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The Road To HMDA Implementation

HMDA is not the same as TRID; lots of testing and training will be needed. Reprinted with permission from the October 2016 issue By Alice Alvey The need to collect accurate data for the Home Mortgage Disclosure Act (HMDA) is buried deep beneath the pressure to close loans on time. It’s a common afterthought and also a misconception that data can be fixed later if it isn’t right the first...
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Legislative Update 12/19/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_121916_alice.mp3 How can your company be more involved in giving to your community this holiday season? Studies show that having a corporate social responsibility platform can increase your bottom line, build customer loyalty, and create a happier community among your employees. Being involved in your...
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Legislative Update 12/05/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_120516_alice.mp3 How effective and integrated is your marketing platform? Any company can benefit from a team that has the mortgage marketing experience to effectively drive revenue goals. On today’s hot topic, learn how to use several fully integrated marketing tools to increase efficiency and...
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Legislative Update 11/21/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_112116_alice.mp3 How do you know if your company is ready to make the transition from broker or originator to mortgage banker? In today’s “Hot Topic” Erin Dee of Legacy Mutual Mortgage in Austin, TX walks us through the process and all the details to consider. Erin addresses legal and...
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Legislative Update 11/14/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_111416_alice.mp3 Where are all the first-time homebuyers? Over on the sidelines, worrying about the homebuying process, the lack of a down payment, and their ability to make a monthly mortgage payment. How can you reach out to them, build their confidence and capture their business? On today’s...
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Legislative Update 11/07/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_110716_alice.mp3 What will this election mean for our industry? Ted Tozer, President of Ginnie Mae, joins us to discuss this and other trends he sees moving into 2017. Ted has been an incredibly effective leader in Ginnie Mae and has great insight for the future of the mortgage and housing industry. This...
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Legislative Update 10/31/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_103116_alice.mp3 Are you a leader with extraordinary motivation, capability, and vision to influence and shape the future of our industry? Then you need to hear this podcast “LIVE” from the AmeriCatalyst: Fast Forward Conference in Austin, TX. AmeriCatalyst is a conference which functions as a...
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Legislative Update 10/24/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_102416_alice.mp3 Is the whole world going mobile? D+H special guests Steve Hoke and Mary KayTheriault join David ‘live’ from the D+H booth at the MBA conference in Boston to discuss why investing in the continuing shift toward mobile will take you into the future. Topics will also include...
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Legislative Update 10/17/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_101716_alice.mp3 On April 18 of this year, we had Mitch Kider as a guest on this program talking about the first ever lawsuit that challenged the constitutionality of the Consumer Financial Protection Bureau’s (CFPB’s) authority. As you no doubt heard, the ruling from this seminal case, PHH Corp. v....
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Legislative Update 10/10/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_100316_alice.mp3 Are you intimidated by construction loans? Chase Gilbert of Built Technologies will explain exciting new trends in construction lending and how your company can manage a high margin loan by offering an easy construction-to-perm program. Learn how to simplify the way you manage construction...
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Legislative Update 10/03/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2017/01/LOL_100316_alice.mp3 What is the bottom line driving your business? Our hot topic will focus on Matt Strahl of Transformational Mortgage Solutions as he discusses the importance of effective outside recruiting. Best practices are touching the talent acquisition and HR landscape more than ever today and that is...
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Legislative Update 9/26/16

Listen to Alice’s Segment. http://mortgage-u.com/wp-content/uploads/2016/10/LOL_092616_alice.mp3 With an increasing average age and decreasing participation, where is the real estate appraiser’s industry heading and what regulations does it face? William Fall of William Fall Group will address these challenges and many other notable industry topics. As normal, the first half...
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Legislative Update 9/19/16

Listen to Alice’s segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_091916_alice.mp3 Lykken on Lending sponsor D+H joins us LIVE from the Motivity Conference in Denver, CO. Dan Putney, Vice President of Sales for D+H stops by to talk about trends in the mortgage industry, millennials and has an exciting announcement about new innovation that D+H is bringing to market to help...
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Legislative Update 8/29/16

Listen to Alice’s segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_082916_alice.mp3 Our special guest today is TONI MOSS, President of AmeriCatalyst/EuroCatalyst and we will be discussing the upcoming AMERICATALYST 2016: FAST FORWARD conference. This conference is an invitation-only, peer-to-peer think tank focused on the housing ecosystem, which encompasses all sectors of...
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Legislative Update 8-22-16

