Thursday, January 25, 2007
Mortgage Technology
Mortgage Technology
Mortgage Technology, June 2006 issue
Brankers Unite!
A new organization has emerged that caters specifically to the broker wishing to move into a banker position. BrankerConnect, Novato, Calif., is a partnership formed in January of this year, between Garrett Watts & Co., a national mortgage banking consulting firm, and ComUnity Lending, a nationwide mortgage banker founded in 1980, with 108 retail branches in 39 states.
The BrankerConnect proposition is that they will mentor the broker through the conversion process, while managing the operational aspects of banking, including furnishing the technology, until the broker can function independently as a banker. Additionally, they will help the prospective banker develop a relationship with two warehouse lenders.
The technology consists of a proprietary system called Seamless, with a SQL database, Web interface and a data interface with the warehouse lender, built in-house by ComUnity Lending 13 years ago. "It draws docs, has all loan level data, has an interface into their accounting system. So essentially we're renting the mortgage banking platform to mortgage brokers," said Corky Watts, a pioneer in the development of the Web for mortgage lending.
"Part of the value proposition is we will train the operational people, and after they have gone through the two-week training program, there's another two weeks at our Nevada training office working on the prospective banker's files," explained Mr. Watts. "So it ends up being about a four-week period altogether, depending on how they do with the training. Some might take an extra week."
After the training, BC imbeds "Mortgage Masters" in the broker's shop. These experienced people do all the underwriting, documents and funding - only for loans to be funded and purchased by ComUnity Lending. ComUnity then performs due diligence after closing.
Mr. Watts explained that a small, recently converted mortgage banker, who has a minimum net worth, is at a comparative disadvantage compared with a larger bank, with worse pricing. "So essentially what ComUnity is doing, through getting all of these prospective bankers together and pooling all the loans, is to get a better execution than these guys would get if they were trying to deliver on their own. We feel that we can get a better price and then pass that benefit on to them," he said.
"We just started this," he added. "We have a couple of betas. This is brand new, as it's only been in effect for about 90 days. We actually funded our first loan about two weeks ago."
(c) 2006 Mortgage Technology and SourceMedia
Mortgage Technology, June 2006 issue
Brankers Unite!
A new organization has emerged that caters specifically to the broker wishing to move into a banker position. BrankerConnect, Novato, Calif., is a partnership formed in January of this year, between Garrett Watts & Co., a national mortgage banking consulting firm, and ComUnity Lending, a nationwide mortgage banker founded in 1980, with 108 retail branches in 39 states.
The BrankerConnect proposition is that they will mentor the broker through the conversion process, while managing the operational aspects of banking, including furnishing the technology, until the broker can function independently as a banker. Additionally, they will help the prospective banker develop a relationship with two warehouse lenders.
The technology consists of a proprietary system called Seamless, with a SQL database, Web interface and a data interface with the warehouse lender, built in-house by ComUnity Lending 13 years ago. "It draws docs, has all loan level data, has an interface into their accounting system. So essentially we're renting the mortgage banking platform to mortgage brokers," said Corky Watts, a pioneer in the development of the Web for mortgage lending.
"Part of the value proposition is we will train the operational people, and after they have gone through the two-week training program, there's another two weeks at our Nevada training office working on the prospective banker's files," explained Mr. Watts. "So it ends up being about a four-week period altogether, depending on how they do with the training. Some might take an extra week."
After the training, BC imbeds "Mortgage Masters" in the broker's shop. These experienced people do all the underwriting, documents and funding - only for loans to be funded and purchased by ComUnity Lending. ComUnity then performs due diligence after closing.
Mr. Watts explained that a small, recently converted mortgage banker, who has a minimum net worth, is at a comparative disadvantage compared with a larger bank, with worse pricing. "So essentially what ComUnity is doing, through getting all of these prospective bankers together and pooling all the loans, is to get a better execution than these guys would get if they were trying to deliver on their own. We feel that we can get a better price and then pass that benefit on to them," he said.
"We just started this," he added. "We have a couple of betas. This is brand new, as it's only been in effect for about 90 days. We actually funded our first loan about two weeks ago."
(c) 2006 Mortgage Technology and SourceMedia
Warehouse Line Mortgage Lending Process
Warehouse Line Mortgage Lending Process: "
The objective to both the warehouse lender and the mortgage company is to create a profitable business relationship. The warehouse lender can make secure loans approved and underwritten according to various agency guidelines, and the mortgage company will be able to make a profitable spread on each mortgage used by this warehouse line.
To make the warehouse lender secure, it must have three items:
A marketable first lien mortgage in which it can obtain unrestricted title.
