Provident Terminates Tier 3 Brokers

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liverichly

3936 Posts

Posted - 07/24/2008 : 5:23:23 PM

Just got an email from Provident terminating my old broker since they were a "tier 3" broker. This was the email I got:

Provident Funding continues its legacy commitment to wholesale lending and to being the “Broker’s Lender” and the “Mortgage Price Leader”.

Our website states:

Controlling our costs is a major factor enabling Provident Funding to remain "the industry price leader". When we commit a fixed price to you for a specific time period, we must honor that price. We take interest rate risk to guarantee to you a price we may not be able to secure in the market when we sell your loan. Managing that risk can be costly if an account fails to keep their commitment to close the loan with us.

Logically then, Provident Funding places a great deal of importance on closing every locked loan within the agreed upon time period so we monitor our accounts locked fallout.

Fallout = loans that an account locks and subsequently does not fund with us.

As you know, your Tier status is constantly monitored and reported to you. Your account performance with Provident Funding places you in our Tier 3 category.

Effective immediately Provident Funding is terminating all Tier 3 accounts in accordance with our philosophy and agreement with you.

We will honor all locked loans and you may fund any locked loan in the pipeline. If by closing your locked loans it qualifies your account for Tier 2 status, we will reinstate your account at your request.

If you have questions, do not direct calls to your local branch. You may email us at anaheim@provident.com

dkendall1979

10261 Posts

Posted - 07/24/2008 : 5:40:26 PM

Ironic.

They kill the majority of their files for BS reasons, but they cut off the brokers who have too much fallout. I could see if it was loans that were locked, approved and ready to close then the broker pulled out, but we're talking about loans that Provident is turning down.

Perhaps they should have just put these brokers on a "Don't lock til it's ready to doc" status?

liverichly

3936 Posts

Posted - 07/24/2008 : 5:42:43 PM

I hear ya David, actually they did take away locking privledges on certain tiers until the file was given a conditional commitment... but I don't remember them taking away the ability to lock until it was CTC. While a lot of people dislike Provident, they were good on absolute slam dunk loans.

dkendall1979

10261 Posts

Posted - 07/24/2008 : 5:50:29 PM

I like MOAI

KHufford

5993 Posts

Posted - 07/24/2008 : 5:55:36 PM

You have to admit a lot of jerk off brokers take advantage of locking loans with mulitple lenders with no real regard. Us, as coorespondent brokers, can be charged up to .125 pt CASH for locking loans and not closing them.

CoolMtgGuy

3702 Posts

Posted - 07/24/2008 : 6:17:26 PM

I suspect that the dropped brokers deserve to be dropped. Too many brokers take the multiple-submission path, and lock their loans prematurely, and ignore sound partnership practices so they pay the price accordingly. Many banks are enforcing similar policies. It is the ways things are in our business today.

khoiey

1583 Posts

Posted - 07/24/2008 : 6:22:14 PM

I never submit a file to them since day 1 signing up with them. Just got that letter as well.

dkendall1979

10261 Posts

Posted - 07/24/2008 : 6:30:57 PM

I would too if my paycheck depended on it though.

You just don't know if a loan is going to close anymore. Too many things come up. The slightest issue and the lender might turn it down.

I understand these companies want to remain profitable, but you also have to keep in mind the CEO's of the companies have HUGE monthly nuts to crack (on both personal and business levels), they've adjusted themselves to yesterdays paychecks and are doing everything in their power to maintain their $1M+/yr salary.

Poor management has a lot to do with it. There's no loyalty in the mortgage industry. That's why I like it at a smaller Corr banker, I get the same small group of brokers sending me business month after month. We don't price so aggressively that we attract the bargain shoppers, but we don't price so bad we deter business.

I don't respect Providents business model at all.

quote:
Originally posted by CoolMtgGuy

I suspect that the dropped brokers deserve to be dropped. Too many brokers take the multiple-submission path, and lock their loans prematurely, and ignore sound partnership practices so they pay the price accordingly. Many banks are enforcing similar policies. It is the ways things are in our business today.

waynepbright

3678 Posts

Posted - 07/24/2008 : 6:32:25 PM

YUP, SUX

CoolMtgGuy

3702 Posts

Posted - 07/24/2008 : 7:34:47 PM

I do understand your point David ... but this is not just Provident's policy. Wells Fargo and other have pull-through requirements and I can't blame them. There are two sides to this. How would your company react if they became aware that files submitted to you have also been submitted to two other lenders?

Maybe its just me ... but I believe in playing by the rules that are the basis for my partnership with my lenders. Call me old fashioned.

quote:
Originally posted by dkendall1979

I would too if my paycheck depended on it though.

You just don't know if a loan is going to close anymore. Too many things come up. The slightest issue and the lender might turn it down.

I understand these companies want to remain profitable, but you also have to keep in mind the CEO's of the companies have HUGE monthly nuts to crack (on both personal and business levels), they've adjusted themselves to yesterdays paychecks and are doing everything in their power to maintain their $1M+/yr salary.

