Paperless, Not Brainless (Posted December 19, 2016)

Full disclosure: what you’re about to read is a full-blown commercial – no lie. While I’m fairly confident it will be better than 95% of the commercials you’re forced to watch between episodes of your favorite reality show (which is a sort of commercial in and of itself, really), I won’t go so far as to say it’ll be better than some of those you see with Tina Fey or Peyton Manning.

Coming very soon, we will be offering an option that will provide greater speed, simplicity, and certainty for everyone – the real estate agents on both sides of the transaction, the buyer, the seller, the lender, and even the title folks – in the buying/selling process. Here are some key features to whet your appetite:

• Validation of income, assets, and employment will be done electronically.

o Borrowers will be able to save time by using electronic data versus collecting documents such as paystubs, bank statements, and investment account statements. We’re going to call that the “where did I put that?” feature.

• Loan application data will be validated up front making the verification of key loan data points easier and faster.

o This means the originators will have greater confidence at the beginning of the process so they can get it to underwriting more quickly. We’re going to call that the “let’s kick this up to light speed” feature.

• It’s estimated that this will eliminate appraisal conditions on 60% of all purchase transactions – we’re going to call that the “it’s about time” feature.

I hesitate to call this a “no doc” loan for a number of reasons, chief of which being the torrents of cold sweat that term induces for anyone who was in this business back in 2005-06 and stayed around to see their crippling effects on so many. With that said, though, there is a certain beautiful simplicity about the “no doc” aspect of this process: we all get the convenience of not having to hunt high and low for a single piece of paper that can make or break the purchase of a $500,000 home, but we have the security of there being someone in the transaction who is going to verify everything electronically on behalf of all parties.

With that said, I now return you to your regularly scheduled programming of watching whether she says yes to the dress or he’s going to accept help out of his 600-lb life – and you know I’m not talking about Tina Fey or Peyton Manning.

Comments

Financial Nearsightedness

Years ago when the Consumer Financial Protection Bureau was created, we had some wacko thought that part of the job of the folks filling its ranks would be to . . . protect the consumer. In some people’s view, this would mean that builders of new homes would no longer be able to dangle the carrot of “free” incentives if the buyer would finance the purchase through the builder’s in-house or preferred lender. To those same people, it just made sense that the CFPB was created to even the playing field and make it so that the consumer got the very best deal available. Well, we were wrong. Builders ARE allowed to offer incentives for using their in-house and preferred lenders despite the fact that sort of goes against the idea that the consumer is getting the very best deal available. And for most consumers, all they see is the incentive, and this computes to less money coming out of their pocket at closing – and they’re right (sort of). The purpose of today’s article is si

Topless Professionals - Nope

Fads come and go, certainly, but you can’t always tell the difference in the moment between a fad and a trend – because refusing to adapt to the trends can be limiting . . . if not disastrous. Let me share a couple of examples where failing to see where things were headed didn’t turn out well. An engineer presented the idea of a “filmless camera” to the executives at Kodak back in 1975, but they laughed him to scorn. In 2012, Kodak was forced to file for bankruptcy because they failed to adapt to the digital world. We all know Steve Jobs and Steve Wozniak, but how many of us recognize the name of Ron Wayne (and, no, that’s not Batman’s brother)? Ronny was the third founding member of Apple, and he sold his 10% stake in the company in 1976 for $1500. His shares would now be worth over $50 billion. WAY BACK in 2000, Reed Hastings approached Blockbuster and offered to sell Netflix for $50 million. Blockbuster turned Hastings down. Netflix is now wor

Sitting on the Fence Only Gives You Splinters

“I woke up this morning and couldn't find my socks, so I called information. She said they were behind the couch. She was right.” Reading the words of comedian Stephen Wright isn’t quite the same as actually hearing them with his deadpan delivery, but they’re still funny. The same can be said for timeless wisdom: whether you hear it coming directly from the lips of a wizened old sage or you read it in a little missive such as this, it’s still wisdom, right? They say a picture’s worth a thousand words, so you’re about to get 2,000 words’ worth right here: I’m going to show you two graphs that are going to speak volumes about buying power and interest rates – far more than I could convey if I tried to write over 2,000 words (and probably put you to sleep). Obviously, this first graph shows how even a slight change in interest rates can affect someone’s buying power in the real estate market. There’s a fairly big swing between what someone can a

Search This Blog