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 lender credit’… why do I have to show fees that I am paying?” And off course it included the usual expletives that I can’t include here. My response is simple… get over it and get back to selling with class! The time to complain about the extra cost to the consumer is long gone. This is why we provide information to the industry when rule changes are proposed and legislation is pending. Everyone needs to pay attention as regulations are being built if you want a say in how they will impact the consumer and your paycheck. Most importantly at this stage is to accept the rules that must be followed without blaming congress, your processor or your investor. The Real Estate Settlement Procedures Act and the GFE from day one were designed to provide borrowers with information about the cost of financing. As an industry, we morphed the form into our own worksheet reflecting funds needed to close. In my decades of quality control and underwriting I saw times when as many as 65-75% of GFE’s did not give the borrower the right total or correct amount of fees. I think you would all have to agree. At some shops it was 100% inaccuracy by leaning on the word ‘estimate’. It is time for loan originators to represent our industry with class and articulate the cost of the loan through the new GFE with accuracy. If you make negative statements about the purpose of the form, its layout or content in an effort to cover up your own ignorance about the meaning of fair disclosure, you are hurting your own reputation. The law has changed how you must communicate and brings opportunity to those who can adapt to the new methods. I have heard many originators say this was the last straw for them and they have exited the business. I say, GREAT!!! If a simple shift in explaining funds to close is more than you can handle, then you certainly weren’t fit to help a borrower with one of the most important financial decisions they will make in their life.