Poor management has a lot to do with it. There's no loyalty in the mortgage industry. That's why I like it at a smaller Corr banker, I get the same small group of brokers sending me business month after month. We don't price so aggressively that we attract the bargain shoppers, but we don't price so bad we deter business.

I don't respect Providents business model at all.

quote:
Originally posted by CoolMtgGuy

I suspect that the dropped brokers deserve to be dropped. Too many brokers take the multiple-submission path, and lock their loans prematurely, and ignore sound partnership practices so they pay the price accordingly. Many banks are enforcing similar policies. It is the ways things are in our business today.

johnnyboy38109

3057 Posts

Posted - 07/24/2008 : 7:57:23 PM

quote:
Originally posted by KHufford

You have to admit a lot of jerk off brokers take advantage of locking loans with mulitple lenders with no real regard. Us, as coorespondent brokers, can be charged up to .125 pt CASH for locking loans and not closing them.

For once I agree with this poster.

I would also suggest that a great many "jerk-off" wholesalers create these problems with lock fallouts because they are obtuse and obstinate.

bmoran

1164 Posts

Posted - 07/24/2008 : 8:00:44 PM

Provident is who they are.

You send perfect files get a million conditions, long delays, hopefully close one day, if not you get removed from their list simple.

All for a .25 point better

johnnyboy38109

3057 Posts

Posted - 07/24/2008 : 8:03:57 PM

quote:
Originally posted by bmoran

Provident is who they are.

You send perfect files get a million conditions, long delays, hopefully close one day, if not you get removed from their list simple.

All for a .25 point better

Yep, thats the way it goes with them, and thats why I cut them off.

khoiey

1583 Posts

Posted - 07/24/2008 : 8:05:35 PM

Their u/w called me up for the sake of past 2 weeks begging us to send in loans. We didn't since most of our deals go through TBW, Suntrust and Wells (due to good AEs). She ended up with a threat... 'Well... we may have to cut you off guys'. LOL. Bite me!

benjamin

2278 Posts

Posted - 07/24/2008 : 8:09:43 PM

Contrary to what some posters have stated, Provident counts locked loans that don't close as fallout. If Provident has conditions that can't be met, this does not count towards fallout.

I too received a notice today. Other branches have sent them loans through a mutual account, which I started, tier 3, F you very much. I have had one locked loan that did not close with them in 10 years.

Keep smiling.

Idiots don't know how to process a loan.

Managing Prime

2802 Posts

Posted - 07/24/2008 : 8:10:28 PM

"Termination of Tier 3 Brokers" sounds like a mercy killing to me.

GatorInSC

59 Posts

Posted - 07/25/2008 : 04:02:05 AM

I wonder if that email went out to all brokers. I received it as well, but we're currently at Tier 2.

ramblinwreck17

49 Posts

Posted - 07/25/2008 : 04:56:59 AM

I got the email. I'm out at Provident (tear).

I signed up with them- sent in 4 full files that month and locked them all- PERFECT files. They conditioned my appraisals to the point where my appraiser threatened to bail. Eventually, they denied two, accepted 1 and the 4th the lady changed her mind.

I had to scramble to get the two denied ones closed elsewhere.

I will be in business long after they are gone.

gsgroupinc

2035 Posts

Posted - 07/25/2008 : 05:50:54 AM

Funny thing is I received the email tell me I was a tier 3 broker but NEVER signed up with them. So I am not sure how that happend. Funny still.

GianniD

215 Posts

Posted - 07/25/2008 : 05:58:04 AM

quote:
Originally posted by dkendall1979

I like MOAI

I MISS MOAI.

I sent them 100's and 100's of loans over the years, and, with their 'Platinum' designation and a processor that used to be an UW, I could close loans quicker than than anyone esle around.

ADVISEUMORT

395 Posts

Posted - 07/25/2008 : 06:25:45 AM

everyone did get those emails no matter what tier, just an fyi for those who asked.

gmic

327 Posts

Posted - 07/25/2008 : 07:31:48 AM

I signed up with Provident less that 3 months ago; I was Tier 1. You have to close 10 loans with them in 6 months time to remain Tier 1. I closed 2 loans in 3 months and I've had no fallout; they demoted me to Tier 2, 3 months ahead of the deadline. I don't get it but I do agree, they are extremely hard to deal with, totally inflexible. A perfect loan gets at least 10 conditions, the last one I had to clear was the Appraiser's pictures were taken in the afternoon; they wanted early morning pictures so they would be lighter. He had to go back out and take pics again; give me a break!

blarney27

163 Posts

Posted - 07/25/2008 : 07:51:35 AM

quote:
Originally posted by benjamin

Contrary to what some posters have stated, Provident counts locked loans that don't close as fallout. If Provident has conditions that can't be met, this does not count towards fallout.

I too received a notice today. Other branches have sent them loans through a mutual account, which I started, tier 3, F you very much. I have had one locked loan that did not close with them in 10 years.

