For REALTORS Only: Did Your FHA Lender Get It Right?

By
Mortgage and Lending with SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171)
http://actvra.in/8yN

MI Premium Increase for FHA Case Numbers assigned after April 17, 2011

More than one Buyer/Borrower got burned on April 17th, the last day one could get an FHA Case Number assigned to the loan application in order to lock an FHA loan at the old MIP rate of .90% instead of the current 1.15% MIP.

The last day to get that all-important FHA Case Number was Monday, April 17th.  (This was not the last day to lock the FHA loan.)  So the question was, "What did I need as a lender from your buyer in order to get the FHA case number?"

HUD Handbook 4155.2 1.A.2

Things are changing very fast right now in the mortgage industry, and the changes don't ever seem to be in the borrower's favor.  When in doubt, ask your lender to document what he or she is telling you. 

We distributed this reminder from HUD:  "Mortgagees are reminded that they must request case numbers only when they have an active loan application for the subject borrower and property in accordance with HUD Handbook 4155.21.A.2...  Starting with Case Numbers assigned on 4/18, a certification will be required that this is a live deal.

Pencil advertisement from 1947: Mike in Tucson, AZ mortgage lenderWhat Is A Live Deal? You need a PENCIL

How can a REALTOR know if the buyer's transaction is a Live Deal?  We use the acronym PENCIL to make sure we have a "live deal."

Property (signed contract by all parties)

Employment

Name of Borrower

Credit

Insurance

Lock

FHA used to allow lenders to order a Case Number with just the borrower's Name, Social Security number, and address.  That's not the case any more.  The new RESPA definition of what constitutes a Loan Application has changed that, since you can't have an application without a property.  (TBD is not an address...  LOL)

Takeaway for REALTORS

Your obligation to look out for your client's best interest means that you need more than a passing knowledge of changes in lending rules.

Use the SEARCH function in Active Rain to see what lenders are saying about particular rule changes, and don't be shy about asking your favorite lender to send you documentation in advance about upcoming changes.

After all, your lender won't make a living without good REALTOR relationships, and your deals won't close if your lender hasn't done his/her homework. 

Takeaway for Lenders

The old model of the LO finding the deal and the processor making it work is dead and gone.  We have to be knowledgeable and then communicate that knowledge to our borrowers and REALTOR partners.

_____________________

I'm Mike in Tucson, your preferred Tucson Arizona Mortgage Lender.

NMLS #223495

SUNSTREET MORTGAGE LLC ~ Correspondent Mortgage Bank
Offices in Mesa, Tucson, Sierra Vista & Nogales

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Rainmaker
750,706
Gabrielle Kamahele Rhind
KGC Properties LLC, Tucson Property Management & Real Estate - Tucson, AZ
Broker/Owner

HI MIKE!  You were out of town when I had to switch lenders and the old lender never mentioned the MP change.  The second thing out the new lenders mouth was the change -- Realtors need good lenders to help them take care of their clients!  Thanks for this well said post!

Apr 20, 2011 01:47 PM #1
Ambassador
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Mike Jones
SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) - Tucson, AZ
Mike Jones NMLS 223495

Gab,

Realtors need good lenders to help them take care of their clients!  Amen to that!  Thanks for being the first to comment.

Mike in Tucson

Apr 20, 2011 01:55 PM #2
Rainmaker
722,073
Juli Vosmik
Dominion Real Estate Partners, LLC, Scottsdale, AZ - Scottsdale, AZ
Scottsdale/Cave Creek, AZ real estate 480-710-0739

Mike, very timely and informative post.  Thanks for keeping us up to date. 

Apr 20, 2011 01:57 PM #3
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721,130
Mike Jones
SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) - Tucson, AZ
Mike Jones NMLS 223495

Juli,

You're welcome!  See you on your blog.

Mike in Tucson

Apr 20, 2011 05:30 PM #4
Rainmaker
687,553
Kay Van Kampen
RE/MAX Broker, RE/MAX Solutions - Springfield, MO
RealtorĀ®, Springfield Mo Real Estate

Mike, keeping up with all the changes is almost impossible.  Glad there are good mortgage lenders out there like you to keep us informed.

Apr 20, 2011 09:46 PM #5
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Barbara-Jo Roberts Berberi & Corinna Birgit Cromartie
Charles Rutenberg Realty - Palm Harbor, FL
Palm Harbor & Dunedin FL Residential Real Estate

Mike - you are the best when it comes to keeping us up to date on what is going on in the mortgage industry! thanks!

Apr 26, 2011 08:34 AM #6
Rainer
63,700
Brett Reichel
Pacific Residential Mtg., LLC - NMLS 1477 / WA CL-1477 - Clackamas, OR
MLO 210215

Good job Mike - I can't believe that lenders wouldn't take better care of their clients.

Brett

May 02, 2011 07:31 PM #7
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Mike Jones

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