Posted by CT_Notary on 4/16/11 8:45am
Msg #380048

Industry recalibrating?

After almost 3 horrible years, my business has finally been operating at a steady 50% of the "old" volume for the past 6 months.

However, this month things have tanked. I've heard that HUD changed some rules and that the lenders are having to to rework their paperwork. Also, TitleServ was a big client and that is another mess.

Has anyone heard anything about what is going on? Can't imagine refi apps have stopped. My regulars tell me that the pipeline is dry for now.

Any thoughts?

Reply by A S Johnson on 4/16/11 11:07am
Msg #380061

You want to know what is going on in the industry. Both comments on this industry and TitleServ have had been posted about them recently.
If you read this Notary Talk and stilled worked for TitleServ, are you going to take anyone who post answers to your question seriously?
Yes our industy is have problems for numerous reasons.
TitleServ has been posted about thier a low ball fees and paynent problems, but you still choose to accept assignment from them.

Reply by notary/OR on 4/16/11 11:45am
Msg #380063

In my area things have returned to a somewhat steady schedule as well. The main reason for the last several months has been because Chase ran a no closing costs refinance program for their mortgage holders in good standing to lower interest rates. I have heard that they are fulfilling their government obligation for the stimulus plan. In the last six months of 2010 we signed hundreds of them in our area but it has slowed down from that. Have you been doing them in your area? If so, I imagine they won't last forever so it may cause a slow down when the program is no longer offered.

Reply by Lee/AR on 4/16/11 11:58am
Msg #380064

I've been doing this for 18 years now in a low population/volume area. From '93 to '99, I probably did 12 a YEAR! Side note: Was paid much better than today with no edocs.
From 2000 to 2004, that became 20 or more per month....all refis. Since then, both volume and fees paid have fairly steadily declined, while work involved has increased.

Frankly, this lasted far longer than I thought it would, but I can see where it can return to '93-'99 levels... in other words, not a good sign if you're thinking this is a full-time job.

Reply by Les_CO on 4/16/11 12:38pm
Msg #380067

Well…you asked. My thoughts are what is happening to you, and what has happened to Titleserve (although there could be some internal stuff we don’t know about yet, like if or why their underwriter cut them off?) is systemic through this country’s entire real estate and related businesses. I) people don’t have jobs, and people without jobs don’t buy real estate (or much of anything) 2) one can’t refinance a house/building/land without any equity in the property. In actuality most of the real estate in this country has a value that is equal to or worth less than is owed on it. 3) New home construction/sales have virtually stopped.4) With millions of foreclosed properties, many with asking prices of less than half of their foreclosed value, most are not selling because without any income one can’t buy a house no matter how good a deal it is. 5) With their ‘compensation’ now limited mostly to a loan origination fee (of 2% or less) most loan brokers are leaving the business.
On the bright side there are many ‘retired’ folks that don’t need or have a job, and many with paid for homes that they don’t intend leaving. Some of these could refi, or do a reverse mortgage, however even with RM’s, and some investors buying foreclosures, business will be less than a third, or maybe a quarter of what it was. And don’t forget many major Title Companies are moving a good portion of their related business (doc prep/records search/scheduling) offshore.
In conclusion, I look for less than half of the little TC’s to be in business by next year. That goes for Mortgage Brokers too. As for SS’s? I think most are gone. The big title companies have or will have their own ‘internal’ SS, and the few small TC’s that are left will have the time and personnel to do it themselves. And the legitimate SS can’t compete with the deadbeats. The thieves, deadbeats, and lowballers will still be here. As for NSA’s? I’d say maybe 10% will be around in a year, and most of those just part time, or all will be newly churned NNA specials, doing closings for less than $40. This will no longer be a business for experienced professionals. Just newly minted part timers, with lots of hand holding from India. JMH (and, sad) O

Reply by A S Johnson on 4/16/11 1:16pm
Msg #380076

Les,
You nailed it!!!!

