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irishbull77: (January 07, 2010 11:34am)

Frank, Comparitive Market Analysis...not Competitive

Spence: (January 06, 2010 8:37pm)

Big Bank Bamboozle By Bubble Blowing Ben Bernacke Backed By Barney's Bubba's. I just HAD to say that lol

Spence: (January 06, 2010 8:30pm)

And what is that insurance company - AIG among others? Bubble Ben has managed to keep prices up - whoop-d-doo and bad for Main Street. My favorite toilet paper used to be 4.5 inches wide recently. Now it's 4 inches wide and the same price. No inflation? BS! Wells Fargo and reverse red-lining? Hell ya. Nothing gets in the way of corporate profits - not legal moral or sane. Where's the Supreme Court in this mess? BTW, Bernacke kept quoting "Taylor" in his recent speech in defense that rates had nothing to do with the melt-down. "Taylor" comes up and says Bernacke isn’t telling the truth. HAAA!! Big Bank Bamboozle

loannetter: (January 06, 2010 8:00pm)

DUH...haven't you heard of mortgage backed securities and credit default swaps? The crooks and Goldman Sachs and Morgan Stanley make MORE on the loans that default. They collect on the INSURANCE!

loannetter: (January 06, 2010 8:00pm)

DUH...haven't you heard of mortgage backed securities and credit default swaps? The crooks and Goldman Sachs and Morgan Stanley make MORE on the loans that default. They collect on the INSURANCE!

Spence: (January 06, 2010 6:44pm)

Jennifer - are you kidding me? That is outrageous, it's criminal fraud. Consider the liability you're open to in these times. Not to get on you specifically, and I hope you don't take it that way, you got to do what you got to do. I'm just saying, You might eat today with that $250 but tomorrow there might not be an appraisal profession. That is their goal. Did you figure out how much you made an hour after all your overhead? Taxes, data bases, education, lights etc... If it's less than $10/hour you might want to consider another job in the interim of the HVCC being sunsetted. Good luck - sincerely

Jennifer: (January 06, 2010 4:41pm)

Oops...meant HVCC

Jennifer: (January 06, 2010 4:39pm)

Recently I accepted an assignment for $250.00. Needed to eat. Property was luxury, waterfront on acrage. The AMC paid me $250. The homeowner made a point in telling me that he paid $1200 up front for the appraisal. This HCVV thing needs to go the hell back to where it came from.

MIke: (January 06, 2010 4:32pm)

Get this. The very first report I did for an AMC had a "fee" listed as "0.00". I was not aware at that time that it meant I had to submit a bid. I accepted the assignment, did the report and submitted an invoice. They came back and held me to the "0.00". The dirtbags got a free appraisal.

Honest ethical certified appraiser from WI: (January 06, 2010 2:04pm)

Gangster Government Gone Wild! Vote all the bums out. What have they ever done right? Give me an example please. If appraisers had more courage and did not sell out, we could all stand strong and refuse to work with AMC's. Be brave and don't cave to AMC's to work for fees from more than 10 years ago! I'd rather be a greeter at Walmart than work with AMC's. God bless the few banks I have left. If they are gone, it's Walmart.

reelyst: (January 06, 2010 2:02pm)

I did not mention the political party on purpose...I have an equal distaste for what GW Bush did at the end of his term. Understand, we the people are supposed to be the dog...our gov't is supposed to be the tail. Right now the tail is wagging the dog! Put away party affiliation and see things in the light...it's clear when you do. I'm not saying what Wall Street or Wells, (or Ameriquest, Countrywide, New Century, etc for that matter) did was good or ethical, I'm just saying realize how/why it got started and let's not look to the same people to fix it. Just say no to the kool-aid!

Jersey Girl: (January 06, 2010 1:58pm)

Desperate Home Appraiser (DHA): I'm sure you have to make a living. We (a group of NJ appraisers) are trying our best to NOT accept assignments under a certain $ amount. Most appraisers in our area have been averaging $300-$400+ for the past 10+ years for a standard/full appraisal. Now we are forced to find another job or accept half of what we have been getting. And AMCs have no idea how long it takes to complete an accurate report. It makes me sick. Shady appraisers, brokers, realtors, etc need to be held accountable if fraud occurs....not our entire industry! Geeeeeeez!

f: (January 06, 2010 1:42pm)

its unbelievable that their are people in this business that still blame one person of one party for our current econimic mess. Barney Frank did not create this mess, greedy bankers and wall street elist share most of this blame. not one politician underwrote a single loan, took a single application, appraised a property or closed a deal. we did!! it starts with principle belief that all people are equal and deserve consideration for a home mortgage as long as they can afford it. if you qualify a client on their actual income and assests and if there is a home within that range (25% of their take home is ideal) then they should get the loan. quit blaming people who are not in the business, we did this to ourselves. just because a lender will pay 5 pts on the ysp doesn't mean you take a client w/$30K/yr income and put them into a $150K home because you have a loan program (NINA)that will work for you to recieve that extra money. have some ethics based on strong, fair principles

reelyst: (January 06, 2010 1:37pm)

Sorry, I meant REOMAC 2007...Lawrence Yun was the economist's name. Wonder what he's doing these days.

