Lykken on Lending

[David] Alice Alvey, let’s get over to you. Alice Alvey, who is Vice President of Partner Education and Training in Union Home Mortgage is here with Legislative Update. It’s good to have you here. Appreciate you.

[Alice] Thank you. Hi Dave. Hello everyone and Bill teed us up today very well ahead of the program and we have memos that came out from both Fannie and Freddie under the direction of the Federal Housing Finance Agency that are going to start floating out for all of us, the first generation homebuyer criteria and so their memos and then their accompanying guides that went with it, are very full of different initiatives. As a matter of fact, the MBAs Spotlight from today’s program on the attorney opinion letters is a component of that in trying to reduce title costs and as you guys have mentioned, we are not fans to jump on that bandwagon right away because I like my title insurance. I’m not sure I want to just go with an opinion letter. I think a lot of the industry is indicated is still. thinking that through. But nonetheless, that gives them the ability to say they’ve done something and so what they’re doing now that doesn’t have any impact on the market from what I can see is defining a first generation home buyer and asking the industry as an option to fill in a form to have people certify that they are not only a first time home buyer but a first generation home buyer. Which involves having their parents defining a parent and also having their parents provide their address and that’s all we would do. We would include a special feature code or IFI if you’re a Freddie user and make sure that the loan is identified as meeting the criteria and having filled in this form. There isn’t a price advantage or a special new program for these as yet. Essentially, it looks like they’re trying to collect data and Bill, as you mentioned, how do you verify somebody is a first generation homebuyer? So I’ll let you jump in here and then we can talk more about it.

[Bill] Yeah, thanks, Alice. So I’m not a very good poker player, right? My subject line in my email is bringing this up is liar loans are back. There’s clearly something coming with this and it just feels like it’s going to be built on the back of something that really isn’t going to be able to be supported and documented or if they come up with a way to do it, guess what it’s going to do. It’s going to add more documentation and increase the cost to originate. The other thing that I thought about is the response we’re going to hear now is going to be, although we’re just gathering data to make policy decisions in the future. Okay. I don’t know. I always felt like to make decisions. You need good, accurate, verifiable data. The build off of this is just going to be assembling a pile of garbage for somebody to make an agenda driven pronouncement off of down the road and don’t think for a second that this is not the nose of the Trojan horse. Yeah, there’s a lot of directions. This is going to go and it just doesn’t feel like it. It’s going to be well thought out and risk vetted, etc.

[David] Yeah, I liked when you said liar loans are back because it does really get us into the point of what are we going to have as facts behind this? And it’s pretty interesting. Yeah. Thanks so much for bringing this up. Marc, Allen, David, any comments you want to add to the first generation home buyer loan?

[Allen] No, very well said by Alice and team here. Great conversation.

[David] Good Alice. What else do you have for us?

[Alice] I think it’s a worthwhile read and Bill, what you described is something that a lot of people I think are wondering is what is really going to happen out of collecting optional data and how good will the data actually be for anybody to come up with a reasonable conclusion on then what can you do with it? So I think more to come but that was really the main thing I wanted to report on that aspect, was the fact that the form is optional, the FAQs really come out and explain that, yeah, in the future, there could be documentation requirements, but we don’t know any of it yet. So wait and see is really what it is. One last quick thing, VA did issue a circular on a new form for assumptions. Assumptions sit in the background in servicing. Just want to make sure everybody saw this form. They do want it delivered to the vet borrower as soon as possible. I really like the form. We get calls from people, who are veterans selling their home. The realtors, said, Oh, sell on an assumption and doesn’t know the facts. Sorry, realtors. But this is very complicated for the veteran to understand that they won’t get their entitlement back and this disclosure, I think, puts a little bit more fear and then even most people are communicating to the customer up front. And VA, I think, did a good job on this one. So get it signed up front. Make sure your seller’s understanding the consequences of not getting their entitlement re established. So there would not be a substitution of entitlement. So I know a lot of realtors do a great job, but the mortgage side is our expertise and we’re the ones who need to decide if an assumption is a good idea or not. So that’s my two cents, Dave, back to you.

[David] Thank you so much, Alice. Appreciate it so much. Check out all of Alice’s comments. We post them out there on each one of our segments. We post out. Bill’s and Alice’s and Alan’s and Mark’s. All the comments are published separately on our website as we’re tracking the views on those and listens on those, but it’s a really solid. Thank you, Alice, for being there. Check out all of Alice’s comments on our website.

---

 

Alice Alvey, Master CMB
Vice President Partner Education and Training at Union Home Mortgage
8241 Dow Circle
Strongsville, OH 44136
D: 440.420.4294
C: 248.941.1939

She handles development of their World Class Training program designed to support UHM partners and organizational effectiveness.

Prior to UHM, Alice served as Senior Vice President at Indecomm leading the Indecomm-Mortgage U division, Internal QA and Compliance and SaaS technologies. Indecomm acquired Mortgage U in 2013, where Alice was President/Co-founder, providing training and consulting since 1996. Prior to MU she served as SVP of Operations at a national bank overseeing operations for wholesale, retail and correspondent from underwriting through servicing, and compliance.

She has been in the trenches of mortgage lending operations from application through servicing for over 30 years. Her authoring work in training content, policies and procedures and the FHA/VA Practical guides illustrates her ability to bridge regulatory requirements with day-to-day operations.

Alice has been a weekly contributor to the Lykken on Lending show since its beginning in April 2009 and has made her weekly contributions to 450+ episodes!