Have The Regulators Seen Their Shadows?

Have the Regulators Seen their Shadow?

Karen Deis, Publisher, www.MortgageCurrentcy.com – View free video blog on home page.

Well, it seems like the agencies have “seen their shadow” and crawled back into a hole—because there were only a few updates within the last 30 days!

As part of the continuing mini-series of breaking apart the various rules from the Consumer Protection Finance Bureau, we are dissecting each topic that is important to loan originators, and writing about one every month—until they go into effect in 2014.

Part two of the mini-series talks about the Qualified Mortgage Rule and the five tiers of loan amount thresholds when it comes to the maximum amount of income that can be earned for each tier.  There are five different loan amount tiers to be aware of:

Greater than $100,000

$60,000 to $100,000

$20,000 to $60,000

$12,500 to $20,000

And less than $12,500

The maximum income earned on each tier is inclusive of fees and points that are NOT included in your commission.  It also states that those maximum commissions will be adjusted based on the CPI for inflation at the first of every year.

Loan Officer Compensation Rule defines the term “loan originator” in part two of the mini-series.  While it’s not new, it basically says that anyone who quotes rates, assists the consumer in filling out a loan application, or negotiates loan terms and issues approval letters is a loan originator.   SO, if processors, underwriters or assistants do any of these things, they must be licensed.

Something new that doesn’t affect you but we wanted you to know about is that if a seller finances residential property that they own, and provides financing for 4 or more properties within a 12-month time period, they are considered a “loan originator.”

So, if a builder is providing self-financing to home buyers AFTER the home has been completed, a builder would be considered a “loan originator.” However, if they are providing construction loan financing only, they would not have to be licensed.

Just a couple of update from FHA!

There will be a new 92900 form with the new MIP disclosures, but the form won’t go into effect until June 3.  HUD said they are not going to provide a copy of the new form until the changes go into effect, but check with your LOS systems to make sure they are working on the updated version.

And, there was a strange email from HUD.  On March 2, they sent an email with a link to a new TOTAL Scorecard update.  The link took everyone to an OLD update.  We searched the websites, contacted the HUD officials, and the mystery continues—no one knows where to find the March 2 update.   So watch for it in the future.

And, there has been nothing from VA in quite a while—it’s probably one of the most stable loan programs available today.

Remember, getting a loan approved and closed these days IS rocket science.