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ML
4905 Posts |
 Posted - 11/13/2007 : 4:26:02 PM
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http://biz.yahoo.com/ap/071113/vacant_homes_crime.html?.v=1
Good article about the effects on neighborhoods with multiple foreclosures, read it! |
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mantixmortgage
3368 Posts |
Posted - 11/13/2007 : 4:34:21 PM
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| i think the tighter lending guidelines will probably take care of this without the hr 3915 |
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LoanShark21666
89 Posts |
Posted - 11/13/2007 : 4:35:43 PM
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are you serious? what does foreclosure have to do with YSP? charging YSP doesn't make people go into foreclosure.
i bet if you look in those areas with #1 and #2 foreclosure lists (cali and nevada) the area's that are going under are OVER inflated with 600k houses 2-3 years ago that people couldn't afford because the market is so out of wack out there compared to income ratio's.
i hear from friends in southern cal area a SHACK costs 500k! does everyone out there that bought in the last 5 years make 150k a year? i doubt it so it was just a matter of time before they went under like the titantic!
I say let the market dictate it's own rules. just like the climate it changes every few centuries and starts over and puts everything back in perpective. |
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ML
4905 Posts |
Posted - 11/13/2007 : 4:49:32 PM
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quote:
Originally posted by mantixmortgage
i think the tighter lending guidelines will probably take care of this without the hr 3915
Possible, but my experience indicates that if you only wait a short while the lenders will go back to their old products with the programs modified ever so slightly.
I believe Albert Einstein wrote: "Not everything that counts can be counted, and not everything that can be counted counts." |
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ML
4905 Posts |
Posted - 11/13/2007 : 5:00:49 PM
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quote:
Originally posted by LoanShark21666
are you serious? what does foreclosure have to do with YSP? charging YSP doesn't make people go into foreclosure.
i bet if you look in those areas with #1 and #2 foreclosure lists (cali and nevada) the area's that are going under are OVER inflated with 600k houses 2-3 years ago that people couldn't afford because the market is so out of wack out there compared to income ratio's.
i hear from friends in southern cal area a SHACK costs 500k! does everyone out there that bought in the last 5 years make 150k a year? i doubt it so it was just a matter of time before they went under like the titantic!
I say let the market dictate it's own rules. just like the climate it changes every few centuries and starts over and puts everything back in perpective.
what does foreclosure have to do with YSP?
YSP = higher rate. Combined with super flexible terms and little documentation,
(does everyone out there that bought in the last 5 years make 150k a year? i doubt it) this opened up the market to more potential buyers. Greater demand equals higher price. Now the music stops (no stated, 100%, investor, etc.) and everyone is left holding the bag, because demand has dried up. |
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VVance
6509 Posts |
Posted - 11/13/2007 : 5:10:49 PM
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quote:
Originally posted by ML
http://biz.yahoo.com/ap/071113/vacant_homes_crime.html?.v=1
Good article about the effects on neighborhoods with multiple foreclosures, read it!
LOL!!! You've got to be kidding me! Your implying that, as per the article, YSP is responsible for a rise in prostitution, vagrants and drug activity. The only thing left out was GLOBAL WARMING!
Tell me your not serious... |
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southbanc
76 Posts |
Posted - 11/13/2007 : 5:18:33 PM
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| I dont see what this has to do with H.R. 3915 or YSP. The Brokers (or the Lenders) did not have a gun to their clients head saying you must buy this house!!! Yes there are dirty Brokers in this business but the majority of us are hard working individuals who have fought to keep and expand on our client base. Who is to say that some of the people that bought multiple properties went to their own bank or went out and priced the rates and fees because they might have HAD good credit? All of these homes that are now in forclosure are not all from people who had bad or spotty credit (from the beginning). I would not mind if lenders and or brokers (NAMB) would come together to come up with a solution to fix the problems in our business but when the government is stepping in with this HR 3915, they are making this situation go from bad to worse. Just my opinion. |
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ML
4905 Posts |
Posted - 11/13/2007 : 5:23:43 PM
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quote:
Originally posted by VVance
quote:
Originally posted by ML
http://biz.yahoo.com/ap/071113/vacant_homes_crime.html?.v=1
Good article about the effects on neighborhoods with multiple foreclosures, read it!
LOL!!! You've got to be kidding me! Your implying that, as per the article, YSP is responsible for a rise in prostitution, vagrants and drug activity. The only thing left out was GLOBAL WARMING!
Tell me your not serious...
I am serious about the statement I made pertaining to the effects on neighborhhods. At no point did I mention YSP, or did the article even mention YSP. And if you mean I am implying YSP is the reason for these things, you would be wrong.
There are numerous regulations in the bill, improvements that are long overdue, that will be welcomed by many. |
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LB 54
448 Posts |
Posted - 11/13/2007 : 5:56:56 PM
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ML please clarify "what does foreclosure have to do with YSP?
YSP = higher rate. Combined with super flexible terms and little documentation,"
In addition please answer the following, as I have asked in the past:
I did as you mentioned, however this is the only info noted??
Member Since: 12/15/2006
User Name: ML
Real Name: stephen michaels ?????
Location: albany, vt ?????
Total Posts: 469
[1.42 posts per day]
Find all non-archived posts by ML
More About Me
Bio: 25 years banking, brokering, wholesale, retail, and bond biz before that
Links
Homepage: No homepage specified...
Cool Links: No link specified...
Once again: "Also speaking of full disclosure please state your name title,
line of work & contact information so that I and the mortgage community can help you.......
Look forward to your full contact information as noted once again.
I think the mortgage community can help you as we all can learn from each other.
I believe many mortgage originators are in agreement that the flexible term mortgages with little or no documentation along with FICO scores below 660 with small down payments ("sub prime") adjustable terms / option arms that wall street put on the street to be sold are the root of the current mess that the market is experincing. Per: http://biz.yahoo.com/ap/071113/vacant_homes_crime.html?.v=1
*As defaults surge on mortgages made to borrowers with spotty credit and adjustable-rate loans, more people are noticing that their neighbors are caught up in the meltdown*.
