Mortgage Talking Points

Freddie’s HomeSteps special financing for their foreclosed properties has been extended to Jan 31, 2010.  Why don’t they just extend it for 6 months at a time–instead of month to month?  Updated MortgageTalkingPoints(r) posted on the site. 

http://www.mortgagecurrentcy.com/downloads/TalkingPoints_HomeSteps_111009.doc

Freddie is trying to sell their foreclosed homes and is offering buyers awesome incentives to do so.  Here’s some info from Freddie’s website but complete info can be found at www.homesteps.com

From HomeSteps Website:  Now, no matter where you live in the United States, owning your own home may be more affordable than you think! If you currently rent or are considering homeownership, now is the time to make a SmartBuy. The HomeSteps SmartBuy purchase program may help you on your way to homeownership, with a little added peace of mind.

To qualify for this offer:

Don’t have a real estate agent yet? Click here to search for an agent near you!

This offer is only valid until December 31, 2009, so start searching for your SmartBuy home today at HomeSteps!

HomeSteps will pay up to 3.5%* of your purchase price in closing costs for initial offers presented on HomeSteps homes between July 17, 2009 - December 31, 2009.

The word on the street (especially from appraisers) is that “Fannie and Freddie are still waiting to hear from the FHFA about the implementation of using AMC’s…but things seem to be on the back burner.”  Why, because they are so busy with the bail out, they don’t have time right now to tackle this issue. 

Now the bad news…some lenders have made the decision FOR YOU and are kinda’ REQUIRING that you use an AMC (Appraisal Management Company) for your appraisals.  Why did I say ”KINDA”?  Well what they go on to say is that you can use your own appraisal company, but it may be subject to a review appraisal by an AMC.  I don’t know about you, but how would you like to tell your client that need to fork over a couple extra hundred dollars for ANOTHER appraisal.

The bottom line is to check with your investors and wholesale reps and see who requires you use AMC’s and who does not.

Knights ALWAYS Follow the Code

It floors me that nobody I talk to knows anything about a silly little matter called the “Home Valuation Code of Ethics“. It has such huge consequences! If you want to know about it, read “Will Brokers Lose the Ability to Order Appraisals” at MortgageCurrentcy.com. The bottom line is that unless something changes, no one in the entire production staff can order their own appraisals as of 1-1-09.

Someone e-mailed and asked me who was left to order them… the Seller? I thought it was pretty funny. (Except not.) The answer is ordering through a third party, usually an Appraisal Management Company. In fact, some lenders already require you to do this. It’s the “Code”.

Ya know, I really do have mixed feelings about it. Everyone knows that you order the appraisal from the appraiser who will give you what you need. Right? Don’t you think there’s a conflict of interest when the person picking the appraiser has a commission riding on the transaction? I do.

I also realize that it will wil be a crisis to all of those honest and ethical loan officers who have a favorite (honest and ethical) appraiser because the appraiser is responsive to rushes, letters, whatever. 

Hate to say this, but I still think there’s a conflict of interest.  My struggle is that I think “Code” takes it too far. 

BUT IT DOESN’T MATTER WHO THINKS WHAT.

As of right now, The “Code” is still on for 1-1-09. And if you think about the political environment and the current view of mortgage brokers, it may just happen after all.

And you know what? We’d adapt. (It’s the appraisers I’m worried about.)

I’ll let you know what happens.