june 2009
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TABLE OF CONTENTS
President's Message
Doreen White, Lender Services
Coordinator, Market Street Settlement Group, LLC
 I
am very pleased and excited to be your president for the
2009 – 2010 year! There is a lot of work to get done within
the next few months. Loan officers employed by either a
mortgage broker or mortgage banker are required to be
licensed and fulfill continuing education requirements by
December 31, 2009, which is outlined in the S. A. F. E. Act.
Depository loan officers are excluded from the S. A. F. E.
Act but will need to be registered by National Mortgage
Licensing System (NMLS), as soon as the Federal Financial
Institutions Examination Council (FFIEC) finalizes its
rules.
No one can argue that the constants in our industry are
change and transition. Let me take this opportunity to
reassure you that as a MBBA-NH member you can feel confident
that we will continue to work hard so that you stay informed
and compliant.
With the onset of licensing, continuing education, and a
licensing exam, MBBA-NH’s goal is to rollout as quickly as
possible continuing education credits this summer, with the
hopes of a seamless course approval process by NMLS.
With this in mind, the volunteers of the association have
been putting in overtime recently. The education/programs
committee is busy getting us ready for continuing education
courses; the ethics/legislative committee was successful with removing a possible state tax on refinances; and
the public relations committee’s recent work includes a
first time home buyer article to the media (scroll down to
see a copy of this article) on driving home
the point that now is a good time to buy. The public
relations committee is also gearing up to offer a Realtor
continuing education course on basic mortgage financing
options.
Now that you are aware of some of the work in which the
committees are involved, I would like to formally make a
call to action: Please help your association continue
supporting the mortgage finance industry by joining one of
our very active committees. You’ll meet some great people
in our industry who care about it as much as you do, and
you’ll be helping the MBBA-NH fulfill its mission to help
its members (you!) be as successful as possible.
As president of MBBA-NH, I promise to provide all the
necessary information and education you need. In the
meantime, MBBA-NH’s board of governors and I are here to
help you succeed professionally now and in the future. Your
input is always encouraged and welcomed.
Attention Loan Officers: 20 Hours of C/E Credits and a
Passing Grade for the SAFE Act Exam is NOW Required
 MBBA-NH will become an approved course
provider with the National Mortgage Licensing System (NMLS).
In this capacity, we will be offering continuing education
courses, especially the 20 hours required by the end of this
year. If all goes as planned, we will be offering this
education by August 2009 in plenty of time for you to
fulfill your requirements.
The 20 hour pre-licensing course
includes the topics below and will help you prepare for the
SAFE mortgage loan originator exam:
-
Ethics
-
Federal Law and regulation
pertaining to mortgage origination
-
State law and regulation
pertaining to mortgage origination
-
Federal and state law and
regulation, including instruction on fraud, consumer
protection, the nontraditional mortgage marketplace, and
fair lending issues
The content outlines for the
state-specific and national exams are now available on the NMLS Web site.
Please click here for a copy
of the state-specific or click here for the national content outlines. Both
outlines will further assist you in preparing for the exams.
If you have additional questions about licensing
requirements for loan officers, please visit the NMLS Web
site by
clicking here.
Appraiser’s Corner:
Sales Concessions No Longer Reported in MLS
By Mark McKeon, President, M. H. McKeon Appraisal
Services, Inc
 As
of May 1, 2009, sales concessions are no longer reported in
the MLS, and many brokers have taken the position that it is
inappropriate for them to disclose the dollar amount of sale
concessions if an inquiry is made by an appraiser. The
decision was made because the amount of money given to a
buyer by a seller, often to assist with the payment of
closing costs, is not a matter of public record. Therefore,
to disclose the amount of concessions might be considered a
violation of privacy for the buyers and sellers. While I am
all for privacy, this is a significant issue for anyone in
the business of residential real estate and lending who
relies on accurate property valuation.
Some real estate practitioners will argue that the recorded
sale price is the real sale price of a property, regardless
of sales concessions that might have been paid. Others feel
that the real sale price is the amount of money that the
seller receives for his/her home, after the payment of sales
concessions. I fall into the latter group. It is not local
custom or law that closing costs are paid by sellers.
Closing costs are sometimes paid by sellers, most often when
buyers have limited cash on hand, or they simply choose to
borrow the closing costs. Whether I am selling a piece of
real estate or a car or any other possession, it’s real
market value is represented by the amount of money I put in
my pocket at the end of the transaction after all customary
fees are paid (I consider customary fees to be those that
are paid in virtually every transaction, such as real estate
transfer tax).
Fannie Mae and Freddie Mac are clear in their expectations.
The definition of market value in the standard appraisal
form is lengthy and I will spare you all of its detail, but
one of the conditions relates to sales concessions. It
states that “The price represents the normal consideration
for the property sold unaffected by special or creative
financing or sales concessions* granted by anyone associated
with the sale. (* adjustments to the comparables must be
made for special or creative financing or sales concessions.
No adjustments are necessary for those costs which are
normally paid by sellers as a result of tradition or law in
a market area; these costs are readily identifiable since
the seller pays these costs in virtually all sales
transactions)”.
Appraisers and brokers are now in the position of knowing
the amount of closing costs paid only in a relatively small
percentage of cases. To find out if there were any
concessions, it is necessary to call the listing or selling
broker, only some of whom feel comfortable sharing the
information. The process is time consuming. If lenders allow
the seller to pay up to 6% of the sale price in concessions
to the prospective purchaser, it is possible that appraisers
will overvalue properties to that degree. Most often the
amount is smaller than that, but even 3% is significant. In
my opinion, an appraisal is considered to be accurate if it
is within 5% of a property’s value. The accuracy is
seriously diminished if the sales prices of the comparables
are potentially overstated by up to 6%. In the opinion of
this writer, the inability to properly adjust for sales
concessions places an upward bias on appraisals which will
lead to loan amounts that are higher than the lending
community intends to lend.
