Written By: MortgageCurrentcy.com Staff (MortgageCurrentcy.com)

Rule Synopsis:

Fannie Mae has announced they are establishing additional appraisal requirements to supplement the Uniform Standards of Professional Appraisal Practice (USPAP)

NEW Form 1004MC – “MARKET CONDITIONS ADDENDUM to the APPRAISAL REPORT” required on all 1- to 4- family appraisal reports dated on or after April 1, 2009, and includes

• Trend of Property Values, Demand/Supply, Marketing Time – Additional data required on form
  • Written conclusions and reasons: must be included in writing for declining market determinations, over-supply, or marketing time > 6 months
  • Transfer to appraisal: CONCLUSIONS reported on 1004 in “Neighborhood” Section
• Seller & Third Party Concessions Analysis – required to determine trends
  • Adjustments for concessions on market influence, not dollar for dollar
  • Adjustments may be required EVEN if concessions are typical

UPDATED APPRAISAL POLICIES

Effective with Appraisals Dated on or after January 1, 2009:

• Supervisory Appraisers – Must inspect all properties if signing as appraiser
• Sales Contract Required – Lender must provide appraiser with sales contract, all addenda, and all contract changes during the loan process
• Appraiser’s Selection of Comparables – Appraiser must provide explanation if comparable used is outside of subject’s neighborhood.

Written By: Cindy Douglas, ConnectTheData.com, providing online audio sessions (only $4.97 each or $99 for all 30) on exactly how to build a database so you have an asset to sell in the future.

From experience I have noticed there are two types of sales people ~ those that keep chasing business and those that cultivate the business they have.

The first builds a business based on the number of transactions closed. Occasionally there may be some repeat business going on, but this is not typically the norm. The second individual nurtures relationships.

It’s no secret that customers are the key to business growth, yet even though you have literally millions of potential opportunities to increase your business, you know that only a very small percentage actually commits to doing business with YOU!

The key to success is knowing how to identify your GOLDEN clients, what events in their lives trigger a financial opportunity, and which clients to stay away from.

The term database management is not new ~ in fact it has been kicked around A LOT! However, just like the thought of going to the dentist can make your teeth hurt, for some loan officers creating and maintaining a database can bring on that pain-to-the-brain-feeling.

While most sales people can see the importance of implementing a Customer Relationship Management (CRM) system they are hard pressed on how to quantify the value. In other words, will the time and effort justify the end result? Can a CRM program really make a difference when it comes to winning and retaining customers?

The answer is a resounding YES! While a long journey begins with a single step, read about 3 steps and download the Financial Life-Events Time Line to help you identify key touch-points in the lives of each of your clients.

It’s the New Year and your clients are making financial decisions for 2009. Now is the very best time to get in touch with them—especially when the rates are so, so, so low! You won’t find recipes or cute quotes. Just down and dirty info that your clients can use right now.

• How to Keep Your Financial New Year’s Resolutions! (Refinance opportunity)
• What You Should Bring to an IRS Audit
• A Power of Attorney—The Good, The Bad and the Ugly!
• Are You a Prime Target for Burglars?

Preview the contents; add your contact info and space is provided to add your own personal message. You can also cut and paste and email one article per week to your database. Hey, your agents and affinity partners can use this info, too, so don’t exclude them from your client newsletters either!

Written By: Kim Payne, President, Folsom Mortgage (KimPayne@FolsomMortgage.com)

"Here", the bored cashier said as she handed me the receipt. That's all she said. I looked around the counter, found my shopping bag and left the store. And I got to thinking…did basic courtesy and building customer relationships and loyalty go the way of the dodo bird?

I was struck with the fact that we probably all miss these opportunities, and often. A slight shift of viewpoint toward including generosity of spirit, interest in our fellows, good old common courtesy and good manners would expand our businesses and personal reputations. The logical end to that expansion is more and better business for us.

