NON FHA-APPROVED MORTGAGE BROKER FEES IN FHA MORTGAGE TRANSACTIONS

By
Mortgage and Lending with Prime Processors, Inc.

***POLICY ALERT - RESPA/FHA EXISTING POLICY REGARDING NON FHAAPPROVED MORTGAGE BROKER FEES IN FHA MORTGAGE TRANSACTIONS***

 HUD just recently published a policy alert regarding this subject at: http://www.fha.gov/sf/lenders/notapprbr.pdf

 I have been keeping track of these developments for sometime...you can find past threads on the subject here:

http://www.closingprime.com/forum/topic.asp?TOPIC_ID=66
http://www.closingprime.com/forum/topic.asp?TOPIC_ID=45
http://www.closingprime.com/forum/topic.asp?TOPIC_ID=97

 So, I have a couple questions for the ActiveRain community.

  1. Would you be a party to one of these type transactions?
  2. What kind of fee is "REASONABLE" in relation to the services provided?
  3. What QC measures should be put in place to ensure a greater degree of consumer protection?

 

Comments (9)

Scott Slocum
Florida Future Realty Inc. - Cape Coral, FL
Scott Slocum & Associates 239-222-4800, Cape Coral

Well first and foremost if you're not an FHA approved lender, or mortgage broker then you shouldn't be doing FHA loans... It's like workng as a mortgage broker without a MB license !!! If you're doing this you should be fined

As far as fees... the nice thing about FHA is that they don't charge many fees since the program is designed to "Make the dreams of homeownership possible"

If you need to charge things in the "800" section of your GFE or HUD-1 you can charge it in either loan origination or discount points.  The total amount of points is already set by FHA to protect the consumer.  Most FHA products are paying a pretty good YSP anyways coupled with the benefits of a low MIP factor of 0.5% FHA is a win win situation.

Oct 31, 2007 01:08 AM
Prime Processors, Inc.
Prime Processors, Inc. - Winter Garden, FL

"Well first and foremost if you're not an FHA approved lender, or mortgage broker then you shouldn't be doing FHA loans... It's like working as a mortgage broker without a MB license !!! If you're doing this you should be fined"

 I agree wholeheartedly, however this alert addresses the practice where the non-fha approved broker controls the client and acts as an "advisor" and solicits multiple quotes/bids from fha approved brokers/lenders who as as the originator.

Oct 31, 2007 01:12 AM
Charlie Ragonesi
AllMountainRealty.com - Big Canoe, GA
Homes - Big Canoe, Jasper, North Georgia Pros
Thanks for the post. I have bookmarked you for reading this evening
Oct 31, 2007 01:16 AM
Charlie Ragonesi
AllMountainRealty.com - Big Canoe, GA
Homes - Big Canoe, Jasper, North Georgia Pros
Thanks for the post. I have bookmarked you for reading this evening
Oct 31, 2007 01:19 AM
Todd Moeller
Seven Gables Real Estate - Anaheim Hills, CA
Thanks for the post and keeping us informed
Oct 31, 2007 01:39 AM
Kris Krajecki
Kris Krajecki - FOX VALLEY MORTGAGE - Huntley, IL - Huntley, IL
Mortgage Broker Huntley, IL

We simply charge the same processing fee that we charge on ALL of our loans. It is always the same ($395.00) and it is very usual and customery.

:-)

Oct 31, 2007 02:28 AM
Anonymous
Anonymous

"We simply charge the same processing fee that we charge on ALL of our loans. It is always the same ($395.00) and it is very usual and customery."

What services do you provide to justify the $395?  Do you find that working in this capacity is favorable to actual FHA approval?

Oct 31, 2007 02:36 AM
#7
Anonymous
Anonymous
all of you are wrong.  HECM Advisor is a federally regulated program that allows non-fha approved brokers to be compensated 25% of the 2% origination fee FHA approved brokers make.  convenient how the link is dead...
Jan 24, 2008 10:13 AM
#8
Anonymous
monali

<a href="http://www.talkinghomeloans.com">Home Loans</a>

Jan 14, 2009 08:45 PM
#9