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As
the industry calms down from dream
levels of production and profits the
last several years, where are you
heading? Are you thinking down stream a
year or more, or focusing only on
tommorrow? This cycle's gona be around
for a while longer.
Even now with countless numbers among us
running scared, many of the more hardy
soles with some foresight, are
considering seeking investment capital;
approaching investors to either build
and develop an organization, or to
expand existing ones as the market
continues the shake-out. Hopefully they
will recognize a need for a very
specific and detailed proposal about how
they plan to use the money they are
trying to raise and what it will do to
the bottom line, because investors will
expect to see it, and also understand
that raising capital is an expensive and
very time-consuming activity. Many have
tried this option, most fail at it. No
matter what you may think about your
special plans, it's not a slam-dunk.
On the other hand, some may be
considering selling their firm one day
soon. Many who are broker/originators,
naively feel their production these past
few 'dream years' and relationship
contacts (who will disappear when they
sell & leave), plus their used
computers & old furniture may be
worth hundreds of thousands of dollars
to potential buyers. That group should
instead, be cautious to center their
thoughts on retaining earning inside
their company (and not pull most of it
out), and focus more closely on 'long
term and steady' production numbers, so
they'll really have something saleable -
since most interest from serious buyers
is directed on organizations with $500
Million+ in annual production for some
time, and not in Mom & Pop shops!
Maybe you're in the third group. Not
considering raising capital in these
times of many opportunities, nor
thinking about selling out - but instead
simply going along with the flow! That
bunch will have the most difficult time
of the three, what with the constant
changes in this industry which will
continue to catch them flat-footed.
Their long-term survival is suspect
without a plan of action. Historically,
at this point in the cycle of a
contracting market, just bobbing along
clueless won't work! They can look
forward to being part of the 50%
employed in the industry today, who will
be out of work within one year. You
gotta have a plan - and work that plan -
to survive and prosper; you can't wish
it will simply all work out fine! Register
then post your views here on our
Discussion Board
Clayton Gets Immunity for Due
Diligence Info
"New York Attorney General Andrew
Cuomo has granted Clayton Holdings
immunity in exchange for providing
information on its due diligence work
for Wall Street firms that securitized
subprime mortgages. The publicly traded
company says it has provided due
diligence reports to the New York AG
since it was first subpoenaed in June.
"Now, at the request of the New
York attorney general, we have entered
into a cooperative agreement with his
office," said Frank Filipps,
Clayton's chairman and chief executive.
The New York Times first reported the
immunity agreement. The New York
attorney general's office has not
replied to requests for confirmation.
Clayton performs due diligence on loans
purchased by conduits, and identifies
"exceptions" to the issuers'
loan guidelines. The Shelton,
Conn.-based company also evaluates the
performance of loans once they are
securitized. A company executive said
the percentage of loans securitized in
2006 that had exceptions was about
30%."
... I gotta finish off this new piece
... so these guys (who were the
'gatekeepers') KNEW 1/3 of the loans
didn't even meet the loose reckless
standards that were being employed by
the wholesale lenders, but they went
ahead anyway and gave them a pass, then
stuffed those loans into securities, and
sold them to suckers! And, they want/get
ammunity! ... OMG. CLICK
HERE if you want to give us your opinion
on our Discussion Board
Mortgage Licensing Registry
Launched
States have a new tool to regulate
mortgage companies and access their
track records, including information on
companies punished in other states for
fraud or predatory lending.
The Nationwide Mortgage Licensing System
is an online database that will make it
easier for states to monitor mortgage
companies. If a firm operating in
multiple states is sanctioned in one of
them, other states will know
immediately. And if that firm applies to
open in new states, officials will know
about the infractions and could deny the
company a license.
“The ability to hide a blemish is
gone,” said Steven Antonakes,
Massachusetts’ state banking
commissioner. In the last two years
Massachusetts has issued more than 215
enforcement actions against lenders and
brokers.
So far, seven states are participating
in the registry, which kicked off Jan.
2: Idaho, Iowa, Kentucky, Massachusetts,
Nebraska, New York and Rhode Island.
Another eight are slated to join by
July, and more than 35 states are
expected to participate by the end of
2009. By then, the public also will be
able to use the portal to see a
company’s state record.
All states require that mortgage
companies be licensed, though licensing
standards vary in each state.
“This will enhance our regulatory
supervision over the mortgage industry.
… We’re sharing resources, trying to
focus our efforts into providing the
most bang for the buck,” said Jeffrey
Vogel, chairman of the Conference of
State Bank Supervisors (CSBS) and the
banking commissioner in Wyoming, which
will join the registry in July.
The two groups that set up the system,
CSBS and the American Association of
Residential Mortgage Regulators, say the
depository is a one-stop shop where
mortgage companies and loan officers can
fill out a standardized set of forms to
apply for a license in all participating
states. For example, if a firm already
has information in the registry to
operate in New York and wants to open in
Kentucky, it only needs to make a few
clicks on the Web to apply for a
Kentucky license instead of filling out
a new set of state-specific forms.
Planning for the database began four
years ago, before the mortgage crisis
began dominating headlines. The current
wave of foreclosures stems partly from
shady lending practices in the
high-interest subprime loan market. Some
unscrupulous lenders hid the true cost
of subprime loans, tacked hidden or
excessively high fees onto the loans,or
included prepayment penalties for
borrowers who tried to refinance. Last
year, 1.5 million homes entered
foreclosure.
The database will include unique
identifiers for each company, its
branches, owners and loan officials.
Similar to Social Security numbers,
these identifiers will follow that firm
or person throughout the industry. This
is to prevent fraudulent loan
originators from escaping punishment by
moving to another company, companies
from changing their names, or owners
from setting up new firms to avoid
disclosing past infractions.
On the registry’s first day, 289
companies began filing applications, and
55 submitted them. Eventually, the
database could grant more than 370,000
licenses to companies, their branches
and loan officers.
One group critical of the registry is
the National Association of Mortgage
Brokers (NAMB) because they say it
doesn’t go far enough. The system only
oversees state-regulated banks and
lenders, not the largest banks that are
regulated by the federal government.
“From a consumer standpoint, this
isn’t the perfect scenario because if
there’s a bad originator out there,
they can easily fall through the cracks
and work for someone else,” such as a
federally regulated bank, said George
Hanzimanolis, NAMB’s president. “If
this is about consumer protection, there
can’t be an argument that anybody
should be left out of this.”
He supports a bill the U.S. House of
Representatives passed in November that
would require state-regulated banks to
join the registry, while loan
originators at federal banks must
register with the system and receive a
unique identifier. See for yourself - HERE's
a Link to it. CLICK
HERE and Tell us what You Think about
this on our Discussion Board
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