Note from the Founder July 2009

by 18 Nov 2009


I am going to keep this short and just rant a little bit about a situation I have encountered recently as a loan originator with the assumption that many of you have experienced this same thing – and I’m curious how you feel about it. Here it goes.
So recently, I’ve caught myself “selling” a title company’s fees to various clients. This is a title company I have used for quite some time simply because they offer decent service.  I explained to the various borrowers that these particular fees were NOT my fees and they should perform their due diligence and shop around for a title company if they believe they can find a better deal. However, what I quickly realized is that stating this to the borrower really does not matter – the fees were on the Good Faith Estimate I presented them and the bottom line number was the only number that mattered. As a result, I ended up losing a couple of deals due to the title fees on the GFEs.  I quickly realized what a phenomenal strategy this title company (and I am sure many more with similar relationships with LO’s) had deployed. Title companies have an army of loan officers explaining and rationalizing – and more importantly – selling the title company’s fees to the client! This is precisely when I called one of the advertisers in The Niche Report – Entitle Direct – to receive a quote for a borrower who wanted to shop for more competitive title fees/rates. My mouth dropped when I tripled checked and questioned the representative’s quote. Yes, like their advertisement stated, they beat my local company’s fees/rates by over 35% (I actually pulled out the calculator). I then started to see RED – I was fuming – I lost deals over THEIR fees (remember, I was going to bat for them and selling their fees). I quickly turned over my entire pipeline to Entitle Direct. I will also add that to date, their service has been excellent. Please take this as an objective helpful tip. You may call this an endorsement of one of our advertisers, however, I call it a “call to arms” driven by pure disappointment. Again, I would use any company that advertises in TNR – and this episode just strengthened my belief in our advertisers.
Keep up the fight,
Robert Pegg
Letters to the Editor
While the intent of the HVCC regulation was to keep an appraiser from being unduly influenced in determining fair market value of a given property; what has happened is the quality of appraisals have deteriorated, timeframes have become longer and frustration has ensued from buyers, borrowers, brokers, real estate professionals, lenders and the appraisers themselves.
The HVCC while perhaps well intended has seemingly added a crippling blow to a recovering yet struggling real estate marketplace. One final result with the advent of the HVCC, the cost of an appraisal has increased by about $150.00 as an additional expense to the buyer/borrower, yet both service and quality have declined with the new process. Thus, nobody wins.
Michael Davenport
Licensed Mortgage Broker
King Mortgage & Realty, LLC
Michael – We ALL feel your pain, but unfortunately, as industry insiders, our opinions do not matter to the powers at play. This regulation was put into effect for the consumer, and fortunately, we have Martin Andelman, as a consumer, expressing his opinion on HVCC in this issue’s feature article titled “Cuomo’s Crossing”. Check it out, maybe someone will start to listen when a consumer’s point of view is presented.
First of all, I want to thank and congratulate you on a great magazine. I read it cover to cover and always find some gems of mortgage wisdom. I'm enclosing a copy of the email I sent to Martin Andelman regarding his recent article in the May issue.
Dear Martin Andelman - I enjoyed reading your article in the May issue of The Niche Report about loan mods - factual, candid and very well said. I think the underlying reason why the Obama's Administration is trying to criminalize the legit loan modification firms and services is its unspoken disdain for the private sector in general (treating it as a necessary evil just to get the tax revenues, not as the great stuff our American economy is made of). Our firm does modifications (mainly for past Clients and their friends and family) and I know exactly what you are talking about.
PS - I talk to a lot of borrowers, and so far, I know of only one (1) person who successfully modified his loan on his own (he is a CPA and an experienced real estate investor). I'm sad to say this, but the average homeowner has almost no chance. The government and the lenders advertise that their help costs nothing and it is true... people get what they pay for (nothing).
Robert W. Dudek
Chief Lending Officer
Statewide Home Loan Corp.




Is TILA-RESPA a good or bad thing long term?