That I believe the majority in the industry are in agreement.
However when it comes to "Prime Mortgages" with applicants having FICO scores in the 700 & up YSP should not be changed in any way of what the current market dictates. Most lenders generally will not pay more than 3 to 4 points on a YSP.
Once again I just wanted to make it clear that YSP should in no way be changed when it comes to Prime Mortgages.......
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toddblue
4296 Posts |
Posted - 11/13/2007 : 6:25:04 PM
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Todays problems are't caused by YSP, or lender guidelines. Just like guns don't cause crime.
It's when a product is used irresponsibly it has adverse effects.
There is nothing itrinsically wrong with ARM's, IO's,Neg-Am's, etc. It is when a borrower, or the LO that sold it, did not fully understand the long-term ramifications of these loans and mis-applied or abused them that excacerbated the problem.
A lot borrowers wanted more home than they could afford; most realtors were happy to sell them at an inflated price; hungry appraisers were sure to bring in value irregardless; LO's would find a product that would get it done (even if it meant adverse terms in the future). The lenders funded the loans and investors greedily ate up the end product.
Are there a lot of folks in this picture that were unwise? You bet.
But had the Broker's/LO's that bought into this had the guts to step up and realize they weren't looking after the best long-term interest of the buyer and putting their lender at risk and just learned to say 'NO', this trainwreck could have been avoided.
Without so much easy money, an artificially overstimulated housing market would not have increased prices so dramatically. And as Brokers/LO's, we are the front line of that market.
The market did not bear the demands placed upon it. It is now correcting for the mistakes of those that helped get us to this point.
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mitchmaxx
904 Posts |
Posted - 11/13/2007 : 6:29:57 PM
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| ML you aare insane... keep it up. we will all be out of a job... |
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MisterVA
8615 Posts |
Posted - 11/13/2007 : 6:34:07 PM
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quote:
Originally posted by LB 54
ML please clarify "what does foreclosure have to do with YSP?
YSP = higher rate. Combined with super flexible terms and little documentation,"
In addition please answer the following, as I have asked in the past:
I did as you mentioned, however this is the only info noted??
Member Since: 12/15/2006
User Name: ML
Real Name: stephen michaels ?????
Location: albany, vt ?????
Total Posts: 469
[1.42 posts per day]
Find all non-archived posts by ML
More About Me
Bio: 25 years banking, brokering, wholesale, retail, and bond biz before that
Links
Homepage: No homepage specified...
Cool Links: No link specified...
Once again: "Also speaking of full disclosure please state your name title,
line of work & contact information so that I and the mortgage community can help you.......
Look forward to your full contact information as noted once again.
I think the mortgage community can help you as we all can learn from each other.
I believe many mortgage originators are in agreement that the flexible term mortgages with little or no documentation along with FICO scores below 660 with small down payments ("sub prime") adjustable terms / option arms that wall street put on the street to be sold are the root of the current mess that the market is experincing. Per: http://biz.yahoo.com/ap/071113/vacant_homes_crime.html?.v=1
*As defaults surge on mortgages made to borrowers with spotty credit and adjustable-rate loans, more people are noticing that their neighbors are caught up in the meltdown*.
That I believe the majority in the industry are in agreement.
However when it comes to "Prime Mortgages" with applicants having FICO scores in the 700 & up YSP should not be changed in any way of what the current market dictates. Most lenders generally will not pay more than 3 to 4 points on a YSP.
Once again I just wanted to make it clear that YSP should in no way be changed when it comes to Prime Mortgages.......
For the record, Albany, VT, is 20 miles south of here. Fewer than 1000 residents. No Stephen Michaels in the phone book. [Not that there's anything wrong with that.] Invited him to stop by when he was in town, but never heard back from him. One of my closing attorneys lives in Albany and has her office there. Another one lives in Albany and has her office in the town next to mine. Maybe I will inquire... |
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STELIOS
19 Posts |
Posted - 11/13/2007 : 6:34:56 PM
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| I am tired of everybody blaming the mortgage brokers for this crisis. They should look at the banks that made billions if not more fron sub prime A- and other programs. Brokers sell what programs are available from lenders. They tell us what is available, they set the rates not us. So get off out case and look into the lenders that make millions compared to a few thousand that brokers make |
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VVance
6509 Posts |
Posted - 11/13/2007 : 6:45:45 PM
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quote:
Originally posted by ML
quote:
Originally posted by VVance
quote:
Originally posted by ML
http://biz.yahoo.com/ap/071113/vacant_homes_crime.html?.v=1
Good article about the effects on neighborhoods with multiple foreclosures, read it!
LOL!!! You've got to be kidding me! Your implying that, as per the article, YSP is responsible for a rise in prostitution, vagrants and drug activity. The only thing left out was GLOBAL WARMING!
Tell me your not serious...
I am serious about the statement I made pertaining to the effects on neighborhhods. At no point did I mention YSP, or did the article even mention YSP. And if you mean I am implying YSP is the reason for these things, you would be wrong.
There are numerous regulations in the bill, improvements that are long overdue, that will be welcomed by many.
In truth, I believe if this bill passes in it's present form, the mortgage broker will be finished. That would negate any benefits you see in this legislation.
This bill looks as if it were written by large institutional lenders in order to wipe out competition from the broker community, being disguised as a protection to the consumer.
The arguement regarding YSP = higher rate is true. It is also a means to obtain mortgages with less cash out of pocket for the consumer. In addition, if your in favor of YSP elimination, this bill does nothing to address this issue with large retail lenders, who have no legal need to disclose to a consumer what their backside profit is on a so called "no points" loan where the rate is much higher. |
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toddblue
4296 Posts |
Posted - 11/13/2007 : 6:54:16 PM
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quote:
Originally posted by STELIOS
I am tired of everybody blaming the mortgage brokers for this crisis. They should look at the banks that made billions if not more fron sub prime A- and other programs. Brokers sell what programs are available from lenders. They tell us what is available, they set the rates not us. So get off out case and look into the lenders that make millions compared to a few thousand that brokers make
I would never blame ALL brokers.
