I feel like I am about to play back a broken record. But I received an e-mail today with this link. More bad decisions by G.E.

Here is my initial problem with anything that is put out there for the consumer to read. It's one-sided, yet is sounds like good opinion and advice. hhhmmm...  Exactly that, it's an opinion that sounds like fact, because of the figures mentioned.

Here is what was stated :

Even though I am a mortgage banker, I would agree with the first statement. (there is nothing wrong with this statement)  It's the second sentence, highlighted in yellow, that I have a problem with. Is this author saying that mortgage bankers don't educate the consumer?

And then the second part of that sentence in green makes it sound like brokers offer the best choice of mortgage programs with competitive price. This could be an ongoing debate with both sides having valid arguments. That is not what this post is about, which I will explain soon.

In the next paragraph, this is then mentioned by the author.....

"We must remember that: Mortgage brokers do not underwrite loans! 99% of brokers shop rates and package loans to be underwritten by banks and mortgage insurance underwriters. Direct lenders, banks and MI underwriters must approve these transactions and apply for mortgage insurance certificates based on the quality of their underwriting not the mortgage brokers package."

So wait, are you telling me, that even if you put a loan into the system, even if it shouldn't go, that if it is approved, then it's the banks fault? What ever happened to due diligence? What ever happened to taking responsibility? Just think about these statements and comments.

Now, can we blame this on Fannie or Freddie and even on FHA/HUD? Sure, in regards to Fannie or Freddie. But where does the blame truly take place?  I wrote about this a month ago or so,  Stop pointing the finger !!!!! We screwed up !!!!

Conclusion : As I mentioned, this will always be an ongoing debate that mortgage bankers are better than mortgage brokers or vice versa. In my opinion, that is irrelevant. What about the people that you actually deal with. Why don't we criticize them, meaning the loan officers at hand. Do you know that a mortgage broker can promise you a rate and fees and change it on you at the end?  This is called bait and switching.  But wait, so can a loan officer that works for the bank, aka, banker. Wait, there is more....

In regards to the statement above, that loan officers can bait and switch, coupled with the statements in the beginning, the bankers are at fault for this mess. As an underwriter, no matter who they work for, they underwrite the loan. They don't police it, making sure what was promised in the beginning is the same at the end. That is called compliance or post closing. Which can still be argued about from different sides of the fence.

Overall, let's stay with the original argument or post in hand. It goes back to education. Educating the consumer, the public, and not blanket statements that are based on opinions. Personally, that is partially what got us in this mess to begin with.  Not giving the consumer what they need to hear, but what they want to hear.... what do you say?

And to add this...  Scott Leaf made this comment below.  Comment about fraud....  Here is my opinion on this.  Fraud can pass from a broker to banker and in many cases, you might not know until a year later. Again, it shouldn't be about banker vs broker.

________________________________________________________________________________________

For more information on FHA loans, please go to this link. : The FHA Expert

For more information on how you can obtain your dream home, please click here : Mortgage Financing Options

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags

Copyright © 2008 by Jeff Belonger