Not surprising to me HUD is going to put a 120 day 'enforcement' delay for the new Good Faith Estimate and HUD-1 roll out scheduled for Jan. 01, 2010.  What a mess. What a disaster. This photo depicts perfectly how our government (the big guy - Oliver Hardy) and HUD (the skinny -Stan Laurel) are managing this little thing we call a financial calamity. Recovery my (Fill in blank).

HUD always has a scandal each administration costing millions or billions (depending upon how many years you include). Inexplicably they eliminated the down payment assistance program thinking a down payment would solve this economic calamity. BIG thinking.

So here the nation of lenders wait to see what's next. How are the investors going to react. Some lenders may require us to use the new form. Others may not. How will the consumer navigate through this?

ME of course and my fellow mortgage professionals. As usual although always made out to be the villain it is up to us to interpret as best we can the mess handed down to us by the idiots, the knuckleheads, the "intellectuals" - congress & HUD.

We are the ones picking up the pieces to try and make sense of the non-sense. We are the receivers of funny looks from the consumer asking us - WHY DO WE HAVE TO DO THIS OR THAT - glaring at us like WE are the crazy ones!

AMERICA -WE did not make this up....this is Barney Frank, Chris Dodd - both sides of the political spectrum-  brilliance is coming out from all corners.

The consumer is getting nothing. The consumer cost is increasing - will increase and continues to get more expensive. After getting reamed at the financing table because of the 'new' regulation the consumer will have to pay more taxes to cover the bureaucratic tape that goes with it.

I'm in a bad mood.

I wish us all well.

If you were one of the activists that mailed in the online petition supporting the elimination of HVCC the day in court is coming soon.

A group will be delivering the petitions to one of the enemies of the consumer and our industry - the attorney general of New York - Mr. Cuomo maybe as early as this week. His office has been contacted and we will see how they respond.

See previous blog about its history and BS that fly's around this issue.

You want government to do what? The failure of HVCC appraisal

It continues to baffle me why the Honrable Mr. Cuomo does not go after the real villian in this and that is Wall Street. Oops I forgot that's where he will be getting his campaign donations for future political asperations...what was I thinking!

I wish us all well.

Talking to friends, colleagues or total strangers about their experiences in the military I am always impressed by their humble nature. What an all star group of people - men and women.

Not all serve in the battle of war. Often times they spend tireless hours supporting those engaged on the ground.

Then there are the families. The families are hero's too and in my opinion neglected way too often and need better support particularly today in the times we live.

To all I cannot thank you enough. 

I wish us all well.

Yes. Instead of doing the heavy lifting and figuring out how to work out loans for the folks still employed Fannie has decided to become a landlord. Instead of foreclosing they will lease to folks for one year then month to month there after.

How they set the rent or how things get fixed in a timely manner or even how they evict people are details nobody knows. It is safe to say knowing our government Fannie Mae does not know but sounds good doesn't it?  Just like the other failed programs.

Unfortunately if you live in an area where home sales are brisk there will be less inventory because Fannie isn't foreclosing on homes that perhaps should be foreclosed on. (I don't believe that will be a problem in most areas unfortunately)

The real tragedy from where I sit is the government cannot come up with a loan work out plan and force anybody to play along (it seems) so this is the solution. I wonder if lobbyists have anything to do with this....hmmm.

So here we go again and what a mess.

I wish us all well.

I have just been resuscitated after the shock and awwweeee of the news I'm about to tell you. Our government.....the government....yes our government actually did something that will help stimulate the economy and keep this little thing we call a country breathing.

Not only did they extend the tax credit for new homebuyers ($8,000) it now offers a $6500 tax credit for repeat buyers or buyers moving up (how do you move up when prices are down?).

This tax credit will end in June 2010 and all contracts must be in writing by end of April. I wonder if the record number of foreclosures in a quarter in American history had to do with it....HMMMMM.