But sub-prime, alt a and A- loans were never designed to put someone into a house they wouldn't be able to afford. True, some loans will go bad do to borrower misfortune (illness, job loss, etc.) But how many loans are going bad today because of over-stated incomes, Neg-am Arms and the like that the borrower was sold into believing they could refi out of at more favorable term in the future?
And yes, lenders made millions. But look at the losses they are taking today. How many commissions have you had to give back?
If you were a broker that put people into loans that are destroying the industry today, shame on you. It's too bad that those of us that looked after the borrowers and lenders best interest before our own are paying the price for those who only wanted a quick buck.
Personal responsibility amongst brokers didn't work. Now it is being regulated upon us. |
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LB 54
448 Posts |
Posted - 11/13/2007 : 7:30:05 PM
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Once again I repeat:
When it comes to "Prime Mortgages" with applicants having FICO scores in the 700 & up YSP should not be changed in any way of what the current market dictates. Most lenders generally will not pay more than 3 to 4 points on a YSP.
& TO: ML
In addition please answer the following, as I have asked in the past:
I did as you mentioned, however this is the only info noted??
Member Since: 12/15/2006
User Name: ML
Real Name: stephen michaels ?????
Location: albany, vt ?????
Total Posts: 469
[1.42 posts per day]
Find all non-archived posts by ML
More About Me
Bio: 25 years banking, brokering, wholesale, retail, and bond biz before that
Links
Homepage: No homepage specified...
Cool Links: No link specified...
Once again: "Also speaking of full disclosure please state your name title,
line of work & contact information so that I and the mortgage community can help you.......
Look forward to your full contact information as noted once again.
I think the mortgage community can help you as we all can learn from each other.
Once again I just wanted to make it clear that YSP should in no way be changed when it comes to Prime Mortgages.......
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LoanShark21666
89 Posts |
Posted - 11/13/2007 : 11:10:13 PM
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quote:
Originally posted by ML
quote:
Originally posted by LoanShark21666
are you serious? what does foreclosure have to do with YSP? charging YSP doesn't make people go into foreclosure.
i bet if you look in those areas with #1 and #2 foreclosure lists (cali and nevada) the area's that are going under are OVER inflated with 600k houses 2-3 years ago that people couldn't afford because the market is so out of wack out there compared to income ratio's.
i hear from friends in southern cal area a SHACK costs 500k! does everyone out there that bought in the last 5 years make 150k a year? i doubt it so it was just a matter of time before they went under like the titantic!
I say let the market dictate it's own rules. just like the climate it changes every few centuries and starts over and puts everything back in perpective.
what does foreclosure have to do with YSP?
YSP = higher rate. Combined with super flexible terms and little documentation,
(does everyone out there that bought in the last 5 years make 150k a year? i doubt it) this opened up the market to more potential buyers. Greater demand equals higher price. Now the music stops (no stated, 100%, investor, etc.) and everyone is left holding the bag, because demand has dried up.
you know this is a FLAT OUT LIE! YSP didn't and wouldn't cause a foreclosure! The client KNEW the monthly payment going into closing and agreed to it! What caused this mess is the greedy SOB's on both side of the ball (industry and buyers) that did this by accepting ARM's and Neg Am loans!
People are stupid and blind when money is free flowing clients especially! We all have done an ARM helping a client get back on their feet telling them to keep your credit clean and your scores will come back up then we will refi you into a better program and fix it only to watch them take out MORE debt because of that free flowing easy money THAT is when they can't afford the damn house and have to go back into the same program and pay off more debt. Is that MY Fault because I structured the right deal at the right time for the right client? I guess we now need to be fortune tellers and look at the "Bling" Factor and make a judgement call.
Luckily I make sure my clients have enough equity in their houses so if they screw up again they won't loose it.
So don't point fingers and say YSP destroyed America!
Here maybe you should use this in order to tell if you're clients are good borrowers and won't default on their mortgage let alone their bills.
http://www.msu.edu/~vandrag2/8-ball.html
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RANDY P
4163 Posts |
Posted - 11/14/2007 : 12:15:58 AM
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The one thing that hasn't come to light with the failures of all these loans are the lenders themselves. I don't mean just simply the way these programs are lax and poorly designed, but how the policies are followed.
The joke is on the final investor. Has been and will continue to be. It's sickening how these lenders and investors are pointing the dirty end of the stick to those who made these deals possible with tools given to them by the lender.
Some notable examples:
How many remember all those subprime lenders out there that were allowing a 10% variation (whip) on appraisal review - as long as the brokers appraisal was no more than 10% of whatever the AVM or desk review came in at, it was allowed to fly at value - even on 100% LTV?
How about those lenders out there allowing VOE = Full Doc? There was one big name lender out there that was allowing this to occur if the broker did the VOE- and intentionally didn't check the VOE? This same lender was one who would take the information on the 1003 and U/W based on that, despite what the supporting documentation said - biz license clearly states one year self employed, but the 1003 says two years - 1003 wins.
It's way past just gross negligence, it's not limited to a few lenders - it's widespread. It's outright fraud and it was possible thanks to the lenders themselves. They are guilty for allowing this to happen.
For us to decide at our level who deserves a loan and who doesn't based on our gut feelings and prejudices is a sure way to get sued for discrimination. The lenders come up with a standard which all borrowers are judged against. We simply find the borrowers and test them against that standard, without bias and undue influence (fraud)
Of course, if fraud is found the broker should be open for prosecution - however if it's fraud where the lender let it slip due to lack of QC checks or even common sense then the lender should be liable as well.
It's these issues which caused the present mess. This whole problem is like giving a bottle of whiskey and your car keys to a teenager and then being amazed something bad happened.
rjp |
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servicefirst
3421 Posts |
Posted - 11/14/2007 : 01:13:42 AM
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Sounds to me like using powerful tools in an improper and unregulated fashion is as American as Apple Pie. Be they guns or mortgages.
