Wednesday, August 29, 2012

Labor Day Vacation

IDS Will Be On Holiday Thursday to Monday
Back Tuesday Due to Labor Day Holiday! A Day Not Spent Laboring For Us!

History: Labor Day is an American federal holiday observed on the first Monday in September (September 3rd this year) that celebrates the economic and social contributions of workers.

Labor Day pays tribute to the contributions and achievements of American workers. It also symbolizes the end of summer for many Americans, and is celebrated with parties, parades, major store sales and athletic events. How do you celebrate Labor Day? Leave a comment telling us about your Labor Day traditions and celebrations, we would love to hear!

As for now have a safe, fun and relaxing Labor Day holiday and day off from laboring of course! Happy Labor Day from IDS!

Tuesday, August 28, 2012

The Term 'Underwater' is the Newest Addition to Merriam-Webster Collegiate Dictionary

Merriam-Webster Adds ‘Underwater’ to Newest Edition of Collegiate Dictionary

It may not be as sexy a term as “ear worm,” “mash-up,” “man cave” or, well, “sexting,” but one of the words just added to the newest edition of the Merriam-Webster Collegiate Dictionary speaks volumes about the impact of the financial crisis, especially when it comes to housing.

Few can argue that “underwater” has not earned its place in the American lexicon.

As for the definition of “underwater” it goes something like this: having, relating to, or being a mortgage loan for which more is owed than the property securing the loan is worth.”

With more than 15 million homeowners owing more on their mortgages than the current value of their homes, “underwater” is more than just a buzzword. Economists like Joseph E. Stiglitz and Mark Zandi, who penned an August 12 editorial in The New York Times, continue to say there can’t be an economic recovery without solutions to the mortgage crisis.

In the Bloomberg News report, Mortgage Resolution Partners President Steven Gluckstem, a former senior insurance executive who oversaw reinsurance operations at Warren Buffet’s Berkshire Hathway Inc., said underwater mortgages remain a threat to housing, including those who continue to pay.

“Eventually, they all stop. There will be no recovery until this problem has been addressed,” said Gluckstern.

Which means “underwater” was a good pick for the dictionary, said Merriam-Webster Editor at Large Peter Sokolowski.

Thursday, August 23, 2012

The Loan Estimate and Closing Disclosure

The Loan Estimate and Closing Disclosure

CFPB Process and Background/Basis for Change
  • 10 Iterations Submitted to Industry for Review and Informal Commentary

Temporary Exemption for Dodd-Frank Disclosure Obligations
  • Negative amortization feature warning.
  • State anti-deficiency protection disclosures
  • Partial payment acceptance policy disclosure
  • Mandatory escrow account disclosure
  • Waiver of escrow at consummation disclosure
  • Monthly payment disclosure for variable rate transaction with     escrow account
  •  Repayment analysis disclosure of monthly payment
  • Settlement charges and wholesale rate disclosures
  • Mortgage originator fees disclosure
  •  Total interest as percentage of principal disclosure
  • Appraisal management fee optional disclosure

Disclosures are Reflected in Proposed Loan Estimate and/or Closing Disclosure
  • CFPB is not sure about wholesale rate disclosure (proposed as                   cost of funds disclosure) and total interest as percentage of principal disclosure

  • Excluded from this requirement are HELOCs, Reverse mortgages,Modular/Mobile (Not permanently affixed); or Creditors who make five (5) or fewer mortgages in a year

Wednesday, August 22, 2012

Mortgage Applications Fall 7.4% With Rising Rates

Rising interest rates deterred refinancing activity last week, resulting in a sharp decline in overall mortgage applications, an industry trade group said.

The Mortgage Banker's Association said its market composite index- a measure of mortgage loan volume- fell 7.4% from a week earlier as refinancing activity declined 9%.

The purchase index, on the other hand, remained relatively stable, while still falling a slight 0.9% from last week.

As rates rose and refinancing activity declined, refinance applications ended up representing 80% of all mortgage applications, down from 81% a week earlier.

The drop in refinancing activity corresponded to rising rates with the 30-year, fixed-rate conforming loan increasing to 3.86% from 3.76%.

The average interest rate for a 30-year, FRM with a jumbo loan balance hit 4.11% from 4.03%.

In addition, the average contract interest rate for the 30-year, FRM backed by the FHA grew to 3.62% from 3.53%.

The 15-year, FRM rose to 3.15% from 3.12%, while the rate for 5/1 ARMS edged up to 2.74% from 2.73%.

Monday, August 20, 2012

Forbes 12 Strange and Unusual Homes for Sale

Forbes 12 Strange and Unusual Homes for Sale
Among the millions for sale homes in the U.S., Forbes gathered a list of 12 proprieties deemed outrageous, unusual and in some cases, just plain strange. The homes range in price from $225,00 up to $13 million.

