CALIFORNIA MORTGAGE LOAN BROKERING AND LENDING 4th edition

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CALIFORNIAMORTGAGE LOAN BROKERING AND LENDING
4th edition

• By Dr. D. Grogan, MBA, GRI, CRS, CPM
• M. C. Buzz Chambers, RECI, GRI

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Contents

• PART 1 SCOPE OF THE BUSINESS
• Ch 1 Scope of the Loan Brokerage
• 1.1 Overview of the Book
• 1.2 Historic perspective
• In the beginning
• Early progress
• Unstable market
• Today
• 1.3 Basic information
• Hard money versus seller carry-back money
• Careers in mortgage loan brokering
• Loan originators
• 1.4 Licenses and Professional organizations
• Legal and licensing requirements
• Professional organizations

• Ch 2 Sources of Business
• 2.1 Getting started
• 2.2 Marketing
• 2.3 Advertising
• 2.4 Other Sources of Business
• Referrals from Realtors
• Referrals from Other sources
• Referrals from the Public
• Testimonial
• 2.5 Types of Media
• Affiliation
• Billboards, benches, Buses
• Direct advertising
• Direct main advertising
• Internet
• Magazines
• News Releases
• Newspapers

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Contents

• PART 2 Loans
• Ch 3 Loans Conventional
• 3.1 How a mortgage broker selects a loan
• 3.2 Conventional loan features
• Loan amounts
• Eligibility requirements for high-balance loans
• Loan to value ratio
• Loan to value payment
• Fixed rate loan
• Bi-Weekly fixed rate loans
• The 10- or 15-year mortgage
• Adjustable rate mortgages
• Index
• Treasury bill rate
• LIBOR
• The two step mortgage
• Price level-adjusted mortgage
• Reverse annuity mortgage

• 2.5 Types of Media (continued)
• Office supplies
• Promotional materials
• Radio
• Realtors
• Telemarketing
• Television
• Trade Shows
• Networking group
• 2.6 Advertising regulations
• Licensee advertising
• License number on business cards
• Advance Fee Advertising
• Regulation Z Advertising Disclosures
• Fair Housing Terminology

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Contents

• 3.2 Conventional loan features (cont.)
• FNMA FHLMC loan programs
• Condominium loans
• 3.3 Mortgage insurance
• 3.4 California loan programs
• California housing finance agency
• Southern California Home Financing Authority
• Hope for Ownership of Single Family Homes
• Home Investment and Affordable Housing
• Public Employees Retirement System
• State Teacher Retirement System
• Home Ownership Program
• My Community mortgage loan
• Energy Efficient Mortgage
• Other loan programs

• 3.5 Refinance, Equity and Junior or Sub-Prime
  loans
• Refinance loan
• Junior liens
• Home equity line of credit
• Loans Sub-Prime borrowers
• Defaults
• Ch 4 Loans Government
• 4.1 FHA loans
• Statutory loan amount limits
• FHA 202
• FHA 203B and FHA 203I
• FHA 302 K
• FHA 207

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Contents

• 4.1 FHA loans (cont.)
• FHA 221 d 2
• FHA 221 d 3
• FHA 221 d 4
• FHA 223 e
• FHA 223 f
• FHA 234
• FHA 237
• FHA 238
• FHA 244
• FHA 245
• FHA 251 (ARM)
• FHA 255 (HECM)
• FHA Title I
• FHA Energy Efficient Mortgage (EEM)

• 4.2 FHA loan considerations
• FHA versus first-time-home buyers (FTHB)
• FHA MIP
• FHA Streamline loan (rate reduction)
• Other FHA features and loan programs
• Secondary residence
• FHA housing loan programs
• 4.3 Veterans loans
• Veterans regulated closing costs
• DVA loans with second trust deeds
• DVA refinances
• Rate reduction refinance
• Standard refinance
• DVA jumbo loan
• Veterans EEM (DVA EEM)
• Sellers concessions
• FHA or DVA loan approval

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Contents

• 5.6 Government loan disclosures
• Required disclosures for FHA loans
• Required disclosures for DVA loans
• 5.7 California disclosures
• Mortgage loan disclosure statement
• 5.8 California licensee non-loan disclosures
• Appraisal disclosures
• Credit and fair lending disclosure
• Death of acquired immunodeficiency syndrome
  (AIDS)
• Earthquake disclosure
• Energy conservation, retrofit and thermal
  disclosure
• Environmental hazards disclosures
• Fire hazard areas (state responsibility areas)
• Flood disaster areas
• Foreign investment in real estate tax act
  (FIRPTA) and Cal-FIRPTA

• 4.4 Credit Alert Interactive Voice Response
  System (CAIVRS)
• 4.5 California Veteran (Cal Vet)
• 4.6 SBA
• Ch 5 Loans Financial Disclosure and Other Real
  Estate Disclosures
• Real Estate Settlement Procedures Act (RESPA)
• Regulation X (Reg X)
• Home Mortgage Disclosure Act (HMDA)
• Home Mortgage Disclosure (Reg C)
• 5.1 Federal TIL (Reg Z)
• 5.2 APR
• 5.3 Section 32 loan guidelines
• 5.4 Federal RESPA, Reg X
• 5.5 HMDA (Reg C)

