NEW Changes to Truth In Lending Act MUST READ!!!

Summary Effective for applications taken on or after July 30, 2009, the Federal Reserve Board

and Legal (“FRB”) adopts the final rule amending Regulation Z, 12 C.F.R. §§226.1 et seq. ("REG

Reference: Z"), which implements the Truth in Lending Act, 15 U.S.C. §§1601 et seq. ("TILA") and the Home Ownership and Equity Protection Act of 1994, 15 U.S.C. §§1639 et seq. Public Law 103-25 ("HOEPA").

The final rules revise the disclosure requirements for mortgage loans under REG Z. The intention is to ensure that consumers receive cost disclosures earlier in the mortgage process. The revisions to REG Z implement the Mortgage Disclosure Improvement Act (“MDIA”). On July 30, 2008, the MDIA was signed into law as part of the Housing and Economic Recovery Act of 2008 (“Public Law 110-289”).

Changes: The key changes to TILA effective in July are listed below:

· TILA disclosures are now required on all dwelling-secured, closed-end mortgage loans and applications. Previously, only certain transactions required these disclosures.

· There is a new statement that must be provided with the early TIL: “"You are not required to complete this agreement merely because you have received these disclosures or signed a loan application."

· The “early” TILA disclosures must be delivered or placed in the mail not later than 3 business days after the creditor receives the consumer's written application, and at least 7 business days before consummation of the transaction. This is a new “waiting period.”

o For the above purpose “business days” include each day (other than Saturday or Sunday) when the head office is open to the public for carrying on substantially all our business functions.

· If the annual percentage rate (“APR”) on the “early” disclosure becomes inaccurate, by increasing or decreasing beyond established tolerance levels, the creditor must now make corrected disclosures to the consumer with a revised APR. The consumer must receive the corrected disclosures no later than 3 business days before consummation.

o The APR is considered accurate for a regular transaction if it is not more than 1/8 of 1 percentage point above or below the actual annual percentage rate.

o The APR is considered accurate for an irregular transaction if it is not more than 1/4 of 1 percentage point above or below the actual annual percentage rate

o For this purpose, the definition of business day is the “rescission” standard for business day, which includes all calendar days except Sunday and legal public holidays.

· Except for a reasonable fee for a credit report, no other fees may be collected before the consumer has received the “early” disclosure.

o If the creditor mails the disclosures, the creditor may assume the consumer has received the disclosures after midnight on the third business day following mailing of the disclosures.

o For this purpose, the definition of business day is the “rescission” standard for business day, which includes all calendar days except Sunday and legal public holidays

Mortgage News for Tuesday June 30th 2009

Tuesday's bond market has opened in negative territory despite early stock losses and weaker than expected economic data. The stock markets are in selling mode after digesting this morning's economic news with the Dow down 116 points and the Nasdaq down 14 points. The bond market is currently down 7/32, which will likely push this morning's mortgage rates higher by approximately .125 - .250 of a point.

The Conference Board gave us today's only relevant economic data when they posted June's Consumer Confidence Index (CCI) late this morning. They reported a reading of 49.3 that was well below forecasts of 55.1. This means that consumers were much less optimistic about their own financial situations than many had thought. This is actually supposed to be good news for the bond market and mortgage rates since it indicates consumers are less apt to make large purchases in the near future. Unfortunately for mortgage shoppers, bond traders seem to have forgotten that this morning.

The Institute of Supply Management (ISM) will release their manufacturing index for June late tomorrow morning. This index measures manufacturer sentiment by surveying trade executives on current business conditions. A reading below 50 means that more surveyed executives felt business worsened in the month than those who felt it had improved. Analysts are expecting a reading of 44.0. That would indicate that manufacturers felt business improved slightly from the previous month. Good news for bonds and mortgage rates would be a weaker than expected reading.

Thursday brings us the release of two monthly reports, one being the extremely important Employment report. The other, May's Factory Order's data will likely have little impact on the financial markets or mortgage rates as most of the attention will be directed towards the employment figures.