The mortgage to be pre-sold to a permanent mortgage investor limiting the time exposure to the lender.
Complete control of the funds on the sale to the permanent investor.
The loans are approved prior to funding and specific closing instructions are given to the title companies instructing them to close the loan only when the mortgage is a first lien with a good and marketable title. In addition, prior to closing, the mortgage will be pre-sold with a written commitment in possession from an approved third party investor. After closing, the mortgage is sold to the permanent investor, and all monies from the sale will go directly to the warehouse lender for dispersal.
Under our current program, the warehouse lender will advance up to a maximum of 100% of the loan amounts which are to be purchased by third party companies or which are to be pooled.
The first stage of a mortgage loan is for the mortgage banker to take a loan application from the homebuyer. The mortgage banker then secures an investor in the secondary market. The loan is then processed and submitted to underwriting for approval. Once the loan is approved, it is then sent to closing."
The objective to both the warehouse lender and the mortgage company is to create a profitable business relationship. The warehouse lender can make secure loans approved and underwritten according to various agency guidelines, and the mortgage company will be able to make a profitable spread on each mortgage used by this warehouse line.
To make the warehouse lender secure, it must have three items:
A marketable first lien mortgage in which it can obtain unrestricted title.
The mortgage to be pre-sold to a permanent mortgage investor limiting the time exposure to the lender.
Complete control of the funds on the sale to the permanent investor.
The loans are approved prior to funding and specific closing instructions are given to the title companies instructing them to close the loan only when the mortgage is a first lien with a good and marketable title. In addition, prior to closing, the mortgage will be pre-sold with a written commitment in possession from an approved third party investor. After closing, the mortgage is sold to the permanent investor, and all monies from the sale will go directly to the warehouse lender for dispersal.
Under our current program, the warehouse lender will advance up to a maximum of 100% of the loan amounts which are to be purchased by third party companies or which are to be pooled.
The first stage of a mortgage loan is for the mortgage banker to take a loan application from the homebuyer. The mortgage banker then secures an investor in the secondary market. The loan is then processed and submitted to underwriting for approval. Once the loan is approved, it is then sent to closing."
Warehouse Line Company Information
There are two types of funding for mortgage bankers table funding and warehouse lines
Warehouse Line Company Information: "Our entire warehouse line program is managed by mortgage bankers, not bankers.
We warehouse and fund all A paper products which include FHA, VA, conventional and jumbo loans. Approvals for funding include direct endorsement (FHA), VA automatic or prior approved (VA), DU and LP.
There are no legal preparation fees, no annual renewal fees or no non-usage fees to pay with obtaining this warehouse line.
The average time for approval after receiving a complete package is approximately two weeks or less.
We only require that you fax us the key documents needed 24 hours prior to the funding. No need to overnight us a complete package. We also offer same day funding requests at no additional charge.
The amount of the line requested is determined by the performance of the company. We do require a minimum audited net worth of $250,000.
The funding percentage on each 'A' loan is up to 100% of the loan amount. There is no 'haircut' in these instances.
There are no set net worth ratio's to establish the warehouse line amount.
This is a non-directed line, which means you do not have to sell the loans to one investor. You can sell them to any one of the investors on our approved investor list."
Benefits and Advantages
Establishes a reputation for your company with consumers, builders, brokers and real estate agents to close and fund loans in your own name. We fund within 24 hours of request and in most cases, funds can be sent the same day of receipt of your information. This method of funding helps keep both your customers and agents content by paying for the entire transaction at the closing.Correspondent and wholesale lenders typically pay more for closed loans as well as charging you less fees. The fees brokers can earn are limited. This method of funding increases profitability by utilizing available Warehouse Lines to fund your current production into the secondary market.No more need for the Disclosure of Service Release Premiums on the HUD-1 Settlement statement as required by RESPA. Since you are closing the loan in your own name, your company is exempted from RESPA to disclose the SRP's, unlike table funded transactions.Your company gets to earn the interest of the note rate during the warehouse period, which makes up for most or all of the interest that you are paying for the facility.Your company gets to control the entire settlement and funding date of the loan closing. This eliminates the worry of promised wires from your table funding lenders, which rarely arrive on time.Enables your company to grow at a faster pace. Growth is limited without the use of a warehouse line.
Warehouse Line Company Information: "Our entire warehouse line program is managed by mortgage bankers, not bankers.
We warehouse and fund all A paper products which include FHA, VA, conventional and jumbo loans. Approvals for funding include direct endorsement (FHA), VA automatic or prior approved (VA), DU and LP.
There are no legal preparation fees, no annual renewal fees or no non-usage fees to pay with obtaining this warehouse line.
