Article Archives for Yakima, Washington VA Home Loans - Since 2005    (Page 2)

The program initiated by the Government HAMP, has failed miserably to address loan modifications, and the short sales have failed to mitigate housing losses.

These two outcomes have played out for the same reason: Four major banks control over 75% of the nations mortgage servicing.  The GSE’s failure too can be linked to Fannie and Freddie controlling over 70% of the nations mortgage-backed securities market during their hay day. Too much control in the hands of the few has ultimately ended in chaos.

The same four major banks have controlled the majority of the mortgage servicing for the past two decades. During that time their primary responsibilities have been the collection of monthly remittances, payments to bond-holders and submission of the accompanying reports. This responsibility was relatively straight-forward and with the ability, in the past decade, to send processes off-shore the profitability grew at an enormous rate.

As annual mortgage volume grew from $500 billion in 1990 to an excess of $3 trillion in 2006 so too did the number of outstanding mortgage accounts that were being serviced by the large financial institutions. As these numbers continued to grow, so too did the number of delinquent files. Unfortunately loan servicers are not properly set up with the experienced personnel or the technology required to effectively managing these delinquent assets. As a result, too many delinquent accounts are being managed by institutions that have not adequately prepared for such an anomaly and we’ve experienced a massive back-up in the modification/loss mitigation process.

The solution is not simple but it’s doable…

First congress MUST redesign the nation’s Housing finance System to adequately supply the necessary liquidity to meet its future housing needs. This can only be accomplished if congress is willing to address an entire system overhaul and not just Fannie and Freddie.

Congress should also provide the Federal Home Loan Banksthe authority to securitize mortgages. This would serve two purposes. It would first help to deleverage the percentage of the mortgage-backed securities market that the GSEs currently enjoy. After all that is what got them into the situation they find themselves today. Owning 70% of the MBS market was doomed to failure. Allowing the FHLB to securitize would also allow the industry to begin to shift some of the servicing responsibilities from the few to the many. Engaging the community banking system to assist in the deleveraging of the big players should be a goal of the administration.  More importantly, however, moving the servicing back down to these local bankers in local markets makes much more sense and improves the odds of future catastrophic failure of our mortgage system.

If the market ever expects housing to contribute 25% to 30% of GDP again, it will require congress to completely overhaul the housing finance system, deleverage those institutions that have enjoyed the “too big to fail” status and let the private markets control housing rather than the socialized housing system currently in place.

Kevin J. Lawson

If you watch the news or read anylists reports on the economy and the real estate climate as a whole you will get a varying degree of how the country is doing.  Throughout the United States, there are few metropolitan area’s that are doing well.  As a matter of fact most are hanging on & in some cases there are cities that keep trending downward.  Seattle/Tacoma is but one of those area’s.   Foreclosures have steadily increased since 2008, and the realtors dont see a slowing down.  However East of the Mountains in Wenatchee, Yakima, and Spokane, the trend is holding steady.  Those markets have held there ground, yet thats not to say that they havent been hit hard.

One could conclude that were not out of the woods yet.  We very well could see a dip in the economy, as the state of the country is very fragile to say the least.  If the results from the upcoming elections dont put some confidence in the consumers, we could see an even more stagnant real estate market.  More qualified buyers may choose to rent instead of purchasing.  Not to mention the (major) banks are overwhelmed and under qualified.  This holiday season will be heavily scrutinized by analysts to see how were trending as a nation.  The elections will have passed and maybe the bank accounts will open up a bit, and spending will take place.  Dont Count on it though……. we still have some tough, but manageable times ahead of us.

Kevin J. Lawson

The upcoming November political race has much implications for those of us in the mortgage Industry.  Unless you work for a Bank that is.  You see the banks are not held to same High Standards that a broker is.  For a broker or loan specialist in a brokerage is held to yearly continuing education, testing, and fee’s.  Yes Fee’s.  As loan specialists and brokers we have to PAY the state that we are licensed in, in order to retain our jobs.  It should then come as no suprise then that the BIG BANKS are paying legislators to ratchet up the regulation against its main competition.  The Mortgage Brokers. 

You see, the average time for a bank to close a real estate transaction is roughly 90 days.  Yes 90 Days.  The benefits of dealing with a broker are so much more obvious than the bank option.  As specialists or brokers we have the ability to monitor the Entire loan process with the lender we are placing your loan with.  As specialists or brokers the communication lines are always open & I pride myself in Client satisfaction, and that begins with the highest level of communication.  My clients do not complain that I update them too much.  We offer more agressive pricing and have  more knowledge about the loan process to pass along to our clients.  Your lucky if you can get a return call from a large or major lending institution.  Creekside Mortgage, Inc. regularly closes transactions within 25 Days.  YES 25 DAYS !!!  I promise you, most Large lending institutions  Can NOT close a power window inside 25 days.   

So when your voting this election year……..please educate yourself.  The people that call the mortgage industry a career; the people that strive to go above and beyond at the brokerages,  the little guys..think about our livelihoods and what it is we can offer….  Think about the politicians that are getting Large sums of money from the big banks.  Its pretty obvious who they are.   Just do a little investigating and you’ll soon figure out who’s doing what, and what their agenda is.  When the legislators regulate your pay…….you have to wonder what is behind that madness and realize once again…..were being stripped of the freedoms this country was based on.  If legislators can demand that you accept their (government) health care, and they can also regulate your commission pay…….  I ask this.  Whats next America??