8-22-16 Regulatory Update w/Alice Alvey & Market Diversity Report w/Gary Acosta On today’s program we have a doubleheader. Alice Alvey will give us a regulatory update followed by Gary Acosta talking about market diversity opportunities. As normal, the first half of the program will feature, Joe Farr of MBSQuoteline providing a rate & market update, Alice Alvey of Indecomm...
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Legislative Update 8/22/16

Listen to Alice’s segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_082216_alice.mp3 On today’s program we have a doubleheader. Alice Alvey will give us a regulatory update followed by Gary Acosta talking about market diversity opportunities. As normal, the first half of the program will feature, Joe Farr of MBSQuoteline providing a rate & market update, Alice...
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Legislative Update 8/15/16

Listen to Alice’s segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_081516_alice_torchlakeandy.mp3 Do you feel like your marketing needs some help? On today’s program, we have DUSTIN DEMERITT, Marketing Communication Team Leader of Radius Financial Group joining us on the “Hot Topic” segment of today’s program to share what he is doing to promote his...
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Legislative Update 8/1/16

Listen to Alice’s segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_080116_alice.mp3 On today’s program, we are discussing the latest at branding and marketing you and your company. Joining us on the program will be Pat, John and Scott Seroka of SEROKA & ASSOC. If you are looking for innovative ways in which you can brand and market yourself and your company more...
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Legislative Update 6-27-16

Listen to Alice’s segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_062716_alice.mp3 Have you ever actually read your mortgage insurance provider’s master policy and realized its implications for your business? Are you looking for ways to originate outside-the-box of that master policy but want a safe and strategic way to do it? Did you know that not all master policies are...
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Legislative Update 6-13-16

Listen to Alice’s Segment: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_061316_alice.mp3 In honor of Father’s Day, I have invited Mitch Kider and his three sons, Teddy, Jack and Sam, to join us to talk about the important role that father’s play in the personal and professional lives of their children. Mitch has managed to raise three successful sons who are now in...
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Legislative Update 6-6-16

Listen to Alice’s segment here: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_060616_alice.mp3 We have as our special guest on today’s “Hot Topic” segment, William “Bill” Isaac. Bill has unparalleled career and the financial industry and public service, spanning nearly 15 years. He served as the chairman of the FDIC during the crisis of the 1980s and...
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Legislative Update 5-23-16

http://mortgage-u.com/wp-content/uploads/2016/10/LOL_052316_alice.mp3 Our special guest on today’s “Hot topic” segment is Allan Weiss, Founder/CEO of Weiss Residential Research, creator of an innovative new residential real estate indexes and forecasts technology. Before founding Weiss Residential Research, Mr. Weiss was the co-founder and former CEO of Case Shiller Weiss,...
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Legislative Update 5/16/16

Listen to entire program as Alice fills in for David Lykken. http://mortgage-u.com/wp-content/uploads/2016/10/LOL_051616_alice-fillsinforDave.mp3 Today’s “Hot Topic” segment will be a ’round-table’ discussion about where the mortgage industry is at and what we can anticipate as we move forward into the hopefully busier part of the year for our industry. Hosting...
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Legislative Update 5/9/16

Listen to Alice’s segment here: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_050916_alice.mp3 Existing Home Sales, which are published monthly by the National Association of Realtors, are up from a year ago but had their worst 1st quarter month-over-month decline since 1991. How can this be with rates so low? Where are home sales headed? To explain these latest trends, we have...
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Legislative Update 5/2/16

Listen to Alice’s segment here: http://mortgage-u.com/wp-content/uploads/2016/10/LOL_050216_alice.mp3 Ever since we started hearing about Rocket Mortgage, everyone seems to be launching their latest and greatest mobile app. Today, we will be focusing on digital disruption via mobile apps and specifically about transforming the customer experience. Joe will be answering the following...
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FHA UPDATE w/ EDWARD GOLDING, FHA’s Principal Deputy Asst. Secretary

Lykken on Lending http://mortgage-u.com/wp-content/uploads/2016/05/LOL_042516_alice_EdGolding.mp3 Listen to Special Guest Edward Golding, FHA’s Principal Deputy Asst. Secretary for an FHA Update in addition to Alice Alvey’s weekly Legislative Update Created BY mortgage professional FOR mortgage professionals, Lykken on Lending is a weekly 60-minute radio program hosted by...
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Legislative Update – April 18, 2016