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cpruitt
1775 Posts |
Posted - 11/14/2007 : 03:37:13 AM
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Fraud is the major problem. The really serious fraud started with the house flippers spreading money around to straw buyers, new loan officers, appraisers and attorneys. Once they fouled up the reasonable predictions on how well those loans would perform, it ruined the market for others as the problem spread. Up until recently, very good estimates were that almost 70% of the foreclosures were non-owner occupied - both disclosed non-owner occupied and straw buyer non-owner occupied. These fraud rings have touched all across the country and are backed by organized crime and criminal gangs. They methodically stripped neighborhoods of all the cash they could pull out with inflated appraisals. There is a lot more money on that side to tempt weak people than YSP ever provided. YSP for those people was just icing on the cake. Most of the rest of the foreclosures happened to financially irresponsible people who repeatedly used their home as an ATM while loans were easy.
Even the "boiler room" type lenders who put people into subprime loans unnecessarily didn't do anywhere near as much damage as these people. There are a lot of borrowers going around whining about not knowing about YSP etc. Most of them are full of s%^t and are just using brokers as the excuse when their plans of continually tapping into ever increasing equity to fuel their over the top spending didn't work out after the house flippers' fraud depressed property values.
The mortgage bond rating agencies didn't count on that level of fraud when they fixed the rates on subprime loans. We all like to look back with 20/20 hindsight and say these programs are bad. But the fact is that without the fraud, topped with the Fed mismanaging the money supply, housing values would have kept up their slow but steady increase and very few people would have had any problem with those loan programs. They would have performed just as predicted.
Please note, most of the fraud happened in the most regulated states. The ones where all or at least some of the loan officers had to undergo criminal background checks. All the attorneys who played a key part in pulling off the fraud were members of the bar who went through criminal background checks and were massively regulated. Everyone wants to think they can waive their magic regulation wand and solve these problems, but no one is smart enough to figure out all the many billions of minor variations in human behavior that make these things occur. When you bring in government to regulate anything, it is only a short time before the regulated gain control of the system and it starts to work for them and against the consumer. The entire history of regulation is littered with the carcasses of unintended consequences. Government doesn't pay a penalty when it fails. Everyone just adds more regulations on top of the one's that didn't work, hoping that this one time the problem will be solved.
There is not going to be a time when everything runs perfect in the free market. But most of the things in life that are done well are accomplished by free markets. And most of the things that get screwed up get screwed up by government. |
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megalith
28 Posts |
Posted - 11/14/2007 : 03:54:11 AM
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Amen! I am working on a web site to fight HR 3915 and other bad legislation (like the new "simplified" four page GFE HUD is going to be introducing), and I need people that think like this to contribute. The site is still pretty basic, but I have all the germane info, and adding every day: http://www.stophr3915.com
quote:
Originally posted by toddblue
Todays problems are't caused by YSP, or lender guidelines. Just like guns don't cause crime.
It's when a product is used irresponsibly it has adverse effects.
There is nothing itrinsically wrong with ARM's, IO's,Neg-Am's, etc. It is when a borrower, or the LO that sold it, did not fully understand the long-term ramifications of these loans and mis-applied or abused them that excacerbated the problem.
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assassin17
7704 Posts |
Posted - 11/14/2007 : 04:36:30 AM
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quote:
Originally posted by STELIOS
Brokers sell what programs are available from lenders. They tell us what is available, they set the rates not us.
Wrong. They give us a wide range of rates and WE set it.
That's the problem. When we indiscriminately set different rates for borrowers with the same scenario, that becomes inherent discrimination, which then places ALL blame upon the broker who selected the rate... instead of the lenders, who should price their own damn product and just pay us what basically is our fair finder's fee for bringing them a free client they will profit greatly from for many years.
In about 12 more months, when the remaining players see Brokers become respectable again, many of you will have adapted and understand the benefits of this change. There is a very big reason that lenders do not post Rate Sheets on their web site for public viewing, and it isn't to protect your precious YSP.
HR 3915 is becoming a very tired argument. You have no choice in this matter. This bill is going to pass very quickly in some form. Stop arguing over the inevitable and start planning your new marketing strategies before you get swept under the rug. You can bet your ass that lenders are preparing as we speak. You had all better be ready to work under the new rules. |
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megalith
28 Posts |
Posted - 11/14/2007 : 05:08:40 AM
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Wow, spoken like a true socialist. Why don't you just go work FOR the government so you don't have to think at all? Why go through the pretense of pretending to be in business for youself, when you are so eager for them to tell you what you can and can't do? It's no wonder we get the short end of the stick on legislative issues with that type of attitude...
You need to go watch the movie 300. Better to fight and die than live live as a slave... Spartans!
quote:
Originally posted by assassin17
HR 3915 is becoming a very tired argument. You have no choice in this matter. This bill is going to pass very quickly in some form. Stop arguing over the inevitable and start planning your new marketing strategies before you get swept under the rug. You can bet your ass that lenders are preparing as we speak. You had all better be ready to work under the new rules.
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LoanShark21666
89 Posts |
Posted - 11/14/2007 : 05:24:36 AM
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quote:
Originally posted by assassin17
quote:
Originally posted by STELIOS
Brokers sell what programs are available from lenders. They tell us what is available, they set the rates not us.
Wrong. They give us a wide range of rates and WE set it.
That's the problem. When we indiscriminately set different rates for borrowers with the same scenario, that becomes inherent discrimination, which then places ALL blame upon the broker who selected the rate... instead of the lenders, who should price their own damn product and just pay us what basically is our fair finder's fee for bringing them a free client they will profit greatly from for many years.
In about 12 more months, when the remaining players see Brokers become respectable again, many of you will have adapted and understand the benefits of this change. There is a very big reason that lenders do not post Rate Sheets on their web site for public viewing, and it isn't to protect your precious YSP.
HR 3915 is becoming a very tired argument. You have no choice in this matter. This bill is going to pass very quickly in some form. Stop arguing over the inevitable and start planning your new marketing strategies before you get swept under the rug. You can bet your ass that lenders are preparing as we speak. You had all better be ready to work under the new rules.
you're right it probably will pass in some form and when the mortgage market grinds to a halt due to this law and what the lenders have been doing tighting everything down and foreclosures sky rocket even higher into the clouds and no houses are being moved then the econom crashes and panic sets in the rest of the financial markets far worse then what it is now I guess we can all thank our congressman! |
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VVance
6509 Posts |
Posted - 11/14/2007 : 05:26:14 AM
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quote:
Originally posted by assassin17
[quote]Originally posted by STELIOS
Brokers sell what programs are available from lenders. They tell us what is available, they set the rates not us.
