Mortgage Business A Joke
They are laughing it up in the mortgage origination industry, or so reports Inman News. "'We're coming out with a 'stated Social Security program',deadpanned Dan Rawitch,..igniting a delayed wave of laughter in his audience of listeners."
"Though joshing, Rawitch was making a serious observation about the headlong rush by lenders to market a slew of new, and more liberal, loan products intended to open up new flows of business, at a time when "traditional" originations are shrinking by as much as 40 percent."
What kind of "products"? "One revived category is the "stated income" loan, where customers "state" their income amounts, without delivering the normal documented proof.'(T)he 40-year mortgage is really just a response to the fact that the market is shrinking.' Lenders are trying to figure out "how to get that next customer into the game." One firm "will pretty much originate [any]loan if an investor will buy it."
But not everyone is pleased with the environment, "Appraisers themselves are writing anonymous letters to regulators telling them that they are being pressured by lenders to come in with agreed upon values..and if they don't come up with the value they're off the job." Temporary Link.