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Frustrated by Real Estate Investor Associations

By Trent Dalrymple (248) 854-0625

Mortgage and Lending with Home State Bank NMLS# 166179

March 11, 2012 01:16 AM

Months ago I had approached the program directors at the Real Estate Investor Associations and a couple of Real Estate Investor clubs I frequently visit to ask them to add as a speaker one of the state's mortage licensing representatives to speak on the requirements to legally lend on residential properties. The response was, "no thanks, that would just bore the daylights out of our group," and a few thought it just wasn't relevent enough for their attendees. No, they would rather have a series of self-proclaimed "gurus" pitch their boot camps, mentoring systems and DVD's for thousands of dollars. One even went on to say that they don't agree with the licensing laws and if a few laws are broken to move property then so be it. Yes, they are spreading that message, I'm not kidding!

Would you rather hear from the actual state about rules and regulations that affect your business or salesmen that might give you outdated information that puts you in the cross-hairs of regulators?

More frustrating is the discussions I've had with unlicensed private individual lenders. I've been a licensed mortgage lender and broker for 26 years so I can speak from experience about licensing requirements and I worked very hard to become licensed and maintain my license, we all have! If you're a licensed real estate agent or any other professional required to be licensed how would you feel about your competition not being licensed and not following requirement you must follow, a bit unfair, right? More often than not my warnings fall on deaf ears or worse I'm told by these that they believe the state doesn't have time to go after small time individuals. Just waiting for someone to get a visit from regulators.

Trent Dalrymple

Metro Mortgage Investments

www.metro-mi.com

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Raymond Denton

Homesmart / Evergreen Realty - Laguna Woods, CA

Laguna Woods Realtor®

The whole licensing process doesn't make sense to me, Trent. In 2004 it took me 8 months to get licensed properly via the DRE to originate mortgages in California. Afterwards, I learned I didn't need the license, all I needed was to be hired by a company that resides under California's Department of Corporations, with a Consumer Finance License (CFL). I worked at 3 mortgage shops that accepted both the DRE and CFL licenses, and that's how I learned about Boiler Rooms. I couldn't believe those Loan Officers were selling mortgages without any education or experience. How could anybody possibly allow them to originate mortgages without any training?

And how about the NMLS? Since I'm currently originating via a Federally Chartered National Bank, I only have to "register" with the NMLS. If I were originating via my California DRE license, I'd have to be registered AND pass an annual "test". It doesn't make sense to me. You'd think everybody that originates residential mortgages should adhere to the exact same licensing requirements.

Mar 11, 2012 01:45 AM

Dan Hopper

Dan Hopper - Gold Way RE - Westminster, CO

Colorado Broker / Referral Services

Trent, you are so correct as it pertains to the Real Estate Investors "country club" thought process! I do chuckle after viewing the court case decisions on those that tried working their "new innovative" ways to get around the system.... like those that wanted to work loans with cash back from the sellers, and not identify that on the HUD.

Mar 11, 2012 01:51 AM

Trent Dalrymple (248) 854-0625

Home State Bank - Bloomfield Hills, MI

Allowing Mortgage Professionals to Lend Nationwide

Raymond, I too was DRE licensed originally in California for my mortgage and real estate company and was intrigued by individuals who couldn't qualify for their DRE license to originate mortgages just moved over to the DOC to be licensed. Every state is a little different when it comes to the state's licensing but according to the SAFE Act, you have to be licensed to originate, negotiate or take a loan application for home loans, with a few exceptions. Yes, for now the Federally Chartered Banks are also exempt but that also may change. My opinion, it's all about the power of the banks and their relationships with law makers, simple as that.

Dan, recently I was contacted by a private lender who had been referred to me by a banker friend. The private lender wanted me to keep him legal by taking care of the upfront work; take the application, processing, disclosures, etc . so he could make an owner-occupied purchase loan. Once I had a chance to speak with the borrower I found out that the lender expected a 10% rate with a $10,000 fee to the lender when they paid off. When I explained to the lender that the $10,000 fee pushed the loan into usury violations and that I didn't want to have anything to do with that, he told me he changed his mind and refused to make the loan. This is what's going on out there and you're right, it wasn't going to show up on the HUD. If you have any links to the court decisions can you reply with posting them here?

Mar 11, 2012 04:15 AM

Evelyn Johnston

Friends & Neighbors Real Estate - Elkhart, IN

The People You Know, Like and Trust!

Trent, where are you, it says you haven't blogged in almost two years!

Feb 01, 2014 10:41 AM

Wow, how time flies, has it really been that long? I've been working on a video series for our You Tube channel that has taken up alot of my spare time and our daughter and son-in-law have blessed my wife and I with 2 beautiful grand children who we spend as much time with as we possibly can but I do plan on getting back to blogging soon, thanks for the reminder!

Feb 01, 2014 11:19 PM

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