Lykken on Lending Listen to Alice Alvey’s weekly Legislative Update http://mortgage-u.com/wp-content/uploads/2016/05/LOL_041816_alice.mp3 Created BY mortgage professional FOR mortgage professionals, Lykken on Lending is a weekly 60-minute radio program hosted by mortgage veteran, David Lykken. Joining the program each week is Joe Farr with a MARKET UPDATE, Alice Alvey providing a...
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Legislative Update – April 11, 2016

Lykken on Lending Listen to Alice Alvey’s weekly Legislative Update http://mortgage-u.com/wp-content/uploads/2016/05/LOL_041116_alice.mp3 Created BY mortgage professional FOR mortgage professionals, Lykken on Lending is a weekly 60-minute radio program hosted by mortgage veteran, David Lykken. Joining the program each week is Joe Farr with a MARKET UPDATE, Alice Alvey providing a...
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Legislative Update – March 28, 2016

Lykken on Lending Listen to Alice Alvey’s weekly Legislative Update Created BY mortgage professional FOR mortgage professionals, Lykken on Lending is a weekly 60-minute radio program hosted by mortgage veteran, David Lykken. Joining the program each week is Joe Farr with a MARKET UPDATE, Alice Alvey providing a LEGISLATIVE UPDATE, Paul Muolo of Inside Mortgage Finance giving a quick MTG...
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Legislative Update – March 14, 2016

Lykken on Lending Listen to Alice Alvey’s weekly Legislative Update Created BY mortgage professional FOR mortgage professionals, Lykken on Lending is a weekly 60-minute radio program hosted by mortgage veteran, David Lykken. Joining the program each week is Joe Farr with a MARKET UPDATE, Alice Alvey providing a LEGISLATIVE UPDATE, Paul Muolo of Inside Mortgage Finance giving a quick MTG...
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Alice Reviews HMDA Changes on Blog Talk Radio

As most of you are aware, the Consumer Financial Protection Bureau (CFPB) finalized the Home Mortgage Disclosure Act (HMDA) rule in October 2015. With all the focus on TRID, many are not aware that the new HMDA rule adds 25 new data points and modifies 14 others in addition to the existing 9 data fields that were already required. Additionally, lenders now must begin to start reporting data on...
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Legislative Update – Feb 2, 2016

Lykken on Lending Listen to Alice Alvey’s weekly Legislative Update Created BY mortgage professional FOR mortgage professionals, Lykken on Lending is a weekly 60-minute radio program hosted by mortgage veteran, David Lykken. Joining the program each week is Joe Farr with a MARKET UPDATE, Alice Alvey providing a LEGISLATIVE UPDATE, Paul Muolo of Inside Mortgage Finance giving a quick MTG...
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Legislative Update – Jan 25, 2016

Listen to Alice’s Weekly Legislative Update segment on the Lykken on Lending Blog Talk Radio program. http://mortgage-u.com/wp-content/uploads/2016/03/LOL_012516_alice.mp3
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Indecomm Global Makes the List

Training Industry, Inc. continuously monitors the training marketplace looking for the best providers of authoring tools. This fourth annual list is designed to help buy-side organizations in their searches for the right training partners. Our committee selects the top authoring tools companies based on the following: Leadership and innovation Features and capabilities Size and growth...
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Embracing the science of income analysis

Automated tools mean lenders can get income calculations right the first time Technology gave us better lives, moving us from the horse and buggy to the freeway. Now, like the rest of the world, technology is fundamentally altering the work processes in mortgage banking. The industry is in the process of taking a technological leap in an especially difficult area, income calculations. Income...
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FHA Closes Loophole for Student Debt in Revamped Lender Handbook

The sweeping overhaul of the Federal Housing Administration’s single-family handbook offers lenders long-sought clarity on acceptable underwriting practices. But that added certainty comes at the expense of flexibility to get loans qualified, including a popular workaround for borrowers with deferred student loan debt. “It tightens certain underwriting guidelines that were on the...
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Getting TRID QC Right

To make implementation smoother, quality control teams should be involved in the planning process for TRID> Many companies have underestimated the resources needed and the cost to implement the new TILA-RESPA Integrated Disclosures (TRID) rules. Budgets have been thrown out the window, and management has implemented a “get it done, on time, at any cost” approach. As the implementation...
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Fair Lending – One Loan and One Gap Is All It Takes

Complying with fair lending laws has quantitative and qualitative aspects both of which must be covered in thorough and well-written procedures. One case study of an FDIC (Federal Deposit Insurance Corporation) audit demonstrates just how critical developing and upgrading procedures for both elements are to a company. It only takes one loan for a problem For the year being reviewed, the...
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Are You Ready to Manage a Subservicer?

