{"id":11580,"date":"2010-03-17T19:07:37","date_gmt":"2010-03-18T02:07:37","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=11580"},"modified":"2010-03-17T20:03:04","modified_gmt":"2010-03-18T03:03:04","slug":"will-pre-approval-letters-be-banished","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/11580\/will-pre-approval-letters-be-banished\/","title":{"rendered":"Will Pre-Approval Letters Be Banished?"},"content":{"rendered":"

Score one more screw up for the Government-Banking Complex…and watch mortgage brokers thrive because of it.<\/p>\n

Andrew Duncan of Keller Williams in Tampa, FL reprinted a Mortgage News Daily story<\/a>:<\/p>\n

As part of the changes to the Real Estate Settlement Procedures Act<\/em>, borrowers can no longer shop for a home with a firm loan commitment in hand. While that might not be a big deal in today’s buyer’s market — it could give cash-rich buyers an advantage when sellers are back in the driver’s seat.<\/p>\n

Under the new RESPA rule<\/a>, a lender cannot perform income, asset and credit verifications until the prospective borrower has received a Good Faith Estimate, Patton Boggs LLP\u00a0Partner Rich Andreano told MortgageDaily.com<\/em> in a telephone interview. Andreano is a RESPA expert with nearly 25 years’ experience who advises mortgage bankers, mortgage brokers and other providers of mortgage-related services about regulatory compliance and transactional issues.<\/p><\/blockquote>\n

What this means is that mortgage lenders will be forbidden from performing normal income and asset verifications, or seek permission to perform those tasks, without issuing a binding Good-Faith-Estimate of loan fees.\u00a0 Pragmatically, this means that most large, direct lenders will not want to commit to the fees until they know the exact loan amount and purchase price.<\/p>\n

One more reason to do business with a mortgage broker. <\/strong> Mortgage brokers don’t fund loans, they arrange them.\u00a0 What mortgage brokers do <\/em>have in their arsenal is all the pre-approval tools needed to secure an automated underwriting approval.\u00a0 The new good faith estimate<\/a> favors brokers because it allows them to fully-disclose the fee they earn for arranging that loan, while putting a time limit on the rate.<\/p>\n

Andreano explained that HUD’s position is that verifications cannot be performed until the borrower has been provided with a GFE. But if a loan commitment is issued and the property costs vary significantly — the lender cannot revise the GFE.<\/p>\n

“What you can’t do before the consumer gets a GFE\u00a0in their hands is you can’t ask them to give you any verifying documents, nor can you ask them to give you authority to verify,” he stated. “The lender would be stuck with the cost Read more<\/a><\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

Score one more screw up for the Government-Banking Complex…and watch mortgage brokers thrive because of it. Andrew Duncan of Keller Williams in Tampa, FL reprinted a Mortgage News Daily story: As part of the changes to the Real Estate Settlement Procedures Act, borrowers can no longer shop for a home with a firm loan commitment […]<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[26,5],"tags":[],"class_list":{"0":"post-11580","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-lending","7":"category-real-estate","9":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":4418,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/4418\/fannie-and-freddie-fall-to-foreclosure-but-still-lenders-lend\/","url_meta":{"origin":11580,"position":0},"title":"Fannie and Freddie fall to foreclosure, but, still, lenders lend","author":"Greg Swann","date":"September 14, 2008","format":false,"excerpt":"This is my column for this week from the Arizona Republic (permanent link). \u00a0Fannie and Freddie fall to foreclosure, but, still, lenders lend I write this column at the beginning of the week, and it appears at the end of the week. My topics are usually timeless, but, if I\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2884,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2884\/zillowcoms-long-awaited-mortgage-lending-service-to-offer-anonymous-customized-loan-quotes-to-consumers-affording-loan-originators-the-opportunity-to-compete-transparently-for-free-mortgage-leads\/","url_meta":{"origin":11580,"position":1},"title":"Zillow.com’s long-awaited mortgage lending service offers anonymous customized loan quotes to consumers, affording loan originators the opportunity to compete transparently for free mortgage leads","author":"Greg Swann","date":"April 2, 2008","format":false,"excerpt":"Seattle-based real estate start-up Zillow.com tonight releases its long-anticipated mortgage lending product. We've known for nearly a month that Zillow's offering would include working loan originators in some fashion. What becomes clear tonight is that Zillow will basically be acting as a hands-off intermediary between mortgage-seeking clients and loan originators.\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":16209,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/16209\/americans-will-downsize-and-live-multigenerationally-in-order-to-offset-the-fraud-they-know-exists-in-real-estate-until-there-is-wage-growth-and-that-could-be-years-or-decades-away-people-will-n\/","url_meta":{"origin":11580,"position":2},"title":"“Americans will downsize and live multigenerationally, in order to offset the fraud they know exists in real estate. Until there is wage growth, and that could be years or decades away, people will not trust any upward movement in real estate values.”","author":"Greg Swann","date":"September 27, 2012","format":false,"excerpt":"A searing indictment of The Bernanking System in Business Insider:Once people start to come out of negative equity, even more of them will sell and try to get out from under the cloud they are under. So, the housing bubble orchestrated by the Fed and by the hedge funds and\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3223,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3223\/canadian-housing-crash-could-induce-more-investing-in-america\/","url_meta":{"origin":11580,"position":3},"title":"Canadian Housing Crash Could Induce More Investing in America","author":"Brian Brady","date":"June 9, 2008","format":false,"excerpt":"You heard it here first. Canadian real estate is in the danger zone. Well, maybe not all of Canada's housing stock will fall but the Western provinces look overvalued. If you subscribe to my site, you heard about this over the weekend. It all started back in 2003. A barrel\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":14708,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/14708\/lay-down-with-dogs-and-you-wake-up-with-fleas-worse-if-you-decide-to-rape-the-taxpayers-via-nars-rapac-scam-you-get-plague\/","url_meta":{"origin":11580,"position":4},"title":"Lay down with dogs and you wake up with fleas? Worse. If you decide to rape the taxpayers via NAR’s RAPAC scam you get… plague!","author":"Greg Swann","date":"June 29, 2011","format":false,"excerpt":"From the Phoenix Realtor Forum, the monthly newsletter of the Phoenix Association of Realtors: Alas, the plague is a swarm of vampire-like locust Realtors. These are RAPAC's objectives, according to the article, with interstitial commentary by me in bold text. Mortgage Interest Deduction: NAR opposes any changes that would limit\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":329,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/329\/could-valley-resale-home-inventories-really-only-be-15-over-normal\/","url_meta":{"origin":11580,"position":5},"title":"Could Valley resale home inventories really only be 15% over normal?","author":"Greg Swann","date":"September 13, 2006","format":false,"excerpt":"Interesting notes from John L. Wake's Arizona Real Estate Notebook:Dr. Jay Butler, the head of the Arizona Real Estate Center at ASU, made a presentation yesterday at the Industry Partners Conference, an annual meeting of real estate industry folks - agents, escrow officers, mortgage brokers and many others. Looking at\u2026","rel":"","context":"In "Blogging"","block_context":{"text":"Blogging","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/blogging\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/11580","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=11580"}],"version-history":[{"count":5,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/11580\/revisions"}],"predecessor-version":[{"id":11586,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/11580\/revisions\/11586"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=11580"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=11580"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=11580"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}