Anyway that is good news and I have posted an excellent site that gives you full details.

http://www.federalhousingtaxcredit.com/

IRS Form 5405:

http://www.irs.gov/pub/irs-pdf/f5405.pdf

I will be glad to assist you toward your next home purchase. We lend in 47 states and look forward to working with you.

I wish us all well.

In his quest to appease the too big to fail banks making sure the CEO's get the bonuses promised so his campaign coffers remain flush Barney Frank is working hard to keep his promise of killing any and all competition for home loans leaving only the too big to fail banks to lend to the consumer. You know the TARP KIDS.

30 years ago the banks had their little monolopolistic operation - no competition and they were slow. The consumer was victimized because they were the only players in town until the local community based lenders (mortgage bankers/brokers) cropped up and what the consumer found was lower rates and better delivery of service.

Community based lenders (non-bank) provide 40% plus of the origination's and 50% of all FHA (HUD) loans and the reason for that is the big banks and credit unions are lousy at government loans they are flat out afraid of them based upon my personal experience.

So what is this all about? This is HR 1728 Financial Stability Improvement Act. There is a risk retention feature meaning that any lender that originates a loan must put aside a 10% reserve - in other words have a financial stake in making good loans. The concept itself is a good one and community based lenders already and always will have a stake in that but 10% is a huge number cost prohibitive and the only entities that will be able to fork out that kind of reserve is none other than....you guessed it the TARP KIDS wiping out or eliminate most of the community based lenders the result of course is the consumer pays more.

So the American consumer once again has Barney Frank to thank in a series of self serving bizarre blunders that will only build the few banks left to be even bigger to fail for the future bail outs and what about economic recovery? HAH!

On January 1st 2010 the American consumer is going to wake up to a bunch of new stuff featuring the new HUD version of the good faith estimate and the Financial Stability Improvement Act and other fantastic ideas Barney, Chris and Friends .... the same people that have been in charge of oversight and never did any over seeing....have come up with.

Man oh man if you think this is a sour grapes rant it may be but I have been in this business a long time and have seen it all until now of course and I know what it was like then and I can see the future and it stinks for the consumer. AMERICA write, call your representative....or don't. It is so bad it will be reversed once the results and the screaming starts but it will be at the expense of the middle class consumer and it will take another three years to fix. It will cost the middle class millions if not billions across the country.  Chris Dodd already got his sweetheart loan from Countrywide so he's set but what about the rest of America?

The link below is a related blog confirming Mr. Franks motives. Remember there are around 3 banking lobbyists per representative so if you think there is no influence here think again.

Barney Frank & Friends lack knowledge & skill

I wish us all well.

 The highly touted and much patting on the back until it bruised (Thanks NY AG of NY Cuomo) occurred when loan originators were lectured about how badly they behaved. After all it was the loan originator that put pressure on the appraiser to pull values out of their 'pockets'.

What do you know....a bizarre and simply unbelievable report has just come out stating that since the inception of HVCC (started in the 2nd qtr or 2009) the number of 'inflated value appraisal fraud" is up 46% compared to a year ago? Really?

How can this be? The big banks as you recall were for this 'reform'. WHY? Because they (Banks) formed another entity under their umbrella called it an AMC (appraisal management corporation) to separate loan originators from appraisers generating more income for themselves (at expense of consumer) what a dealio! While this is going on appraisers were given stricter parameters in what can only be categorized as a bizarre market on many levels to begin with.

Add to the above the fact banks instituted these electronic measuring systems designed to "review" (dumb down) the values or 'scrub' the appraisal work after it had been scrutinized by their own underwriters.... how redundant can you get on what is a subjective process anyway.

HOW COULD APPRAISAL FRAUD BE UP 46%? WELL IT ISN'T BECAUSE OF THE LOAN ORIGINATOR...AND FRANKLY I DON'T BELIEVE IT.... Who could be putting this out there? Here is the link scroll down and the name Interthinx pops up. A "risk mitigation" firm benefiting from the HVCC regulation thing publishes this information the same time  an amendment is being proposed to kill the HVCC. You be the judge.

http://brokeruniverse.com/news/#1256918407

http://www.interthinx.com/overview/fraud_reports.php

By their admission Interthinx states the sheer size and population of California has a significant impact on the national fraud trend numbers. Ok so why the headline then? Is that food for the BANK lobbyists to keep HVCC alive? You be the judge.

