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The new wholesale lending channel aka “brokering” (as they so call it) I’ve said it time and time again that the terms “broker” and “banker” are comical. We’re all third-party originators to

ping without steering or special interests, period. For those considering or those already pure brokers, just make sure your margins are identically set and you’re following all compensation, fair lending, and anti-steering policies just as all channels should be. Any origination channel can be a good channel to place your license if you are happy, but never discredit wholesale operations or what you don’t understand. If you work “for” a lender and have a bad experience or a change is made, you’re in a pickle. If you work “with” 25 lenders and have a bad experience, you have 24 other options. Think about it.

Mortgage brokers: Just say no to mini-core Lenders selling this, we’re fed up. Just as we were fed up with the net branch fear-based recruiting of brokers in 2009

that has backfired for those that gave up their businesses, we are also fed up with the mini-correspondent talk as it pertains to QM (the qualified mortgage) come Jan. 10, 2014. Good mortgage brokers will not be impacted by the three percent points and fees test. These salespeople pushing mini-core don’t even understand the analytics, nor do the majority of brokers they are talking to. If a broker is making this change to try and work-around these rules then they need to seek another profession, period. As indicated, this work-around will not work. In addition, the CFPB is very clear some are attempting this and they will be held accountable. Mortgage broker transactions that are table-funded are not secondary market transactions. They continued on page 62

EVERYTHING THE RIGHT PERSPECTIVE CHANGES

A NEW AGE IN COMPLIANCE, SECURITY, RISK MANAGEMENT & TRANSPARENCY.

How do you make the best collateral valuation decisions? Are you measuring appraisal risk? Can your AVMs perform just as reliably in a purchase transaction as they do in a reﬁ? Are you checking for UAD and UCDP-compliance, pre-submission? Are your systems giving you a 360-degree view of collateral value and risk? Do you need a clearer perspective on your originations, or your loan portfolio? Get the right perspective with Veros tools and technology.

n Missouri Mortgage Professional Magazine n DECEMBER 2013

Save your money Always expect the best, but plan for the worst. We’re in a volatile industry and you cannot allow your balance sheet to negatively impact your decision-making or emotions. Save as much as you can and try to build enough reserves to be comfortable in any market. Consider also deleveraging any debt other than your primary mortgage or those used for investment purposes to limit the monthly obligations that our industry does not always match as it pertains to accounting. This is very simple, but a huge reminder and security we all need that can significantly improve our lifestyles, behaviors and attitudes.

the primary agencies that buy, insure or guarantee mortgage loans (Fannie Mae, Freddie Mac and Ginnie Mae). Even portfolio and jumbo lending exists on all channels making these titles outdated and unwarranted going forward. Temporary funding or a line of credit to the same agencies will not make someone different than another. While I understand we’re too brainwashed to remove these titles, I’ll go with it for now. Yes, wholesale lending is still here as it has always been and continues to be an important and active origination channel that is growing again. Only those who have been influenced by others with a financial stake in this artificial view have been impacted. The other inaccurate assumption is the one that comes from these that think they broker loans, but in reality really don’t the way it’s meant to be done. Those with correspondent lines interfering with their margins and product offerings “can” broker, but credit line influence removes all the benefits and true picture of wholesale execution and pricing. Priority for most programs will always fall on the credit lines when employed by a creditor. I consider myself a high-producing, experienced, analytical and detail-oriented mortgage originator. I am also a small business owner. I embrace confidence, but despise arrogance. I have reviewed all regulations, data, math and trends over the years to confirm that being a mortgage brokerage exclusively is the best position for my clients, our employees, and my business. If operated correctly, there is nothing like comparing lenders who compete for business on pricing, overlays and execution. I can tell you that we’re dominant in our marketplace when the time comes for competitor comparison with an educated consumer. I love being a mortgage broker and it is the best time in history to embrace the wholesale channel. Do not count out being a mortgage broker or working for one if you have not recently or feel you’re in the corporate roller coaster, I mean a true mortgage broker. As a broker, any bad lender experience for any reason can be removed immediately with unlimited resources on investors to compare. If run properly, it is truly the only channel in which you work exclusively for your borrower and their interests by shop-

NationalMortgageProfessional.com

down, overhead doesn’t. Pricing will be relevant to the creditor, but no doubt you need to find balance and know your competition. It’s realistic to expect “fair” compensation with good pricing for your target of gaining new educated consumers. Pricing does matter and “selling service” in today’s market lacks common sense. Everyone must execute well and have excellent service and experience in today’s primary mortgage market. Pricing will always be a factor to educated borrowers, just not to a disconnected non-originating sales manager that needs that margin. I try my hardest not to pass judgment, but I have been very disappointed and shocked by the lack of understanding most of my colleagues have on current and future regulations that significantly impact their clients as well as the future of our industry. I am very surprised by the questions people ask when it comes to items within DoddFrank such as the Qualified Mortgage (QM), ability-to-repay, three percent cap calculation for points and fees, APOR test, etc. Everyone must understand these things in order to effectively communicate with clients, real estate agents and others. It is our responsibility if we are communicating with the public. Just being average doesn’t cut it in 2014. Make no mistake, being welleducated about the industry will result in more authority and respect from others, resulting in more referrals.