Employment Ideas for Laid Off Mortgage Workers

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Current estimates project the number of mortgage industry workers that will lose their jobs to be 100,000 or more. Here are some job hunting ideas for those resilient folks who love mortgage lending and want to ride out the storm by making a lateral move within the industry.

Consider looking deeper into the big three information service companies (we use to call them the title insurance companies: Firstam, Fidelity, Landam) and check out all the job openings in your state.

[photopress:fired_1_2.jpg,thumb,alignright]If you are an underwriter, consider becoming an independent mortgage compliance consultant. You can help existing mortgage firms move up a notch with training and compliance. But that would mean you will actually have to talk with retail mortgage salespeople and pretend like you are enjoying the conversation. This would be a daily thing and requires your blood pressure and HDL/LDL cholesterol readings to be at or within a healthy range or, alternatively, you should prepare to show an active prescription for Lipitor. If you can’t stomach working directly with retail mortgage salespeople, then consider a position in auditing and compliance at a major bank or lender in your hometown. Someone will have to help write and enforce the ever-changing tighter lending guidelines. However, your real talent may be of use as an independent expert witness for law firms in mortgage broker and shareholder lawsuits. Underwriters, don’t leave the business. We need you now more than ever. Besides, who’s going to help re-assess the risk on all those collateralized debt obligations? Nobody knows what anything is worth right now. You ought to be cashing in on those jobs.

If you are a loan processor, consider joining an independent contract processing company, or forming your own company. If you are a really good loan processor, consider becoming a retail mortgage salesperson yourself. The very best loan originators start out as processors. You will be better than the competition in your hometown because of your knowledge in state and federal laws governing mortgage lending. Trust me on this.

If you were an entry-level worker, such as an assistant or receptionist, you might seek employment as an assistant to a top-producing retail mortgage salesperson or real estate agent. Title companies routinely hire entry-level folks and a background in lending will help. In fact, you might even know more about title insurance than some of the sales reps. If you’re good looking, and by that I mean “hot,” consider a job as a title rep. Am I being too cynical? I don’t think so. But maybe title isn’t the place for you. If you have masochistic tendencies, perhaps escrow is more up your alley.

Traditionally, when the retail side of lending turns soft, jobs open up on the other side; the dark side of mortgage lending. Consider job openings with trustee service companies (these are the companies that help lenders foreclosure), or check out opportunities for jobs in the foreclosure and loss mitigation divisions of local banks and loan servicing companies. Also, there are bound to be job openings for default counselors with non-profit associations. Start by going to HUD.gov, click on the link “talk to a housing counselor

New Mortgage Program for Helping Out Family Members

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Finally there is a mortgage program available that are designed for when someone is buying a home for another family member.   Previously, if someone wanted to buy a home to have their elderly parents live nearby, unless it could be classified a second or vacation home, the borrower would need to use non-owner occupied financing (much more expensive in rate and cost than owner occupied or second home financing).   

In addition to helping out the folks, this new program, the Family Opportunity Mortgage, works for parents buying a home for their college student and parents who would like to help their disabled adult child buy a home. 

Here’s the skinny:

Assisting a College Bound Student

  • The child must be enrolled in college.
  • The property must be located close to the college the student is enrolled.
  • Property must be a reasonable distance from the parents home.   
  • Property cannot be rented and the child must occupy the property for a minimum of one year.
  • Parents cannot own another second/vacation home in the same location as the student’s home.
  • Parents qualify for the loan, the child does not.   If the child is old enough, they can be on the mortgage with the parents, however it’s not qualified required.

Assisting an Elderly Parent

  • Elderly parent must have insufficient income to qualify for a mortgage or be unable to work.
  • The individuals qualify for the loan.   The parents can be on the mortgage although it is not required.
  • There are no distance requirements between the elderly parent and the individuals (their child).

Assisting a Disabled Adult Child

  • Disabled adult child must have insufficient income to qualify for a mortgage or be unable to work.
  • The parents qualify for the loan.   The parents can be on the mortgage although it is not required.
  • There are no distance requirements between the elderly parent and the individuals (their child)
  • Disabled adult child occupies the property as their primary residence.
  • Parents may all ready own their own primary residence.

