On December 16, 2007, the Tennessee Association of Mortgage Brokers' president, Brian Short, was quoted in The Tennessean as saying "I can't see how mortgage brokers are responsible for the increase in foreclosures." Yet, one of the largest lenders with sales channels in both direct sales and via brokers has stated that over 3/4 of its loans that have entered foreclosure were originated by mortgage brokers and not their direct sales channels, known as mortgage bankers. With such a staggering disparity, how can Mortgage Brokers claim no responsibility?
Mr. Short and the TN Association of Mortgage Brokers will argue that it is their job to provide the borrower with options and allow them to choose which one is right for them. These are the same people that are still selling borrowers on 1.9% interest rates but the truth is that the payment required is that low rate but 7% of interest is being charged and the difference is being added to the loan balance. When given confusing or limited information, the average consumer will buy on what seems to be the most important thing - interest rate. But the loan's terms are often far more important.
My six year old loves Spiderman and we often quote the "with great power comes great responsibility" line. I challenge Mr. Short and all mortgage professions, both bankers and brokers, to act with a sense of great responsibility for the borrowers' financial future. After all, it is typically the largest debt of their lives and it should be treated as the most important debt.
Out of the mortgage nightmare is a new movement of professionals looking to raise the standards of our industry. Mortgage Planning is clearly becoming a valued tool for borrowers of all calibers. As one of a few Certified Mortgage Planning Specialists (CMPS) in Middle Tennessee, I am equipped with tools and knowledge that allow me to assist the borrower in planning how they will use their real estate asset and the debt we place against it to support their family's short and long term goals. If applicable, I work in tandem with the family's Certified Financial Planners, Certified Public Accounts and Estate Planners to ensure the plan fits all financial concerns.
While there isn't a formal study available showing how many borrowers in foreclosure had a mortgage plan, I'm certain the number is miniscule. The fact is that most American's spend more time planning their family vacation then they do their home mortgage. If you consider the financial impact of a foreclosure on a family, that week in Destin really wasn't that important after all.
Mr. Short is accurate in stating that borrowers have a choice. However, if they want an opinion of a mortgage planning profession they should consult a Certified Mortgage Planning Specialist. It cost nothing to speak to the most qualified mortgage professionals in Middle Tennessee. Neglecting to do so may cost borrowers their homes.
*******************
Kevin Michelson, CMPS, MBA is one of the few mortgage originators in the state of Tennessee to hold the prestigious designation of Certified Mortgage Planning Specialist (CMPS). He is a Home Loan Consultant for Countrywide Home Loans in Brentwood, TN - Countrywide's #1 branch for purchase originations. Additionally, Kevin earned his Masters of Business Administration (MBA) from Nova Southeastern University bringing advanced concepts to his clients' mortgage plans and his referral partners marketing plans. He believes that if he puts others first, he'll never finish last. Kevin and his family are proud to call Williamson County, TN home.
Comments(5)