Kevin J. Lawson

The delay in foreclosures is not a good thing. Yes, foreclosures are a bad thing, but delaying it is even worse. This weekend, when you’re at the Halloween craft fair (or “faire” if you live in a high income area), and someone asks you, “What’s the big deal?” you can explain it like this. Those servicing companies who have put a moratorium on foreclosing on the property often times still owe the ultimate investor the scheduled monthly interest, based on their contract. And if the loan is possibly subject to a buyback situation, the originator of the loan (whoever sold it to Chase, for example) is certainly going to argue that it is not “on the hook” for interest charges that Chase voluntarily stopped making and thus owed.

The current foreclosure issues certainly increase uncertainty - and markets don’t like uncertainty. Bank stocks are down, and they continue to hold on to trillions of “lendable” money because of nervousness about the future. Chaseannounced that it would now be reviewing 115,000 foreclosure cases in 41 states. PHH’s president and CEO stated, “PHH Mortgage is actively cooperating with its regulators, is responding to such inquiries and has completed a comprehensive review of its foreclosure procedures. Based on this review, PHH Mortgage has not halted foreclosures in any states and has no plans to initiate a foreclosure moratorium.”  This is just going to pro-long the recovery period, and we’re going to see a massive slowdown to our already Slow real estate market.  Hang in there folks, for there is always light in any Dark period, you just have to be persistent, patient and look for the shifts and act accordingly.

Kevin J. Lawson

Some folks out there are clever, but for all the wrong reasons. It is rumored that real estate and mortgage licensees have become the target of a scam. An individual, claiming to be a representative of the Division of Real Estate, is calling licensees and telling them that they have failed to respond to a notice sent out by the Division informing them that they are required to submit updated fingerprints. The individual warns that, due to this failure to respond, the licensee’s license is going to be suspended. The individual then claims that this is a courtesy call from the Division, that the licensee may pay a small fee to avoid having his or her license suspended, and that the fee can be paid over the phone by credit card. It was reported to me that the Division will never contact any licensee and ask for a credit card number over the phone. The only licensees who are being required to submit updated fingerprints at this time are mortgage originators who are establishing their records in the nationwide mortgage licensing system (NMLS). All required payments for this fingerprinting are handled through the NMLS website, NOT over the telephone, and anything different should probably be reported to the Division of Real Estate.

Kevin J. Lawson

We tend to get in a rut at work and pound thru the days, just grinding them out and its Friday and we have great aspirations to go hiking, biking, boating and so forth.  Well if that truly does NOT happen, then your running errands, going to birthday parties for your childrens school friends or family functions.  In most our daily lives, we are getting a good mental work out in some form or fashion.  However if you have a family, and are taxed with all the normal routines that come with it, or are just so busy with work that you have little time for anything else, the physical work out time goes to the back of the bus.

Its extremely important as you know to incorportate some type of physical work out regimine into our lives.  I can always count on my Dr. telling me the exact same thing when I visit.  Pay close attention to your diet, more vegies, less sweets and soda’s and exercise more.  Its a given.  So with that being said, we can all benefit from a little hike, or bike ride, weights, cardio etc..  Just dont resign yourself to giving up.  Just set a small realistic goal, and begin.  Thats the most difficult part.  Just begin, then go from there.

Kevin J. Lawson

The U.S. Department of Veterans Affairs failed to inform 6 million soldiers and their families of an agreement enabling Prudential Financial Inc. to withhold lump-sum payments of life insurance benefits for survivors of fallen service members, according to records made public through a Freedom of Information request.

The amendment to Prudential’s contract is the first document to show how VA officials sanctioned a payment practice that has spurred investigations by lawmakers and regulators. Since 1999, Prudential has used so-called retained-asset accounts, which allow the company to withhold lump sum payments due to survivors and earn investment income on the money for itself.

The Sept. 1, 2009, amendment to Prudential’s contract with the VA ratified another unpublicized deal that had been struck between the insurer and the government 10 years earlier — one that was never put into writing, Bloomberg Markets magazine reports in its November issue. This verbal agreement in 1999 provoked concern among top insurance officials of the agency, the documents released in the FOIA request show.

For a decade, until the contract was formally changed, Prudential wasn’t fulfilling its obligations to survivors of fallen service members, says Brendan Bridgeland, an insurance lawyer who runs the non-profit Center for Insurance Research in Cambridge, Massachusetts.

‘Violated Terms’

“It’s very clear they violated the original terms of the contract,” says Bridgeland, who is retained by the National Association of Insurance Commissioners to represent consumers.

“Every veteran I’ve spoken with is appalled at the brazen war profiteering by Prudential,” says Paul Sullivan, who served in the 1991 Gulf War as an Army cavalry scout and is now executive director of Veterans for Common Sense, a nonprofit advocacy group based in Washington. “Now vets are upset at the VA’s inability to stop Prudential’s bad behavior.”

That the VA allowed Prudential to issue retained-asset accounts for 10 years while the contract required lump-sum payouts is “more evidence that the VA was asleep at the wheel for a decade,” says Sullivan, who was a project manager and analyst at the VA from 2000 to 2006.

“When grieving families check the box that they want a lump sum, they should get it. We remain disappointed and irate at the VA’s failure to provide advocacy for veterans,” he says.

Kevin J. Lawson & Bloomberg Reports