Jon "Higgy" Higginbotham: (January 06, 2010 1:35pm)

Hey Frank! Thanks for this afternoons webinar! Any chance this was recorded or that you will do it again. I had to be out at appt's and listen by phone only but I could tell it was WAY helpful. Thanks again!

Desperate Home Appraiser (DHA): (January 06, 2010 1:34pm)

Jersey Girl-I hate HVCC and AMC's more than anyone in the entire world, but the reason i work for these low life,blood sucking,A-S-S-H-O-L-E-S is that there is no other job out there ,except flipping burgers for Mc Donalds.

reelyst: (January 06, 2010 1:34pm)

Yes SoCal, I do recall Barney Fife, I mean Frank, saying that...just as I remember the NAR economist giving his speech at REOMAC in 2008 saying that foreclosures were going to be isolated to the subprime market only and have no other impact on the housing market or economy in general. These guys can't possibly be that stupid. Propaganda at best.

jp: (January 06, 2010 1:30pm)

what is the lastest on hvcc going away - where does it all stand? It goes to FHA on 2-15 all of us are screwed

Jersey Girl: (January 06, 2010 1:11pm)

SoCalApprs2: I hope you are right about the HVCC...it needs to go away and never come back. I will go flip burgers at McDonald's before I start taking insulting fees from POC AMCs. I was told by one of my clients recently that the AMC they are using charged the borrower $550 for an appraisal and the lender then required a second appraisal. The deal may not even go through...so the borrower may be out $1,100! And we know the appraiser probably got paid crap while the AMC took a majority of the fee. It's disgusting!

SoCalMtgGal: (January 06, 2010 1:07pm)

reelyst - I see Barney Frank as the villain in this whole mess. Funny how he seems to be involved in every aspect of what has happened. Remember him telling us that FNMA/FHLMC were solid? Now the taxpayer is on the hook for funding them forever, a blank check. I say vote them ALL out of office and start over. I only hope the voters in Mass. are that smart. To Jscan - Thank you for the idea. So far no luck, but I'll keep trying. After 20 yrs. in this business I suddenly feel like I can't get a thing approved. I don't think it's me, but it sure gets you down. Work on!

reelyst: (January 06, 2010 12:43pm)

Once the edict was put out to lend more to the less qualified resulting in the establishment of the subprime market, all bets were off. If W/F or any other lender refused to give under-qualified applicants a loan, they would have been accused of redlining and/or discrimination...in fact that is exactly what was happening. Had the market not collapsed, the politicians would be taking bows for forcing the greedy lenders to grant the underprivileged the opportunity to realize the American Dream. Instead, since it all blew up in everyone's faces, the politicians are prosecuting firms for implementing the very strategy they insisted on....right Barney Frank? These suits and political grandstanding are a prime example of "the best defense is a good offense" and a blatant CYA...plain and simple

shagus: (January 06, 2010 12:21pm)

Brian...great comments on the declining numbers today...$8000 tax credit?...bullseye my man!!...besides all the aggravation buyers now have to go thru, how about this?, there are 60 million baby boomers in this country alone...us BB's are the ones that created the real estate bubble over the past 6 years...now that is has come tumbling down, most of us BB's have lost a ton of "equity" in their properties (if not all), liquidated assets to remain afloat, seen their incomes reduced or entirely eliminated...the spending habits of BB's have changed for about the next 25 years...nobody buying second homes anymore, nobody buying rental homes as a hobby, nobody buying boats, motorcycles, planes,etc. no only because they cant afford it but because they cannot qualify for a loan. The hypsters on CNBC etc. are full of it...the BB's make it all happen...the next generation behind us (for the most part) does not have our work ethic, our desire or our motivation.

JScan: (January 06, 2010 12:12pm)

to SoCalMtgGal: do a combo....1st at 80% and 2nd at 10%....I have a couple of small credit unions here in AZ that will do them here...I am sure some CU over there will to a CLTV to 90%...give it a [email protected]

SoCalMtgGal: (January 06, 2010 12:08pm)

HELP! I've got a 90% LTV Condo purchase, great income and reserves, but only a 719 credit score AFTER rapid re-score. Lenders says must be 720 or no deal for 90%. Any ideas besides FHA? My email is [email protected]. Thank you!

findingsolutions: (January 06, 2010 12:02pm)

First off Fannie and Freddie got into the sub-prime business because Wall Street saw that there was big money to be made with those mortgages once they were broken up and packaged and given a AAA rating. Fannie and Freddie only hold 20% of the sub-prime mortgages till this day, if they had them all we would have had across the board principle reductions allready. The investors who bought these CDO's knew there are risks involved, sometimes they win, in this case they should have lost. The american tax payer are not responsible for the private sectors losses. The private sector should be losing all there monies right now but they are being bailed out by the fed and the U.S. gov't. Why? because wall street got so greedy that they created 100's of trillions of dollars of worthless derivatives that were sold throughout the world markets. If they were let to fail, we not only would've had the worst worldwide depression ever, the U.S. financial markets would've have never been trusted again.

brian tbws: (January 06, 2010 11:53am)

Sheffy by the way is my oldest cousin in S.Cal. Its nice hearing from you. I hope all's well with you and your brood.