A perfect example of a missed opportunity for us brokers has to do with loan modifications. The loan mod companies are everywhere now and their ads claim high success rates. Some pay high referral fees to loan brokers (many of whom helped create the troubles some of these borrowers are now facing.) I know for a fact that some of these companies tell borrowers to skip a mortgage payment or two and use those funds to pay the loan modification company instead.

I wondered, "How can a borrower afford to pay $4,000.00 to a loan mod company when they currently cannot make their mortgage payment?" It seems to me that this is really taking advantage of the hard times of others, and I have difficulty reconciling myself to this high cost for the borrowers. After all, shouldn’t a loan mod be a win-win situation for both the lender and the borrower?

As a mortgage professional, you can help explain to your clients how to do their own loan modification that does not cost them one thin dime. And I do this for people, for free, whenever I get a call asking for advice on this. It’s so easy and I will share with you exactly how you can help your clients (free) to get their loan modified.

But first, here's a story about my daughter and her experience about how a "win-win" situation went bad—and what could have been done differently if only the players had taken the time to look at the big picture.

Written By: Leslie Petersen and John Norman, Esq. (MortgageCurrentcy.com)

Recently Congress passed the Housing and Economic Recovery Act of 2008 in what was lightening speed for Congress. In order for a Bill to become a law, there are several different hearings in each Chamber of Congress and procedural hurdles, which typically make it a long time before a Bill becomes law.

A bill is essentially an idea for a new law. A legislator - who is either a Senator or member of the House of Representatives - gets an idea for a new law from a constituent(s), a lobbyist, from legislative leadership, or from their own experience. Almost every consumer protection law from RESPA, TILA, ECOA, to HMDA grew out of a desire to address very specific problems in lending and in some cases, specifically mortgage lending.

So let's step through this process for the making of the laws that govern our nation and our industry.

INTRODUCTION OF THE BILL

After the legislator gets an idea for a bill it must be "introduced". The introduction comes after the legislator works with legislative counsel to write, or "draft" the bill. The draft is then placed in the "Hopper" by the Representatives in the House of Representatives; or, introduced by the Senator during the Morning Hour¹ in the Senate. After the bill is introduced it is given a number and sent to the Government Printing Office (GPO) for copies to be made.

¹Morning Hour - A 90 minute period on Mondays and Tuesdays in the House of Representatives set aside for five minute speeches by members who have reserved a spot in advance on any topic. (www.VoteSmart.org)

ASSIGNED TO COMMITTEE(S)

Next, the Presiding Officer in the Senate or the Speaker of the House of Representatives assigns the bill to a committee. A bill can be assigned to multiple committees or different parts of the bill can be assigned to different committees. The committee chair can then: (a) do nothing; (b) send the bill to a sub-committee; or (c) schedule hearings to debate the bill. These three options occur in varying sequences with any bill: i.e., a bill coming out of a subcommittee can be held in the full committee without further action.

IN THE COMMITTEE

No Action (doing nothing): If the committee chair fails to hold hearings or if the committee takes no action on the bill, then it is effectively defeated or killed. To stop this from happening, the House allows a bill to be lifted from committee by a Discharge Petition, but it takes a minimum of 218 signatures from the members of the House to lift the bill.

Sent to a Subcommittee(s): Subcommittees follow some or all of the same procedures as a full committee. When their work is completed, findings are sent to the full committee.

Full Committee Hearing: Committee steps are:

1. Comments from relevant government agencies, industry representatives and other parties.
2. Hearing and debates may be held.
3. Subcommittees report their findings.
4. Finally, the bill is "ordered to be reported" for a final vote.
5. The committee holds a "mark-up" session during which it makes revisions and additions.
   • If substantial amendments are made, the committee can order the introduction of a "clean bill" which will include the proposed amendments.
   • This new bill will have a new number and will be sent to the floor while the old bill is discarded.
6. The chamber must approve, change or reject all committee amendments before conducting a final passage vote.
7. If the bill gets a passing vote, the committee staff prepares a written report explaining why they favor the bill and why they wish to see their amendments, if any, adopted. Committee members who oppose a bill sometimes write a dissenting opinion in the report. The report is sent back to the whole Senate or House of Representative floor, and is placed on the calendar.

