If you are a loan officer or a lender that uses deceiving practices, who lies, or who likes to commit fraud.... you better watch out. I haven't heard about this as much in the pass, but HUD seems to be cracking down on those lenders that abuse FHA loans and HUD's policys.
As a warning to others in the lending business, HUD made a press release on June 10th, 2009, stating 3 lenders that have been suspended by HUD. These 3 lenders were suspended for serious violations under HUD's regulations. This is directly from the press release....."The 3 mentioned were Golden First Mortgage Corp of Great Neck, NY; Great Country Mortgage Bankers, Inc. of Coral Gables, FL; and Beneficial Mortgage Corporation of San Juan, PR."
Yes, it's all about sales and for many, it's how you can rope in some borrowers to come to your company. I see it often and hear more about it through new clients that have been duped or lied to by other loan officers or lenders. But there should be some form of integrity, no matter how much you might have to sell. I truly believe in educating the borrower, giving them a good deal, and allowing them to make their decision then. Don't get me wrong, there are some very good loan officers that follow this same practice. But for some reason, I am getting more people this year that have had bad experiences than I did in previous years.
Overall, why is this? In my opinion, once supbrime mortgages left the market place and conventional loans became harder or more pricey in rate, many lenders applied for FHA approval. You can read about the 3 lenders and why they were suspended in this press release. HUD press release in suspending 3 lenders
Summary : I would love to see more actions taken amongst lenders and loan officers. The 3 lenders that were suspended were for other related actions outside of your normal bad business practices of lying and such. In what I call, the bad performance of a lender or loan officer, to where they either bait and switch, or that they just mess up a semi simple deal. And in some cases, that deal gets delayed and or very poor service is involved. Please read this blog for a few examples that have taken place amongst two new clients of mine. The further that I dig into the first one, they would have never come close to the settlement date, based on some hard core evidence that I found. In my opinion, the previous lender was going to miss the settlement date by at least 7 to 10 days. To me, that is just unacceptable, because there was no urgency in what they were trying to accomplish. Don't get me wrong, I do understand that things happen and can delay a settlement. But this was not the case. Please read about it here.... False information in regards to who gets the origination fee
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For more information on FHA loans, please go to this link. The FHA Expert
For more information about the 2009 Tax Credit for First Time Homebuyers : 2009 Tax Credit
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!
Copyright © 2009 by Jeff Belonger
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Shame on them. I hope they have learned their lesson.