The financial markets will be closed Friday in observance of the Independence Day holiday, but there will be no early close for the bond market Thursday as has been the case previous years. However, it will still probably be a light afternoon in trading as traders head home for the long weekend. This could magnify the reaction the markets will have to the morning's data.

New DPA from TDHCA

It has been released that we can now do DPA through the TDHCA at America Home Key. I have included the following information from the TDHCA website telling exactly what the program is and you can click on the picture to the left for more info.

Down Payment Assistance Programs

The Texas Department of Housing and Community Affairs (TDHCA) is pleased to announce the release of 2 new down payment assistance programs - the Mortgage Advantage Program and the 90-Day Down Payment Assistance Program. Both programs are designed to monetize the Federal First Time Homebuyer Tax Credit enacted within the American Recovery and Reinvestment Act of 2009 by helping Texas families take advantage of the opportunity made available by recent Congressional action.

Under the Mortgage Advantage Program, TDHCA has made available on a first come, first serve basis to participating mortgage lenders approximately $1 million in down payment assistance for use in conjunction with the 2009 Texas Mortgage Credit Program and approximately $1.5 million in down payment assistance for use in conjunction with The Texas First Time Homebuyer Program (Bond 70). The first lien interest rate for Program 70 will remain at 5.75%.

Under the 90-Day Down Payment Assistance Program, TDHCA has made available $5 million in down payment assistance to be used in conjunction with first lien mortgage loans originated by the lender.

• Program guidelines and additional information (PDF)
• Please refer to the First Time Homebuyer Participating Lender List (PDF) and/or the Texas Mortgage Credit Program Participating Lender List (PDF) to find lenders who also participate in the Mortgage Advantage Program.
• 90-Day Down-Payment Assistance Program Participating Lender Contact List (PDF)
• For lender documentation please visit the Homeownership Programs Lender Documentation page.

For current available program funds please visit the Available Funds page.

Mortgage Update for Monday June 29th 2009

Monday's bond market has opened in positive territory as investors prepare for this week's economic news. The stock markets have opened the holiday-shortened week in positive ground with the Dow up 83 points and the Nasdaq up 10 points. The bond market is currently up 13/32, which should improve this morning's mortgage rates slightly. We haven't gotten any improvements from our investors but if it stays like this it wont be long.

This week brings us the release of only four economic reports for the markets to digest, but three of them are considered to be important and one of those three is arguably the most influential report we see each month. In addition, these reports are being released over just three trading days.

There is no relevant economic data scheduled for release today. June's Consumer Confidence Index (CCI) is the first report of the week and will be posted late tomorrow morning. This index is important to the financial markets because it measures consumer willingness to spend, which is important because consumer spending makes up two-thirds of the U.S. economy. If it shows a sizable increase in confidence from last month, we can expect to see the bond market falter and mortgage rates rise slightly. Current forecasts are calling for a reading of 55.1, up slightly from last month's 54.9 reading.

Overall, tomorrow and Wednesday's data (Consumer Confidence Index and ISM index) should bring some volatility in trading and mortgage rates, but Thursday's Employment report is definitely the most important of the week. Its impact can single handily lead to an improvement or increase in mortgage rates for the week.

The financial markets will be closed Friday in observance of the Independence Day holiday, but there will be no early close for the bond market Thursday as has been the case previous years. However, it will still probably be a light afternoon in trading as traders head home for the long weekend. Oil prices will also be higher because of the holiday so that will affect the oil traders. My family is not planning on traveling for the 4th so increased fuel prices will not affect us as much as other people.

I hope AHK can get my personal production loan completed this week so the investor can buy it and the loan can be on its merry way. It closed on the 5th of June but is still stuck between the Title Co and Gold Financial getting the HUD-1 corrected. I have my fingers crossed that it will happen today, I would hate to have to tell a borrower that the house is not theirs after they have moved everything in because it closed almost a month ago :(

Well that will be all for now if you guys have any tips, hints or comments you want to post let me know and they will be put up. Thanks for reading and hope you enjoyed it.

