Friday, January 20, 2012

The Latest News on Mortgages

USDA turn times for loan closings-Sellers beware!

As a result of the political climate RD was forced to offer early retirement to many of its staff and Virginia was one of the hardest in the Nation with these reductions.  So they centralized their operations and submission centers that began on December 5th.  With the holidays and through the adjustment to the implementation of this new process they have gotten so far behind that they were working on files from December 14th as of late yesterday with the goal to get to 15th today.  He did say that they hoped to catch up more quickly now that they didn’t have any more holidays for a while and that some of the days in December towards the end were Holidays and files were not received. He told me also that they have been given strict orders due to discrimination concerns they can’t pull one file and move it in front of another no matter what the reason is so.  He assured me all lenders are receiving the same treatment and no one is getting better turn times nor service.  They are not allowed to work over-time and have not been given Congressional authority to hire additional people…So it is what it is at this point.

The good news is that he said that they believed that they would begin to be able to get the turn times down gradually over the next few weeks and that they are lobbying hard for Congressional hiring authority.  He said we could do our part by letting our Congressmen know the budget cuts affect on Rural Housing.

He seemed sincere in turning their problems around but was honest that it was going to take time and patience from everyone.  The only thing we can control on our end is the communication to our Realtors, Clients, and how we prepare for our closing dates, locks, etc.  I would recommend for setting 60 day closings with 60 day locks until it gets better.

Here's another one for the band wagon!!!!

As a result of the Temporary Payroll Tax Cut Continuation Act of 2011, effective base pricing to accommodate the increased loan guarantee fee (G-Fee) for all Conforming Conventional (including High Balance) you will begin to see pricing adjustments next week from nearly all investors and an increase in rate lock extension fees..some of these will range from 25 to as much as 50 basis points….so if you have clients floating loans be careful…and watch your extension costs.  The pricing will be adjusted in the rates so there will e no need for further manual adjustments to the prices you get through Nylx, but you do need to be aware of this additional price that will be “baked in” thanks to our Government starting next week.  This only affect loans backed by either Fannie or Freddie so it does not apply at this time to government loans.

Yes that’s right..for a 2 month extension of the Payroll tax cut of 2% for all Americans…they decided to pay for it by Fannie Freddie charging servicers additional fee’s.  This ofcourse gets’ passed all the way through the channel to the consumer.  But no one’s raising taxes right?

Call your Congressmen and let them know that even though consumers might  not realize this is a cost to the housing market that you are fully aware of it and it was a spineless way to pay for a cost for a 2 month (yep only 2 months for a fee that has no limit on how long it may continue) extension to a payroll tax.  If you want the housing market to revive ask them why they put another tax on it?

Have a Nice weekend

Jamie Bailey
Branch Partner
Alcova Mortgage
cell 540-556-0994
fax 540-266-3830
office 540-772-3877


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