House of Representatives Rules Committee: In the House, most bills go to the Rules Committee before reaching the floor. The committee adopts rules that will govern the procedures under which the House will consider the bill. These rules can have a major impact on whether the bill passes. For instance, a "closed rule" sets strict time limits on debate and forbids the introduction of amendments.

The rules committee can be bypassed in three ways: 1) members can move rules to be suspended (requires 2/3 votes); or 2) a discharge petition can be filed; or 3) the House can use a Calendar Wednesday² procedure.

² Calendar Wednesday - A procedure in the House of Representatives in which standing committees may bring any bill up for consideration that was reported on the floor on or before the previous day. The procedure also limits debate for each subject matter to two hours. (www.VoteSmart.org).

TO THE HOUSE OR SENATE FLOOR

Now the Bill is placed on one of the calendars, usually in the order in which it was reported to the floor. All the members of the House or the Senate then consider the Bill for debate on the floor.

The House of Representatives follows the rules for debate as set by the Rules Committee. It is helpful to understand that House Rules are generally based on majority rule. Thus, no one member of the House can hold up a piece of legislation by themselves.

In the Senate there is unlimited time for debate and the Majority Leader decides when a bill can be considered on the floor. Any individual Senator can talk as long as he or she would like, thus, a small number of Senators or even one Senator can filibuster (talk a Bill to death).

If a vote is held by either Chamber (House or Senate), and the majority vote is in favor of the Bill – it passes. If any Bill passes the Senate, it must then be sent to the House to start the process over again under the House rules. If any Bill passed the House, it must then be sent to the Senate where it starts the process over again under the Senate Rules.

DIFFERENT VERSIONS PASS

In all likelihood, once a Bill passes both Chambers of Congress there are differences between the two versions. In that case it is then sent to a Conference Committee consisting of members of both Chambers. The Conference Committee will then come to a compromise and issue a Conference Report. The Conference Report must then be sent to both the House of Representatives and to the Senate for approval.

TO THE PRESIDENT FOR SIGNATURE

If both Chambers approve the Conference Report, the bill then goes to the President for a either a signature or a veto. If a bill is signed, it becomes law. If it is vetoed, it will only become law if both Houses of Congress override the veto.

WHAT IF THE BILL DOESN'T PASS IN THE CURRENT SESSION?

Currently we are in the 110th Session of Congress. The Federal Fiscal Year begins in October. Thus, each Congress ends in September. The current projection is that the 110th Congress will adjourn on September 26, 2008.

If a bill fails to pass both Houses of Congress during any session, it is dead and the process must start over again during the next session.

DELIBERATE AND TRANSPARENT SYSTEM

You can see that we have a system that is deliberative and transparent. This process takes a long time to complete for any idea to become law. The Housing and Economic Recovery Act of 2008 had momentum because policy makers wanted to look like they were addressing the problems created by the sub-prime fallout. Many of the ideas in the Recovery Act were proposed as early as last year. For example, the licensing provisions that were part of H.R. 3915 that passed the House in December 2007.

It looks like there are more changes to come, but we will need to wait for the Presidential Elections to see who controls the White House in 2009. To get our voices heard it is important to vote, contact your Senator and Representative, and generally be active in politics. “Democracy is not meant for the naive, apathetic or the lethargic.” (Neal A. Maxwell) If we, the people, fail to participate, then the system does not function properly. If the system doesn’t function, confidence in the system is lost. When confidence in the system is lost, we cease to be a society governed by the rule of law. The rule of law is what preserves our freedoms.

As we can see with the subprime crisis, there is no confidence from investors in mortgage-backed securities. This lack of confidence could potentially erode the whole financial system. Perhaps the Housing and Economic Recovery Act of 2008 will restore that confidence, especially in the debt issued by Fannie Mae and Freddie Mac. But we must also insist that our Representatives and Senators fix the lack of confidence caused by the actions of rating agencies and security issuers, which also facilitated this crisis.

Copyright - 2009 - LoanOfficerMagazine.com