Michelle's Blog

Commercial Lending Events

Michelle Reid (Pikes Peak Processing) — Wed, 27 Aug 2008 15:18:22 -0500

This blog is to help others look for or post commercial lending events. I myself am looking for events happening in the New York area. I am always interested in learning all I can about the commercial lending industry and like to know about all the events I can. If you know of any events in any area please feel free to post on this blog. I know there is a commercial education seminar coming up in Jericho, NY but it is yet to be announced. I will announce it as soon as I hear from them and post the link to sign up.

Happy commercial blogging everyone. LOL.

Michelle Reid

Commercial Lending Events

Michelle Reid (Pikes Peak Processing) — Wed, 27 Aug 2008 15:17:17 -0500

Happy commercial blogging everyone. LOL.

Michelle Reid

CMLA & New Colorado Law

Michelle Reid (Pikes Peak Processing) — Thu, 28 Jun 2007 11:06:04 -0500

In recent days, one or more funding lenders has notified customers that they would no longer accept certain loan products in Colorado that might be described as "stated income", "low doc", "no doc", and/or "no ratio". As a result of those communications, many members and friends have contacted CMLA to inquire whether such products are somehow banned in Colorado.

While CMLA is unaware of an explicit prohibition on such loan types within the new laws passed on Colorado, we would respectfully defer to each funding lender to determine what types of loans it will offer in Colorado or any other state, and under what terms. Loan originators, production managers, and others should seek guidance from their funding lenders as to how each entity will conduct business under the new laws passed in Colorado. CMLA cannot make that determination for any particular lender.

We urge all persons who may be affected by the new "mortgage laws" in Colorado to read the bills as passed, to determine how each may affect your operations, and to seek advice from the Colorado Division of Real Estate and/or private counsel.

Each bill is available for download from the CMLA web site, along with helpful information from CMLA about the bills:

http://www.cmla.com/DRE.html

Loan Processing: The Fastest Way for Brokers to Close Loans

Michelle Reid (Pikes Peak Processing) — Mon, 25 Jun 2007 17:08:52 -0500

Are you tired of loans dragging on for weeks or even months before they even get a chance to close?

Let us help you get past that.

We have closed loans very quickly using the following methods. Our goal is to close a loan within 2 weeks which we have done quite often. We have even closed a loan in a week using this strategy.

Confir with your client that they will need some items at your appointment to fill out the application.

Documents Needed Per File

Copy of social security card & drivers license (processor has to fill out the "Patriot Act" form. It's part of the disclosures.
Letter of explanation of any derogatory credit they might be showing on their credit repot. (if they don't know off hand they can get it to us after the credit has been pulled)
If a refinance, a copy of their most current mortgage statement
If a purchase & they are renting, will need the landlord information (Name or company name, phone number)
Lease agreements on any other properties they own and rent out
Most current pay stubs for 30 days for all borrowers on the loan qualifying with income
2005 & 2006 W-2's for all wage earner borrowers
If self employed 2005 & 2006 complete tax returns with ALL schedules
Most current bank statements, IRA, 401K, Mutual Funds, etc
Purchase contract & copy of earnest money check if a purchase
Homeowners' insurance if a refinance, if it's a purchase they can get it before we close.
If the file is stated and the borrower(s) is self employed, we will need a CPA letter that states the borrower(s) have been self employed for the past 2 years at the same location in the same line of work, or a business license or a trade name certificate.

These items will help the processor submit the file immediately to get an approval and process the file quicker. If the processor reviews the items and needs additional items then he/she may ask for additional items before he/she submits the file.

2. Make sure that the 1003 is complete. It's hard to process a file with an incomplete 1003

3. Let the borrower(s) know that a loan processor will be contacting them for documentation if needed. This keeps the borrower from getting confused on who he/she is supposed to be speaking with

4. Have the program, lender, interest rate already picked out so all the loan processor has to do is run it on their website and submit it or send the file with the prequal and the submission sheet the processor filled out

These are the most important things you can do to insure that your loan will close quickly and efficiently. If the file is missing a lot of information and/or documentation necessary to proceed with the loan, the loan process will only be that much slower.

You will find more tips, adivce, articles, and lender information on our website. I hope this helps you as a loan broker and look forward to seeing you on more of our blogs.

Pikes Peak Processing

Commercial Applications: Step by Step

Michelle Reid (Pikes Peak Processing) — Fri, 22 Jun 2007 10:53:04 -0500

Commercial Applications: Step by Step

The commercial-application process differs from residential; here's what you need to know

Ken Gatlin, senior vice president and CLO, ITC Commercial Funding

As published in Scotsman Guide's Residential Edition, June 2007.

Many residential mortgage brokers are now searching for information and instruction about originating commercial mortgages. If you understand the general commercial application process from origination to closing, you can be successful.

The following steps give you an idea of how the process .......

For the full article, use this web address. http://www.scotsmanguide.com/default.asp?ID=2213

FHA: An Alternative to Nonprime

Michelle Reid (Pikes Peak Processing) — Fri, 22 Jun 2007 10:49:49 -0500

FHA: An Alternative to Nonprime

As published in Scotsman Guide's Residential Edition, June 2007.