Wrong. They give us a wide range of rates and WE set it.
That's the problem. When we indiscriminately set different rates for borrowers with the same scenario, that becomes inherent discrimination, which then places ALL blame upon the broker who selected the rate... instead of the lenders, who should price their own damn product and just pay us what basically is our fair finder's fee for bringing them a free client they will profit greatly from for many years.
In about 12 more months, when the remaining players see Brokers become respectable again, many of you will have adapted and understand the benefits of this change. There is a very big reason that lenders do not post Rate Sheets on their web site for public viewing, and it isn't to protect your precious YSP.
HR 3915 is becoming a very tired argument. You have no choice in this matter. This bill is going to pass very quickly in some form. Stop arguing over the inevitable and start planning your new marketing strategies before you get swept under the rug. You can bet your ass that lenders are preparing as we speak. You had all better be ready to work under the new rules.
[/quote
Sorry, but I think your way off. If this bill passes as it stands, the broker business is history, WHICH IS THE INTENT OF THIS BILL!!!
In regards to dictating your commission, if your scenario came to pass, your finders fee would be something along the lines of what a retail rep makes...50 basis points. If you could live on that...good for you.
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VVance
6509 Posts |
Posted - 11/14/2007 : 05:29:33 AM
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quote:
Originally posted by LoanShark21666
quote:
Originally posted by assassin17
quote:
Originally posted by STELIOS
Brokers sell what programs are available from lenders. They tell us what is available, they set the rates not us.
Wrong. They give us a wide range of rates and WE set it.
That's the problem. When we indiscriminately set different rates for borrowers with the same scenario, that becomes inherent discrimination, which then places ALL blame upon the broker who selected the rate... instead of the lenders, who should price their own damn product and just pay us what basically is our fair finder's fee for bringing them a free client they will profit greatly from for many years.
In about 12 more months, when the remaining players see Brokers become respectable again, many of you will have adapted and understand the benefits of this change. There is a very big reason that lenders do not post Rate Sheets on their web site for public viewing, and it isn't to protect your precious YSP.
HR 3915 is becoming a very tired argument. You have no choice in this matter. This bill is going to pass very quickly in some form. Stop arguing over the inevitable and start planning your new marketing strategies before you get swept under the rug. You can bet your ass that lenders are preparing as we speak. You had all better be ready to work under the new rules.
you're right it probably will pass in some form and when the mortgage market grinds to a halt due to this law and what the lenders have been doing tighting everything down and foreclosures sky rocket even higher into the clouds and no houses are being moved then the econom crashes and panic sets in the rest of the financial markets far worse then what it is now I guess we can all thank our congressman!
Spot On! Of course, should the economy crash, those congressmen will still blame the evil brokers. |
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LB 54
448 Posts |
Posted - 11/14/2007 : 07:23:21 AM
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Per: megalith "Better to fight and die than live live as a slave"
ACT NOW -- Contact Your Representative TODAY Regarding H.R. 3915
ACT NOW! Take Action!
Contact Your Congressional Representative TODAY Regarding H.R. 3915
Dear NAMB Member,
WE DID IT! Thank you for responding to last week's call-to-action on H.R. 3915 asking the House Financial Services Committee ("HFSC") to amend H.R. 3915, the "Mortgage Reform and Anti-Predatory Lending Act of 2007," and allow small business mortgage brokers everywhere to continue to serve the consumers in their communities. Last week, the HFSC approved H.R. 3915 by a 45-19 vote, clearing the way for the bill to move to the House floor for a full vote this Thursday, November 15, 2007.
Following the mark-up of the bill by the HFSC, NAMB's Government Affairs team continued to work tirelessly with members of Congress and their staffs to clarify the anti-steering provision to ensure that consumers continue to have the ability to finance origination fees and costs and to clarify our ability to receive compensation for our work. Thanks to your patience and timely response when called to action, I am pleased to report that clarifications to the anti-steering language have been made and our concerns have been addressed.
Our work is not finished. Specifically, Title III, which proposes changes to HOEPA that will adversely affect consumers' ability to obtain mortgage financing, must be amended or removed entirely. We anticipate that there will be a number of amendments offered to Title III when H.R. 3915 reaches the House floor. TODAY, we are asking you to CONTACT YOUR CONGRESSIONAL REPRESENTATIVE and urge him or her to support any amendment(s) that may be offered by Rep. Gary Miller (R-CA) to modify Title III, or any other amendment offered to eliminate Title III in its entirety, to help ensure credit will remain available for consumers who need it most. The mortgage reform effort in Congress should move forward and H.R. 3915 is the first step, of many, in this deliberate process.
With H.R. 3915 set to go to the House floor for a vote this Thursday, November 15, 2007, THE TIME TO ACT IS NOW.
Thank you for your continued support.
George Hanzimanolis, CRMS
2007-08 NAMB President
&
Once again I repeat:
When it comes to "Prime Mortgages" with applicants having FICO scores in the 700 & up YSP should not be changed in any way of what the current market dictates. Most lenders generally will not pay more than 3 to 4 points on a YSP.
& TO: ML
In addition please answer the following, as I have asked in the past:
I did as you mentioned, however this is the only info noted??
Member Since: 12/15/2006
User Name: ML
Real Name: stephen michaels ?????
Location: albany, vt ?????
Total Posts: 469
[1.42 posts per day]
Find all non-archived posts by ML
More About Me
Bio: 25 years banking, brokering, wholesale, retail, and bond biz before that
Links
Homepage: No homepage specified...
Cool Links: No link specified...
Once again: "Also speaking of full disclosure please state your name title,
line of work & contact information so that I and the mortgage community can help you.......
Look forward to your full contact information as noted once again.
I think the mortgage community can help you as we all can learn from each other.
