Posted by pat/WA on 7/27/12 9:37am
Msg #428243

EOM

Please explain to me why yesterday was the end of the month

Reply by Philip Johnson on 7/27/12 9:53am
Msg #428246

27,28,30 July

Payday on 31 July. How long you been doing this job?

Reply by pat/WA on 7/27/12 10:02am
Msg #428251

Re: 27,28,30 July

A long time and the EOM is not consistent
I suppose it makes you feel important to be so condescending

Reply by Philip Johnson on 7/27/12 10:11am
Msg #428256

Not condescending at all.

Shocked that someone that has been involved in this business, for as long as you have asks such a basic question.

Reply by Shoshana/AZ on 7/27/12 10:11am
Msg #428257

EOM is always consistent.

It's always the 4th business day from the end of the month for refis.

Reply by Linda_H/FL on 7/27/12 10:00am
Msg #428247

On my... n/m

Reply by Linda_H/FL on 7/27/12 10:00am
Msg #428249

S/B Oh my - sorry...I'm flabbergasted.. n/m

Reply by sigtogo/OR on 7/27/12 10:00am
Msg #428248

last day for refi funding but not last day for purchases n/m

Reply by CJ on 7/27/12 10:01am
Msg #428250

For people who are refinancing, if you signed yestrday, on the EOM, you got 4 days to cancel: count Friday, count Saturday, skip Sunday, count Monday. Title can't technically do anything with the papers until those days on past. THEN, the NEXT day: *Tuesday*, they fund. This is July 31st.

Anybody refinancing today, Friday, their RTC will end on July 31st and they will fund on August 1st. That means that all their paperwork will be calculated for the first payment of their loan on October 1, as opposed to what we have been seeing all July, with a first payment on September 1st.

That's as much as I know. I also know that the loan people will be very busy processing all that paperwork that was handled last night, so it's going to be slow for us for about a week. If you have housework, paperwork or gardening to do, now is the time.

I had a borrower last night complaing that the soonest I could get out there was 10:00 p.m. He said it was "inconvienient" and he wanted to sign in the morning. He told me directly that he wanted me to explain to him why he should sign "tonight" and tell him what the consequences would be if he didn't. I didn't want to give advice or opinions or tell him to sign, so I told him I would ask them to get a different notary who could sign earlier.

I am curious, please tell me what the dire consequenses would be if someone did not sign last night and wanted to sign today. I know it is terrible, but I don't know exactly what it is. Thanks.

Reply by sigtogo/OR on 7/27/12 10:05am
Msg #428252

the only dire consequence is for the LO, title, lender stats

and maybe their split if its monthly based. it might affect the borrower if refi of fha or other gov't insured payoff, but generally no real impact on the borrower.

Reply by sigtogo/OR on 7/27/12 10:07am
Msg #428253

and of course its all about the lender right? lol n/m

Reply by Shoshana/AZ on 7/27/12 10:09am
Msg #428255

Expiration of rate lock?

That's pretty dire!

Reply by CJ on 7/27/12 10:14am
Msg #428258

Why the EOM is not consistant.

Every month, I just get out the calendar and start counting backwards. The very last business day of the month is the month to fund. So you count backwards the RTC dates that would come right before that, and that's how you find the EOM.

In August, the last business day is Friday the 30th. So the three days that lead up to that are (backwards) Thursday, Wednesday, Tuesday. THEREFORE, the EOM will be Monday, the 27th.

Sometimes, if I am not sure, I call a Signing Service that I like and double check with them. I wish that when people created RTC calendars, they would notate the EOM.

Reply by Jack/AL on 7/27/12 12:54pm
Msg #428311

My calendar shows Friday as the 31st, not 30th.

As CJ indicated, going back to the fourth day before Friday, the 31st, does indeed get one to Monday, the 27th.

Reply by sigtogo/OR on 7/27/12 10:17am
Msg #428259

rarely, imo, is rate expiration the reason for eom rush

sure that would be dire but usually it's just the LO and realtor, if a sale, wanting to be paid at eom. rate locks aren't tied to eom.

Reply by ReneeK_MI on 7/27/12 12:45pm
Msg #428307

Excellent explanations (all of them) and I totally agree. n/m

Reply by 101livescan on 7/27/12 10:17am
Msg #428260

Fundamentally, and primarily because the Loan Officer gets paid on anything that closes this month. If it doesn't sign so that the rescission period makes the cutoff for current month, LO doesn't get paid til the next month. THIS IS HUGE for them. This is when we might get asked to backdate, a HUGE nono.

Reply by CJ on 7/27/12 10:22am
Msg #428261

Thanks for explaining this.