For lenders seeking to use a subservicer for the first time, finding the needed experience is a major challenge. Many companies are in the process of obtaining agency direct approvals. This is prompted by good lenders finally reaching the breaking point with the same problems that have plagued correspondent relationships for years: dragged out, inconsistent funding process, balancing credit...
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You Can’t Manage What You Can’t See

Integrated Disclosure implementation is likely the largest project the mortgage origination teams will go through this year touching every step in the process. (Unless of course you’re going through an origination system change at the same time.) Project management on this scale is a skill. Mortgage managers know how to handle each loan file as a project, but don’t often have the additional...
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TRID TIP OF The Week

Explaining Total Interest Percentage (TIP) Originators and closers will be faced with a new acronym on the Loan Estimate(LE) and Closing Disclosure (CD). They will need to explain the Total Interest Percentage or TIP to the borrower. The TIP is the total amount of interest the borrower will pay over the loan term as a percentage of the loan amount. The TIP is shown along with the APR, Finance...
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Integrated Disclosure ‘Business Purpose’ Nightmare

To disclose or not to disclose, that is the question for non-owner occupied residential loans under the integrated disclosure rule. TILA and RESPA have long stated that disclosures under their rules do not apply to a business purpose loan. Technically a loan used to purchase or refinance a rental property today does not need a GFE or TIL. But as an industry, we like standard procedures that are...
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Negative Approach On TRID Causes Problems

Most companies have not had the time to identify the positive impact of the Truth In lending, RESPA Integrated Disclosures (TRID) that must be used with applications beginning 8/1/2015. It seems integrated disclosure education events are focused on raising everyone’s level of panic. I admit there is cause for panic if you are just starting to identify procedural changes but be careful about...
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FHA MIP Refi Boom Caution Points!

By Alice Alvey The FHA reduction in the MIP is the perfect opportunity to fill lackluster post-holiday pipelines. Every borrower who purchased a home in the last 1-3 years using FHA financing is a potential candidate to save money, if they plan to stay in the house long enough. It is important to consider all of the financial calculations to ensure the borrower doesn’t end up spending more...
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TRID in the Weeds

by Alice Alvey for Mortgage Compliance Magazine As we step into 2015, mortgage lenders, brokers, depositories, and vendors are at various stages of understanding and preparing for the TILA-RESPA Integrated Disclosure (TRID) rule (Rule). In an informal survey of various audiences over the last few weeks, it seems that roughly 60% are beyond the initial discovery phase and are actively...
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Indecomm – Mortgage U in the Top 20

TrainingIndustry.com continuously monitors the training marketplace looking for the best providers of authoring tools. This fourth annual list is designed to help buy-side organizations in their searches for the right training partners. Due to the contraction of the Authoring Tools market, only 16 companies were selected for the 2015 list. Indecomm – Mortgage U is honored to be included in...
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VA Residual Income Guideline Not A QM Solution

VA Residual Income Guideline Is Not A QM Solution For Community Banks By: Alice Alvey, CMB August 4, 2014 As community based lenders look to develop their non QM products, compensating factors become the central focus when considering credit policy that permits a Debt To Income (DTI) ratio above 43%. For borrowers with years of monthly payments in reserves, the question still becomes how...
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RapideL Is Best in Class for Rapid eLearning

Indecomm Learning Earns Technology Award from World HRD Congress RapideL Is Best in Class for Rapid eLearning News Highlights: Indecomm wins World HRD Congress Award RapideL named Best-in-Class Technologies – Best Rapid eLearning Tool RapideL is important platform for eLearning needs Edison, NJ (July 17, 2014)—Indecomm Global Services, a leader in business process outsourcing,...
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Completing Your Compliance Management System

Simply having written policies and procedures is not a compliance management system. The key word here is “management”. Compliance management means tracking specific details within every regulation and validating implementation. Indecomm-Mortgage U’s Health Check is your compliance management tool. The key benefit to the Health Check service is the IMU team of compliance...
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The New World of QM

Managing The Change For Originators in the New World of QM Much has been written about the impact of the Qualified Mortgage (QM) and Ability to Repay (ATR) rules from a legal and compliance perspective. Have you noticed whether the stress of this buzz, throughout your company and the industry, is causing originator sales paralysis? In a recent training class of highly experienced originators, a...
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Did Your QM Implementation Feel Like Y2K or a Bomb?