Once again I just wanted to make it clear that YSP should in no way be changed when it comes to Prime Mortgages.......
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nw@8brook
515 Posts |
Posted - 11/14/2007 : 07:44:06 AM
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| the prime market is very competitive(at least where I am, please let me know where I can make more than 2% on every prime deal, I will move there in a heartbeat) and i rarely see anyone making more than 3% in ysp unless they play the rate lock game and got it right. |
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buffalobroker
249 Posts |
Posted - 11/14/2007 : 08:12:53 AM
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Eliminating YSP for brokers but letting direct lenders and banks charge SRP is anti-competitive, pro BIG BUSINESS. It hurts small business and the consumers and in the short run would bring down interest rates but in the long run would RAISE interest rates.
Every academic study has shown that brokers have had a net positive effect on prices despite the bad apples |
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advisor
191 Posts |
Posted - 11/14/2007 : 08:34:04 AM
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YSP=Higher Rate?
You guys on here saying YSP is the cause of the problem, because YSP=higher rates.
Higher rates than WHAT?
I'll say it again
Higher rates than WHAT? Par?, Banks? other brokers? auto loans?
Than the par wholesale rate the borrower never would have qualified for on their own, since borrowers do not qualify for wholesale rates, BROKERS do!
Oh, you mean they should get par, and pay points, right.
Paying points means a payback period. a break-even point. Than break-even point on average in the US is 80 months, which is over 6 years. These people have been in their homes for less than 4 on average.
YSP has SAVED them money.
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Mattrock99
116 Posts |
Posted - 11/14/2007 : 08:55:04 AM
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| HR-3915 is absurd. YSP didn't cause the high foreclosure rate. The availability of programs that would clearly have issues shortly in, this is the cause is it not. Why is the broker being penalized I ask? Shouldn’t we be looking to a higher source, the CEO’s of these companies that allowed these funds to be given to borrowers. They knew the repercussions of issuing these high risk loans if they were to default. These types of loans were certainly priced accordingly. Now that the ______ has hit the fan who is left holding the bag? The brokers? Total crap. Also lets take a look at the individual borrowers themselves. I am not 100% about the disclosure policies in other states but I do know what is required on a Federal level and these folks knew what they were getting into. Most borrowers were put into these loans for short term purposes, they knew it and the brokers knew. This is not meant to negate the fact that there are certainly “bad brokers” out there. These kinds of brokers represent such a small percentage of our industry but unfortunately they carry the popular attention thus making us all look bad. HR-3915 is a ridiculous bill and of course when it does go through, in a year or two it will be a highly modified version its outrageous beginnings. Let’s keep our eyes on who is actually to be held accountable for the high foreclosure rates. I guarantee you it is not the mortgage broker. |
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MisterVA
8615 Posts |
Posted - 11/14/2007 : 09:06:19 AM
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quote:
Originally posted by buffalobroker
Eliminating YSP for brokers but letting direct lenders and banks charge SRP is anti-competitive, pro BIG BUSINESS. It hurts small business and the consumers and in the short run would bring down interest rates but in the long run would RAISE interest rates.
Every academic study has shown that brokers have had a net positive effect on prices despite the bad apples
Unrelated. A lender may hold onto servicing and at a later date be offered a price to sell. This is akin to the banks arguing that credit unions should pay taxes. You may think you are right and you may expend a lot of energy trying to prove you are right, but in the end, your energies are best focused on other areas. |
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ML
4905 Posts |
Posted - 11/14/2007 : 10:37:24 AM
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Here is a topic I posted on the Premium side about six weeks ago. I'm inclined to agree with the conclusions of the writer who is a former Fed Vice Chairman and now Economics Professor at Princeton.
Alan Blinder on Mortgage Crisis Blame
ML:
Excellent analysis on the Sub-Prime mortgage crisis from Sundays NY Times:
http://www.nytimes.com/2007/09/30/business/30view.html
Six Fingers of Blame in the Mortgage Mess
SOMETHING went badly wrong in the subprime mortgage market. In fact, several things did. And now quite a few homeowners, investors and financial institutions are feeling the pain. So far, harried policy makers have understandably focused on crisis management, on getting out of this mess. But soon the nation will turn to recrimination — to good old-fashioned finger-pointing.
Finger-pointing is often decried both as mean-spirited and as a distraction from the more important task of finding remedies. I beg to differ. Until we diagnose what went wrong with subprime, we cannot even begin to devise policy changes that might protect us from a repeat performance. So here goes. Because so much went wrong, the fingers on one hand will not be enough.
The first finger points at households who borrowed recklessly to buy homes, often saddling themselves with mortgages that were all too likely to default. They should have known better. But what can we do to guard against it happening again?
Not much, I’m afraid. Gullible consumers have been around since Adam consumed that apple. Greater financial literacy might help, but I’m dubious about our ability to deliver it effectively. The Federal Reserve is working on clearer mortgage disclosures to help borrowers understand what they are getting themselves into. (“Warning! This mortgage can be dangerous to your family’s financial health.”) While I applaud the effort, I’m skeptical that it will work. If you have ever closed on a home, you know that the disclosure forms you receive are copious and dense. Should we add even more?
Fewer words, and in plainer English, might help, especially if they highlighted the truly important risks. (“In two years, your mortgage payments could double.”) But the truth is that there is much to disclose, that complicated mortgage products are, well, complicated, and that people don’t read those documents anyway.
It seems more promising to point a finger directly at lenders. Some lenders sold mortgage products that were plainly inappropriate for customers, and that they did not understand. There were numerous cases of unsophisticated borrowers being led into risky mortgages.
Here, something can be done. For openers, we need to think about devising a “suitability standard” for everyone who sells mortgage products. Under current law, a stockbroker who persuades Granny to use her last $5,000 to buy a speculative stock on margin is in legal peril because the investment is “unsuitable” for her (though perfectly suitable for Warren Buffett). Knowing that, the broker usually doesn’t do it.
But who will create and enforce such a standard for mortgages? Roughly half of recent subprime mortgages originated in mortgage companies that were not part of any bank, and thus stood outside the federal regulatory system. That was trouble waiting for a time and a place to happen. We should place all mortgage lenders under federal regulation.
