Thursday, August 27, 2009

so who gets to fix it?

Old unsatisfied mortgages, especially those with private individuals, drive me batty. On the one hand, if lots of time has passed and no foreclosure has taken place, some underwriters will instruct agents to simply insure over it. I've done that and been burned, not because of collection efforts by the mortgagee, but because the next attorney or title agent in the chain decides they want it fixed and won't take indemnification. That leaves me holding the bag. So I made a decision moving forward that I would insure over an old unsatisfied mortgage in the loan policy only. Owners have to take the exception. Interestingly, most owners don't want to take the exception. They don't want to get stuck with a fix either, so we either postpone for a fix or escrow.

I was called today by an attorney hired by a seller whose funds we are holding pending satisfaction of an old unsatisfied mortgage. The mortgagee was an individual now deceased. The attorney is having trouble with an heir and so chatted with First American - not the underwriter on this file - and they said they'd just insure over it. He wants to know if I'll rethink my position and insure over it.

Excuse me while I laugh.

Does he really think I'll buy into that proposal?

Thursday, August 20, 2009

this web site should be taken down


It's no longer in business. Despite their claims that they were RESPA compliant, they weren't. The entire illegal operation has been shut down by the Commonwealth of Pennsylvania and the FBI.

Why is this web site still sitting up there in the cloud making unsuspecting surfers confused? Their claims are bogus but some people believe everything they read.

Let's stop the kickback cycle. It stops one step at a time. Who do we need to talk with to get this kickback promising calculator off the net?

Friday, August 14, 2009

I'm still here and they are not.

It seems like a thousand years ago when I started this blog in 2006 and the sister blog, Radical Title Talk. Part of the impetus to defend good practices in title insurance was my outrage over an outfit in State College, Pennsylvania who was soliciting mortgage lenders for a big sham operation. I couldn't believe that someone would so openly operate outside of state and federal rules.

Well, read this article. I think it's all finally over. Their operations were shut down by the state and federal government last year or perhaps the year before. Now a major player in the operation pleads guilty to embezzling 1.6 million dollars from the escrow account.

Gee, I guess scofflaws can't be trusted. Duh.

We along with other good and reputable title agents are spending our time, one transaction at a time, sweeping up the mess left behind by these and other crooks who played at the title insurance game for a few years and are now, hopefully, out on their asses.

We will slowly help consumers rectify the errors and right the wrongs as we find them. We won't be paid extra to do it. That's part of what a title insurance premium pays for, the finding and correction of title defects. It's all part of the job.

I'm glad I'm still here and they are not.

I'm glad you are still here because if you are reading this, you're probably part of the good, so hello, good guys. We're still here. ;)

Monday, August 10, 2009

oh the drama of defalcation...

"Anytime you're talking about $10 million, you're not talking about a drop in the bucket. It's a major defalcation," said Larry Saichek, the court-appointed receiver in charge of Flagler's case.

Flagler Title's underwriters already have paid about $5 million in claims. Other claims still are being investigated, while a few have been denied. These claims are from people who had deposit money held by Flagler or people who were supposed to have mortgages paid by Flagler. Also making claims are real estate agents owed commission checks on sales.

And where in the world is Roger Gamblin? "Hell if I know," Saichek said.

None of the lawyers contacted said they know where he is.

Read more in the Palm Beach Post.

Sunday, August 02, 2009

mortgage underwriting????

I guess since we have standards again, folks are experiencing real mortgage underwriting - perhaps for the first time. That's good but it sure is generating questions. I've had numerous e-mails over the past few weeks and decided to post answers to a few questions here.

In my pre-title life, I was a mortgage underwriter - FHA direct endorsement, VA automatic approval and FNMA/FHLMC. I had the pleasure of managing a couple of high volume retail/wholesale underwriting departments, so when you ask "What happens in mortgage underwriting?", I'll use my experience to answer that question. I say that because the automated pre-underwriting takes place earlier in the transaction and so when your file "goes to underwriting" it's going to a human being.

The biggest question on everyone's mind is how long will it take?

The actual file review will take about an hour if your case is fairly straight forward and the underwriter has the experience to make decisions on the risks identified in your circumstance.

Most of the time lost "in underwriting" is waiting for your turn at the decision table. When I managed underwriting departments our goal was always to get a file in and out inside of 24 hours. In high volume situations we shot for 48 hours, but the reality is that sometimes the flow of files due to rate fluctuations can be overwhelming and the wait can be days.

Why? Well, human underwriters are highly trained individuals and there aren't many of them, especially these days. Mortgage lenders are recreating and retraining underwriting teams.

So, are there any tips on how to make the process work for you - maybe make your file go through a bit faster? Your job as a borrower is to first have patience. Secondly, provide as much clear concise documentation as you can to demonstrate you have assets, stable income and a credit profile that demonstrates a willingness to repay the debt.

If you fight with your loan officer and complain about having to provide information, your loan officer might be forced to send your file into underwriting without sufficient data to convince the underwriter that you are a good risk or that your circumstances meet the guidelines of the program. So, your file will wait it's turn only to go into suspense or worst yet, be rejected. If that happens, you end up having to provide the data then go back into a waiting line again.

So, be your own best friend, realize that the mortgage underwriting guidelines - while they may seem onerous - are there for a reason - one that you may not understand, however, if you need a mortgage, you've got to play the game. Be honest but be thorough. Help your mortgage lender find in your financial profile a willing and able borrower.

If you can't do that honestly, then wait until you can. Fudging the data is fraud and criminal. If you cannot yet demonstrate stability of income or a willingness to repay debt, then start now and create your new financial future by being a more conservative manager of your money. After a year or two of a new financial profile, you should be able to get through the underwriting process successfully.

Hope that helps and good luck. ;)