Change management Rules for Mortgage Lenders In one day I heard the QM regulation compared to Y2K and a nuclear bomb. Company A felt QM implementation was like Y2K because there was a lot of panic in the months leading up to January 10th and then nothing went horribly wrong the next day. This was clearly a testament to how well they prepared and found their process relatively unscathed by the...
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AML training for Mortgage Sales and Operations

The Anti-Money Laundering (AML) and Suspicious Activity Reporting (SAR) section of the Bank Secrecy Act (BSA) will go into effect for lenders on August 13, 2012 and we can get you in compliance with AML/SAR webinar training and procedures for your staff .   The program outline is attached. The agenda sticks to the topics that originators, processors, underwriters and closers need to...
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Servicers No Longer Require Licensing In Michigan

Categories: Compliance PDF Servicers No Longer Require Licensing In MI Good news for servicers of Michigan loans came yesterday when the House passed SB 908 on a 107-0 vote to delete the reference to loan modifications in the Mortgage Loan Originator Licensing Act. A marked up version is attached and illustrates the changes to the current law. Page 3 of the Act shows that reference...
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5 Cents On Combined Job Descriptions

Recently a client asked whether combined job descriptions make sense. In his case the company combine processing, closing and shipping the file to the investor. I have seen many shops, in particular community banks, the combine processing and closing. The challenge for every one of the companies is the delays and problems that start to occur when there is a plan to expand and grow the sales...
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FHA Seller Concession Rules Proposal Issued

The long awaited details of the proposed rule to limit seller concessions is finally back in the federal register. A re-proposal requesting comments was published yesterday, Feb. 23 with a comment period open until March 26th. The new proposal combines a percentage cap with a dollar limitation and works like this (of course it isn’t just a straight forward policy!): The seller is permitted...
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Excessive Ratios On FHA’s

In a recent article highlighting the changes in the FHA Total Scorecard Guide (TSG), it was noted that FHA added a bullet point on page 13 under the review rules for Total. The term ‘excessive ratios’ is now a bullet point and requires a DE underwriter to manually underwrite the file when this rule is triggered. Our team did a little digging and found Mortgagee Letter 08-22 that...
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New FHA Total Scorecard Guide Summary

What do I need to know about the new FHA Total Scorecard Guide? Download Copy Of The FHA Total Scorecard Guide 2011 As you may know FHA released a new FHA Total Scorecard Guide (TSG) with some pretty significant changes. Our team sat down and scrubbed the new TSG to identify and relay the changes to you on our blog. The details will most certainly be incorporated into our FHA Practical...
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When Can The Earnest Money Deposit Be Refunded?

October 18th, 2011 by Alice Alvey, CMB Realtors and sellers constantly struggle with trying to identify if a pre-approval letter is worth the paper it is written on. The costs and delays associated with accepting an offer from an unqualified or marginal buyer can be significant. Even a good loan originator can have a problem when buyers change their financial condition during processing or...
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FHA Mortgagee Approval Clarification

Many lenders are still trying to understand the new FHA approval requirements. As an industry, we have ML 09-31, ML 10-03, ML 10-20 (the main mortgagee letter), ML 10-38 and ML 11-25, along with the FHA Handbook 4060.1 rev.2, FHA’s website and FAQ’s as reference documents to determine FHA approval policies. Over the last few months I have been fortunate to conduct training programs at HUD on...
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Michigan Law Requires Licensing Of Individuals Handling Loan Modifications

The Michigan Office Of Financial and Insurance Regulation (OFIR), now an office under the Department of Licensing and Regulatory Affairs (LARA) issued a letter clearly stating that effective July 31, 2011 any employee solely performing loan modification activities as defined by the MLO Licensing Act must be licensed as a Mortgage Loan Originator. This requirement applies to institutions who must...
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Regulation Z High Priced Loan Definition Change Proposal

This proposal will make several big changes to Regulation Z /TILA. You can find the text in the federal register at: 75 FR 58539. The comment period closed 12/23/10 and we are awaiting more information from the Federal Reserve Board on whether all or part of this rule will move forward. Here is a summary of the key parts of the proposal: Rescission: There is a proposed new ‘Notice of...
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Anti Money Laundering (AML) and Suspicious Activity Report (SAR) Proposal For Lenders and Brokers:

