Anyone who thinks they know the mortgage industry - especially well enough to predict it - is like someone saying they know which star has a planet in orbit that can support human life. Seriously, everything anyone knew about the mortgage industry just six months ago is completely different today.

Yesterday, May 27, 2009, interest rates at par went from about 4.75% to a par at about 5.25% between lunch and five PM eastern. Did anyone see it coming? Well, the indicators were there that's for sure so some people did call it. Many completely blew it like Dan Green who wrote on his blog on May 14, and I quote, "I am predicting that rates will decrease over the next 30 days." Oops.

Not to make an example of Dan but if you read his blog you would think he is a pretty sharp individual and his website certainly gives the impression that he is a consummate professional worthy of trust.

Well - he missed it. Either way I would have never predicted rates decreasing over the 30 day period between May 14 and June 14 and I don't know of anyone in my national mortgage professionals groups who would have. But this is an example to show you that even people who look, sound and act like they know exactly what they are talking about. (Insert big honking buzzer sound here.)

Recently there was a big flap over some things Lenn Harley wrote about pre-qualifying her customers. I can see how she riled a few and ruffled a few feathers but I still believe what she was saying was she doesn't want to waste her time with people she believes to not be qualified. On the broad spectrum that may be okay but when it gets down to actually getting an approval from a lender there are multiple factors examined and weighted algorithms applied. In fact I am often surprised when certain borrowers are approved and flabbergasted when others are not approved.

Every day, literally every day, something changes in underwriting guidelines or lender overlays. Even the underwriting engines, the automated decisions making software, are tweaked and changed every day. Nobody - not one person - whether they have 3 days or 30 years in the mortgage industry can know for certain if an apparently qualified median borrower will be approved or denied until they have exhausted the correct protocol. Just having 800 plus credit scores is not all you need, just having the right income or reserves is not all you need. Even combining 800+ scores, good income and good assets is not all you need.

Now you can even factor in the HVCC and the wild results overstressed, underpaid appraisers are likely to bring to the table. And who knows when that will change? Not me and not you.

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