educate themselves about technology, or full doc loans, mortgage insurance, and other stuff makes me feel like I'm doing something to help. And I'll admit, it's not just about being a good guy. Originators are my customers, and I want as many customers as possible, heh-heh. So make sure to keep watching the training area of this blog. I've got many new topics planned in the near future, like understanding FICO scores and how to optimize your website so it's comes up higher on the Google search list.
Joint Center for Housing Studies of Harvard University
I came across this study recently, and while the news isn't great it's obvious that the folks at Harvard (or maybe I should say the 'scholars' at Harvard) did their research. Part of the purpose of this blog is to pass along informative news items, and this is packed with good info. Click here to see the Executive Summary of their research.
Thursday, June 26, 2008
Wednesday, June 18, 2008
Mobile Origination, Mobile Man
Web Origination
When I first accepted a position with Calyx Software in 1995, most brokers didn't even use a computer yet to originate loans. It seems like not so long ago, but loan origination changed quite a bit in the 1990's. So how did they fill out all those forms in the loan package? You got it- a typewriter. Can you believe that? The amazing thing is that many shops, when shown a better, more efficient way of doing things using a computer, said 'Nah- I'd prefer to keep using my typewriter and bottle of White-Out.' But the more tech savvy and the early adopters bought computers and their first copy of Point software, and eventually the masses followed.
I mentioned that little bit of trivia so you'll know I've had a bird's eye view of mortgage broker technology basically since computers were first used on a broad scale to originate loans. And in all that time, in the vast majority of all cases I saw, loan officers still collected a handwritten 1003 and let a processor take it from there. I'm seeing that finally change as again the more tech savvy originators realize that they can use eMagic to do many of the things that they either do today with pen and paper, or rely on a processor to do. And that is really our mission: To give loan officers and processors a web-based origination tool that is available anywhere they can get online. When you originate in eMagic, not only do you have a secure environment in which to collect loan data, collect and share loan documents, generate loan apps and disclosures and manage contacts and leads . . . You also have the ability to export the loan data out of eMagic at any time and import it into a new file in Point, to handle the rest of the processing. Using this method, originators have greatly increased potential in terms of what they can accomplish at the point of sale, and the processor has immediate access to any data or documents collected!
I'll be hosting a WebEx in July that covers this exciting new function of eMagic in detail, so simply find the link at the left and click on it to sign up.
In the News
The White House has threatened to veto a Senate bill designed to prevent foreclosures amid a scandal involving key Senators gets VIP treatment by Countrywide. Here is a quote from the story, by Julie Hirschfeld Davis that ran today:
When I first accepted a position with Calyx Software in 1995, most brokers didn't even use a computer yet to originate loans. It seems like not so long ago, but loan origination changed quite a bit in the 1990's. So how did they fill out all those forms in the loan package? You got it- a typewriter. Can you believe that? The amazing thing is that many shops, when shown a better, more efficient way of doing things using a computer, said 'Nah- I'd prefer to keep using my typewriter and bottle of White-Out.' But the more tech savvy and the early adopters bought computers and their first copy of Point software, and eventually the masses followed.
I mentioned that little bit of trivia so you'll know I've had a bird's eye view of mortgage broker technology basically since computers were first used on a broad scale to originate loans. And in all that time, in the vast majority of all cases I saw, loan officers still collected a handwritten 1003 and let a processor take it from there. I'm seeing that finally change as again the more tech savvy originators realize that they can use eMagic to do many of the things that they either do today with pen and paper, or rely on a processor to do. And that is really our mission: To give loan officers and processors a web-based origination tool that is available anywhere they can get online. When you originate in eMagic, not only do you have a secure environment in which to collect loan data, collect and share loan documents, generate loan apps and disclosures and manage contacts and leads . . . You also have the ability to export the loan data out of eMagic at any time and import it into a new file in Point, to handle the rest of the processing. Using this method, originators have greatly increased potential in terms of what they can accomplish at the point of sale, and the processor has immediate access to any data or documents collected!
I'll be hosting a WebEx in July that covers this exciting new function of eMagic in detail, so simply find the link at the left and click on it to sign up.
In the News
The White House has threatened to veto a Senate bill designed to prevent foreclosures amid a scandal involving key Senators gets VIP treatment by Countrywide. Here is a quote from the story, by Julie Hirschfeld Davis that ran today:
"The centerpiece of the package is a foreclosure rescue program in which the Federal Housing Administration would provide $300 billion in new, cheaper mortgages for distressed homeowners who otherwise would be considered too financially risky to qualify for government-insured, fixed-rate loans.
Borrowers would be eligible if their mortgage holders were willing to take a substantial loss and allow them to refinance, and would ultimately have to share with the government a portion of any profits they made from selling or refinancing their properties.