Financial Crimes Enforcement Network (Fin CEN) issued a notice of proposed rule(NPR) 12/6/10 to require ‘a loan or finance company’ to comply with Anti-money laundering programs and SAR reporting. (Yes, this would include lenders and brokers). The Secretary has authority to do so under the Bank Secrecy Act. They tried this in 2002 and it was pulled back to conduct studies on the impact...
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Appraiser Independence Rules Effective 4/1/11

October 28, 2010:  The FRB published the first rule for mortgage lenders under Dodd Frank to specify the requirements for the Appraiser Independence rules.  It is an ‘interim final rule’.  They accepted comments until December 27, 2010 but followed with a statement that mandatory compliance is April 1, 2011. Scope per Final Rule: Applies to creditors, appraisal management...
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Qualified Mortgage, Qualified Residential Mortgage And Risk Retention

Under Title XIV of the Dodd Frank Act federal regulators must establish minimum underwriting standards for residential mortgage loans by 4/15/11 (excluding reverse mortgages and bridge loans of up to one year). This referred to as the Qualified Mortgage standard (QM). The requirements will define how a lender will support the consumer has a reasonable ability to repay the obligation. The QM...
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2011 Bills We’re Watching

H 363: Forced Refinance Provisions For Fannie/Freddie Status: Introduced 1/20/11 The formal name of the bill is ‘Housing Opportunity and Mortgage Equity Act of 2011”. The bill would require Fannie/Freddie to create a     program for qualified mortgages where an appraisal is not required. The servicing fee will be restricted to a maximum of $1,000. H 330:  First Time Homebuyer...
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Underwriting FHA in 2011

The current shortage of underwriters has made FHA Direct Endorsed (DE) underwriters a hot commodity as lenders continually seek for underwriters with a CHUMS ID #. Why are DE underwriters so sought after in today’s mortgage market? Here are some of the key reason that the CHUMS ID # has become good as gold: 1) The underwriter has prior FHA experience 2) Only DE underwriters can review...
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Mortgage U To Conduct FHA Training For HUD

Indecomm-Mortgage U is proud to announce that we have been selected by Campus MBA, the education division of the Mortgage Bankers Association to conduct FHA training for a team of employees from the Department of Housing and Urban Development. The training will cover an overview of FHA residential, senior housing and hospital programs including renovation lending, reverse mortgages as well as...
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Clarification – Risk Base Pricing Disclosures Made Easy (?)

One of my new year’s resolutions is to be very diligent in creating a valuable newsletter every week. My second resolution is to make sure I have it proofed three times before sending. The newsletter article titled “Risk Based Pricing Disclosures Made Easy”sent out on December 30th, 2010 describes the lender’s option to issue a Residential Mortgage Credit Score...
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Risk Based Pricing Disclosures Made Easy (?)

Like RESPA in 2010 we are faced with a yearend disclosure that at first can seem relatively straight forward but the details start to make operations managers nervous. The Risk Based Pricing (RBP) policies and disclosures required as of 1/1/11 will need some attention to make sure both the technology and operations have been considered. The regulation requires creditors (therefore not mortgage...
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Vicki Bott Speaks to MBA Committee

The MBA Residential Loan Production committee meeting was held yesterday at the MBA Convention in Atlanta. Vicki Bott, Deputy Assistant Secretary of Single Family Housing Programs spoke at the meeting and provided an important update. FHA’s main focus in 2011 will be oversight of its business partners the DE lenders. Bott said they will be “looking harder and smarter” at the quality of...
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97th MBA Convention, Atlanta Panel of Industry Experts

The 97th Annual MBA Convention is here. We are looking forward to the panel of prestigious experts on the mortgage industry assembled by Solidify for October 26, 2010 in Atlanta. The expert panel includes Pete Taglia, CPA, CMB, Vice President of FTN Financial Capital Assets Corporation whose expertise is loan sale and securitization strategies, asset backed securities and portfolio analysis...
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What do FHA approval and LO compensation have in common?

We are seeing a pattern in the way regulators are communicating their policies to the industry. First let’s look at the FHA lender approval changes. FHA has said that wholesalers are responsible for monitoring that all ‘sponsored correspondents’ (the new term for non-FHA approved companies) are in compliance with FHA requirements. This is a very broad statement and every wholesaler is...
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How Many Loans by Processors?