Mortgage News for Friday June 26th 2009

Friday's bond market has opened in positive territory again despite stronger than expected results in this morning's economic data. The stock markets closed with the Dow down 34 points and the Nasdaq up 8 points. The Bond Market closed at 3.52% which is lower than it has been in the last 2 weeks. But not sure what effect it will have on mortgage rates on monday. Most of our investor have not repriced even though the market went down and Oil prices were down.

May's Personal Income and Outlays data was posted early this morning, revealing a 1.4% jump in income and a 0.3% rise in spending. The spending reading was very close to revised forecasts, but the income reading greatly exceeded forecasts. However, a good portion of that increase was due higher unemployment limits and revised payroll withholdings. Therefore, analysts are taking the spike in stride and not with fear that wage inflation is a threat.

The second report of the day also gave us a stronger than expected reading. The revised reading to the University of Michigan Index of Consumer Sentiment for June came in at 70.8. This was nearly two points higher than forecasts and indicates that consumers were more optimistic about their own financial situations than earlier thought. That is considered negative news for bonds because rising sentiment usually means consumers are more apt to make large purchases in the near future, fueling economic activity.

Yesterday's 7-year Treasury Note sale was also met with a strong demand from investors. Wednesday's 5-year sale went well, helping to set the stage for yesterday's sale. This helped boost bond prices during afternoon trading and eases some concerns about the supply of debt being sold by the Fed, at least temporarily.

Next week is likely to be a very active week for the markets and mortgage rates. There is no relevant data scheduled for release Monday and the markets are closed Friday in observance of the Independence Day holiday. But, in between are several relevant and important reports with one of them being the almighty monthly Employment report. Usually oil prices have dictated what mortgage rates will do but with oil being so volatile that hasn't been the case lately. People in the industry said oil prices will probably rebound in time for the Fourth of July holiday and mortgage rates will spike around the same time.

Mortgage News for Thursday June 25th 2009

I just found out at AHK we have 3 investors who will do the IRS Down payment Assistance Program using the $8000 tax credit available to new home buyers. I will have more information on this exciting news tomorrow.
Thursday's bond market has opened up slightly despite no highly important economic data on the calendar today and a positive opening in stocks. The stock markets are showing minor gains with the Dow up 34 points and the Nasdaq up 15 points. The bond market is currently up 4/32 from yesterday's close, which should improve this morning's mortgage rates by approximately .250 of a discount point over yesterday's morning rates.

This morning's release of the final reading to the1st Quarter GDP didn't reveal any significant surprises. It showed that the economy contracted at a 5.5% annual rate during the first three months of the year. This was a small upward revision from the previous estimate of a decline of 5.7%, meaning that the economy did not shrink as much as previously thought. However, since this data is old now (second quarter initial reading comes next month), the size of the revision was not enough to influence bond trading or mortgage rates.

The Labor Department gave us last week's unemployment figures, reporting that 627,000 new claims for benefits were filed. This was an increase from the previous week's revised total of 612,000 and much higher than forecasts of 600,000. But, as with today's GDP reading, this data is not considered to be of high importance to the markets or mortgage rates.

Also worth noting is today's 7-year Treasury Note sale. Yesterday's 5-year Note sale went pretty well, but the FOMC statement took center stage during afternoon trading. If today's sale is also met with a good demand from investors, we may see bond prices rise later today and mortgage rates move lower. Results will be posted at 1:00 PM ET.

Tomorrow morning has two reports on its calendar. May's Personal Income and Outlays data will be posted early morning. This report gives us an indication of consumer ability to spend and current spending activity. Analysts are expecting to see an increase of 0.2% in income and a 0.4% rise in the spending portion of the report. Smaller than expected increases should be good news for the bond market and mortgage rates.

The second report of the day and the last relevant data of the week will come from the University of Michigan who will update their Index of Consumer Sentiment for May. An upward revision from the preliminary reading of 69.0 would be considered a negative for bonds. The earlier data is the more important of tomorrow's two releases.