The average time for approval after receiving a complete package is approximately two weeks or less.
We only require that you fax us the key documents needed 24 hours prior to the funding. No need to overnight us a complete package. We also offer same day funding requests at no additional charge.
The amount of the line requested is determined by the performance of the company. We do require a minimum audited net worth of $250,000.
The funding percentage on each 'A' loan is up to 100% of the loan amount. There is no 'haircut' in these instances.
There are no set net worth ratio's to establish the warehouse line amount.
This is a non-directed line, which means you do not have to sell the loans to one investor. You can sell them to any one of the investors on our approved investor list."
Benefits and Advantages
Establishes a reputation for your company with consumers, builders, brokers and real estate agents to close and fund loans in your own name. We fund within 24 hours of request and in most cases, funds can be sent the same day of receipt of your information. This method of funding helps keep both your customers and agents content by paying for the entire transaction at the closing.Correspondent and wholesale lenders typically pay more for closed loans as well as charging you less fees. The fees brokers can earn are limited. This method of funding increases profitability by utilizing available Warehouse Lines to fund your current production into the secondary market.No more need for the Disclosure of Service Release Premiums on the HUD-1 Settlement statement as required by RESPA. Since you are closing the loan in your own name, your company is exempted from RESPA to disclose the SRP's, unlike table funded transactions.Your company gets to earn the interest of the note rate during the warehouse period, which makes up for most or all of the interest that you are paying for the facility.Your company gets to control the entire settlement and funding date of the loan closing. This eliminates the worry of promised wires from your table funding lenders, which rarely arrive on time.Enables your company to grow at a faster pace. Growth is limited without the use of a warehouse line.
lendere-source.com update
Hud Exemption to Certain States for Lenders
Hud Exemption to Certain States for Lenders
| To establish proof of a mortgage license exemption, we offer the following services: | ||
| State Agency License Exemption Confirmation Request Letters or Registrations: (Our Fee: $500 per Confirmation Letter or Registation for license exemption knowledge, letter drafting, Registration preparation & followup and interaction with State Agencies [SEE DISCLAIMER BELOW] | ||
| LICENSE EXEMPTIONS DUE TO STATUS AS: HUD Approved Non-supervised Mortgagees with Direct Endorsement Underwriting Authority "FULL EAGLE" | KY Broker & Lender Registration TX 1st Broker & Lender Registration MO Broker & Lender Confirmation MT 1st Lender Registation TN Broker & Lender Registration MS Broker & Lender Registration OH 1st Broker & Lender [Limited Exemption] OK Broker & Lender Confirmation HI Broker & Lender Confirmation CO Broker Confirmation IN Broker Confirmation WV Broker & Lender [Limited Exemption] SC Broker [Limited Exemption] AL Broker & Lender Confirmation | |
| LICENSE EXEMPTIONS DUE TO STATUS AS: HUD Approved Correspondent Lenders "MINI EAGLE"
| KY Broker & Lender Registration MO Broker & Lender Confirmation CO Broker Confirmation IN Broker Confirmation TN Broker & Lender Registration MS Broker & Lender Registration HI Broker & Lender Confirmation WV Broker [Limited Exemption] SC Broker [Limited Exemption] AL Broker & Lender Confirmation | |
| Benefits: State Agency License Exemption Confirmation Request Letters give notice to the state that you will be doing business in their state and requests confirmation on state agency letterhead that you are not required to obtain a mortage license in their state. Normal response is about 60-75%. This alternative is much cheaper than confirmation via an Opinion of Counsel in each state that could cost as much as $3000 each. Written confirmation on State Letterhead is very valuable to present to Lenders as evidence that a license is not required.TD> | ||
Lender regulations changing for US
In recent years, more states have implemented
loan-officer-licensing legislation in an effort to protect borrowers from abuse by predatory lenders and officers. Although only three states required loan-officer licenses just three years ago, 31 states now have license or registration regulations on the books.
Despite the increased legislation, noncompliance
is rampant. Many mortgage companies are ignoring the laws. Some are openly defying them, funneling all loan officers’ loans through the company’s one licensed loan officer.
The goal of state legislators and predatory-lending groups is to hold loan officers and lenders
responsible for predatory-lending behavior. State-agency enforcement departments are issuing
cease-and-desist orders, revoking licenses and levying fines in an effort to promote compliance
with these laws.
Ultimately, mortgage companies are responsible for getting all their loan officers registered or licensed. The best way to stay in compliance is to file for loan-officer registration
or licenses for each loan officer who brokers or makes mortgage loans in the one of the 31 states. The other option: Risk violations for failure to supervise the licensing of your loan officers.
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