Alice Alvey President, CMB  Indecomm-Mortgage U, Inc. I have been on a mission asking every customer ‘how many active loans can your processors handle in their pipeline?” As you can probably guess I receive a lot of questions in return trying to qualify the definition of pipeline, processor and if the processor is working overtime. One person asked me if the processor is...
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Processors are a Bridge

A processor’s role has changed dramatically from the first widespread use of computers in the ‘80’s to the paperless task management systems of today. The automated systems moved the industry into thinking processing was an entry level administrative task. It is not uncommon to hear processors say ‘it doesn’t matter what documentation I think I need, the underwriter is going to change...
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FHA Fine Print Reduces Allowable Lender Contributions

FHA published a proposal on July 15th announcing changes to important underwriting requirements. Lenders and brokers must be aware of a problem in the fine print and respond to FHA immediately! FHA is not only changing the maximum seller contribution from 6% down to 3% they have changed the definition of ‘interested third party’ in a footnote at the bottom of page 41220. FHA’s 4155.1...
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Appraiser Coercion or Not?

Everyone in the mortgage industry, including borrowers are all too familiar with the challenge of trying to determine whether the comparables provided by the appraiser are adequate. Typically the underwriter is concerned that the value is inflated and the borrower and loan officer are concerned that the value is too low. The ‘tip toe’ around the home valuation code of conduct and requesting...
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Land Contracts

Realtors and builders are realizing that their new state licensing laws may include a provision to require a license when you sell a non-owner occupied property on a land contract. Many people have never used or heard of land contracts. They were popular in the late 70’s, early 80’s and prior when mortgage’s didn’t have a due on sale clause. Under a land contract, the seller retains...
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Regulation Z ARM Changes – Still?

Regulation Z had a proposed rule with a comment period that expired 12/31/09. This proposal received over 3300 comments primarily focused on the section that would prohibit loan originator compensation based on the terms of the loan. Now that the financial regulatory reform bill has included the ‘prohibition on steering’ and restriction of loan originator compensation, we’ll be watching...
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FHA’S New Lender Approval World

FHA ML 10-20 outlined the provisions for HUD’s reform of the lender approval process. Effective May 20th 2011 most lenders must possess a net worth of at least $1m (20% must be liquid assets). The only exception is for small lenders as defined by the Small Business Administration: o mortgage & non mortgage brokers with $7million or less in gross receipts; o Banks, Savings institutions...
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Home Warranty Companies and Section 8 Violations

HUD issues Final Rule RE: Home Warranty Companies and Section 8 Violations On June 25, 2010, HUD issued a final rule addressing whether compensation paid by Home Warranty Companies to real estate and mortgage brokers violates Section 8 (the “anti-kickback” section) of RESPA. The rule is effective on the date it was published (June 25), but HUD is accepting public comments until July 26,...
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Pros and Cons of FHA Lending

Pros and Cons of FHA Lending This is Q&A hosted by Alice Alvey President, CMB of Indecomm-Mortgage U for a large group to provide a forum to discuss the pros and cons of FHA Lending. If you haven’t heard of Alice, she is a Master CMB and a well known industry speaker who talks about FHA lending about as much as she talks about her wonderful children. She is the author of many training...
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FHA Condominium Approval Panel Discussion

The FHA condominium approval process has undergone major changes in the last several months. To help lenders understand the nuances of the new HUD Review and Approval Process (HRAP) and Direct Endorsement Lender Approval Process (DELRAP) I assembled a panel of experts for the event: Angelo Rea, First VP at Flagstar Bank. Angelo is very involved in government lending policies at Flagstar...
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FHA Lender Approval Announcement – April 5, 2010

FHA announced on April 5th more details about the elimination of broker approval and the increasing net worth requirement for FHA DE lenders. There are many problems with the announcement. 1) Commissioner Stevens likes to get the word out before the final word is issued. In other words we don’t have an actual final rule to work with yet, only two different press releases. These are just the...
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HR 4811 Summary

HR 4811 – FHA Safety and Soundness and Taxpayer Protection Act of 2010 Introduced March 10, 2010 • Formalizes a Deputy Assistant Secretary for Risk Management • Ability to enter contracts with private companies to analyze credit risk • Increase annual premium up to 1.75% on the remaining insured principal balance • Implements a ‘flexible risk based premium pilot program’...
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WDIV Local 4 & Alice Alvey On Foreclosure Scams

March 29, 2010 Detroit, MI – WDIV Local 4 contacted Alice Alvey, President of Indecomm-Mortgage U to discuss a recent rise in calls into their “Ruth To The Rescue” hot line regarding foreclosure scams. As Michigan continues to rank among the top 5 states in foreclosure numbers it’s no wonder that more and more people fall victim to scams. The main story for Ruth’s segment...
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Faxes, eSign and Disclosures for FHA