MookLover: (January 06, 2010 11:44am)

Banks do not have to loan in areas that they don't service. Only in the communities they have brick and mortar.

Chris Dodd: (January 06, 2010 11:33am)

I hear Chris Dodd quit today. I hope you get hit in the face by Mike Tyson you lying cheating bastard, you played a big role in ruining the life of the broker so F^^&& you!

Sheffy: (January 06, 2010 11:31am)

I been sharing you with my friends I know that are in real estate Brian-Rock N Roll Brother...from other mother- (Aunt Sue,etc..) Its cool to see you, watching you tell your stuff!

ThePhoenix: (January 06, 2010 11:28am)

A couple of comments on Wells Fargo. The issue is an act, which on the surface is lawful, that results in a disparate impact. I am not sure that redlining, as traditionally defined, is the issue. Regardless, going into a neighborhood that is predominantly lower income and having a higher percentage of uneducated or lower than average educated persons and making them loans that should be provided to more sophisticated persons may result in a disparate impact. Personally, this disparate impact is not in my view neighborhood specific but more of an individual specific impact. Most likely the plaintiffs are overlaying this individual disparate impact to entire neighborhood because that is the result. Kind of new in my mind. However, we will be seeing more and more of this type of litigation because making available to lower educated individuals, when knowing that as a fact, stated income products to get someone "in a home" in itself resulting in a disparate impact. I could elaborate.

Sick of Govt. : (January 06, 2010 10:59am)

If you were broke, YOU SHOULDN'T HAVE BEEN BUYING A HOME!!!

WVAppraiser: (January 06, 2010 10:48am)

tbone - If you misrepresent yourself as a Broker, then yes it is a violation of USPAP. But USPAP does not have any comments as to the form or format of an appraisal. With that said, any valuation format is allowed under USPAP, as long as it is not misleading. Now... what you provide to the client and what you retain in your work file are two different things. The general BPO form that I have seen has very little information on it, but just because the form is limited, does not mean that all the other research you should be doing, is able to be ignored. Basically, its the same amount of work as a full appraisal. So - USPAP violation "NO" ; Unreasonable amount of work for the fee "YES"

JohnnyRepo: (January 06, 2010 10:48am)

Your comments are wrong, they search for these loans to resell in the market. who do you really work for

(.)(.): (January 06, 2010 10:31am)

BPO's....Old news. I guess what they say is true...When the public figures it out its probably too late.

Norcal LO: (January 06, 2010 10:30am)

Rc is right this is THE situation that has the biggest implications going forward...EVERYONE SHOULD READ THIS AGAIN OK, I disagree that the 8K tax credit has not been a huge part of keeping the real estate market going. I think that it was supposed to expire in November and you had a pipeline of people trying to beat that deadline that closed either in October or early November. Then in the middle of November it was extended. It will take time to build up a new pipeline but I definately think that will happen, that is until 4-30-10. Think about this. Fed is going to stop buying Mortgage Backed Securities 3-31-10 sending rates soaring, First Time Homebuyer Credit goes away 4-30-10(I know, it can close by 6-30-10) and then FHA talking about raising minimum DP to 5% & capping DR at 45%. You tell me what this spells for the Real Estate Market in the next 6 months. I hope that someone gets it and changes these things before they become a reality because the combination of all 3 will be de

Sparky: (January 06, 2010 10:28am)

I 100% agree that there was an incentive to the WF loan officers to target subprime loans. Nothing to do with Ethnic background but financial/education of the client. No direct targeting by WF but definitly by the LO.

tbone: (January 06, 2010 10:27am)

I have heard that it is a serious violation of USPAP for appraisers to perform BPO's. Does anyone know if this is true and if so why?

tbone: (January 06, 2010 10:27am)

I have heard that it is a serious violation of USPAP for appraisers to perform BPO's. Does anyone know if this is true and if so why?

Chico: (January 06, 2010 10:26am)

I was a MoRe (Mortgage Resource) originator with Wells for a year back in the boom. ("MoRe" is their euphemism for subprime) There was a wide gap between the "A-side" and subprime departments in terms of the loan programs offered. If clients didn't qualify for the A-side's programs, they were referred to the subprime department. Many, many loans that went subprime would have easily qualified for Alt-A programs in the wholesale world, but WF didn't offer Alt-A products. This meant that if a borrower didn't QUITE make it into the A-side's programs his only option was subprime, and we were selling rates up to 10% when the 30-yr was just starting to get into the 5s. To make matters worse, the LO didn't make much money until he charged at least 3 points, and 4 points was encouraged by management (upfront fees and YSP combined). I already had experienced the broker world prior to joining WF, and I couldn't stand the way they overcharged borrowers.

