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Loan buyback demands are a major setback for the mortgage industry and the economy. Many do not know how to deal with them and being proactive is the way to deal with them. Before 2006, most buyback requests started as an early payment default within the first 90 days of the loan’s being sold. Defaults after 90 days were few, and the cost was priced into the [more...] This article was written by Brian Collins, Editor, Source Media, Published in National Mortgage News and Origination New. This article can be found on free distrubution at Source Media. A private sampling of Rural Housing Service loan originations discovered that lenders have become more lax this year in verifying income and the employment of borrowers. Executive vice president and owner of Quality Mortgage Services, Tommy Duncan said [more...] Mortgage investors conducting mortgage audit reviews turn up potential red flags such as undisclosed debt, income and employment misrepresentation, occupancy fraud and appraisal issues which are many of the focus findings discovered during the mortgage audit that will prosecute a repurchase claim. As mortgage bankers defend against a mortgage repurchase, some consistent patterns appear that may help mortgage bankers to prevent mortgage repurchase claim. As a [more...] The interpretations of Mortgagee Letter 2010-20 continue to manifest itself among the mortgage industry. Back in late 2009, the comment period began and a group of nation’s top post-closing quality control companies came together to address this issue through the Mortgage Bankers Association (MBA) with Tamara King acting as liaison between the MBA and the Federal Housing Administration (FHA). At that time, the FHA was [more...] Quality Mortgage Services has been performing repurchase defense and rebuttals or responses to indemnification letters before the mortgage periodicals were writing about them in the papers and magazines. Now there are hundreds of post closing quality control companies and consultant who magically appeared who claim to be experts in repurchase defense and loan buy back audits and rebuttals. Think about it… do you want a [more...] Thanks to the Dodd-Frank Wall Street Reform Act, the federal government is making it virtually impossible to be a mortgage broker. By extending the application of the Truth in Lending Act to include mortgage brokers (formerly limited to “creditors”) and clearly defining, and otherwise limiting, how brokers can be compensated (YSP is dead), the act is forcing brokers to rethink the way that they do business. [more...] I agree the Automated Underwriting Systems (AUS) were misused as a “quick an easy”. As a post closing quality control expert, we constantly made attempts warning lender of the data model manipulation to get deals done. Now with new quality control initiative like Fannie Mae’s Lenders Quality Initiative (LQI) we are seeing more diligence and prefunding measures taken to prevent data model manipulation and back to [more...] I think that we can agree that the Home Valuation Code of Conduct (HVCC) is here to stay. The most recent change I see impacting the appraisal world are the states writing legislation in regard to appraisals management. It is funny to see the different approach each state is taking. It is very obvious that the legislation is written by appraisers because the states are [more...] All post closing quality control companies have seen the Non-Supervised Loan Correspondent (FHA Broker) perform virtually zero post closing quality control audit as required by the HUD Handbook 4060.1 since the publication of the HUD Mortgagee Letter 2010-20, June 11, 2010. The reason the FHA Broker not having their post closing FHA audits performed is because the broker community was hoping the Annual Financial Audit included the [more...] I had a client call me who is working diligently to make sure his company is tight on compliance. I am very proud of him taking such a proactive approach and taking ownership of this focus for a quality loan production. He sees the value of quality loan production resulting in survival in the mortgage industry. As we were discussing the many things in quality [more...] What is the biggest trend Quality Mortgage Services sees in quality control audits for 2010? So far in 2010, we are seeing exactly what we expected to see. The big numbers are with violations with the final Truth-in-Lending and annual percentage rates (APRs). In 2009, this category did not register in the top 10. In 2010, it ranks number three with a 183% increase from 2009 which includes [more...] This conference was probably the most successful MBA Conference for Quality Mortgage Services for 2010. The buzz is repurchase and rebuttal to repurchase claims of loans made approximately 4 years ago. There are a number of investors concerned with the volume of repurchase claims and in order to reduce their risk of mortgage backed security of pooled loans, they want to insure they have a good [more...] The quality control and fraud detection arena is excited about the “going green” concept for the mortgage industry because it is leading the way for a decrease in mortgage fraud, such as identity theft and forgery. The problem with going paperless is the fact that so many documents require signatures known as “wet ink.” There are two types of signatures other than wet ink: Electronic [more...] This conference was better than what I thought it would be. I had been to so many mortgage fraud conferences and siminars, I thought it would be a repeat of the same thing I have heard year after year. I must give credit to those who made this conference a success especially the committees who brought the expert panelist together. I was excited to see [more...] The New Jersey Regional Mortgage Bankers conference was exceptionally good. Mr. Levy did a great job pulling together the other states and speakers to make this event an informative and productive event. I went to the event without my notebook. I had to take notes on a 3”x 5” pad of paper provided by the conference host. I thought I had lost all my notes [more...] Quality Mortgage Services made it a point to attend the Mortgage Bankers Association National Policy Conference 2010 because we felt it was important not only the industry but for America. The conference had approximately 320 attendees. I was personally impress with the turn out and the conference all only had standing room for those who came in late. I was very much inspiredby Senator Bob Corker [more...] I think the industry is doing a good job but it could do better. One of the things it has done well is the requirement of licensing of loan originators. I was happy to see the recent Federal Deposit Insurance Corporation (FDIC) requirement for loan officers who work for banks to be held to the same standards as non-banks at lease with registration. Fannie Mae’s [more...] Real Estate/Mortgage Fraud: Facts Every part of the mortgage lending process presents another window of opportunity for people in our industry who, by the very nature of their job description, are exposed to unscrupulous loan originators, builders, real estate agents, borrowers, processors, underwriters, appraisers, lender account reps, and title closers. Each one of these positions or areas, needed to obtain a mortgage, leaves an opportunity for [more...] We should all recognize individuals commit the act of mortgage fraud not companies. Every part of the mortgage lending process presents another window of opportunity for people in our industry who, by the very nature of their job description, are exposed to unscrupulous loan originators, builders, real estate agents, borrowers, processors, underwriters, appraisers, lender account reps, and title closers. Each one of these positions or [more...] Quality Mortgage Services owns a software called Mortgage Analysis Review Software (MARS). It is basically a ASP.net ran on MySQL that allows mortgage auditors to enter data during their audit. It is not a decision making tool, we leave that up to real human intelligence. It is a software that takes the end users through the loan process. The end user must be advanced mortgage [more...] |
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