Today I was working with one of my loan officers on a file ... an extremely qualified borrower I might add that was getting quite frustrated with having to document his income and identify his deposits in his bank account. Here was my response back to the loan officer:
"I know it is tough to ask a buyer as qualified as Mr.XXXX for all this documentation. Unfortunately, it's the world we live in today. Investors don't care about common sense, and for some reason the risk factor seems to have been completely eliminated for the time being. The crack down by the Federal Reserve has forced investors into a CYA mentality (don't mean to be crude, but it seems to be the best way to describe it.)
All move up and relocation buyers are going through the shock of what is being asked of them, because "the last time" they didn't have all these hoops to jump through. And they didn't. And WE didn't have to ask them to jump in those days either. Our industry as a whole has been put in a sort of "time out" being punished for the stupidity of following our instructions a decade or so ago, when the government's call to action for our industry was "every American DESERVES a home" (started during the Clinton administration, actually). Thus came stated income and then stated income, stated asset loans along with 125% LTV loans, and let's not bring up those self-destructing option ARMS! Doing these high risk loans, resulted in high returns for those lenders and investors... but not for long. And even though WRSM did not participate or fund those types of loans, we are not exempt from the national punishment which is bestowed on not only the lender, but our buyers as well.
Is it ugly? ABSOLUTELY! And I hate it, too. But there's nothing we can do about it right now. And to wonder if it's going to get worse is a concern I hope we all have. But that's another discussion. For right now, our buyers just need to know: THIS IS NOT ABOUT THEM and to try and not take this personally. And to be honest, I have to wonder if this is part of the "big plan": make it difficult; make us all become so frustrated, that government run housing is welcomed as another change in our nation.
So, do I feel for what Mr. XXXX is going through? Most definitely. But it's not too far fetched to be concerned that a day may come in the not too distant future that wanna-be buyers won't even have the option to jump through all these hoops.
Now that I've completely depressed myself, I'm going to go and pull those never ending weeds that like to invade my flower gardens, except today I'm going to be thankful that I have a house and a yard of my own to worry about. And hope and pray my grandkids do, too."
I seldom, if ever, write any blogs having to do with a political edge to them. But right now, I'm frightened. We ALL need to be!
Opinions expressed here are the sole responsibility of the author, and do not necessarily reflect the view of Fairway Independent Mortgage.
Ruth Vogt, Sales Manager
#LMB100023827, NMLSR# 257576
Equal Housing Opportunity.
Regulated by the Division of Real Estate.