More proof that the idiots are in charge

We have all heard the horror stories of lenders screwing up on refinances and purchases but it seems that in all aspects of banking the big guys are messing up. Last year Bank of America foreclosed on at least three homes that they did NOT have a loan on! At least one of these homes was paid for and never had a mortgage with B of A or any lender (http://abcnews.go.com/Business/bank-america-sued-foreclosing-wrong-homes/story?id=9637897). Since taking over Countrywide, B of A has slowed approvals down by 80%, increased closing package size by over 20% and in general has messed up what was one of the best mortgage lenders in the country ( formerly Countrywide). B of A is not the only one by far but it seems they are doing everything they can to piss off their customers even on the banking side. A friend of mine had a line of credit in place for years with B of A. He was never late and often used it for payroll when large account payments came after pay periods. He ran up the balance and then paid it off when checks arrived. Without notice, he found out that is line had been closed and B of A cleaned all of his bank accounts to pay off the outstanding balance. He had to scramble to make payroll and moved his accounts to a more friendly local bank. But he went cash short near Christmas, incurred bounced check fees, service fees and actually had to take a loan on his life insurance to continue in business till new credit lines were in place. This man has a profitable and well established business.

Chase mortgage seems to be impossible to work with as well. One client I had went almost 11 months to refinance. Both borrowers had over 40 years of perfect mortgage history, long time state jobs, a 55% equity stake and were current Chase customers. Chase changed 800 numbers three times during this process and just disconnected the old one rather than transfer to a new number, they went through five processors, three LO's, and never talked to a supervisor more than once before being passed on to someone else. They had to contact their Senator's office to complain before Chase would finally approve and draw docs. Once the senator's office got involved it took 7 days to close. The closing package was such a mess that it took over two hours to close, involved over 200 pages and even required the borrowers to initial all signatures (legally this is questionable and indicates their lawyers are fools). If you sign a document, why initial the signature-makes no sense.

You do not have to look further for proof of the "Peter Principal" in action. The best and brightest have been laid off and the incompetent are in charge. Tighter guidelines, underwriters with NO ability to use common sense, credit score dependency without regard to real credit history and conditions that go far beyond what is necessary. Patience and firm aggressive pressure is the only way to get a loan done in this market. Best advice to give a borrower...make sure you work it everyday and talk to your LO and the processor frequently. Allowing the process to take care of it self will result in the file dying like thousands of files do weekly.

The beginning...

I have been in the mortgage industry now for over 20 years. I have done just about every job possible from processor, loan officer, broker, managing a brokerage, account executive, underwriter and closer. I have seen a lot of changes and VERY few have been good. I honestly believe the mortgage industry to be populated by some of the most incompetent, self centered, greedy and moronic people in business today. And it is getting worse! Yes, I am still fighting the good fight within the industry and love the satisfaction I get when helping people get into a new home. But nobody is telling the brutal truth what is going on and most within the mortgage field are nothing more than sheep following the herd to the next slaughter.
That being said, I think you will see in the following posts that common sense is very uncommon and nothing good will come of the changes we are seeing in the industry. I saw this entire fiasco coming back in 2003 and everything I foretold has come true. I will be brutally honest about what is going on, what to expect when wading into the mortgage morass and how you can deal with it. I will post about once a week with a new topic and encourage my readers to comment and offer their opinions.
Topics coming up:

• FHA, how dumb are your new changes!
• Conforming loan changes that scream "we are clueless morons"
• TIL, the stupidest form ever created and getting worse!
• Credit scores, what a unfair and lousy way of doing business
• Closing packages and how we are killing our trees for stupidity
• Closing fee ripoffs
• Why "stated" programs were lost and why self employed people are getting screwed
• Arms...the good, the bad and the ugly
• Regulation that does no one any good
• The bleeding of home equity
• Home values and how appraisers are going from optimists in value to clueless cowards