It’s about time!  🙂  

Ba-Ba-Ba-Benny and the Fed

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Aw come on and sing along with me (Benny and the Jets).   Ben just surprised many by dropping both the Fed Funds and the Discount Rate by 0.50%.    It’s too soon to tell how this may impact mortgage interest rates…however it (the Fed Funds rate) directly drops the rate home equity loans are based on to 7.75% (Prime Rate).    You can see by the chart below that waiting on rate reductions from the FOMC to impact long term mortgage interest rates may not be the move for you to make.

[photopress:SeptAlertChart.jpg,full,centered]

Chart compliments of Loan Tool Box

The Fed based this reduction due to ” the tightening of credit conditions has the potential to intensify the housing correction”.   To read the entire press release, click here.

Taking on KING/KONG…

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Yesterday I was interviewed by a KING-5 reporter, Kim Holcomb, and which I had written about on my blog at this post.  I had jokingly referred to taking on King Kong but only because the news segment was shown on KING-5 and KONG-6 last night.

King Kong

The news story was about how the market here is changing just a bit to more of a stabilized market.  At the beginning of the report a seller talks about it being a “buyer’s market” but I wouldn’t necessarily agree with him completely.  We’ve still got room to move before that happens and if anything we’re more balanced than the past 5 years.  The segment did run on both KING and KONG stations and, from what my business partner tells me, it is one of the most viewed and forwarded links from the KING-5 website today.  Here is a link the actual news story about the Seattle real estate marketplace along with pieces of my interview.

It seems we’re (Team Reba) getting a lot of press lately.  I was interviewed in July for a story on blogging for the RE/MAX Times back in July (released in September) and just last week I was interviewed for a real estate investment magazine which will be printed in the November/December time frame.  Now, if I could just get the interviewers to pronounce my name correctly…. 🙂

How walkable is your neighborhood?

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In late August a press release was sent out by Mayor Nickels office regarding plans to increase sidewalk construction in areas of the city where there are none now.  Many buyers I talk to on a regular basis tell me they want to live in neighborhoods with safe streets where they can walk to and from shops or to be able to take their kids safely to local parks, etc.  I personally love having sidewalks in my neighborhood.  An online tool that can be used to determine if your area has good “walkability” is this site: http://www.walkscore.com/

A large portion of the northern section of Seattle is without sidewalks since they were developed prior to being within the city’s borders (most areas north of 85th St).  An article in the Seattle Times highlighted this area and others recently noting how expensive it is for cities to add sidewalks, but because city inhabitants have been vocal for it Mayor Nickels is going to give them what they want.  Or is he?

Here is a link to the city’s current plan to add sidewalks, most of which is supposed to be funded by new construction: http://www.seattle.gov/DPD/Planning/Sidewalks_Improvement_Initiative/Overview/

Now, let’s compare that to a notice I received from the Master Builder’s Association as shown below.  As I read it, the MBA doesn’t want to take on the responsibility for the costs of adding the sidewalks.  If they do, they will, of course, pass it on to the consumer (buyer of their developments) and as a result the cost of the sidewalk will go up multi-fold because there will be added costs from the builder on top of the original cost to install.  I don’t know if the city can get a “bargain” compared to the MBA developers or not but I would think that it would be inefficient for the city to try and manage all of the independent developments and the sidewalk needs of those as they happen ad hoc around the city.  Perhaps if the “fee in lieu” were to go directly into a pot that could be used for ad hoc installing of sidewalks I’d feel better about it, but I’d also be concerned about whether or not that would be managed well too.

The Mayor’s Sidewalk Announcement

The long anticipated Sidewalks Initiative was announced today by Mayor Nickels and is available at: Sidewalk Press Release. 
Should the proposal pass, sidewalks, curb and gutter would be required for all new development in Urban Centers and Villages and along any arterial.  The threshold for the remaining portions of the city would be lowered to 3 units.  For more detail, goto:  Seattle Sidewalks.
The MBA is proposing a fee in lieu of program that would bank sidewalks and allow the city to contract with the lowest bidder to install all sidewalks—I assume the city gets a better deal than we can.  The goal is for members to avoid the long and expensive SDOT review. 