The Mortgage Business and Stanley Bing

I regularly read Fortune magazine just to see whats going on in the financial world since since mortgage rates are driven so much by oil prices as of late and the bond markets. The last page of Fortune Magazine always has cool stories and this months editorial by Stanley Bing caught my eye. His column this month is about his experience with refinancing his coop in New York City and the hoops he had to jump through to get it done. Stanley Bing is the alter ego of Gil Schwartz a high ranking Exec at CBS. Since he is a pretty well off fellow you would think he would have no problem refinancing or doing anything to do with money. But his story really hit home because of what documentation he was required to provide to satisfy the underwriters.

As with most large companies the bank he was refinancing through had outsourced their underwriting to a foreign country. His particular underwriter only knows what the computer tells her is required and if she doesn't get these documents she will not approve Stanley's loan for his apartment. Things went from bad to worse. Every document needed at least two pieces of paper for backup, which then required additional documentation. Sometimes things got "lost." He began to have trouble sleeping. Then one morning He got an e-mail from the Speedy Approval Department. This situation is what we deal with everyday all day with underwriters and setup clerks everywhere. I tell all my loan officers to document, document and then document some more just for things like this.

Last week, when all seemed perched on the verge of success, Mr Bing got an e-mail from the Speedy Approval Department requesting my appearance at a certain time and a certain date at Room 101 of the corporate headquarters. "For final adjudication of this matter," the note said. It was not signed. That was a week ago. I'm happy to tell you that I did get my refinancing package through at last. And in the end, I don't think I had to sacrifice too much.If more borrowers were like Stanley it would be a lot easier for us to get loans through in a timely fashion. But the same can be said about Loan Officers that turn in packages to processing with an incomplete 1003 and the loan has to close yesterday.

The point of this new blog is to relay stories like these and many others to more people within our company. We need to all roll upour sleeves and get back to doing business like we used to before we got in this mess. If you want to read more of Stanley Bings editorials you can go to http://money.cnn.com/magazines/fortune/stanleybing/ or http://www.stanleybing.com .

If you have a funny story or an informative blog posting you want to share feel free to email me at nick@ahkloan.com.

New blog about the mortgage business and AHK!

Hey everyone I have finally got America Home Key Inc a blog where we can find out the latest happenings at corporate and the mortgage industry as a whole. I will also be including links to training available from AHK Corporate and through Marie Murry at Apex Training Group. We will try to get as many of our underwriters as we can to do guest blogs and tell us whats coming up as far changes they see and changes that have occurred and affect our daily lives as loan originators.

Our industry is steadily changing at a pace that hasn't been seen in many years and definitely not by the current generation of loan originators. This blog will be available to everyone at AHK to comment and respond to our posts. We will be posting new legislation that has been passed recently and what is in the pipeline for future legislation sessions that will change out industry. Most people I have talked to said the mandatory registration as a mortgage originator will be a good thing since everyone will be on the same level and we will not have Broker title versus the Loan Officer title. The only problem is everyone will have to get their 20-30 hours of Continuing Education in before the deadline.

Marie Murry with Apex Training Group has been doing her CE classes since the beginning of 2009 with America Home Key employees to get everyone ready for the change we saw coming. She has put on classes about Ethics and Morals to the most basic of How to Complete a 1003 Loan Application. These classes are open to everyone even if you do not work for AHK since everyone needs their required hours of CE.

Chas Winckel and Don Harris have really stepped up to try and fill the void that was left by Melinda Truitt who did so much for our company. Chas and Don have stressed that everyone needs to make sure they use Oasys and check your email on the system everyday to stay informed about changes. This blog will also be a place to keep up with changes but more on the public level.
Bryon Cunningham is probably one of the best DE underwriters in the FHA mortgage world and a make sense underwriter that wants to approve your loans. I know AHK is working to improve our rates and be able to bring us competitive pricing to help you close more loans.

I hope this blog is what everyone was talking about at our last meeting with Chas on Wednesday at our USDA Training and CE we had with Marie. Please comment and let me know what you guys want to see on the blog and where you want it to go from here.