Keep smiling.

Idiots don't know how to process a loan.

"If Provident has conditions that can't be met, this does not count towards fallout."

This has not been my experience with Provident. For nearly a year I had a great working relationship with Provident. As long as it was a strong file, I would send it to them and I would have no problems. The best rate, and very fast turn times.

Then starting in Feb/Mar disaster hit and they destroyed 3 of my files. Needless to say these locked loans, ended up as fallout. Even though they requested conditions that could not be met, they still dinged us.

And all loans (ours at least) go through appraisal review BUT they will not review it for 2-3 weeks unless you lock. So you lock, get the review and turns out value is cut, can't do the loan with them and then they ding you for it.

homebroker@sbcgl

3519 Posts

Posted - 07/25/2008 : 08:23:13 AM

They canceled one of my loans because I was related to the borrower, not a problem, but first I called them to ask if this is OK, they said it s not a problem just mention they are a cousin with the same last name in an explanation letter. They later canceled the deal and it was a point agaist our company. It was 80% LTV, full doc, $200,000 reserves the cleanest deal ever!

quote:
Originally posted by dkendall1979

Ironic.

They kill the majority of their files for BS reasons, but they cut off the brokers who have too much fallout. I could see if it was loans that were locked, approved and ready to close then the broker pulled out, but we're talking about loans that Provident is turning down.

Perhaps they should have just put these brokers on a "Don't lock til it's ready to doc" status?

pnc1luv

17 Posts

Posted - 07/25/2008 : 11:08:18 AM

I liked Provident because of their strong rates, though an extra .25 - .50 isn't everything, in these tougher times, it's helpful. Yes they were only good on the real clean deals...we also got cut off being a tier 3, but some of their conditions and appraisal requirements were ridiculous, which counted towards our fallout. Just got off the phone with a rep from there, and she wasn't helpful at all, but did notify us that "we cut off around 1400 brokers in the tier 3 status yesterday, it's going to take us quite a while to filter through this". Wow sounds like they may be in trouble?

blarney27

163 Posts

Posted - 07/25/2008 : 11:15:10 AM

quote:
Originally posted by pnc1luv

I liked Provident because of their strong rates, though an extra .25 - .50 isn't everything, in these tougher times, it's helpful. Yes they were only good on the real clean deals...we also got cut off being a tier 3, but some of their conditions and appraisal requirements were ridiculous, which counted towards our fallout. Just got off the phone with a rep from there, and she wasn't helpful at all, but did notify us that "we cut off around 1400 brokers in the tier 3 status yesterday, it's going to take us quite a while to filter through this". Wow sounds like they may be in trouble?

Anyone else take this "notice" as a signal Provident may be in trouble?

bkladd

43 Posts

Posted - 07/25/2008 : 11:19:45 AM

They dropped us yesterday. We sent one clean file there that they conditioned the hell out of, didn't close it so I guess our fallout was 100%. Eff them, everything I read about them on this board came true. I was glad they dropped us so I don't have to deal with them again.

pnc1luv

17 Posts

Posted - 07/25/2008 : 11:22:19 AM

Either they were just trimming off the "fat" or may have lost a line or investor or something?

nowbroker

1384 Posts

Posted - 07/25/2008 : 11:31:17 AM

I have been getting calls and emails asking us to sign up again at Provident. After reading this I see they have not changed over the years.

Still the lender from hell.

CoolMtgGuy

3702 Posts

Posted - 07/25/2008 : 11:33:16 AM

Why do people seem so surprised at what Providence is doing? The extra 0.25% they gave to you was in return for the best, strongest deals that were capable of surviving their onslaught of conditions. What is so surprising about that?

Also, this policy has been implement by several of the larger wholesale lenders, to varying degrees, for about 1 year. No new news here.

g8r1fl

21 Posts

Posted - 07/25/2008 : 12:00:19 PM

We've used them for years. Mostly our super clean deals. Over the last 3 months, we've sent 6 files, all over 740 scores, 80%ltv's, full doc and they've killed the appraisal values. They didn't cut the value, just lowered the loan amount. 1 out of six closed because they counteroffered. We were cut off today as well, but we cut them off after the problems they were giving us.

assassin17

4172 Posts

Posted - 07/26/2008 : 10:17:28 AM

I got the notice also, but when I checked after subsequent emails we were a tier 2. I'm assuming they sent the notice to everyone, as a robot might do, and that you should check individually to see if you are really cut off.

But since they suck, it doesn't matter.

khoiey

1583 Posts

Posted - 07/26/2008 : 10:49:59 AM

I checked and I'm with tier two. Wondering if those brokers that are in tier 3 and get cut off, would they be reported to MARI?

quote:
Originally posted by assassin17

I got the notice also, but when I checked after subsequent emails we were a tier 2. I'm assuming they sent the notice to everyone, as a robot might do, and that you should check individually to see if you are really cut off.

But since they suck, it doesn't matter.

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