The Georgia General Assembly have completely lost their minds? Reference SB 57
OUTLAWING YIELD SPREAD PREMIUM WILL NOT HELP WHAT YOU MAY THINK IT WILL HELP. I typed in all caps because it's obvious you have not been able to see it in the past.
I don't know how many times I have to say this until every math deficient person on the planet gets it: Yield Spread Premium DOES NOT INCREASE INTEREST RATES. Greedy loan officers do and it doesn't matter if they work at the bank, the lender, a broker, or your mamma's house.
For example: Today I can do an FHA loan with one of two interest rates JUST LIKE EVERY BANK AND LENDER IN THE NATION. I can do it at 5% 5.455APR and the borrower will pay all/most or some of the closing costs or I can do it at 5.5% 5.749APR and the borrower will pay ZERO closing costs. Both scenarios require the borrower to pay escrows and UFMIP by cash or in the loan amount.
I called Flagstar bank, made four separate calls to track down my "Home Lending Specialist" and asked, "What is your rate on a fixed thirty FHA loan today?" They answered, after a protracted conversation, "5.625%". I said does that include closing costs? They said "yes, it does". I asked, "What about pre-paids, escrows and mortgage insurance?" Their answer was, "those are not included."
So, dear Georgia General Assembly, my rate, using my evil Yield Spread Premium (YSP) which I use to cover closing costs - JUST LIKE FLAGSTAR BANK A DIRECT LENDER - is actually lower than FLAGSTAR bank. Major difference: I am required by FEDERAL LAW to divulge my amount of YSP where Flagstar, and every other bank by the way, actually makes MORE profit on the loan than I do but are not required to divulge on penny of their profit.
In addition I am a licensed lender not a licensed mortgage broker in the state of Georgia and I could, according to the law, not divulge my YSP because it becomes Service Release Premium. Do you think we don't know who is behind this measure? BIG BANKS OF COURSE! Without mortgage brokers in the way they will be free to pillage the people of America without interference from pesky mortgage brokers.
Oh, I know Chris Dodd, Barney Frank and Nancy Pelosi have you worked into a tizzy over mortgage brokers and say they are the evil that corrupted America. Here's the issue boys and girls: Brokers have never ONE TIME created or FUNDED a loan. It's Countrywide, Wells Fargo, Bank of America, Flagstar, Suntrust, Wachovia, Fifth Third, Chase, M&T ... on an on ... who created, underwrote, funded, AND APPROVED EVERY loan that came from a mortgage broker.
So you go ahead and sleep in the pocket of the Democratic truine powers and the pocket of the big banker while the citizens of my great State are left to deal with the ones who sold them down this river of despair to begin with.
Georgia General Assembly - you are faced with the opportunity to continue the greed and blind maneuvering by the big banks to send the state's economy farther down an irreversible pathway or do the right thing and vote NO to Georgia Senate Bill 57 on Tuesday, March 31, 2009
You can phone me directly at 678-946-0101 or see me at the Tea Party at the Georgia Capitol after it's too late. I'll be there. YOU CAN REST ASSURED ANY TIME GOVERNMENT GETS INVOLVED IN BUSINESS THEY LIMIT THE ABILITY OF INTELLIGENT THINKING INDIVIDUALS TO OPERATE. Basically this is yet another law that *may* help a very small percentage of borrowers who are ignorant of the process WHICH I VOW TO PROTECT as a business man with high integrity. Meanwhile it will limit the vast majority of borrowers who took the time to understand the mortgage process and how to use it to their advantage.
Section 2 Part (7) Yield spread premiums are prohibited in the origination and closing of home loans to the extent that any such premium exceeds the amount of direct payments by the mortgage broker to third parties, unaffiliated with the mortgage broker, of closing costs on behalf of the borrower.