The Mushroom House
142 Park Road
Pittsford, NY
List Price: $1.1 Million

Frank Gehry’s Schnabel House
526 N. Carmelina Ave
Los Angeles, CA
List Price: $13 Million

Monolithic Dome Home
35 April Way
El Prado, NM
List Price: $225,000

Stone Castle
4720 Grosvenor Ave
The Bronx, NY
List Price: $2.99 Million

Floating Home
2369 Fairview Avenue E6
Seattle, WA
List Price: $3.45 Million

Desert Nomad House
6353 West Sweetwater Drive
Tucson, AZ
List Price: $975,000

Converted Church
459 40th Street 2
Lawrenceville, PA
List Price: $1.5 Million

Moroccan Palace
4 Rivercrest
Houston, TX
List Price: $8.9 Million

Sculpture Home
86 Sabino Gonzalez
Glorieta, NM
List Price: $1.68 Million

The World Residences at Sea
Ports around world v. Headquarters
Prices vary depending upon unit

Plum Residence
141 Sundance
Mountain Village, CO
List Price: $8.5 Million

M at Beekman Condo
345 East 50th Street
New York, NY
List Price: $1.7 Million

Out of these 12 strange and unusual house which one would you want to buy and live in?

Wednesday, August 15, 2012

Credit Unions Weigh in on CFPB's Mortgage Servicer Rules

Executives from five credit unions commented on the Consumer Financial Protection Bureau’s proposed mortgage servicer rules during a recent meeting with the watchdog agency’s Small Business Review Panel.

The credit unions represented included the Arizona-based American Southwest Credit Union, the Nebraska-based Omaha Police FCU, the South Dakota-based Services Center FCU, the Connecticut-based First New England FCU and the Colorado-based Rocky Mountain Law Enforcement FCU, Credit Union Times reports.

Credit unions estimate that between $20,000 and $40,000 in initial costs would be required to implement one of the requirements, which would provide U.S. consumers with monthly mortgage statements detailing principal, interest and other fees.

The panel included 16 representatives from “small entities,” including credit unions and banks with less than $175 million in assets. These entities, which use third-party vendors to issue mortgage statements, maintain that they would have little control over any price increases associated with compliance costs related to the proposed requirements, though those costs could be contained if vendors were required to implement the rules for all clients.

Another requirement would force mortgage servicers to issue two written notices to borrowers before charging them for force-placed insurance. According to a report on the input issued by the CFPB, the small entity representatives maintain that their actions did not contribute to the recent housing crisis, according to Credit Union Times.

Smaller servicers utilize a “high-touch” model that involves consistent and regular customer contact and exceptional service to ensure the health of loans. The group said that the compliance burden associated with the new CFPB rules would make it more difficult for small entities to compete in the market and allow consumers choice.

Monday, August 13, 2012

Pinterest for PR Pros

Pinterest for PR Pros

Considering the mortgage industry has taken their sweet time to adapt to the forever evolving social media world, it might take some time for our industry to appreciate the true value of all things social media, especially the newest social kid on the block, Pinterest.

Yesterday I was able to listen in on a webinar about Pinterest and what it can do for a brand and a company.

If you are considering creating a Pinterest account for your company you should consider a few things before you start.

  1. Determine whether your business is a match for Pinterest
  2. Determine how you’re going to use Pinterest to drive traffic to your website.   
  3. How are you going to keep Pinterest users interested?   
  4. How are you going to incorporate Pinterest into your overall campaign strategy?

Did you know that Pinterest has 7% of the membership that Twitter does, but produces nearly as much referral traffic?
This is an amazing statistic and goes to show that Pinterest users are a very proactive group, making them easy to engage, click to click, until they get to the original post.

In order to drive traffic to your site you can do several simple things. One is adding the 'pin it' button to your website and blog. This allows visitors to pin whatever is on your site to their pin boards, driving more traffic to your website. You can also link your Pinterest to your Facebook and Twitter accounts. This allows you to promote your brand and company on all social channels. Add links in your description and add hash tags making your content more searchable directing traffic back to your site.

Another big thing that needs to be applied to your Pinterest account is using keywords. I know we have all heard about keywords and their benefits for SEO and that is exactly why using keywords, even on Pinterest, is good for your traffic.

You might be asking yourself how the mortgage industry is going to utilize Pinterest. We can use Pinterest to promote a lifestyle, your office lifestyle and your employees. It is great to showcase a personality on your Pinterest; this allows your followers to connect with you on a different level. You can create your personality around your brand, you can run contests, tell stories and showcase different items or ideas related to your industry.

For example IDS client 360 Mortgage Group who signed up for a company Pinterest account about five months ago has had a positive response to their Pinterest boards and has been able to grow their female fan base, drawing in an increased number of female mortgage brokers.

“At 360 we are always looking for new ways to take advantage of social media and we saw Pinterest as an increasingly popular social media source,” said 360 Mortgage Groups Social Media Coordinator and Editorial Writer Amy Elms.

360 Mortgage Group has already seen an increase of traffic particularly to their blog since using Pinterest and linking their followers directly to their blog and website.