Mod: (January 06, 2010 10:17am)

Michelle my only real question with that scenerio is how and who absorbs the loss the lenders will take? How do you see that shaking out. I do feel it is inevitable because there are too many folks who don't qualify for HAMP and don't have the cash difference to refinance through HARP. HAFA will help them in a short sale but if they really want to keep their home a prin reduction seems the only way.

michelle in Cali: (January 06, 2010 10:09am)

So much to say -- start with the projection that the Feds will spend some $23 Trillion before the "bailout" is over ... earmarked $13.2 trillion so far. How much they've spent is anyone's guess, but the interesting thing is that the total mortgage debt in the entire USA is only about $11-12 Trillion! If the Fed's spend $13 Trillion, that equates to $44,000 for every man, woman and child in our nation! Staggering -- double that amount if the projections are true. What would happen if every mortgage in america was paid down by 50% and reamortized at prevailing rates, say 5%? Would that not stimulate our economy? Essentially you would cut every mortgage payment in half -- freeing up capital to be spent into the economy in various ways, or saved for the future.

jp: (January 06, 2010 10:08am)

is there any home equity lenders out there

NORTHERN CALIFORNIA APPRAISER: (January 06, 2010 9:58am)

Come on, guys. I read that about 20% of sub-prime borrowers did not actually need sub-prime loans. They would have qualified for better loans, but were steered into sub-primes because somebody was going to profit from the higher fees. Big surprise - many of them were minorities. Think about it for a moment. How does somebody get away with it? Find a less knowedgible buyer. Many other folks know a little more about home buying & loans, because they have lots of relatives & friends who bought homes before & talked about the experience. In less affluent areas, you are more likely to grow up surrounded by people who never bought homes before. You just don't have the "personal database" that others take for granted. If a greedy SOB wants to maximize fees & profits as much as possible & does not care who gets hurt, what is the easiest way to do it? Target a minority area with the largest possible concentration of buyers unfamiliar with the home buying process.

Bobbi: (January 06, 2010 9:49am)

Hi Dez thank you The first is with Chase and the second is with Wells When I called Wells subordiantaion they could not give a cltv limit. DU plus won't even do new MI over 90% because the mi companies won't do it. She does not have MI so it could work if I can get some answer from the crazy Wells subordination dept. thanks

Modgirl: (January 06, 2010 9:45am)

brokebroker I just feel that at some point we will have to see some principle reductions. Not that I think it is good for anyone but otherwise like the guys said people who can afford their houses, don't qualify for a short sale or just can't sell their homes will just be walking away. We are dealing with a guy who owes $125K and has his house listed for 60K and no bites. without assistance it is just another empty house

daleppard: (January 06, 2010 9:39am)

socal- thanks. it is [email protected] thank you.

Turnip: (January 06, 2010 9:35am)

I don't agree with the analogy of this not being in Wells best interest. If you are required to lend via CRA so that you can exceed capital requirements, and you think there is a high possibility of those loans going south, why wouldn't you want them concentrated. If Wells was a huge walking bloodbag, and they knew they were going to take a hit, would they: rather get a pistol in the foot (concentrated in one area which won't kill them - it's not that important), or a shotgun blast to the torso (spread throughout more important and vital areas)?

SoCal Mortgage Broker: (January 06, 2010 9:31am)

daleppard: I have an email from HUD on 12/22/09 that says the regs have been delayed to 2/15 and that a Mortgagee Letter will be issued. If you want to post your email address, I will send it to you.

BrokeBroker: (January 06, 2010 9:30am)

Fat chance on principal reductions in a loan modification is due to the shared loss provisions given by the FED (read, us the taxpayers) in the takover agreements of banks and servicers. As long as we pay the banks more for foreclosures, there will be no principal reductions on loan modifications. Another feather for corporations and stick in the eye for homeowners and taxpayers.

Ronny1958: (January 06, 2010 9:19am)

Otherside: GREAT position. We are required to use common sense. If you have a deal and you settle you better be able to stand in front of a judge and justify why you thought this borrower could make the payments. We are required to ask ourselves this question. I asked Scott Borison of Legglaw.com MD specializing in mortgage law and he states this: You do your best. Treat the bor fair and make sure you disclose properly… but the issues come when the rules are not followed. You look at paystubs and then go NIV. You qualify the loan on a single income because of the COB credit and place the BOR into an NIV. You flip loans and the excessive profits just keep rolling in. "Otherside" I do not refuse qualified persons, but I also do not structure loans that will keep them in B paper or ignore what I know to be true. These are the issues we are speaking of. When the written programs are followed to the T by the LO many would be defaults would never have accrued.

Appraiser in Central CA: (January 06, 2010 9:14am)

Appraiser's have to follow USPAP whether doing a BPO or an appraisal. In following USPAP, BPO's are not really economically feasible to do. It would be worse than working for the cheapest AMC. The smartest banks are getting at least a BPO and an appraisal. That way you have an agent and an appraiser giving an opinion of value.

Obamanomics: (January 06, 2010 9:10am)

Time to pull out the textbooks and financial history from the last 3 decades, it all started with Clinton et al and form HUD boss Cuomo who were pushing minority housing for years and squeezed Fannie and Freddie and the lenders to make these funds available as they saw homeownership as a right and not earned. Of course 90% of the population will never know this because everyone would rather watch fudgeing MTV or the Hills, so wall st, govt etc will continue to get away with their ways. fudge them all because of course it was the brokers fault..right folks. Oh yeah and Health care is the next right...obamanomics and his monkey boys will ruin the country with this one

SoCalApprs2: (January 06, 2010 9:04am)

Jersey Girl- Fellow appraiser here in the SoCal. The type of appraiser who is enjoying AMC work may be the type who doesn't like to market themselves at all and are not comfortable in defending their completed reports. AMC work comes, they do it and their done. What they are failing to see is there is only 10hrs of sun light a day. So how can one drive farther, try to squeeze in 4 to 5 appraisals a day, type them up over an average of 2 hrs each, and call themselves making a profit? I tell you how. I know of one appraiser who is sending out trainees to do the photos and write down particulars, fill in boiler plate templates, email the templates and photos to him, he sits in his office all day receiving the reports, looks them over, signs them, and moves on. This is why the appraisals are all jacked up. But hey, they are happy to do this. Is this what an appraisal has come down to? Hang in there. HVCC will soon be dead, FHA is not going to follow HVCC, we will prevail!!

