Feature Article #1

Who is and Who is Not Passing the New Loan Originator Exam

I’ve had a chance to meet many loan originators during the past 5 months while teaching the required 20 Hour SAFE Comprehensive Pre-licensing and Exam Prep Course.
Currently, loan originators in WA State who have not been previously licensed are going through the licensing and testing phase which includes the required 20 Hour Course, mandated by [...]

mf | April 27th, 2010 | Continued

Feature Article #2

Mortgage Lead Generation Firms Continue to Violate Federal and State Laws

So here we go again.  Now that mortgage rates are headed up, the deceptive lead generation ads are crawling back onto the web.  Here’s a great example from a Google ad:
FHA Refinance 4.0% Fixed
$160,000 FHA mortgage for $633/mo. No SSN req. Calculate payments now!
MortgageRefinance.LendGo.com
When clicking through, the lendgo.com lead generation site asks some simple questions like [...]

mf | April 15th, 2010 | Continued

Feature Article #3

LOs Who Attack Realtor Commissions Might Want to Look Inward

I was just asked to proof a very agressive manifesto penned by a mortgage broker who was attacking the, in his words, “outrageous” commissions Realtors make when helping people buy and sell a home.  It made me wonder why the LO was so angry with Realtors in general. 
Any Realtor who reads the article in its current [...]

mf | March 17th, 2010 | Continued

Feature Article #4

The Financial Crisis Inquiry Commission is Interviewing the Wrong People

The Financial Crisis Inquiry Commission is currently interviewing bank CEOs in order to examine the cause of the current financial crisis.  So far, it sounds like the bankers are very concerned about their bonuses and are shirking off the cause of the financial crisis as a nothingburger.
We keep hearing the bankers say “We need to pay out big bonuses [...]

mf | January 16th, 2010 | Continued

Feature Article #5

Paramount Equity Consent Order

Paramount Equity has settled their case with the Washington State Department of Financial Institutions. Read the Consent Order here.  The Statement of Charges outlined many, many violations of state and federal law:

Using the term “mortgage bank” in their radio ads. Paramount Equity is not a bank and they are not permitted to use the words [...]

mf | May 15th, 2009 | Continued

About this Site

The National Association of Mortgage Fiduciaries was formed primarily to educate and guide mortgage lenders into fiduciary status. We recognize that the mortgage lending industry is undergoing dramatic change.  The current global economic crisis which began with the subprime meltdown in 2007 has historic roots in mortgage lending securitization and the eventual relaxation of underwriting [...]

NMLS Approved 20 Hour Pre-Licensing and Exam Prep

Other Recent Articles

Loan Originator Liza Bautista Finally Arrested

Liza Bautista was a mortgage broker with a strong client base inside her Christian church in Tukwila. After successfully closing several prime loans for folk with A-paper credit, she targeted consumers who were turned down by lenders and created two sets of loan documents.  She submitted the credit history and identity of her prime, A [...]

11Aug2010 | mf | 5 comments | Continued

905 Lenders Failed To Meet Requirements for Annual Recertification of HUD/FHA Approval

Today HUD released it’s Administrative Actions from the Mortgagee Review Board. Read the Federal Register PDF here.  There were 905 lenders that failed to met requirements for HUD’s annual recertification for FHA approval.  The Mortgagee Review Board voted to immediately withdraw FHA approval for a period of one year for each of the 905 lenders.  “The Board took this action [...]

26Jul2010 | mf | 0 comments | Continued

To the Students from the July 13-15, 2010 Prelicensing Class in Tacoma

Hi Everyone!
Here’s the follow up from questions that were asked in class and more.
There was a request to take a look at a sample Adverse Action form. Here’s one from the FDIC.
There was a question regarding if a consumer loan company does not hold a mortgage broker license, does that company have to follow the MBPA [...]

15Jul2010 | mf | 0 comments | Continued

Dodd-Frank Wall St Reform Act Will Limit Loan Originator Compensation

The Merkley Amendment to the Wall Street Financial Reform legislation limits loan originator compensation to no more than 3 percent of the loan amount. If you want to debate the Merkley amendment, please visit this thread or this thread. From the Mortgage Banker’s Association, here is a summary of how loan originator compensation would be limited under [...]

6Jul2010 | mf | 29 comments | Continued

To the Students from the June 7, 8, 9 2010 SAFE Prelicensing Class

Hi Everyone,
Here’s the follow up from today’s class.
Here’s the link to the Neighborhood Watch website where you too can check the FHA deliquency rate of your own firm.
Here’s that great blog post by Seth Godin about deadlines.
Here’s more about the excellent book Outliers by Malcome Gladwell.
Here’s a link to the NMLS Resource page so you [...]

7Jun2010 | mf | 0 comments | Continued

To the Students from the May 21, 2010 Exam Prep Course in Renton, WA

Hi Everyone,
Here’s the follow up Q&As from today’s class.
Although here HUD references that the Special Booklet regarding settlement costs should be provided for purchase money loans, here on this page (#27) HUD says the booklet is to be given out 3 days from the date of the application and doesn’t include or exclude refinance transactions.  [...]

22May2010 | mf | 0 comments | Continued

Merkley-Klobuchar Amendment Creates Level Playing Field

The Senate has passed an amendment to the Wall Street Reform bill that would ban loan originators from accepting compensation based on placing a consumer in a higher interest rate loan or a loan with less favorable terms.  The amendment also requires lenders to underwrite loans to assure a homeowner’s ability to repay the loan.
As [...]

