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Many of you have already read my blog on "soon to be required" licensing for loan officers. It can't come soon enough! Just this past month, I've learned of several loan companies closing their door, laying off their staff and cutting way back. It appears that there has been so much fraud and inadequate knowedge among loan officers, Realtors, etc., that everything is now falling apart. Most of the companies going under deal primarily with home buyers with financial problems or "sub-prime loans". Apparently, many lenders didn't really care too much about whether or not the buyer was really able to afford the mortgage payment, but just wanted to get that loan through. Dishonest buyers have been able to log on to the internet and get falsified W-2's.
I have a personal friend who is an underwriter working in A paper as well as sub-prime. She has enlightened me on how much fraud there is between some lenders and some Realtors and even some title companies. Two large companies that she has worked for have gone under. Now the latest news is that another mortgage company has shut down. Though I imagine this "fraud" has been going on since the beginning of time, I think that the unusual home buying craze of 2004-2005 and the investors and the "quick money" is what drove this "nail in the coffin." Be sure to work with a Realtor that has a good reputation and who can provide you with names of lenders that are experienced and in compliance with the laws. Buying a home is SUCH a huge investment - why not do your homework and get the best. There are still "good" lenders out there who will do a subprime loan, but you need a lender who knows what they are doing. In my experience, many, many don't.
The
Arizona Republic, reports that regulators have shut down Mesa-based
Eagle First Mortgage citing illegal practices. "Eagle First is surrendering its
license as a result of multiple and repeat violations," said Felecia Rotellini
of the Department of Financial Institutions, which regulates mortgage firms.
Eagle
First Mortgage has been cited for offenses before. In early 2004, it was fined
for 10 violations. Some of its recent violations include laws it had broken
three years ago, according to the Department of Financial Institution's consent
order. Sanchez started Eagle First in 2003. The firm, which worked with many
first-time buyers with credit problems, started to rapidly add branches in 2004.
Several
employees also were named in the complaint. Those employees are not licensed and
could get jobs at other mortgage firms. So could Sanchez, as long as he does not
apply to be a broker again. Brokers must be licensed. It's estimated there are
as many as 18,000 unlicensed people taking mortgage applications, negotiating
rates and getting loan commissions statewide. Legislation recently was
introduced in Arizona to license all loan officers and originators to help crack
down on bad loans and mortgage fraud. The
firm, one of the largest that Financial Institutions has shut down, has until
March 14 to finish any outstanding loans and close its doors. For the complete article, I have provided a link.
http://www.azcentral.com/arizonarepublic/news/articles/0225mortgageshutdown0225.html
Today's active listings total 46,453. Be sure to call me if you have a home to sell or if you are ready to make a purchase. The rates are still low, and the builders are clamoring to sell their inventory homes. Have a great week!!
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