Tuesday, September 02, 2008

interesting conversation going on Active Rain and...

...I'm gonna link to it here just cause Brian Brady called me a smart lady! LOL sheesh.....

Why don't I follow my own advice? Last summer, I said, in this post:

I often advise new borrowers to get a signed mortgage loan commitment, showing the expiration date of the lock. That "commitment" now has to be analyzed for the financial solvency of the funding/purchasing lender. I'll be practicing a strategy of dual submissions until this liquidity crunch clears.

Diane Cipa, a title agent, said, in a comment:

Please don't. It's going to be hard enough for responsible secondary market managers to feel their way through these rough waters without mortgage brokers double or triple locking product.

A more prudent position might be to educate borrowers so that they take some of the risk and understand that the lock is tied to a particular mortgage banker and not you as mortgage broker.

Frankly the lack of liquidity will encourage mortgage bankers to consider shutting off wholesale/correspondent divisions in favor of supporting their retail operations. If mortgage brokers en masses decide to start doing multiple submissions and locks, the shut off may come sooner rather than later. Retail originators can't do multiple locks or submissions and so are a more predictable or reliable source of pipeline data.


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