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Notice to Loan Officers/Brokers

Posted By Barry Ritholtz On August 7, 2007 @ 10:30 am In Credit,Derivatives,Psychology,Real Estate | Comments Disabled

The following comes from a major U.S. mortgage writer. It is typical of what has been going on in the mortgage business over the past few days:

As you are probably aware, the mortgage industry is going through a major disruption. In response to these market conditions and to enable ******* to continue to serve our customers; we have made changes to our loan eligibility, appraisal rates and repricing of loans in the pipeline.

  • Rate exceptions by AE’s will no longer be allowed
  • Only full doc loans allowed
  • No Non OO (Owner Occupied) and second homes
    allowed
  • Increased disposable income requirements on D/R’s > 50% from $2000 to $3000
  • No refinances of Vacant Properties
  • No refinances of properties listed for sale in the last 3 months
  • Limited ltv’s on homes listed for sale > than 3 mos but less than 6mos for cash out refi’s 
  • Loans in the pipeline will be repriced according to the current rate sheet unless they are in ‘"docs out" status or are Purchase transaction types in "Conditional Approval"
  • All loans in the pipeline that are NOT O/O Full Doc must fund by August 17
  • Appraisals must be less than 90 days old
  • Appraisals must contain 1 comp  sale< 3mos old and 1 current listing. All other comps provided must be < 6mos old

Thank you for your understanding; we realize the impact this will have on you and your customers however in order to continue to stay in business we felt it necessary to make these unfortunate
changes.
   

~~~

Now if only this had been sent out, oh, say about 3 years ago . . .


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