I just know that everyone is a crazy maniac at the EOM, and I thought it was all about the borrowers. Hey, us notaries wait all the time for our money to finally show up. I think LOs should be able to wait as well. It would make everyone's life a lot easier, including the borrower's, if there was no EOM insanity.

Reply by sigtogo/OR on 7/27/12 10:27am
Msg #428265

exactly my point! I had a processor call me once screaming

about the docs not being signed in time for month end funding (borrowers choice) telling me it was going to cost the borrower thousands of dollars. She said I had no idea of the impact. Now, her cut wouldn't have been that big so she either was ignorant or thinking I was!!
The realtor by the way did not expect it to fund until the 2nd. sigh....

Reply by Dorothy_MI on 7/27/12 10:35am
Msg #428272

To answer the question about the consequences to borrower

If he didn't sign last night (depending on lender), the documents might have to be re-drawn and incur a re-draw fee. Most re-draw fees that I've seen have been about $150.00. That answer might have made him more inclined to be inconvenienced.

Reply by sigtogo/OR on 7/27/12 10:46am
Msg #428278

only if the re-draw is borrowers fault-otherwise lender prob n/m

Reply by Dorothy_MI on 7/27/12 3:12pm
Msg #428340

Re: only if the re-draw is borrowers fault-otherwise lender prob

I have a feeling that not wanting to sign because it was inconveniently late would qualify and the borrowers fault.

Reply by Bob_Chicago on 7/27/12 11:21am
Msg #428286

Actually, Cheryl, I believe that it goes beyond just

having the LO wait to the end of the following month to be paid.
Many lenders and brokers have a system where the LOs have a quota or other method , where there compensaton varies by the number of closings that they do in a calendar month.
If they get over a certain amount ,either in number of deals or in $$ volume, then they receive extra compensation.
Accordingly, the last few deals that they get funded during a month may have a significant effect on the amount of their compensation.
There is no magic with the end of the month. Several lenders and brokers have started using a different date to compute LO compensation. They may "end " the month on (eg The 5th, ther 12th, the 23rd, etc, etc)
I wish that they all would adopt this system. It would make it much easier on the TCs, the SSs and the NSAs.
I know that I had to turn down a number of good job offers this week, just because there were not enough hours in the day. I worked late every nite this week.
It would be better for all concerned, including the borrowers, if the work could be more evenly spread out over the month.

Reply by BrendaTx on 7/27/12 2:10pm
Msg #428329

Re: Actually, Cheryl, I believe that it goes beyond just

That is what I have always understood...that the higher the amount closed that month, the larger percentage that the LO took home.

Reply by TheCloser123 on 7/27/12 10:35am
Msg #428271

Well, if the rate lock expired...pretty big deal. If it is a VA loan the pay off will be all messed up (all the interest for the entire month is due on the 1st for these) so if it doesnt fund by the last day of the month, the pay off just jumped significantly. EOM is EOM.

Reply by CJ on 7/27/12 10:46am
Msg #428277

Thank you so much Dorothy and Closer123

Of course, I got the call when I was in the car, so I didn't have his docs, so how am I supposed to know what his EXACT situation is? Definately the lender needs to make it clear to him. I was suspicous that there might be a rate lock, and most likely a re-draw, and a re-adjustment of all daily interest on the per diem as well as the payoff, but who am I to tell him that? If I am wrong, I could be in big trouble for opening my big mouth.

Reply by Deborah Breedlove on 7/27/12 10:45am
Msg #428276

If they fund by July 31, the borrowers only have to prepay one day of interest and their first payment will be Sept 1.

If they fund on August 1, they have to prepay interest for the entire month of August and their first payment will be Oct 1. That may cause a short to close, which borrowers generally don't like. Even though they are getting an extra month to make the first payment, this is still money they have to pay up front, and they may not be prepared to do that.

Occasionally, we will see a credit for interest back to the first of the month. So if the funding date is August 5, they would get a credit for 5 days of interest, and their first payment is still Sept 1. That usually generates the 30 Day Hardship letter. IMO this is the best solution for fundings early in the month, but it rarely happens.

Reply by CJ on 7/27/12 10:50am
Msg #428280

Thank you Deborah

Wow - the "short to close" angle. People really get worked up about that. Good point.

Reply by pat/WA on 7/27/12 11:16am
Msg #428285

hey Philip

I had all my signings yesterday in my zip code and docs were all ready on time!

Now how is naive

Reply by Philip Johnson on 7/27/12 4:28pm
Msg #428358

Had nothing to do with you, other than

the fact you chose to do only signings in your zip code.