Based upon my experience since the inception of HVCC I cannot see how fraud could have increased. Honestly. The appraisers task is monumental and their work is scrutinized in an abnormal market place. It is ridiculous out there and our government continues to make it worse. Unbelievable. Just unbelievable. 

By the way - more garbage on the airways from the media pundits or guests proclaiming small community banks are handing out businesses loans.... really...which ones and ask the businesses that never missed a payment why their credit was pulled or canceled.

http://www.fdic.gov/bank/individual/failed/banklist.html

Hokey Smokes Bullwinkle....I wish us all well.

History....

Anytime we turn in a claim to our insurance company pertaining to our home and damage that information is collected for all insurance companies to see. This information is stored in a 'repository'. Experian and Equifax are both repositories storing information about our credit.

If you are looking at a home to purchase you should call your insurance agent and have them pull up the property to see what kind of claim history it has before you call your home inspector. Armed with that information going into an inspection can help you make an informed decision on what is the most important financial decision other than retirement you can make.

It is kind of like a CARFAX for houses.

I wish us all well.

I am usually available to my clients (borrowers/Realtors) as they need me and on Saturdays it is not uncommon to get a phone call or two about qualification on a home a borrower may be interested in or a call from a Realtor to confirm the price range our mutual client can afford before the offer goes in.

This past Saturday I sat in my office looking at two new purchase contracts on my desk. The tax credit certainly is playing a role and my sources tell me it will be extended into 2010 up through June. Perhaps congress would just extend it permanently since it is clearly a better stimulus program than the cash for clunker crap.

It is imperative you call your representatives. Write too. I have found when writing (via email from their website) I get a standard formatted non-response response telling me what they are doing for me. That does not mean I stop writing. I continue.

My second phase of "Operation Crazy Person" is to call the local office of my representative. I have met some of the staff through chamber events and so forth and as long as I have taken the time to write I should have someones ear.

There are many issues if addressed succinctly could add to the very modest momentum this tax credit has started- a few are:

1. Bringing back the down payment assistance program
2. Aggressively force banks/lenders/note holders to re-negotiate or modify existing loans consistent with the economic realities of our times vs a re-underwrite process to "unmeetable" standards
3. Banks that have foreclosed and have properties on the market must respond within 10 business days to offers and negotiate realistically plus any repairs of such properties are to be corrected by the lender or its facilitator.
4. Stop the cost prohibitive and unfair pricing of home loans based upon credit score
5. Force lenders to stop abusing their correspondent lending relationships (Buy back practices)

We need to drip on the representation in DC because the banking lobby has 3 lobbyists to every one Representative so if you think you are being represented (I don't care which party you drink kool-aide from) think again.

If you watched the interview of Tim Gietner on Meet the Press you should note what he did not say. The point is we have a long road ahead.

I wish us all well.

Nutty professors at HUD, the spoon fed (by lobbyist) congress and its agencies run around making speeches, proclaiming villains, pointing fingers yet right under the noses of all these knuckleheads bad players continue to play bad.

Case in point is Lend America's Mike Ashley. Caught, arrested, fined, fired, rehired, fired, ordered to stay out of the business, restrictions ordered -  See link for the full story:

http://www.housingwire.com/category/buzz-post/

The point is no regulation in the world will prevent stupid OR bad behavior unless of course there is oversight and enforcement. A drum I have been beating for the past 18 months and will continue to do so.

The enemy is from within and that enemy is our very own government to include the 'pretenders' in congress (pretending to practice oversight) the pretenders in the SEC (pretending to watch Wall Street) to name a few and of course the HUGE lobby effort by the Banking & Insurance industry.

Until we have real oversight and enforcement the noise we hear today is just that...noise.

I wish us all well.