Yea (Y):43Nay (N):9Not Voting (-):2Excused (E):2 * Y ADELMAN, 42ND * Y BALFOUR, 9TH * N BROWN, 26TH * N BUCKNER, 44TH * - BULLOCH, 11TH * N BUTLER, 55TH * Y BUTTERWORTH, 50TH * Y CHANCE, 16TH * Y CHAPMAN, 3RD * Y COWSERT, 46TH * Y CROSBY, 13TH * Y DOUGLAS, 17TH * N FORT, 39TH (ODDLY ENOUGH) * Y GOGGANS, 7TH * Y GOLDEN, 8TH * - GRANT, 25TH * Y HAMRICK, 30TH * Y HARBISON, 15TH * Y HARP, 29TH * Y HAWKINS, 49TH * Y HEATH, 31ST * Y HENSON, 41ST * N HILL, 32ND * E HILL, 4TH * Y HOOKS, 14TH * Y HUDGENS, 47TH * Y JACKSON, 24TH * N JACKSON, 2ND * N JOHNSON, 1ST * Y JONES, 10TH * Y MOODY, 56TH * Y MULLIS, 53RD * Y MURPHY, 27TH * Y ORROCK, 36TH * Y PEARSON, 51ST * Y POWELL, 23RD * Y RAMSEY, SR., 43RD * Y REED, 35TH * N ROGERS, 21ST * Y SEABAUGH, 28TH * Y SEAY, 34TH * Y SHAFER, 48TH * Y SIMS, 12TH * Y SMITH, 52ND * Y STATON, 18TH * Y STONER, 6TH * Y TARVER, 22ND * N TATE, 38TH * Y THOMAS, 54TH * Y THOMPSON, 33RD * Y THOMPSON, 5TH * Y TOLLESON, 20TH * Y UNTERMAN, 45TH * E WEBER, 40TH * Y WILES, 37TH * Y WILLIAMS, 19TH
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9 Comments
on The Attack on Yield Spread Premium Goes Mainstream
MAR
30
2009
Ken, I love your passion and the Govenment has no clue what they are doing right now. Sorry but it is true. How dare they fire Rick Wagoner from GM. I don't know if he is good or not. That is not the point, it is NOT RIGHT FOR GOVERNMENT TO INTERFERE IN PRIVATE BUSINESS.
If they can do it with one they can do it with anyone.
Missy - thanks for your support! I guess I failed "Short Blog Post 101" again :) What have I always said? "Education beats legislation every time." Nope, not in I Blame You-nited States of America where personal repsonsibility left with the drive to be the best in the WORLD. Here I go again ...
Terry - thanks for stopping in. I'll take "What is greed" for 500 ...
Ken, It is certainly starting to sound like MBs are being eliminated from the market place. I wonder of agents will be next? Just let the banks sell all the houses since they own most of the inventory anyway.
Bryant - we've heard the threats of big banks becoming Big Banks again for years. I guess all the people who were property of the Big Banks in the past have gone and are not around to remind these young bucks what that leads to.
Lane Bailey - I know you already know your state senator is Renee Unterman and she is a Republican. You're probably in the 104th House district which gives you that abomination Lee Thompson but hopefully you are in the 105th and you can speak directly with Donna Sheldon who feels the struggles of the small business owner and at least has some conservative leanings.
This mischaracterization of the Y.S.P will continue until all of the wholesellers and investors are gone and then the brokers will have no source for money.
Who expects politicians to understand?? I surely don't. They do whatever their major contributors tell them to do. In fact, the lobbyists write the bills for them.
Lenn - if the voting public could just grasp a slight glimmer of the truth of your last paragraph and especially your last seven words. Our country is not being operated in any fashion designed to benefit the people and I fear great disturbance in the future unless there are some major changes in the way our elected servants serve us. Right now they do not serve us for anything but evil and their own corrupt purposes. Think Blogo is the only one? Ha! We have become lovers of the popular and despisers of the truth. America is beyond corrupt and the next generation will not, without major and immediate changes, live in a free and trusted nation.
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For example: Today I can do an FHA loan with one of two interest rates JUST LIKE EVERY BANK AND LENDER IN THE NATION. I can do it at 5% 5.455APR and the borrower will pay all/most or some of the closing costs or I can do it at 5.5% 5.749APR and the borrower will pay ZERO closing costs. Both scenarios require the borrower to pay escrows and UFMIP by cash or in the loan amount.
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Ken, I love your passion and the Govenment has no clue what they are doing right now. Sorry but it is true. How dare they fire Rick Wagoner from GM. I don't know if he is good or not. That is not the point, it is NOT RIGHT FOR GOVERNMENT TO INTERFERE IN PRIVATE BUSINESS.
If they can do it with one they can do it with anyone.
Off to order my tea.