“We always make sure to link our latest blog posts on Pinterest using an image that is related to the post. We have had a good amount of followers repin our blog posts on their own Pinterest boards, thereby increasing the number of people who view our blog,” said Elms.

According to Elms Pinterest is a great new resource in order to create a community between borrowers, brokers and fellow mortgage companies. Currently 360 is connected to more than a dozen other mortgage companies on Pinterest as well as a number of companies and individuals that focus on the mortgage industry or the housing market.

Make sure to check out the 360 Mortgage Group's Pinterest account for yourself.

Pinterest has proven to be a great way for those in the mortgage industry to fine new mortgage and housing-related articles, infographics, images and blog posts.

With free resources available at our fingertips, the mortgage industry is starting to catch on to the social media hype that continues to plague our daily lives with information. It is what you make it and we can all utilize social media to improve and create the communities throughout our industry.

Friday, August 10, 2012

CFPB Proposes Two Servicing Rules

The Consumer Financial Protection Bureau this morning proposed two notices that would create new national standards for mortgage services in their interactions with consumers.

The proposed rules, subject to a comment period with the intent of implementation by January, would provide consumers with "clear and timely information" about their mortgages so they can avoid costly surprises. A second set of proposed rules would impose "common-sense" requirements for handling consumer accounts, correcting errors and evaluating borrowers for options to avoid foreclosure.

"These proposed rules operate on two basic principles: no surprises and no run-arounds," said CFPB Director Richard Cordray at a news conference yesterday. "Millions of homeowners are struggling to pay their mortgages, often through no fault of their own. These proposed rules would offer consumers basic protections and put the 'service' back into mortgage servicing. The goal is to prevent mortgage
 servicers from giving their customers unwelcome surprises and runarounds."

While the Dodd-Frank Act addressed some of these issues and imposes certain requirements on servicers, the law also gave the CFPB statutory authority to write additional rules. The CFPB first announced in April that it was considering proposals to implement the Dodd-Frank Act requirements and address systemic problems in the servicing industry.

The first set of proposed rules targets information about consumers' mortgages; CFPB said the rules are designed so consumers could avoid "costly surprises" and bring greater transparency to the market.

The first set of proposed rules include:

  • Monthly Mortgage Statements: Servicers would be required to provide regular statements which would include: a breakdown of payments by principal, interest, fees and escrow; the amount of and due date of the next payment; recent transaction activity; and warnings about fees.
  • Warning Before Interest Rate Adjusts: Servicers would be required to provide earlier disclosures before the interest rate adjusts for more adjustable-rate mortgages. This disclosure would include information about alternatives and counseling resources if the new payment is unaffordable. Existing disclosures for interest rate adjustments that cause a change in mortgage payments would be amended to include additional information and arrive earlier so that borrowers could anticipate consequences of payment changes.
  • Options for Avoiding "Force-Placed" Insurance: Servicers would have the responsibility to ensure that borrowers maintain property insurance. CFPB said if the borrower does not maintain this insurance, however, the servicer has the right to purchase insurance to protect the lender's interest in the property. CFPB is proposing a rule it said would provide more transparency in this process, including requiring servicers to give advance notice and pricing information before charging consumers for this insurance. The servicer would also be required to terminate the insurance within 15 days if it receives evidence that the borrower has the necessary insurance and the insurer would refund the force-placed insurance premiums.
  • Early information and Options for Avoiding Foreclosure: Servicers would be required to make good faith efforts to contact delinquent borrowers and inform them of their options to avoid foreclosure.
The second set of proposed rules targets servicer requirements for handling consumer accounts, correcting error and evaluating borrowers for options to avoid foreclosure.

The second set of proposed rules include:
  • Servicers generally would have to credit a consumer's account as of the date a payment is received.
  • Servicers would be required to establish "reasonable policies and procedures" to provide accurate and current information to borrowers and minimize errors. They would be required to submit accurate legal documents that comply with applicable law, help borrowers on options to avoid foreclosure and provide oversight of their contractors and foreclosure attorneys.
  • If a consumer notifies the servicer that she thinks there has been an error, the servicer would be required to acknowledge receiving the notification, conduct a reasonable investigation and, in a timely manner, inform the consumer about the resolution.
  • Servicers would be required to provide delinquent borrowers with "direct, easy, ongoing access" to employees who are dedicated and empowered to help delinquent borrowers.
  • Servicers that offer options to borrowers to avoid foreclosure, such as loan modifications or other payment plans, would be required to promptly review applications for those options. Servicers would be prohibited from proceeding with a foreclosure sale until the review of the borrower's application is complete. Servicers would also be required to let borrowers know when applications are incomplete and to allow borrowers to appeal certain servicer decisions.
MBA President and CEO David Stevens commended CFPB for moving forward with national mortgage servicing rules and said MBA would carefully review the proposed rules.

How are these new proposed rules going to affect the servicing businesses and the time they need to put forth in order to comply with the new proposed rules?