The measure is designed to help hundreds of thousands of borrowers in danger of losing their homes, but it also would benefit mortgage holders by allowing them to avoid costly foreclosures and reclaim some of what they're owed by people facing financial ruin.
The bill would tighten controls on Fannie Mae and Freddie Mac -- which provide huge amounts of cash flow to the mortgage market by buying home loans from banks -- creating a new regulator for the firms.
It also would provide a $14.5 billion array of housing and other tax breaks, including a credit of up to $8,000 for first-time homebuyers who buy a home in the next year and boosts in low-income tax credits and mortgage revenue bonds.
A group of 28 House Republicans wrote to Speaker Nancy Pelosi, D-Calif., on Thursday demanding an investigation -- with open hearings -- on the Countrywide allegations.
"At a time when millions of Americans are struggling to repay their mortgage debts while coping with $4/per gallon gasoline and soaring foods prices, they will be outraged to learn that some members of Congress may have personally profited from their official positions through secret sweetheart deals on their mortgages," said the letter, signed by House leaders. "Although there is no evidence that has arisen to suggest direct quid pro quo dealings, it is extremely troubling that these revelations of preferential treatment have emerged at a time when Congress is considering multiple legislative proposals affecting the mortgage lending industry.""
Tuesday, June 3, 2008
The 'Flight to Quality' Continues . . .
Good afternoon fellow mortgage industry stalwarts (or good morning, if that's when you're reading this). I hosted a web seminar this morning on the subject of Full Doc Loans (presented by MGIC corporate trainer Sheryl Yu), and I want to thank the attendees for making it a very productive session by asking so many great questions. I know this topic will remain popular, so watch the space to the left to see when the next Full Doc Loans session will be and sign up quickly. After all, it's free training!!
A couple of news items that I thought were definitely relevant to this blog came across the wire recently. First, an informal newletter I receive regularly included an item that indicates that conforming loan limits will almost definitely be raised on a permanent basis, and they will be determined on a regional basis like the temporary arrangement we're using now. Further, the story states that "Political observers suggest that legislators will end up agreeing on a new conforming loan limit at $600,000-plus. That’s a level between the "temporary" $729,750 loan ceiling in place now and the $550,000 limit approved by the Senate Banking Committee last week." Note: The newsletter normally includes the source of the quote, but this time it didn't.
Desktop Underwriter(TM) 7.0
The other news item is the fact that Fannie Mae(R) upgraded the Desktop Underwriter decision engine over the holiday weekend/ It reminds me of an anricle I read recently that said France waits until holiday periods to enact unpopluar legislation. It should come as no suprise that most of the changes result in tougher automated underwriting guidlines. And since GSE-saleable loans are going to be a big part of the wholesale product mix for the foreseeable future, I think it means that originators more than ever need to be intimately familiar with the finer points of DU (TM) and LP (TM). Below you'll find a few links to pages on Fannie Mae's website that you can use to educate yourself on the specific changes you can expect to see with DU 7.0:
https://www.efanniemae.com/sf/technology/ou/du/pdf/du70_flyer.pdf
https://www.efanniemae.com/sf/technology/ou/du/aboutdu70.jsp
https://www.efanniemae.com/sf/guides/duguides/pdf/current/rndodu70.pdf
Let me know if you have any specific scenarios to share as you begin to runs loans through DU with the new automated guidelines. Thanks!
A couple of news items that I thought were definitely relevant to this blog came across the wire recently. First, an informal newletter I receive regularly included an item that indicates that conforming loan limits will almost definitely be raised on a permanent basis, and they will be determined on a regional basis like the temporary arrangement we're using now. Further, the story states that "Political observers suggest that legislators will end up agreeing on a new conforming loan limit at $600,000-plus. That’s a level between the "temporary" $729,750 loan ceiling in place now and the $550,000 limit approved by the Senate Banking Committee last week." Note: The newsletter normally includes the source of the quote, but this time it didn't.
Desktop Underwriter(TM) 7.0
The other news item is the fact that Fannie Mae(R) upgraded the Desktop Underwriter decision engine over the holiday weekend/ It reminds me of an anricle I read recently that said France waits until holiday periods to enact unpopluar legislation. It should come as no suprise that most of the changes result in tougher automated underwriting guidlines. And since GSE-saleable loans are going to be a big part of the wholesale product mix for the foreseeable future, I think it means that originators more than ever need to be intimately familiar with the finer points of DU (TM) and LP (TM). Below you'll find a few links to pages on Fannie Mae's website that you can use to educate yourself on the specific changes you can expect to see with DU 7.0:
https://www.efanniemae.com/sf/technology/ou/du/pdf/du70_flyer.pdf
https://www.efanniemae.com/sf/technology/ou/du/aboutdu70.jsp
https://www.efanniemae.com/sf/guides/duguides/pdf/current/rndodu70.pdf
Let me know if you have any specific scenarios to share as you begin to runs loans through DU with the new automated guidelines. Thanks!
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