02.27.07
Posted in Industry News, Money and Finance, Mortgage and title Fraud at 9:21 pm by Jeanne
“As most people know I have agreed to shut down Eagle First Mortgage. The Department of Financial Institutions was gracious in allowing loans not yet closed to continue closing so as to not hurt the borrowers. We will be officially closed on March 14, 2007. I want to thank the thousands of clients that have done business with Eagle First Mortgage over the years.
Sincerely, David Sanchez, CEO Eagle First Mortgage”
Sanchez started Eagle First in 2003, quickly growing the company to 75 offices.
The company franchised itself out to the point that “there was no control over the branches,” said Felecia Rotellini, superintendent of the state financial institutions department. “That’s a recipe for loan officers being tempted to engage in mortgage fraud,” she said. Regulators described more than 100 illegal money transactions, loan activities and hiring practices. See full article at Eagle First.
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02.24.07
Posted in Industry News, Money and Finance, Mortgage Problems, Mortgage and title Fraud at 6:17 pm by Jeanne
Shares of NovaStar Financial, which makes loans to people with weak credit, fell almost 43 percent yesterday after the company announced a surprise loss of $14.4 million for the fourth quarter and told investors that it might not make enough money to pay dividends for the next four years. Subprime lenders are not obligated to follow the tougher regulations that apply to commercial banks and as a result loans are available to virtually anyone – creditworthy or not. Is this a sample of what is to come?
See the NY times full article here.
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02.19.07
Posted in Money and Finance, Mortgage Problems at 10:48 pm by Jeanne
BasePoint Analytics, a provider of scientific fraud anaysis and consulting services, announced the results of a new scientific study which found that up to 70 percent of early payment defaults (EPD) on mortgages can be linked to significant misrepresentation on the original loan application. The purpose of the study was to investigate the link between fraud and payment trends during the early life of the loan.
The study concluded that loans with gross misrepresentations were five times more likely to default in the first six months than others. More importantly, the study concluded that models could be used early in the loan process to help lenders predict those loans likely to default within the first six months. This would allow loans to be rejected pre-funding. According to BasePoint, its product, called FraudMark product could accurately identify approximately 40 percent of consumers who, if funded, would stop paying within the first six months.
To read a more complete article, see BasePoint Analytics Article. http://www.basepointanalytics.com/newsfiles/NR%20-%20BasePoint%20Finds%20EPD%20Linked%20to%20Fraud%2002-12-2007.pdf
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02.08.07
Posted in Industry News at 6:32 pm by Jeanne
In a strategic move, LandAmerica announced that it is moving underwtriting offices for Commonwealth, TransNation, and Lawyers Title (previously domiciled in Pennsylvania, Arizona and Virginia, respectively) to Omaha, NE
“Consolidating the underwriting companies’ domicile and corporate governance into one state enables LandAmerica to comply with a single set of regulations administered by the Nebraska Department of Insurance. Nebraska tax law allows LandAmerica to save on retaliatory premium taxes, which are computed and charged on policies written by the company.” says emediawire.
Read full LandAmerica Article
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02.02.07
Posted in Mortgage Problems, Mortgage and title Fraud, Regulation of Insurers and Banks, Value of a title searcher at 10:36 am by Jeanne
Are you better off today than you were ten years ago?
Whose fault is it. Let’s blame all errors, poor judgment, misconduct, wrongdoing, transgressions, egregious behavior and crimes on someone else. It’s easier to point the finger than to take responsibility. Sub-prime Mortgages, Predatory Lending, or One in Three closings with Title Problems? Our actions damage the Public and their perception of the mortgage and title industries.
Cases in point:
President of Mortgage Banking Company
The NY Times sites a mortgage banker who “acknowledges that standards were lowered, but he placed the blame at the feet of investors and Wall Street, saying they encouraged Ownit and other subprime lenders to make riskier loans to keep the pipeline of mortgage securities well supplied. “The market is paying me to do a no-income-verification loan more than it is paying me to do the full documentation loans,” he said. “What would you do?”
See NY Times article
Mayor of New Orleans
Mayor Nagin blames race, class, and President Bush for the devastation caused by Katrina.
Baltimore Sun article
Global Warming
Beijing shifts the blame for Global Warming on developed countries.
Sydney Morning Herald
When will we, as individuals in the mortgage and title industries, begin to take personal responsibility for the outcome of our actions? We need to enlighten the public and the media that subprime lending and fast-and-cheap titlework is NOT okay. Just because someone suggests you do something unethical (give the borrower a mortgage that doesn’t fit but makes you money, or do a last-deed-of-record only title search) doesn’t mean it’s the right thing to do. We will all pay the price.
Take individual responsibility for your actions, and quit pointing at everyone else. Take a good look at your situation. Are you better off today than you were ten years ago?
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