That said, bank regulators deserve the next finger of blame for not doing a better job of protecting consumers and ensuring that banks followed sound lending practices. Fortunately, the regulators know they underperformed, and repair work is already under way.
Regulators also need to start thinking about how to deal with a serious incentive problem. In old-fashioned finance, a bank that originated a mortgage also held it for years (think of Jimmy Stewart in “It’s a Wonderful Life”), giving it a clear incentive to lend carefully. Bu |
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cpruitt
1775 Posts |
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Cool Hand Luke
522 Posts |
Posted - 11/14/2007 : 11:48:54 AM
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| Eliminating YSP will solve the foreclosure problems. Everyone will have to pay cash for their house. |
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RIMBY
167 Posts |
Posted - 11/14/2007 : 12:09:28 PM
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Typical scenario?
$250,000 at 6.5 par = $1,580
$248,000 at 6.875 (.75 YSP) = $1,629
YSP $1,860
Monthly payment increase to borrower $49/mo, $588/yr
YSP has destroyed America and caused all these foreclosures? Tell me another one. |
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wlavigne
563 Posts |
Posted - 11/14/2007 : 12:31:34 PM
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next time i go to the bank I want the prime rate on the credit card loan and home equity loan that the other bank is charging my bank for lending out that money anything else is a mark up and disciminatory to me.
same goes for cars at dealerships, I want the price that they were coming off GM's plant production lot or else its predatory and discriminating against me in unfair pricing for upstating the price to retail.
I want my mile to be less then what they charge at Dairy Farms or Seven Eleven because i should not be upcharged any money that is unfair when it costs less from the direct manafacturers firm.
I want my groceries at wholesale why should I pay 2 cents or more per item at any grocery store thats robbery.
Why do I pay 3 bucks for gas or oil Its unfair pricing why not pay less it should be given to us at wholesale prices directly from the drilling fields.
Should I go on? Its no different with YSP ------- I can't believe how so many people are so dense about YSP and how the consumer would never get the brokers par rate since the wholesale lender does not deal with a consumer directly---- and would only sell a retail rate on their retail side which basically is the same or more in cost of the YSP built in which is legally allowed and called SRP. |
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assassin17
7704 Posts |
Posted - 11/14/2007 : 1:47:40 PM
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quote:
Originally posted by RIMBY
Typical scenario?
$250,000 at 6.5 par = $1,580
$248,000 at 6.875 (.75 YSP) = $1,629
YSP $1,860
Monthly payment increase to borrower $49/mo, $588/yr
YSP has destroyed America and caused all these foreclosures? Tell me another one.
Why don't you amortize that extra $49 over 30 years and reveal the true cost? Compare a TIL calculation using both rates. Even at $588 a year any idiot should be able to see that after just a couple of years your $1860 begins to pile up on the consumer due to that higher rate. Toss in the PPP that most-likely comes with that, so the consumer cannot avoid the end-result of paying many times over for your YSP.
Nowhere in that bill does it say that YSP solely 'causes' foreclosures, nor is that what the government believes. What it causes is a 'conflict of interest' that intentionally sways a Broker to benefit one party at the expense of the other. That is absolutely not allowable by someone in a mediator role. It increases the cost of a consumer loan, as evidenced by the increase in Finance Charges.
All of the double-talk out of Broker's mouths on this issue always comes with the caveat of people not keeping a loan for more than 2 years, when you know darn well that the average is much longer.
Toss out any insults and names that you want. YSP is not the total picture here, it is just one part of many issues being addressed in advance of an expected national emergency. They can always change this bill along the way and even after it passes. If you guys can't seem to get this, then you need to be more than just regulated. If you think the mortgage industry can avoid a forced cleansing, the only people you are fooling is yourselves.
As for fighting and dying... I'd rather just stay alive elsewhere, thank you. You guys go ahead and die if you feel like it. We'll bury you next to the subprime lenders who also had no foresight or ability to adapt to the marketplace. |
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assassin17
7704 Posts |
Posted - 11/14/2007 : 1:55:18 PM
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quote:
Originally posted by wlavigne
I want my mile to be less then what they charge at Dairy Farms or Seven Eleven because i should not be upcharged any money that is unfair when it costs less from the direct manafacturers firm.
When purchasing a gallon of milk can leave you homeless your analogy will make sense.
Do you think dairy products, cars, and gas are not already regulated with laws... or would you like an unknown full glass of BGH, a new car with unknown used parts in the motor, or a tankful of unknown water added by a service attendant?
The government stepped in on these issues also. It's their job. |
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nw@8brook
515 Posts |
Posted - 11/14/2007 : 2:03:01 PM
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| first off, the spread is more like 1% using those rates and that's $2500. I don't know if you have work with 1st time homebuyers, a lot of them just do not have a lot of upfront cash(just your average american who does not save). Hey, they can always put away $400 a month and come back in 6 months to buy a house and pay the closing costs if they don't like to finance it. |
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LB 54
448 Posts |
Posted - 11/14/2007 : 3:40:39 PM
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Once again I repeat:
When it comes to "Prime Mortgages" with applicants having FICO scores in the 700 & up YSP should not be changed in any way of what the current market dictates. Most lenders generally will not pay more than 3 to 4 points on a YSP.
& TO: ML
In addition please answer the following, as I have asked in the past:
I did as you mentioned, however this is the only info noted??
Member Since: 12/15/2006
User Name: ML
Real Name: stephen michaels ?????
Location: albany, vt ?????
Total Posts: 469
[1.42 posts per day]
Find all non-archived posts by ML
More About Me
Bio: 25 years banking, brokering, wholesale, retail, and bond biz before that
Links
Homepage: No homepage specified...
Cool Links: No link specified...
Once again: "Also speaking of full disclosure please state your name title,
line of work & contact information so that I and the mortgage community can help you.......
Look forward to your full contact information as noted once again.
I think the mortgage community can help you as we all can learn from each other.
Once again I just wanted to make it clear that YSP should in no way be changed when it comes to Prime Mortgages.......