Yes it still says in the FHA Handbook (4155.1 1.3e) “include in the loan file a certification stating that original documents were examined” and a lender should include a document that makes this certification. The guide also states that lenders may use fax documents as long as the fax header of the document supports an acceptable source. As we move faster and faster into using more...
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FHA Minimum Investment

Every day it seems someone finds a loophole that has to be closed or confirmed and today is no exception. In the new world of RESPA and tolerance requirements a lender may be faced with providing a refund of closing costs to the borrower at the time of closing if the fees were under stated by more than 10%. The consequence may lead to the borrower receiving cash back at closing and/or appearing...
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Excessive Fees on FHA Loans

The FHA Home Ownership Centers have been requiring lenders to refund unreasonable fees to borrowers for years but this practice has increased over the last year. In many cases the company has charged a broker fee in addition to a 1% origination fee. In other cases the lender has charged a processing, underwriting, administrative and broker fee and FHA has required a refund of fees that were...
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Brokers Can Not Order FHA Appraisals

DE lenders need to be very careful when accepting appraisal from other companies on FHA loans. FHA ML 09-28 prohibits a mortgage broker from ordering an FHA appraisal. FHA defines a broker to be a loan correspondent/‘mini eagle’ company. The definition of a broker for ML 09_28 is not solely or directly related to which entity is funding the loan, as for other regulations. The Appraisal FAQ...
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RESPA & Origination: Complaining won’t help

I received an email today from a loan originator complaining about the new GFE as if it had just been rolled out in March! The ranting consisted of the usual complaints with the form – ‘why doesn’t it show the seller credit?!’… ‘this is not clearly showing the funds needed to close’… ‘why do I have to show block 1 so large in order to get block A to reflect the right...
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State and Local Taxes

The transfer tax debacle continues as we all struggle to stay competitive and in compliance with block 8 of the new GFE. With potentially thousands of dollars at risk, many lenders have chosen a very conservative route and require disclosure of all state and local taxes in block 8, regardless of whether state law dictates the seller must pay the fee. There is certainly room in the RESPA...
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Excess Credits and RESPA

Our client initially thought they had to disclose YSP on loans that they funded with their own money and they put it on the GFE which was issued after 1/1/2010. In order to give themselves extra room on the GFE they cushioned not only their estimated fees that go into block one but they added cushion to third party costs like title, etc. They were doing a no cost loan for the borrower so they...
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Texas Mortgage Bankers Association MDIA Summary

Texas Mortgage Bankers Association MDIA Summary July 2009 The Texas Mortgage Bankers Association has published one of the clearest write ups that I have seen related to MDIA. For those of you still trying to confirm that your policies are correct, I recommend this bit of light reading. It’s only 6 pages and gets straight to the point. It’s also a great tool if you are new to compliance and...
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FDIC Examination Procedures TILA and MDIA

The best way to know how to prepare for an audit is to know the procedures the regulator will use when they come on site.  The attached FDIC procedures have some helpful tools even if you are regulated by another entity. Here are my cliff notes: 1)      there is a helpful finance chart on page 11 2)      Page 29 -32 have great flow charts to illustrate when the finance charges...
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The Red Flags Rule: Deadline Extended

The Red Flags Rule has been extended three times. Lenders are required to have a written policy in place no later than December 31,2010. Don’t expect an extension again! (Well maybe) Attached is a sample red flags policy that is available at the FTC website. For those of you at a small to midsized community bank or credit union, lender or broker, you may find that this template is the best...
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FFIEC Fraud Report February 2010

The FFIEC has updated its fraud report to include more information about short sale and foreclosure fraud. This publication illustrates the various types of mortgage fraud, example scenarios and the red flags lenders should be aware of in order to properly detect fraud in advance of a loan closing.
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Texas MBA MDIA Summary

The Texas Mortgage Bankers Association has published one of the clearest write ups that I have seen related to MDIA. For those of you still trying to confirm that your policies are correct, I recommend this bit of light reading. It’s only 6 pages and gets straight to the point. It’s also a great tool if you are new to compliance and need to get a handle on MDIA in a hurry.
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FHA Approval

FHA correspondent lenders across the country are taking a look at their options for moving forward under HUD’s new lender approval criteria. As we talk with banks, credit unions, lenders and broker we are hearing a variety of opinions that range from ‘great I can’t wait to stop the audited financials’ to ‘how do I elevate my operation to handle DE authority’. The most aggressive...
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