Reply by Blueink_TN on 4/16/11 4:25pm
Msg #380095

Les, I agree with most of what you said but I would like to comment on just a couple of your statements:
#2) one can’t refinance a house/building/land without any equity in the property.
There are refi programs available (for qualified applicants) that will fund up to 125% loan to value.
#5) With their ‘compensation’ now limited mostly to a loan origination fee (of 2% or less) most loan brokers are leaving the business.
Loan originators also have the option of 'borrower paid' compensation which is very similar to the original comp, just the same numbers placed in different areas on the GFE. (way to go gov't for scrambling up the current policy and calling it 'reformed')
The reason the LO's are leaving the business is not their choice - with all the new licensing laws, some LO's that have been in the biz for years are not qualifying. Some are just not good test-takers, some have bad credit (no foreclosures or short sales, no scores under 600), and some should have never been originating loans in the first place (the sharks). So to rid the industry of the sharks, many others are suffering. I'm betting that some of the very one's who made these laws would not qualify. For some reason the whole issue of bad loans, foreclosed properties and horrible housing economy is the fault of the loan originators...HOGWASH!
In my opinion, the drop in signings for the month of March is in direct relationship to the rolling out of the "new LO comp plan". Again, way to go gov't. Now that things are starting to get back to as normal as it can, you should see an increase in signings.
I have noticed also, that along with the new reformed LO rules, the larger title companies are requiring their signing agents to be background checked. Yes, lets blame the SA's also. Pathetic.
So my advice to signing agents that love their job and want to make the cut? Yes, do as the hiring companies ask, get the background check, do a great job and DON'T COMPROMISE YOUR FEES. You see, and this is where I most disagree with you Les, the experienced professionals are the ones who will still be around in years to come.

Reply by Les_CO on 4/16/11 6:00pm
Msg #380100

I didn’t know about that program, and I was speaking in large generalities. I don’t see the point in refinancing your home for more that it’s worth, unless you plan on walking away from it? Or are a hopeful investor. And it’s still hard to qualify if you’re unemployed.
As far as LO compensation, sure they can put in “extra profit” and hope the borrower doesn’t see it? But? I just think there will be little money for a lot of work in the future. It will probably be good for big bank, with salaried employees.
I forgot to mention that many Title Companies now, rather than just passing our fees on to the borrower (free for them) see us as a profit center, charge the borrower a bundled services closing fee… Say $300, and pay us $50 for our part and keep the difference. Not exactly in the spirit of respa, but how many borrowers have you seen actually get a final correct copy of the HUD 24 hours in advance of signing this year?
And as for your last paragraph….I sure hope your right!!!! Personally I can think of many reasons for our profession to stay around, mostly we enable Title companies to do business nationwide in places they don’t have offices. This service although free to them is worth a large percentage of their income. Secondly the service we provide is not only convenient, but important, often involving the largest transaction in the borrower/buyers lives, and if done incorrectly can have extremely damaging effects on the borrower/buyer. Our job NEEDS to be done by knowledgeable Professionals. I guess time will tell?

Reply by Susan Fischer on 4/17/11 4:34am
Msg #380122

Remote Closers. We are Mobile, Remote, and Experienced.

What's not to love?

The righteous companies pay according to generally accepted industry standards - and we Remote Closers have been struggling to keep those standards high, as our profession demands - while the slimeballs just keep shafting us.

As for: " Not exactly in the spirit of respa, but how many borrowers have you seen actually get a final correct copy of the HUD 24 hours in advance of signing this year?" Yes. 99.9% of my signings. (It's been a long time since I've had a surprised borrower. Sure, they've been in the pipeline "a long time," just like always - but the nitty-gritty of the loans are known way before I get there. Virtually 100% of monies due from Borrower are appointment-ready.)

We have no collective voice at the table, including in the NNA, etal, where we are continually passed over for Profits.

The forces we face are vast. Those with solid Business Plans, proven track records with intimate knowledge of our service areas, impeccable Ethics, and a Professional's attitude, will continue to survive.