The Otherside for thought: (January 06, 2010 8:56am)

If you have a loan program that I qualify for and you refuse to give me that loan.. it sounds a lot like discrimination to me. There is an argument that a loan officers job is to take the qualification of that borrower and search for a loan program they qualify for... not to say you Mr. borrower are stupid and even if I have a program you qualify for I refuse to give it you.. that sounds like your giving investment advice or flat out discriminating against the borrower. what gives the loan officer the right to choose who gets the loan and who does not?

ILL Appraiser: (January 06, 2010 8:50am)

Brian-What's it going to look like? Are you privy to inside info?

daleppard: (January 06, 2010 8:49am)

But where does it say it was postponed?

brian tbws: (January 06, 2010 8:46am)

It's Feb 15th and it wont look anything like HVCC.

daleppard: (January 06, 2010 8:44am)

Ok guys there has been rumblings on here that FHA has postponed the HVCC style odering process. I have heard many lenders say that they are not having to do it yet. My company says January 1st. because they cannot find anything from HUD. Can you please point me in the direction? PLEASE?

WV Appraiser: (January 06, 2010 8:44am)

Ronny1958 - I apologize for misunderstanding your point. Icommend any person who has the ability to consistantly look at wad of cash, and say "NO" for no other reason then principle. Good job to all you honest and ethic professionals! Its tough working in a field so full of dishonest, greddy people that give our professions a bad name!

Cal RE Broker: (January 06, 2010 8:43am)

To James the appraiser. Potential listings is the game. I ususally drive within 5-10 miles, requires 3 pics of subj, 3 sales 3 active/pending from MLS or title. I do them in groups 3-5 a day. And only when I have the time. Prices are as low as $35-$125 high price on a rush.

Ronny1958: (January 06, 2010 8:30am)

brian tbws: This is why that LO lasted one deal with us. Just because we can does not mean we should.... There is a time and place for every loan. Brian, I never was able to feel good about a big payday simply because a borrower was down or un-educated. Extra work deserves extra pay, but 200bps for A paper and 600-800 bps for B paper and then repeat it. This seems a little excessive. You and I may never write loans like this, but some owner, some manager will always encourage it. It is all about character. I love this business. I love how it makes me feel at the settlement table when we all have done our jobs and the client is now a homeowner or we saved the home (saved a family) My industry peers are actually the group I look to for a little validation. If my peers are proud to know me, then I am doing right by my clients and my them.

That Tony Guy: (January 06, 2010 8:24am)

Glad to see you guys did away with the skipping down the street scene to start the show off and got right down to biz. Hope that will continue, because minutes are precious, and I think were all looking for good solid info and not entertainment. Thanks and keep up the good work!

Central valley: (January 06, 2010 8:19am)

I saw something similar to this Well's deal a few years ago when I was working for a large lender. It was caused by pressure from the regulators to increase the lenders CRA quota....

Evergreenappraisers: (January 06, 2010 8:19am)

Not a huge fan of Wells as they are expensive, but let's be realistic here. If Wells didn't lend to these borrowers in this particular neighborhood, weren't there like 15 or 20 net brokers lined up who would? New Century, Top Dot, Countrywide, and a huge list of others were there to offer the loans to these folks. Wells was simply taking their piece of the marketshare as any business in the same environment would have. They didn't create the product, they were competing with the market. If a huge demand for purple Yugos erupted, would you fault GM or Ford for producing a competing product to earn a share of that market demand? I agree on the CRA comments. Barney, if it weren't for your recent creation of HR 4173, I'd say you were completely worthless. As it stands now, at least there's one decent piece of legislation we can give credit. You still need to go, however.

FED up: (January 06, 2010 8:15am)

Wells Fargo was the lender for CRA. which was design by federal law to require banks such as Wells to lend in the those areas, zip codes, neighborhoods. so now goverment sue banks that were forced by goverment to lend in those areas. just lovly.

So Cal Broker: (January 06, 2010 8:06am)

Hi Frank- I'd love to read the filing from the court to see just what WF is being accused of, but I don't think I'm missing the point at all. In the video you said, "minority communities." Your argument in favor of WF was, "Why would they target a concentrated area?" The answer is because there were GAZILLIONS of dollars to be had. The fact that these areas are minority communities makes it that much easier for the banks. They understand very well that generally speaking, "minorities" are less likely to ask questions and will just sign on the dotted line. It didn't matter that entire neighborhoods were being victimized. The fact that they were poor, under educated and yes, minorities meant that they were the perfect target.

