Foreclosures and Everyone wants to be a STAR

I really don’t follow the statistics or the bad news in the newspapers. No, not at all.

But on average, we’re receiving at least one referral a day—that’s about 7 to 10 per week—of people in trouble. They’re one or two months down on their [tag]mortgage[/tag] and they want to save their home. Pretty much there’s nothing we can do. There’s no value in most cases to refinance the client, even if it’s going to be at a terrible fixed rate. In just about every instance we’re passing on the referral.  We don’t even want the telephone number.

Many of these clients are Hispanic and they have those nightmarish I/O Option ARMS that have now adjusted to a higher rate. Once again I’m thankful of the fact that I refused to originate those types of loans for my clients—many of whom are Hispanic. Of course, in refusing to originate anything but 30year fixed rate loans, I lost a lot of business in the past three years. So much so that my originations within the Hispanic community—which has been a consistent 80-90% of my business since 1997—dropped off significantly. In fact, these originations went to less than 10% of my business.

Still, I stood firm. I knew what was waiting down the road for any client with these types of loans and I simply would not, and could not, in good conscience originate these radioactive loans for my clients. Too, I never subscribed to the “…your house will go up 25% in value and you can [tag]refinance[/tag] next year…” theory, either. No, I never said that; not ever.

It’s painful to speak with these folks who are in very real danger of losing their homes. I started in the business helping people out of [tag]foreclosure[/tag] in the early 1990’s. I learned a lot about the mortgage industry, people’s dreams of homeownership, and how to get loans approved through that experience. But today there’s nothing I can do to help most people in this situation.

And many [tag]Realtors[/tag] are listing “[tag]short sale[/tag]” foreclosure homes. This means the bank holding the loan has to agree to take less than they’re owed on the mortgage before the house can be sold to another buyer. This, then, seems to be the latest hot trend in real estate sales.

It disgusts me.

Recently I’ve been speaking to a lot of “experienced” mortgage originators. Not only speaking to them, but interviewing them to work with our company.

The common denominator with this bunch of bananas is they all have little experience with “real” mortgage loans, care very little about their originations after the fact, and ALL want to someday (soon) own their own company. They all want to be a star and the captain of their own ship.

That’s all fine and dandy to want to be a successful entrepreneur and business-owner. But there’s something amiss when you have very little understanding of the “big picture” of our industry and don’t even know the basics of underwriting even a fundamental FNMA or FHA mortgage loan (you would not believe what comes out of their mouths when we ask questions aboutf basic guidelines!).

So these “burger-flippers” (that’s where they really belong, after all) continue to screw up our industry, home buyers and homeowners, and ultimately the economy. You want to be a STAR? Put in the time, gain the experience, develop some ethical standards, and learn the damned RULES!!!

Success is long in the coming and requires the investment of your character as well as your time and sweat.

Yeah, again, I have to say, “It disgusts me.”