The Flip Side of the Sub-Prime Story

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[photopress:P1000150.JPG,thumb,alignright]Who will suffer most from all of this? Will the people who honored their commitments, and who valued and appreciated the chance the lender took on them, get hurt by all of the “reform”?

No one was more surprised than I, when I got the mortgage and closed on my home. In the end, the lender wanted me to write my profile of “Who I Am” right before the loan funded. I was starting over again in a new city. No proven history of what I might be able to make long term, as an agent in a new place. Coming out of a 20 year marriage, too old to wait until I stablilized my income, arriving with only what could fit in the trunk of my car. Sleeping on the floor at my sister’s in Green Lake while I worked hard to re-establish myself after a debilitating and nasty divorce. Needing a home for my three daughters and grand daughter to come to, hoping I could woo them away from L.A. where they were not doing well, and couldn’t afford to live on their own and be safe.

I worked day and night, seven days a week, and made the payments gladly. The one day a year when all my daughters came together at Thanksgiving, the couple of weeks when my grand daughter came up and we visited the ducks up at the Marina in Downtown Kirkland. Helping them through their hard times with their car insurance and car payments and making my mortage payments. Gladly working 24/7 for the opportunity to prove to them that a woman could make it after divorce, and not just “get by” but have a nice home.

I wouldn’t trade these last two years for anything. The memories in this house with my dearest and most cherished treasures, my girls and my grand daughter. Each of them proud of me and realizing that all things are possible, and life doesn’t get you down unless you let it.

Yes, for the first time in my life I was “sub-prime”, I was “stated income”, I was 49 and starting over. I am the person sub-prime and stated income was made for, and I’ve worked hard to be the person they believed in when that loan funded. And when the news got scarier, I took a second job as Broker of BRIO to make sure I could keep going, even if I couldn’t refi, and honor my commitments.

The day they asked me to write that profile so they could take one last look at who I was to decide if they should take a chance on me, I remembered my Uncle Johnny Rosati. How no one would give him a loan for a truck for his business “idea”. How finally, one bank said yes and he started his business and busted his butt day and night to prove himself worthy of the chance they took on him. How he refused to ever use another bank his whole life, no matter how many people told him he could get more interest elsewhere. He was loyal to that bank until the day he died, because they were the only ones who believed in him when they had no reason to, and no one else would.

Every day I live in my house, every month when I pay my mortgage payments to Washington Mutual, I thank them for believing in me and for giving me my “sub-prime” mortgage. I wake up working. I go to sleep working. I work every single day. I work to be the person they believed I could be, and I worry when I read all the bad news. I worried so much I took a “second job”.

Will I never be able to convert my 2 year arm because of the reform? I don’t know. But I do know that I will pay my mortgage payment as the rate adjusts higher. I’ll work two and three jobs if I have to. I know that they took a huge chance on me, and I know it was the boldest move of my entire life when I took this on.

Every day my girls get a year older, and every day I need to have this house less and less. Every day I thank those who believed in me and took a chance on me, and work hard to honor my commitment to them. Will all this reform close the door on me? No matter. I’ve already made it to the light at the end of my tunnel.

Who is to Blame for the Subprime Meltdown?

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Every day there’s another news story or blog post spreading more blame and anger about the mortgage market, increasing foreclosure statistics, the effects on our economy, fears of more layoffs in the mortgage sector and beyond, and so forth. With enough blame to go around, everyone keeps pointing fingers at everyone else. So far, here is who’s been blamed for the subprime meltdown/credit crunch/liquidity crisis.