Ronny1958: (January 06, 2010 8:06am)

WVAppraiser, I think my last post tells you where I/My company stands on excessive charges. I agree just because we can charge does not give us the free pass. There were NIVs we would not do while they fit programs. I lost Realtors who knew I really did qualify bor's and would not throw them into NIVs because they could make a buck. You simply took my comments out of context.

btian tbws: (January 06, 2010 8:03am)

hi ronnie, even subprime loans had options of buying down rate with ysp. i thoink your guy chose to gouge. That also was an industry problem not unique to wells

James the Appraiser: (January 06, 2010 8:02am)

BPO - $80 - Ha Ha, some one tell me how much work one of these requires. I would like to know, I have never completed one.

Ezradams: (January 06, 2010 8:00am)

Realtor BPO's are illegal in New Jersey unless being performed for the purpose of listing a property. (No mortgage, divorce, estate, tax appeal etc. BPO's are allowed) As per state law, valuations must be done by an appraiser. $80.00....no way, a proper valuation on a residential property is more like $350+

RGianna: (January 06, 2010 7:59am)

It anyone could remember many years ago Ford Motor Credit was brought up on charges of unfair lending practices because the rates and fees charged to minorities where much higher than the fees given to white collar educated non minorities. Any statistic could tell you that minorities are less educated than non-minorities, and if they are not educated they would naturally be able to be sold higher fees and charges, originators are sales people and paid for performance. Ford lost the case and had to pay millions in the lawsuit. Government has learned nothing from that. Years ago our company implemented a simple system where if a particular client, regardless if educated or not, would fit into a debt to income and credit score range and that result would dictate the actual rate and fees, (FNMA and FREDDIE new Risk based pricing module)Every client got an equal and fair terms compared to everyone else. Allow lenders and brokers to set their own fees and submit them on file every year. RG

Ronny1958: (January 06, 2010 7:54am)

Frank, I love you guys...But when you have LOs that are knocking down hundreds of thousands of dollars in income settling loans in the inner cities and with minority borrowers and they are turning these loans over and over while nobody is asking questions....while these Los are receiving company awards for their production…YIKES! I had a new LO bring his first loan into my shop and the fees and total income were well over our company average and as soon as I found out it was a black single mom I went nuts. I would not have permitted it to settle regardless what category the borrower was, but I am extremely careful of protecting those who cannot protect themselves. Just because we can charge these fees does not give us the freedom to do it. This is why the lawsuits. While they may get thrown out they will change company policy.

Modgirl: (January 06, 2010 7:53am)

Hey TBWS I am in the loan mod biz and am waiting for principle reduction legislation. Especially for homes in California. One good note is the new HAFA regulations streamlining the short sale process so all you Realtors need to read up and be ready for more paperwork. Or of course find a good processor like me!

Jersey Girl: (January 06, 2010 7:50am)

Appraiser Jim: I hear you. Believe it or not, I spoke to a couple of appraisers in the past month or so that are thriving in the AMC world because they said they are volume-based. Hmmm. What idiots would want to work twice as hard for less money, and give a big chunk of their fee to a middle-man who does close to nothing? I really do not get it. If you are an appraiser out there working for half your normal fees due to the HVCC/AMCs, please explain WHY to the rest of us!

brian tbws: (January 06, 2010 7:48am)

i agree that wells and others took advantage w sub loans. i disagree with the scenario put forward in the law suit. just saying subprime abuse had more to do with income than ethnicity.

Frank Garay: (January 06, 2010 7:46am)

So Cal Broker - First of all it's quite alright to disagree with us, we love it. But I think you're missing the point. I worked the A side as well and we were strongly encouraged to do MORE or subprime, but we were NEVER encouraged to "target" a race or neighborhood. This is what they are accused of with this lawsuit.

WV Appraiser: (January 06, 2010 7:43am)

Ronny1958 - Seriously?!? So a loan officer is allowed to do anything without conscience, as long as the greedy bank let it happen. Thats rediculous! People should be held responsible for what they get involved with. The reason that we are in this mess is that people were allowed to act selfishly/greedily without any real threat of repercussions. Second, $8,000 tax credit is not a big deal. Even on a $260,000, this will cover 3% of the loan. With FHA financing at 97%, that means that a buyer can get a loan with basically 100% financing again. If a buyer has nothing in a house, and housing prices are stable at best, and declining at worst, then we are just setting up the next wave of foreclosures. The average sale price of homes in the country is around $195K. $8,000 is over 4% of the average sales price. 4% is a lot and a major factor. I agree that it is not the only factor, but certainly a major one.

So Cal Broker: (January 06, 2010 7:40am)

LOVE you guys, but this time you are wrong. WF ABSOLUTELY took advantage of the subprime borrowers. Frank, when you worked for WF, was it the A side, or the subprime side? I also worked for WF, but on the A side and had no idea. Totally different company. WF picked the low lying fruit because the payoff out weighed the risk. According to a former subprime "General" I know from WF, they were making 700 (YES, 700) bps on these deals. Subprime was the biggest money maker of all the WF divisions and it was all about the money. PLEASE take the time to read the book, CHAIN OF BLAME. It explains why Wells and all the other banks were making such reckless loans. It doesn't make sense on the outside, until you understand what was happening on the backside with Wall Street. READ THE BOOK!

appraiser Jim: (January 06, 2010 7:34am)

What is the latest on HVCC? I had heard the House or Senate had passed a bill that would either temporarily halt this action, or get rid of it, and then again, I am hearing that FHA will soon adopt it, which will effectively end my career, as I am not in the camp that thinks AMC's are a good thing, and FHA is all the work I have. To me, the AMC is akin to the HMO that has been a plague on the health care industry, and if there is a lesson to be learned, it is that HVCC is counter to the free enterprise system. Much like a painter or plumber, appraisers should have unrestricted access to potential clients, and vice-versa. HVCC is anti-American at the very least, and is in danger of chasing us all away to other careers. When will this stupidity end?