13May2010 | mf | 52 comments | Continued

To the Students from the 20 Hr SAFE Course in Oklahoma City

Hi Everyone,
Here are the follow up Q&As from Day 1:
There was a question about if LOs in Oklahoma are required to take a course on Oklahoma State law. On the right hand side of this link, click on “state specific edu” to view the PDF. No other courses are needed for OK LOs but you [...]

23Apr2010 | mf | 0 comments | Continued

To the Students from the April 6-8, 2010 20 Hr Prelicensing and Exam Prep class

Hi Everyone,
Here’s the follow up from Day 2 of our 3 day class.
Some folks asked for information regarding how a short sale, foreclosure, or bankruptcy affects a person’s credit score.
Here’s Ken Harney’s article on credit scores. And here’s Ardell’s blog post as a follow up. She has a nice visual graph for those of us who [...]

8Apr2010 | mf | 1 comment | Continued

To the Students from the March 29-31 Prelicensing Class in Bellevue, WA

Hi Everyone,
Here are the Q&As from Day 1.
There was a question about Errors and Omission Insurance available for loan originators. In doing research, I see that carrying this type of insurance is a requirement already in some states and in those states, insurance carriers have stepped up to offer the product. I can forsee a [...]

30Mar2010 | mf | 0 comments | Continued

To the Students from the 20 Hr Prelicensing Class at Firstam Yakima March 2010

Hi Everyone,
Here’s the follow up Q&As from today
 Here is the updated Credit Suisse chart.
There was a question as to whether or not a church can gift the funds for closing on an FHA loan. Here is a link to the HUD manual….
“An outright gift of the cash investment is acceptable if the donor is…
•the borrower’s relative
•the [...]

4Mar2010 | mf | 1 comment | Continued

To the Students from the Feb 16-18 SAFE Pre-Licensing Class at UoPhx Bellevue

Hi Students;
Day 1 follow up:
Here’s the link to the Neighborhood Watch website where you can check on the status of a company’s FHA delinquencies. Follow the link that says “Early Warnings.”
There was a question about the use of the word “firm” in the WA State law Escrow Registration Act. Here’s the link to the definitions [...]

17Feb2010 | mf | 0 comments | Continued

To the Students from the Jan 19-21, 2010 Pre-Licensing Class

Hi Everyone,
Here’s the follow up from Day 1:
Ken Harney’s column regarding LOs using worksheets to provide a pre-GFE in order to attempt to escape quoting fixed costs on the new GFE.
Link to the Neighborhood Watch website where we can check on the FHA default rate of various companies.  And a related story from the Seattle [...]

20Jan2010 | mf | 2 comments | Continued

New National LO Exam Pass Rate 69%

The pass rate of the new national LO exam is 69%.  Between July 30, 2009 and November 30, 2009:
10,421 national exams were taken and 7,219 passed the exam. The report PDF is available here.
This means the new national exam is too easy, like I surmised back in June.  Or is it?
What would be more helpful to [...]

27Dec2009 | mf | 38 comments | Continued

Z3 Case Studies

Pedro and Kip are ready to buy a home.  Kip is a Veteran and they want to use her VA Eligibility Certificate to finance a home.  Pedro just finished college and has a degree in theater.  He is new on the job and works in customer service in a white collar industry.  Kip has worked [...]

24Nov2009 | mf | 19 comments | Continued

Z2: Case Studies

Vashon and Riley want to re-enter the housing market as investors. (They currently own their own single family homes.) They have attended several investment seminars put on by local real estate agents and have decided to begin buying homes at the foreclosure auctions or buying REOs from the banks.  They both have $50,000. to invest [...]

24Nov2009 | mf | 20 comments | Continued

Z1: Case Studies

Steve and Scott want to buy a small, 4 unit investment property. They will each live in a unit and they will rent out the other two units.  Steve is a Veteran. The home is located in a USDA approved area.  They have saved 10% for a downpayment. Which loan program would your group recommend [...]

24Nov2009 | mf | 20 comments | Continued

VA Loans

VA guaranteed home loans benefit veterans because they do not need to make a down payment and there is no upper limit or required cap on the income of the borrower.  Without a down payment as security against foreclosure, lenders receive a certificate of guaranty from VA.  In essence, as gratitude for honorable military service, [...]

24Nov2009 | mf | 17 comments | Continued

Hard/Private Money

A hard money loan is a specific type of asset-based loan financing through which a borrower receives funds secured by the value of a parcel of real estate. Hard money loans are typically issued at much higher interest rates than a traditional mortgage loan. Hard money is similar to a bridge loan, which usually has [...]

24Nov2009 | mf | 22 comments | Continued

USDA Loans

USDA Rural Development Loan home page
USDA Mortgage Loan Origination Handbook
USDA ActiveRain channel
USDA Fact Sheet
USDA Guaranteed

Section 502 loans are primarily used to help low-income individuals or households purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities.
Eligibility: [...]

24Nov2009 | mf | 19 comments | Continued

How to Think About Ethics

What do you remember from your last Ethics class?
When I ask this question, the room falls silent.  Then maybe a lone person might shout, “honesty.”  Someone else might say “The Golden Rule.”  It’s easier to talk about ethics in smaller groups rather than one large group so when the classroom is divided up into smaller [...]

24Nov2009 | mf | 36 comments | Continued
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