TEAM EMPOWERMENT MORTGAGE CHATTER: January 18: HUD and the NMLS; Freddie lowers 2011 production estimates; Freddie Updated Servicers; QUESTIONS SELLERS SHOULD ASK BEFORE CHOOSING AN AGENT

“When it comes to eating right and exercising, there
is no ‘I’ll start tomorrow.’ Tomorrow is disease.” – Terri Guillemets: Quote anthologist

A few weeks ago HUD announced it will begin collecting NMLS identifier information for individuals and entities participating in the origination of loans submitted for insurance by the FHA. And recently the OCC issued a SAFE Act reminder notice of the expected start date for federal registration of residential mortgage loan originators employed by banks, savings associations, credit unions, and their subsidiaries. The registration period is expected to start at the end of this month and last for 180 days, after which any employee subject to registration under the SAFE Act will be prohibited from originating residential mortgage loans without having first met the registration requirements. Check out NMLS and the notice at SAFENotice

And as this commentary noted a while back, law firm BuckleySandler reminds us that HUD issued Mortgagee Letter 2011-02. “The letter reminds mortgagees that, since the FHA no longer approves or monitors Loan Correspondents, mortgagees now must perform quality control reviews on all sponsored third-party originators (TPOs) from whom they acquire loans. Additionally, the letter states that mortgagees must create a report documenting (i) the methodology used to review TPOs, (ii) the results of each review, and (iii) any corrective actions taken as a result of their review findings. This report must be kept on file for two years.” HUDQC


In its latest downward revision, Freddie Mac estimates that mortgage originations will total $1.05 trillion this year, down from its projected $1.2 trillion last month. Most of this, of course, comes at the expense of refinancing as rates are expected to grind higher in 2011. Per Freddie, refinancing made up 69% of the total $1.55 trillion in home mortgage originations last year, but are expected to constitute just 41% this year and 35% in 2012. FreddieVision


Freddie Mac released an update for servicers, and wannabe servicers, regarding new servicing technologies. (Freddie also extended its stay of foreclosure protections for service members.) “A dynamic, Web-based solution, the Service Loans application will provide greater operational efficiencies through a more intuitive and user-friendly servicing environment for investor reporting functions, including default reporting, when servicing Freddie Mac mortgages. Read all about the 6+ pages at: FreddieServicing


Given the lower supply, one would think that, relative to Treasury yields, mortgage rates and prices should be doing ok. And they are – MBS prices are about 1.5 points off their lows (worst) last week. Friday MBS prices finished the day about unchanged from Thursday’s levels, and the 10-year T-note closed off .250 in price hitting 3.33%.

Besides earnings, this week’s news includes some “Empire State” manufacturing data today, Housing Starts and Building Permits tomorrow, and weekly Jobless Claims, Existing Home Sales, Leading Economic Indicators & the Philly Fed on Thursday. There is zip scheduled for Friday. Today, so far, we’re seeing some improvement, with the 10-yr down to 3.29% and MBS prices better between .1225-.250.

Questions Sellers Should Ask Before Choosing An Agent


Once a homeowner decides to sell their home and hire a professional agent to market it for them, most sellers will interview a few agents before signing on the dotted line. That’s a good idea. However, most sellers don’t have a clue on who is the RIGHT choice. Many sellers pick and agent based on a “connection” or similar personalities.

Unfortunately, just a good personality match alone is rarely enough these days. You need an agent who is more effective in getting results than someone you “have a good feeling about”. You are not hiring a friend; you are hiring someone to do a job.

The average agent’s listing presentation is very similar to every other agent’s presentation. And as a result, the seller really has little to judge by and they reduce their decision down to the two questions they want answered.

  1. Which agent will sell my house for the most money? (That leads to overpriced listing inventory that sits unsold because today’s buyer is looking for a “deal” and NOT overpaying.)

  3. Which agent will charge me the least to do it? (That results in getting an agent less likely to invest in improving their performance through education or technology or an agent with a limited budget to spend on the marketing of your home.)

Of course, I understand the logic to those questions (make more, spend less), but focusing on these questions alone is shortsighted and eventually costly. Here are four questions that most sellers don’t think of- questions that actually WILL give you a better indication of the relative strength of your agent.

1.) “What percentage of your listings EXPIRE? How does your number compare to the average agent in our marketplace?”


Expired listings are listings that didn’t sell during the time agreed to between the seller and the agent. If one agent has 95% of their listings sell without expiring and another has 25%, wouldn’t you want to know that? ASK!

2.) “What is your Average Days On Market?”


If the average days for homes listed “For Sale” in your market is 180 days, and one agent is selling their listings in 90 days, wouldn’t you want to know what they do differently to get their results? Conversely, wouldn’t you want to avoid the person who is at 270 days?

3.) “What is your Average List Price to Sales Price Ratio?”


There are many agents who take overpriced listings with the plan to bring the price down as seller frustration goes up. They know it won’t sell at the overpriced number, but they get to have months to get it priced correctly because you have signed a listing agreement. But, you want to sell your home, not drag out a process. Agents with big gaps between List Price and Sales Price are not doing any favors for their client. Uncover their game early and save yourself the heartache. Great agents price correctly Day 1 because they know that price is the best possible marketing strategy.

4.) “What percentage of your own listings do you sell?”


Occasionally, agents and I battle on this point, because they feel that the methods they use to market your home to other agents (to bring their buyers to your home) are more important. But I believe, an agent’s ability to sell their own listings is evidence of the effectiveness of their marketing plan to the consumer (which is really what you are hiring them to do, isn’t it?).

If I were selling my home today, in my quest to find the best agent, I would be asking different questions- questions that prove effectiveness. You may be surprised to learn that some of the most “successful agents” in terms of “units sold” have a large percentage of listings that expire or a high number of days on market or a significant gap between list price or sales price or that after they list your home they are off looking for another listing and NOT for a buyer of your home. In a twist of the old adage, “Seller, Beware”.





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