To: ass-----17 You are either very young or very naieve if you think
the Gov should change YSP on plain vanilla fixed rate mortgage's with no
pre payment penalty..
In the early year's of the Savings & Loans there was little competition which led to a monopoly. Do a study on economices 101 and find out when you eliminate price or competition what happens to the consumer.
The educated American consumer know's how to shop for a car, boat,
mortgage, etc. The internet has and will help the consumer shop and be able to compare apples to apples along with checking the reputation of the company with the State Licensing Board (Banking Dept) , BBB , REFERENCES ,
and length of time the company has been in business.......
Folks we all know the HR 3915 has some valid points for some changes
such as licensing and funky sub prime / adjustable / option arms /
Pre Payment Penalty etc.
However your plain vanilla 30 20 15 year fixed rate with no pre pay should, and I believe will be left alone. It's that simple..... |
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RANDY P
4163 Posts |
Posted - 11/14/2007 : 4:10:40 PM
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it always helps to ask what the borrower has in mind in terms of how long they're gonna be there. A 30 Y/O with a newborn with more on the way would be different than a soon to be empty nester.
sure, .25 difference in rate after 10 years or so adds up quick. What if the borrower was selling the house in a year? Are you going to "rip him off" (there's those words again!) by charging par and 2 PTS?
To remind everyone (or at least, anyone who is skilled at this biz) this is not "one size fits all". -
Also - in regarsds to HIGH FICO and 3 back YSP - how do you expect the little loans to be closed if the lender isn't paying that much? Ever try to close an $70K loan when you're limited by sheer dollar amount since there's no equity, or most of the 6% you're allowed as closing costs contribution gets eaten up by every other 3rd party costs?
Yes, I think 700 FICO clients need that option to have that if it makes sense. YSP isn't a bad thing if you're a little guy. YSP isn't bad if you're trying not to burn up your equity in closing costs. YSP isn't bad if your borrower is just a cheapskate and can't stand seeing someone make money off of them.
rjp
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chasjh46
213 Posts |
Posted - 11/14/2007 : 4:26:52 PM
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| Wow, seems like everyone wants to blame the brokers for all the foreclosures. As if we wrote the guidelines and did the underwriting approvals. Further more, we didn't even write the wholesale rate sheets that offered the (YSP) which was usually capped at 2%. Now lets see here. who was the genius that came up with the 2 or 3 year fixed SISA with a 5.25% margin and qualified the borrowers on the interest only payment with a 560 score? Geeze, was that us, the mortgage brokers? Didn't we have since enough to know that 2 years from now the borrower would be faced with an increased payment based on an index of 4.95% plus a margin of 5.25%. Oh, we also came up with a great way to nail down their forclosure coffin lets charge them with a 3 year prepay on a 2 year fixed then right at 2 years, we'll pull our billions out of the market and run back to China. No, it wasn't us the mortgage brokers, it was the same greety clowns on wall street that refuses to roll back the interest adjustment because the borrower signed a piece of paper called a "note". Its the same genius that would rather lose billions in foreclosures than lose a few million in loan modifications. It's the same genious that can't firgure it out that pulling your investments out of the mortgage market worsens the whole picture of recovery. Its the same genious that sniffles because their forclosure feet hurt then load their guns with guideline bullets and shoot their own toes off. Thats my take on the foreclosure mess. |
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LB 54
448 Posts |
Posted - 11/14/2007 : 4:53:19 PM
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Saw a typo * (In the heat of the moment)
Once again I repeat:
When it comes to "Prime Mortgages" with applicants having FICO scores in the 700 & up YSP should *NOT be changed in any way of what the current market dictates. Most lenders generally will not pay more than 3 to 4 points on a YSP.
& TO: ML
In addition please answer the following, as I have asked in the past:
I did as you mentioned, however this is the only info noted??
Member Since: 12/15/2006
User Name: ML
Real Name: stephen michaels ?????
Location: albany, vt ?????
Total Posts: 469
[1.42 posts per day]
Find all non-archived posts by ML
More About Me
Bio: 25 years banking, brokering, wholesale, retail, and bond biz before that
Links
Homepage: No homepage specified...
Cool Links: No link specified...
Once again: "Also speaking of full disclosure please state your name title,
line of work & contact information so that I and the mortgage community can help you.......
Look forward to your full contact information as noted once again.
I think the mortgage community can help you as we all can learn from each other.
Once again I just wanted to make it clear that YSP should in no way be changed when it comes to Prime Mortgages.......
To: ass-----17 You are either very young or very naieve if you think
the Gov should *NOT CHANGE YSP on plain vanilla fixed rate mortgage's with no
pre payment penalty..
In the early year's of the Savings & Loans there was little competition which led to a monopoly. Do a study on economices 101 and find out when you eliminate price or competition what happens to the consumer.
The educated American consumer know's how to shop for a car, boat,
mortgage, etc. The internet has and will help the consumer shop and be able to compare apples to apples along with checking the reputation of the company with the State Licensing Board (Banking Dept) , BBB , REFERENCES ,
and length of time the company has been in business.......
Folks we all know the HR 3915 has some valid points for some changes
such as licensing and funky sub prime / adjustable / option arms /
Pre Payment Penalty etc.
However your plain vanilla 30 20 15 year fixed rate with no pre pay should, and I believe will be left alone. It's that simple.....
Also folks think of the many very educated consumers who chose to go with a true No Point & No Closing Cost Loan they benefited huge when the Greenspan era of all time low mortgage rate trends.
The True Zero Point & Zero Closing Cost Loan is a very wise way a consumer can shop mortgages............ |
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yan
402 Posts |
Posted - 11/14/2007 : 6:44:21 PM
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If
I bought my house 2 years ago 100% $500k value at 5.75 first and 10% second gives me a monthly payment of $3211.
Now the rate it's adjustable, my monthly payment is $800 more, I can not refinance because 10 properties in my neighborhood are in short sale or have been sold for $80k less. What makes my property value $80k less.
SO
I am paying for a house that worths LESS, I am paying MORE, and it's adjustable.
I rather go into Foreclosure than keeping a property that it's not worth it.
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