Frank Garay: (January 06, 2010 7:30am)

mwoojones - I get what you're saying, but what they are accused of is targeting specific neighborhoods for subprime loans. When I was at Wells, back in the boom, we were encouraged to do subprime, but it was never directed to us to "target" a race or neighborhood. That's why I personally find these types of lawsuits ridiculous.

mwoojones: (January 06, 2010 7:24am)

I agree that Wells Fargo is predatory. I experienced working with several clients to take them out of the subprime loans they had with Wells Fargo. Purchase and refinance. When they had spent 3-5 yrs repairing their credit and had appropriate credit scores, ranging from 650-680; they were only offered another suprime option. this was at a time when rates were close to where they are now and I was able to put all of them into FHA loans with rates from 5.00-5.75%. They had been offered subprime loans with rates as high as 8.5% with adverse terms. Perhaps Wells Fargo is short sighted when it comes to clients who already have loans being serviced by their suprime division. Or maybe, they're just greedy. Each client I helped happened to be African American or Latino. They may claim that it is not a racial issue but many minority borrowers have been conditioned to take what they can get because they have not been given options. At no time, did a Wells Fargo l.o. discuss FHA loans.

Ronny1958: (January 06, 2010 7:09am)

RG, Well said. Brokers/Bankers can only settle the loans offered by the lenders. If they do not offer them or approve them then there is nothing left to talk about.

Frank Garay: (January 06, 2010 7:07am)

Actually it is "Reverse Redlining" they are accused of - our bad - where they are accused of "targeting communities" with bad loans.

RGianna: (January 06, 2010 7:05am)

If they are going after Wells they should go after Countrywide/BOA. When Countrywide first came up with their automated underwriting system years ago, shortly prior to DU & LP, they would deny loans under 620 even though they were approved under DO/LP. After denying these loans they would refer them another lender called Full-Spectrum which was owned 100% by guess who? That's right-Countrywide. We had a file approved under FNMA at a 600 credit score and submitted the same exact data under the Countrywide Automated System but received a denial and where referred to their other company. We were told that they did this with every single loan. Who's was watching this game of bait and switch? They should NOT be regulating originators and brokers and treating us like criminals or fraudsters-unless they do it with the Banks as well, that's where the real damage can happen...let's stay united. Thanks RG

PA LO: (January 06, 2010 7:04am)

Miami is right. I believe they are being accused of steering borrowers into subprime loans because they were easier to do and more profitable for Wells. If this is proven true than they should pay up big time.

PA LO: (January 06, 2010 7:04am)

Miami is right. I believe they are being accused of steering borrowers into subprime loans because they were easier to do and more profitable for Wells. If this is proven true than they should pay up big time.

Ronny1958: (January 06, 2010 7:04am)

Wells Fargo, Yes the case may be thrown out but that does not mean innocent. If Elizabeth Jacobson worked for any of us and as an inner city LO and earned $700K in one year you bet your #$% as owner or manager I would look at her book of business to make a determination of the quality of the loans. The lack of this type of supervision is the nature of the crime. If this was such a great way to make $700K then there would have been thousands of us doing this work and it would have been in all the trade journals as the way to the top. What volume, how many units did she settle to earn $700K as a WF LO? To the first person who replies I am Jealous…you’re an idiot. This is why we have the reputation issues.

MiamiAppraiser: (January 06, 2010 6:52am)

Wells Fargo has also been sued by City of Baltimore for the same issue. The problem is not so much redlining but steering people away from FHA towards more profitable sub-prime loans. A top producer who has gone on record in the lawsuit has provided written evidence that he was reprimanded for putting clients into FHA rather than sub-prime. You're probably right about that it's not about race. It's all about money. Sub-prime, negative amortization loans, etc. which were terrible for lower income consumers were much more profitable to the investor than FHA. Wells Fargo is just as greedy and reckless as any other smaller sub-prime lender that wasn't lucky enough to get bailed out with TARP funds.

Kentwood Mike: (January 06, 2010 6:47am)

Dont forget about contract law guys. If you continue changing the terms i.e. rates and principal reductions you are gonna have a tough time getting private enterprise (instead of Fannie and Freddie,etc.) to provide money to the real estate loan market. People are not going to invest in something if the terms can be unilaterally changed down the road.