With the decline in the nonprime market, mortgage brokers are suffering because a big source of their loan originations is disappearing. Much of this volume soon might be replaced by Federal Housing Administration (FHA) loans, however -- especially....

To read the whole article, go to this site. http://www.scotsmanguide.com/default.asp?ID=2194

Why Should A Broker Use Contract Processing?

Michelle Reid (Pikes Peak Processing) — Thu, 21 Jun 2007 15:57:05 -0500

The processing of loans affects the broker side of the mortgage industry. Regardless of how your loans are currently being processed, chances are your success and sense of security rest on how well your processing works for you. Many people have heard of mortgage loan processing companies but have no idea how to utilize them as a resource. So what do they have to offer you?

The benefits of using mortgage contract processing companies are numerous. Experienced processors know as much as a seasoned Loan Officer and possibly more. When you use a company with trained and qualified processors, the immediate advantage is access to their accumulative knowledge. You gain the support of highly qualified individuals helping you to originate and fund more and create stability and security for your business.

Outsourcing your processing can allow you to originate a higher volume without hiring or creating additional overhead. Depending on your volume, using contract processing for all of your files could considerably reduce your overhead and tax liability. You should also consider their services for temporary increases in business due to lowered interest rates. Instead of turning business away, you have an opportunity to close those additional loans without hiring.

It can be very useful to outsource during times of urgency, as well. Stress from deadlines, obstacles and problem solving involved in processing contributes to a high turnover rate. You could find yourself without a processor or a plan B. It is smart to research loan processing companies and keep their information on hand, just in case.

Offsite processing reduces the phone calls and faxes coming into your office, as the processors are handling the approvals, conditions, doc orders and closing preps. You require less in-house staff, use less of your own office resources and, in turn, reduce your responsibilities. One of the goals of any mortgage loan processing company is to provide a service that frees the Loan Officer or Broker from the details of processing and allows them to market and do sales.

However, utilizing a mortgage loan processing company differs from having an assistant or processor in your office. Responsibilities that you give to someone employed by you may not be part of the service provided by a company. You will, at the very least, be asked to send in a very complete and accurate 1003 application, a form completed (specific to each contract processing company) with the lender, program, contact, appraiser, escrow/title/abstract/attorney information and instructions for the file.

If you have trouble placing your loans with lenders and finding programs, outsourcing your processing will not solve your problems. In general, mortgage loan processing companies will not "shop" with lenders to find the appropriate programs for your files.

In addition, all sales issues are your responsibility. If you are looking for a way out of having to be the "harbinger of doom", then hire an assistant who lives for that sort of thing. A lot of work and effort go into getting a file funded. For what is charged, it is quite the deal already without the processor completing the L.O.'s tasks as well. Keep in mind that a processor is usually someone who would like to remain behind the scenes. If they wanted to work in sales and handle sales related issues, they would make more money as a Loan Officer.

Before contacting a company to inquire about outsourcing, do some research online. Read the various websites and get a feel for how each company differs. Then, take some time to think about what you need right now and what your goals are for the next six months. Having these in mind when you call a mortgage loan processing company will allow you to ask very specific questions, such as the following:

n Do they process the type of loan you are doing?

n What are the qualifications of the staff?

n What is the price? Is it a flat fee per file or can there be additional charges? Is there a discount for volume? Who pays for shipping and mailing?

n What about cancellation fees if the file does not fund?

n Will you be working with just one processor or a team? Or will your file be assigned as it is received?

n How will you receive status on your files? How often?

n How many files can they currently accept?

n What are their turn times once a file is received or conditioned?

n Will your files be taken care of if the processor working them is sick or on vacation?

It is not necessary to send files locally or in a state close to you (unless you are in a Brick and Mortar state such as Arizona where processors must reside in the state). Everything is just one day away, and technology has shortened those distances even further. Remember to ask for a sales packet so you can see the level of detail the company puts into its work.

Keep in mind that the company may have some questions for you as well to see if they can be of service or to answer your questions accurately. Be prepared to answer how many loans you originate and how many of those loans fund a month, explaining the fallout if it seems excessive.

When working with a mortgage loan processing company, there are a few basic tips to ensure a successful partnership:

n Be available - return calls or emails promptly.

n Respond to your borrowers' concerns that the processor cannot address in a timely manner.

n Be accountable and follow through with what you state you will do.

n Use email to communicate with the processor for faster service.

n Send complete and accurate 1008/1003/GFE with your files.

n Know the program on which you are having them submit.

n Treat your processor as a team member - not a service provider.

n Pay the processing company promptly if an escrow officer leaves it off of the HUD and you receive their money. Show that you value their service.

n Pay the cancellation fee promptly when invoiced if you have previously agreed to do so. In most cases, it will not cover the costs they have incurred.

n Above all, be courteous and respectful.

Mortgage loan processing companies are a very valuable resource whose potential benefits are just recently being discovered by Loan Officers and Brokers around the nation.

The Benefits of Utilizing a Mortgage Loan Processing Company

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