The Mortgage Blog

Well here we are, another year gone by and if you are in the Real Estate business as either a Realtor or mortgage professional you probably didn't let the door hit you in the tush.

So where does that leave us?  The first word that comes to mind is "patience". For the first time in decades, the mortgage industry is going through some significant changes, some good and some...well lets just say that is to be determined.  But good or bad, as a Realtor and Mortgage Planner you must practice patience.  We are all learning the do's and don'ts with the HVCC laws and I can say they have mostly been don'ts.  Now even though HUD has suspended the HVCC requirements on FHA appraisal's it is earmarked to start on February 15th, so it appears for now it is here to stay.

As of this writing, we all have to contend with a new Good Faith Estimate and I have yet to see how this will make the industry any clearer for the consumer.  By the way these changes are not just going to affect the mortgage broker, they will affect the mortgage Banker, Realtor and consumer.  Let me give you one example of how the process could be impacted very negatively.  The new GFE now requires the Lender to be held to very strict closing costs figures with very slim tolerances on some items.  The problem is that if there is a delay due to documentation, appraisal, legal work etc..that may lead to a rate expiration. That process will no longer be a simple phone call into the pricing department to adjust.  It will now require something similar to a change order that may trigger a "rescission period" before the new clear to close can be issued. It will have to be determined if the expiration was due to an acceptable condition before a rate can be changed or extension fee can be granted. In the past this was usually handled very quickly and adjustments could be made at the closing table. My suggestion would be to stick tight to 30 day commitment time frames and 60 day closing time frames on your purchase contracts.  It is always better to under promise and over deliver.  At least lets see how the new guidelines impact closing times before we shorten our dates. 

Lets also keep in mind that these are industry changes, the consumer will have no idea that the process and documentation has recently gone through an overhaul, and they probably won't care much since they are focused on buying their new home.  I am planning on taking a "business as usual" approach but will stay very close to the behind the scenes details that our industry is going to experience.  Hopefully excellent communication with Lenders, compliance officers, Fannie, Freddie and HUD will smooth out the bumps.

My suggestion to all Realtors would be to contact your loan officer and discuss the new changes, see how you both can handle questions that may come up and make sure you both are under promising and over delivering.

Good luck in 2010, I believe it will be a great one!