RC: (January 06, 2010 6:43am)

OK, I disagree that the 8K tax credit has not been a huge part of keeping the real estate market going. I think that it was supposed to expire in November and you had a pipeline of people trying to beat that deadline that closed either in October or early November. Then in the middle of November it was extended. It will take time to build up a new pipeline but I definately think that will happen, that is until 4-30-10. Think about this. Fed is going to stop buying Mortgage Backed Securities 3-31-10 sending rates soaring, First Time Homebuyer Credit goes away 4-30-10(I know, it can close by 6-30-10) and then FHA talking about raising minimum DP to 5% & capping DR at 45%. You tell me what this spells for the Real Estate Market in the next 6 months. I hope that someone gets it and changes these things before they become a reality because the combination of all 3 will be devastating!

Scary Mary: (January 06, 2010 6:43am)

I also worked at Wells Fargo for many years in the "Emerging Markets" dept - and was strongly encouraged to submit clients to our "MORE" dept for subprime loans - now one of my best friends is facing foreclosure - I could not help her so upon her request referred her to the subprime rep (which paid me a nice commission for just a name/phone number) - she did the 80/20 option with a 2 yr arm against my wishes -

Socal Appraisal Gal: (January 06, 2010 6:33am)

Wells Fargo is the worst. Their Core Logic product (yes people follow the trail it ends back to them) has appraisers from outside the state in which the review is not a review at all. Appraisers with no data sources other than one provided by Core Logic are to look at that data and comment on if it matches the appraisal. This data is your basic dated AVM that figures nothing about views, upgrades, remodeling, etc. The appraisal is glanced over and they go with Core Logics data rather than the well written and supported appraisal done by a lic. appraiser that was actually at the property. These Core Logic/Wells Farto appraiser's get paid $30.00 to ruin your deal and a well supported appraisal. Wells Fargo has data sources they sell separately that are the same data. There is a reason why I call them the "MODERN SNAKE OIL SALESMAN WITH THE LITTLE WAGON"....

mortgagebrad: (January 06, 2010 6:22am)

hey guys.. How about Chris Dodd's news on retirement? I think we should throw him a retirement party next November. Do you think Angelo would show? One down, several to go. Barney...oh, Barney Frank... the retirement phone is calling.....

APRcock: (January 06, 2010 6:20am)

Guys..."Redlining" is not aggressive lending in certain areas. Redlining is the pracice of refusal to lend in certain areas. You are confusing "Predatory Lending" with Redlining!

Midwest Appraiser: (January 06, 2010 6:13am)

Most experieced and legit appraisers don't want to take on the liability doing BPOs for $80 either. that is what most AMCs are offering up for the assignment. Therefore you still have idiots giving the bank advice. I guess you get what you pay for.

Lwood: (January 06, 2010 6:06am)

....and this is a surprise? Boys, I saw as many rich people have subprime loans as poor ones.

Appraiser (is that better?): (January 06, 2010 6:04am)

Appraisers cannot provide a BPO. If an appraiser is also a broker then they can provide a BPO if they disclose that they are an appraiser but acting as a broker for that particular assignment.

Dez: (January 06, 2010 6:00am)

Bobbi - If the loan currently has MI on it, it must go back to the original lender. The DU Refi Plus program is part of the HARP program and approval is ran differently since Wells runs through LP. However, if you have a 1st and 2nd, you can keep the 1st with Wells and you do not need a resubordination agreement for your 2nd lien.

Gnotboxchecker: (January 06, 2010 5:47am)

C'mon...The mortgage brokers (and banks) were capturing the here-and-now fee because there was no regulatory clawback for bad deals. If there is no professional risk, pick the low hanging fruit.

Keaster: (January 06, 2010 5:46am)

They don't say "bite you in the keaster" in NY....Boston maybe...In NY they say "shove straight up your F***in' @ss and twist it"...Hey You dalkin da me!

T: (January 06, 2010 5:43am)

J Why don't you get your butt out of bed and do a show. When rediculous law suits quit coming forth I am sure Brian and Frank will quit reporting on them. And I'm sure CRA credits did come into play ratherbeinmaui. Good point. Maybe the Fed's need sued! J, were you always a dick or did this start in 2007??

Kathleen : (January 06, 2010 5:40am)

Bobbi...Du Refi Plus IS Wells Fargos HARP programs

ratherbeinmaui: (January 06, 2010 5:30am)

On Wells' redlining... higher fees due to "risk layers", CRA credit from Feds... 'nuff said http://www.illinoishomemortgagerates.com

Brokerboyce: (January 06, 2010 5:24am)

If a real estate agent has a question about doing a BPO they should ASK THEIR BROKER. If they don't know wether the law in their state allows collecting a fee, they should return their license to their regulatory agency and save their broker the trouble.

Apex Appraisals: (January 06, 2010 4:54am)

In North Carolina, BPO's Are illegal for Realtors to do for a fee. They may done for a potential client, but not for a fee. Lenders continue to ask Realtors and with sales down many are complying. These Realtors need to realize that their licenses could be revoked if caught.

J: (January 06, 2010 4:43am)

Guys -- get with it. Wells has been sued by a number of cities and have been thrown out of court. In Baltimore, MD the case is about to be thrown out. Great story........ In 2007.

Bobbi: (January 06, 2010 4:40am)

Need help This may sound stupid but I am trying to get a Wells subrdination to do a loan on DU refi Plus. Will qualify When I called Wells they never heard of DU refi plus and asked if this was part of the HARP program Is it?? I try to keep up with all but hard This business sucks Any Thoughts???