  1. Mortgage brokers, for being rapacious capitalists;
  2. Loan originators, for having the audacity to wish for a six-figure income with no experience required;
  3. Loan officers who work at a bank, for knowing nothing and legally hiding their yield;
  4. Greedy wholesale lenders for enticing the brokers and relaxing the underwriting standards because of competition;
  5. Greedy Wall Street investors;
  6. Greedy Wall Street investment bankers;
  7. Incompetent Wall Street ratings agencies
  8. Greedy investors who just wanted to buy and flip;
  9. Realtors for threatening to pull business if the broker or lender did not approve their buyer’s loans;
  10. Realtors for pushing the sales prices up, up, up by continuing to add closing costs and more into the sales price, then threatening the appraiser when the home didn’t appraise;
  11. Real estate broker/owners, in their national conspiracy to keep commissions at 6%;
  12. Redfin, because it’s always Redfin’s fault;
  13. Zillow, for forcing loan originators to force appraisers to meet the homeowner’s expected Zillow zestimate or lose the refinancing client to a competitor;
  14. Unethical appraisers who turned in falsely inflated appraisals under threat of retaliation from mortgage brokers;
  15. Escrow closers for being a neutral, powerless, third party observer to the madness;
  16. Deceptive banner ad companies such as lowermybills.com, nextag, etc. who are still advertising pay option, interest only, negative amortization loan products;
  17. Deceptive, bait-and-switch advertising from mortgage lenders in the mail and on the radio;
  18. Allen Greenspan for keeping rates low for way too long;
  19. Ben Bernake for not lowering interest rates RIGHT NOW, when Jim Cramer says so;
  20. State regulators for not properly supervising their licensees;
  21. Federal regulators for being altogether absent on a day-to-day basis in regulating RESPA, and the Truth-in-Lending Act;
  22. The Mortgage Bankers Association for having a huge war chest of lobbying dollars;
  23. The Nat’l Assoc of Mortgage Brokers for continuing to testify before congress and congressional committees that their members subscribe to a strict code of ethics, when nothing could be further from the truth. By the way, their website points consumers back to state regulators for “ethical complaints.”
  24. The media, because they keep running bad news stories, which are frightening homebuyers;
    The Community Reinvestment Act for forcing banks to make loans to non-whites;
  25. Republicans, for promoting homeownership;
  26. Democrats for promoting homeownership;
  27. Democracy for allowing political candidates to receive $210 million dollars in campaign contributions and lobbying dollars from mortgage banking trade groups and corporations;
  28. The consumer is also to blame for being irresponsible, failing to read the loan documents, falling for the zero down American dream story, and believing the LO when told “we can just refinance you into a fixed rate after you clean up your credit.

A Fistful of Feeds

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The man with no nameCue up the Ennio Morricone music and head for the hills! There’s been some recent talking among the town folk, about the feeding frenzy that’s happening out there on the wild web of the west. Let’s just say San Miguel will never be the same once the schema with no XSD enters town.

Just when you thought it was safe in digital listing land, it’s going to get a little wilder. You see, Jesse ‘Zillow’ James has got a new six shooter and is getting ready to take your listings, publish them for the world to see, and give the town sheriff something else to think about. Right now, Jesse is just at target practice, but high noon at the O.K. Corral is coming soon enough.

Even better, Jesse has been taking marksmanship lessons from Wild Bill Gates’ old play book. It’s every bit as clever as the lead shield old Clint used in the movies. You see, Zillow’s doing 2 things which show they’ve learned the “embrace and extend” tactics from yesterday’s web slinging masters.

First, Zillow is embracing Trulia’s feed format – This move means that anybody who already has a Trulia listings feed will be able to get their listings onto Zillow with than less than 10 minutes of effort (the amount of time it takes to fill out a form with your feed url). It’s entirely possible that by doing this, Trulia’s feed format will become the “de-facto” industry standard. (Which wouldn’t be all bad)

Secondly, Zillow’s extending the purpose of Trulia’s format, by coming out with their own feed format – OK, some of you are already thinking, oh great, another XML format I need to implement and support. However, I think Zillow will be able to garner support for their ZIF format because of the following reasons.

  1. Their spec is simple to understand. Unlike GoogleBase & edgeio, which seem to be trying to win an Obfuscated XML code contest with their name spaced RSS mess, Zillow’s feed documentation is every bit as clear as the current industry feed leader, Trulia.
  2. Their spec is comprehensive. The only industry schema that compares to the breadth and depth of the Zillow’s XML Schema is RETS. Except Zillow has the benefit of not having to getting 900 MLS boards to play nice together.
  3. Doc ‘Trulia’ Holliday is not dumb. A master gun fighter in his own right, nothing is preventing Trulia from embracing the Zillow feed standard as their V2 spec. If that happens, RETS may suffer the same fate as Lester Moore. Out here on the wild web of the west, there’s the quick and the dead.
  4. Oh yeah, they also get about 4+ million monthly visitors on their web site.

Anyway, grab the popcorn; it’s going to be show!