Written by Dick Lepre
The U.S. House of Representatives recently passed a bipartisan bill known as the Mortgage Choice Act of 2015. The bill essentially reforms two existing regulations – Dodd-Frank Wall Street Reform and Consumer Protection Act and the Truth in Lending Act (TILA). Will the proposed changes benefit the consumer? Let’s break it down.
The U.S. Department of Housing and Urban Development (HUD) recently announced they will make significant changes to the FHA’s Distressed Asset Stabilization Program (DASP). DASP helps to sell mortgages in danger of foreclosure to qualified bidders and encourages loan servicers to work with borrowers to bring the loan out of default.
Effective October 3, 2015, (extended from August 1, 2015) the Consumer Financial Protection Bureau (CFPB) will implement a rule intended to reconcile inconsistencies between two federal acts that regulate the mortgage qualification process. The new rule, known as TILA RESPA Integrated Disclosure (TRID), seeks to simplify standard loan documentation, limit fees charged to consumers, make documentation easier to understand, aid consumers in comparison shopping, prevent surprises at the closing table, and clarify timing requirements for disclosure of final loan terms and costs. Here’s what you need to know about the changes put forth by the new “Know Before You Owe Rule.”
In areas like the San Francisco Bay Area, where median home prices tend to hover around the million dollar mark, mortgage loan amounts often exceed the conforming and high balance conforming loan limits (respectively, $417,000 and $625,500, in most local metropolitan statistical areas). The ability to offer well-priced, comprehensive jumbo loan programs to meet the needs of buyers in all the regions we service is a necessity here at RPM.
As of January 26 Fannie Mae will make their Collateral Underwriting (CU) tool available to lenders during the underwriting process. The announcement has elicited mixed reactions from industry experts. So what does it all really mean?
As the one year anniversary of the Qualified Mortgage (QM) loan guidelines approaches, the time is right to reflect upon the impact and the uncertainty of QM vs. non-QM loans. We have spent the past year working with QM loans and developing smart solutions beyond QM to serve more borrowers. The non-QM terminology lends itself to the perception that a loan and/or borrower is somehow inferior to one who is “qualified.” As a result, there is skepticism, uncertainty and fear associated with “non-QM,” which is misguided.
We asked our Chief Credit Officer, Gary Scoma, to break it down for us.
FICO is the most widely used credit score. The three major credit repositories, Equifax, Experian and Transunion, work with FICO to develop their scores. But, when it comes to mortgages, FICO is the only credit score that is considered. So, when FICO recently announced it was changing its scoring system, the resulting headlines caused some confusion and debate. Will FICO’s decision to recalculate credit ratings be a boon for the mortgage industry? Some say the changes will not impact consumer credit in any meaningful way. So, what’s the real story here?
I have said before that I believe the transition in mortgage finance will include short-term pain, mid-term adjustments, and a new era in lending. Now that the Great Recession is behind us and recovery is underway, it is time to recognize and support a very important constituency that has been left out of our economic recovery – self-employed and retired (SE&R) consumers. RPM is leading the way to a new era with our recent release of the Tailored Line of borrowing solutions. The program offers common sense loans for qualified buyers in more segments of the community. It is my sincere belief that within the next few years many other lenders will agree with RPM’s stance that SE&R communities are alive and vibrant. Serving them, as well as other uniquely qualified buyers, with secure loans, is vital to the strength of our economy and our country.