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Contents

• 5.8 California licensee non-loan disclosures
  (cont.)
• Flood disaster areas
• Foreign investment in real estate tax act
  (FIRPTA) and Cal-FIRPTA
• Government compliance disclosure
• Hazard insurance coverage
• Language of the agreement
• Lead-based paint
• Local option disclosure statement
• Supplemental property taxes disclosure
• Mello Roos disclosure
• Methamphetamine-contaminated properties
• Pest control
• REO property (REO)
• Smoke detector compliance
• Title insurance advisory
• Transfer disclosure statement (TDS)

• 5.8 California licensee non-loan disclosures
  (cont.)
• Utility line extensions
• Water heater bracing
• Lender/purchaser disclosure statement
• 5.9 Other loan disclosures
• Article 7
• Prepayment penalty
• Liability
• Loan terms
• Maximum charges
• 5.10 Predatory lending law
• Disclosure
• Prohibited loan terms
• Prohibited practices
• Penalties and corrective action
• Balloon payment
• 5.11 Good Faith Estimate (GFE)

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Contents

• PART 3 Processing
• Ch 6 Processing Pre-qualification and loan
  application
• 6.1 Lender/purchase statement
• 6.2 Disclosure of home ownership counseling
• 6.3 Residential loan application
• 6.4 Qualifying ratios
• 6.5 Department of Veterans Administration (DVA)
  qualifications
• 6.6 Federal Housing Administration (FHA)
  qualifications
• 6.7 Conventional qualifications
• 6.8 Other qualifications

• Ch 7 Processing Credit and disclosures
• 7.1 Credit
• 7.2 Credit and FICO score
• 7.3 Privacy policy
• 7.4 ECOA
• 7.5 Non-traditional credit reports
• 7.6 The housing financial discrimination act of
  1977 (Fair lending notice)
• Ch 8 Processing Verifications and stacking order
• 8.1 Processing tools
• 8.2 The processors file
• 8.3 Income and guidelines for the processor
• 8.4 Borrow documentation
• 8.5 Sample loan file
• 8.6 Stacking order

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Contents

• Ch 9 Processing Escrow, settlement, title and
  appraisal
• 9.1 Escrow
• 9.2 Statement of Information
• 9.3 Impound account
• 9.4 Title insurance
• 9.5 Appraisal
• Ch 10 Processing Underwriting and quality
  control
• 10.1 Underwriting
• 10.2 Red Flags
• 10.3 Quality control and auditing

• Ch 11 Processing Docs, funding and closing
• 11.1 Conditions prior to Docs
• 11.2 Drawing Docs
• 11.3 Conditions prior to funding
• 11.4 Loan documents
• 11.5 Funding
• 11.6 Closing
• PART 4 The Secondary Money Market
• Ch 12 Shipping and Servicing
• 12.1 Shipping
• 12.2 Loan servicing
• 12.3 Securities dealer
• 12.4 Types of securities
• 12.5 Real estate economics
• 12.6 The secondary money market Investor
  protection

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Contents

• Ch 12 Shipping and Servicing (cont.)
• 12.7 Packaging and selling loans
• 12.8 Yield spread premium
• 12.9 National Code of Real Estate Loan Servicing
  Industry
• PART 5 Regulations and Operations
• Ch 13 The business operational practices and
  Department of Corporations (DOC) licensing
• 13.1 Employment considerations
• 13.2 Business office operations
• 13.4 Wholesale broker agreement
• 13.4 How to become a mortgage banker
• 13.5 Computer applications and publications
• 13.6 Acts by the loan agent
• 13.7 Compensation and referral fees

• 13.8 Exemptions from the licensing requirements
• 13.9 License law for the loan agents
• 13.10 California DOC
• Ch 14 The California Department of Real Estate
  (DRE) license activity for loan agents
• 14.1 California Department of Real Estate (DRE)
  license
• 14.2 DRE Broker supervision
• 14.3 California codes and regulations for
  licensees
• 14.4 Review of instruments
• 14.5 California financial code
• 14.6 Trust Funds

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Contents

• Appendix
• Appendix A Loan application FNMA Form 1003
  English and Spanish
• Appendix B Credit Report
• Appendix C Verifications
• Appendix D Sale Escrow Instructions
• Appendix E Appraisal Report
• Appendix F Preliminary Title Report
• Appendix G Loan documents
• Appendix H Employment forms
• Appendix I Wholesale Brokerage Agreements
• Appendix J Internet Web Sites
• Appendix K Glossary of terms

• Ch 15 Math and trust funds for the loan agent
• 15.1 Introduction
• 15.2 LTV ratio
• 15.3 Borrowing qualifying income
• 15.4 Payment factor chart
• 15.5 Amortization comparisons
• 15.6 Financial calculators
• 15.7 Trust fund accounting