Author Archive

Bill Passes, now what?

Mike Mueller

Host Richard Dawson and contestants from the 1...Image via Wikipedia

As Richard would have said on the Family Feud,

Survey Says… 263 to 171

So we’ll now have a law.

My question to you is this?

Will it help?

Will it hurt?

Or are we just spinning our collective taxpayer wheels?

Comments are great, but I’d love to see you get in on the video conversation.

To do so, play the video, then hit the reply button.

That’ll fire up your webcam (yeah, you need a webcam)

Seesmic is free and your comment will show up right along side everyone else.

Join the conversation: http://seesmic.com/videos/yoT30tM5jB

So, what say you?

October 3, 2008

Understanding the Good Faith Estimate

Mike Mueller

The Good Faith Estimate Scam.

Have you heard of it? It’s out there.

Here’s the truth: A loan officer can outright lie on the Good Faith Estimate (GFE).

Surprised? Don’t be.

They can and some will lie to you for one reason: to get your loan.

There are a lot of bad people out there in all aspects of the real estate world, and there are a lot of good people as well.

The government had a great idea in mandating the GFE to all borrowers.

Unfortunately they also some left very large loop holes.

The Good Faith Estimate does not have to be accurate – AT ALL! Some of the most common tricks are:

  • Points and fees can be grossly underestimated or even omitted
  • Rates can be based on extremely short lock periods
  • Programs can be quoted that the borrower won’t qualify for
  • Third-party fees can be grossly underestimated or even omitted
  • Prepaid expenses (e.g., taxes, insurance) are often manipulated to their minimum
  • Title and escrow charges can be grossly underestimated or even omitted

If you shop by rate, fees, or Good Faith Estimate only… …chances are you are going to lose!

SEE THE VIDEO

How do you protect yourself?

Do more than just look at the numbers. Ask for references, look at feedback, and know who you are dealing with.

BTW: Most every blogger here is a highly trusted mortgage professional.

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September 11, 2008

Who was this Fannie Mae?

Mike Mueller

“And why should I care?”
To the average homeowner, they’ve never had to think about who (or what) Fannie or Freddie for that matter is.  Now that Fannie is all over the news, (i.e. the Fed Bailout) everyone’s talking about her.

First of all, her name isn’t really Fannie, and it’s not Fannie Mae either.  It’s actually Federal National Mortgage Association.    You can see where how we shortened it from the first letter of each word (F.N.M.A.) and came up with Fannie Mae.

But the question remains,

“What does Fannie do?”
I could go on and on explaining the role Fannie and Freddie play.  The simplest answer is that they provide liquidity to the mortgage marketplace.

How they do this, and the roles of the Loan Originator, the Lender, the Mortgage Backed Securities, the Investors, and all the other players is a little more complicated.

The New York Times has a great image that better explains these roles than I possibly could.

Click on the image and get to know her better.  Ok, get to know her as she is today.  Tomorrow she might be in for an “Extreme Makeover”.

Bloomberg: Paulson Plans to Bring Fannie, Freddie Under Government Control
Wall Street Journal: U.S. Near Deal on Fannie, Freddie
Washington Post: U.S. Nears Rescue Plan For Fannie And Freddie
NY Times: U.S. Rescue Seen at Hand for 2 Mortgage Giants
LA Times: Fannie, Freddie takeover possible

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September 8, 2008