Blog Category: underwriting

Change of Circumstance Form? Needed When Marrying, Divorcing, Breathing, Moving and Dying?

What in the whole wide universe is a Change of Circumstance form? It sounds like the most bureaucratic, idiotic, useless, pointless, and needless document ever. Wise reader, it is. As part of recent RESPA law changes, we now have to issue a mortgage borrower a Change of Circumstance form any time we move a muscle, any time we cross the room, any time we use the restroom, we must alert the mortgage consumer as to all comings and goings and changes in circumstance! It is critical! It is a must! It is the law! I am of course being sarcastic, but for the love of all things logical, pure, and good, Read More

Unreimbursed Business Expenses Hurt Me? Help Me?

Unreimbursed Business Expenses (UBE) is one of the newest issues to trip people up on mortgage applications. Fannie Mae and Freddie Mac have really cracked down on enforcing that lenders deduct any UBE from a mortgage borrower’s income. UBE are expenses that an employee pays that their employer does not pay and also does not reimburse them for. So if you tell me you earn $100,000 a year, Read More

A Tsunami Of Loans!

Mortgage volume ebbs and flows, like a tsunami. Sometimes it comes rushing in and business gets heavy and underwriting turn times swell to 2 weeks from 3 days! And then the tide of business eerily rolls back out to sea, and underwriting turn times get normal again. So when you start a loan process and the loan officer tells you can easily close a loan Read More

Gift Money And The Gift Tax

I often have people ask me if they can lend their son or daughter money instead of giving it as a down payment gift. Or some want to lend the money and then forgive the loan over time to avoid the gift tax. It seems many want to help their family but avoid taxes while they do it.

First, from an underwriting and mortgage guideline standpoint, this is not an option. Read More

What Is A LoanSafe?

There is a service called LoanSafe that attempts to root out mortgage fraud for lenders. One of the most interesting thing it checks is to see if a mortgage borrower has any interest in any way, in any other property. This way an underwriter can check and see if a borrower owns other property they did not disclose, or rents another property, or maybe is a partial owner in another property. The service checks numerous databases to see if your name Read More

Back In The Old Days

I always hear how people miss the good old days. I am not sure I do. I prefer progress. But lately, the mortgage industry has been regressing, and I would say that we have not been making progress; we have actually been going backwards. It seems the mortgage process has swung from too easy, to too strict, and now to downright ludicrous. There is nothing that Fannie Mae wants undocumented that is related to a mortgage borrower’s finances, and I mean that literally. So I understand when someone says to me the following, Read More

Rough Day?

Rough day? I had an experience recently I’d like to share, so people understand why underwriters are so rigid in requiring what Fannie Mae mandates, and they require it to be submitted prior to closing, with no excuses. This is important because there are times where an underwriter requires some documentation that sometimes cannot be provided immediately by the client. And the client inevitably asks Read More

Don’t Shoot The Messenger!

Do not shoot the messenger. It is a fun cliche, is it not? However, it is more than a cliche, it is truth. Why do so many of us act like three year old children when given news we do not like? The mortgage industry is currently full of messengers and full of hard news to deliver. The news is usually fairly innocuous, but people do not take it that way. Below are some examples where the response I hear from people leaves me puzzled. Read More