I am of the belief that most buyers and sellers would not
object to the disclosure of sales concessions. It may be as
simple as asking the buyer and/or seller at the time of
closing to grant permission to the broker to disclose sales
concessions in MLS. Perhaps it could be made a line item on
the PA-34 form (Department of Revenue’s post closing form,
completed by the buyer, that outlines the details of the
transaction). I am hopeful that there is a reasonable
solution to this problem that allows for sales concession
information to be disseminated without violation of privacy.
It is a crucial issue in the valuation of property.
First-Time Home Buyers:
Don't Miss Out On A Perfect Storm
The following
press release was
written by Andrew Cadorette on behalf of MBBA-NH. He
is the Education Coordinator of New Hampshire Housing
Finance Authority and MBBA-NH Public Relations Committee
Member
 Since 1998, Amy and Joe were renters. You could say for
the last 10 years that their rent benefited someone else’s
bottom line. Although they enjoyed the flexibility of
renting, they were ready to set down roots and call New
Hampshire home. Amy, a teacher, and Joe, a minister, had
always dreamt of owning their own home, but never thought
they could afford one. For them a home was a place to
settle down, an investment, and a sense of pride. Also, for
Amy, it would allow her to have the puppy she always wanted.
Through a friend, they contacted a local
Manchester mortgage broker, Joe Moriarty of Guardian
Mortgage Corporation. They were impressed with the mortgage
broker’s experience, honesty, and qualifications as a
Certified Mortgage Professional (CMP) - a designation he
earned through the Mortgage Bankers and Brokers Association
of New Hampshire (MBBA-NH). When the couple first started
their home search in 2000, they were nervous about the
Joe and Amy with Their
market and decided not to purchase. Then in 2004, when they
began to look
German Shepard
again, but they were too late - prices were
rapidly rising and home ownership
Puppy Sadie
again seemed out of their
reach. Amy and her husband, Joe, felt like home
ownership
would never be a reality for them. Then in 2009, as Amy put
it,
“the perfect storm of opportunities hit.” Now was the
time to reach for their dream.
As home prices began to fit within their
budget, they once again visited their mortgage broker. He
encouraged them to take advantage of the historically low
rates as well as down payment and closing cost assistance
programs offered by New Hampshire Housing. In addition, he
told them about the $8,000 federal first-time home buyer tax
credit. Their mortgage broker also insisted that Amy and
Joe attend a free first-time home buyer seminar offered by
New Hampshire Housing to learn about the market and home
buying process. “They could have qualified for a home
earlier in their search, but I knew Amy and Joe wanted to do
it right,” said Mr. Moriarty, their mortgage broker.
By working with their REALTOR®, Mike Caouette
of Keller Williams Realty, Amy and Joe were able to find the
right home that fit their needs. To Amy this new house
meant: “A place where we could live our life together,
settle down, and actualize our dreams - a place to call
home.” By working with an experienced CMP, Amy and Joe were
able to receive a great fixed-rate mortgage with favorable
terms. In addition, they qualified for $10,000 in down
payment assistance through New Hampshire Housing’s Home
Advantage program, while still taking advantage of the
$8,000 first-time home buyer tax credit offered through the
federal government. With assistance from their professional
REALTOR®, they were also able to purchase an affordable home
and take advantage of the current buyers’ market by asking
the seller to contribute additional funds toward the closing
costs. By the end of the closing, they had received more
than $26,500 in incentives to help them purchase their first
home. Low rates, a buyers’ market, down payment and closing
cost assistance, as well as a tax credit incentive, made the
difference for them as first-time home buyers. In today’s
real estate market, Amy and Joe felt that many of their
barriers to home ownership were lifted.
"It feels good!” said Amy about their new
home. “Without the ‘perfect storm’ of incentives and the
help of dedicated professionals, we may never have reached
our goal.” They have been in the home since April, are
settling in, enjoying their new investment, and have just
added a new puppy to their family - making this house their
home.
MBBA-NH's
Annual Dinner Almost Makes National Headlines
The
2009 annual dinner at the Executive Court Conference Center
on Wednesday, May 13, 2009, attracted 75 mortgage finance
professionals in New Hampshire. All enjoyed
Governor John Lynch who was the keynote speaker. Upon
beginning his talk, he hinted that an important announcement
would be made by him tonight. With this being said,
everyone immediately became silent and sat up in their seats
with anticipation of being the first to hear the Governor say that he was
going to support or oppose the gay marriage legislation on
his desk, a contested and divisive issue that people were
engaged in all over the country.
The
Governor's delivery was very good: the room remained silent,
except for the ever-increasing volume of his every word,
until he blurted out with sheer delight that "The new state
dog is a Chinook!"
The
annual dinner marks the end of the 2008 - 2009 fiscal year
and is when the new slate of officers are sworn in,
Certified Mortgage Professionals (CMP) are awarded their
designations, and college scholarship winners are
introduced.
Shelly Akatyszewski, CMP
Jane Jordan, CMP
Kurt Strandson, CMP
SARA Mortgage
Mortgage Network, Inc.
Radian Mortgage Corp.
There were three
members who earned their CMPs: Shelly Akatyszewski of
SARA Mortgage, Jane Jordan of Mortgage Network, Inc., and
Kurt Strandson of Radiant Mortgage Corp. The CMP
designation demonstrates professionalism, knowledge, and
ethics in the mortgage finance industry. It takes
about three years, from start to finish, to fulfill its
strict requirements. Congratulations to our new CMPs!
Joe Moriarty of
Guardian Mortgage was the lucky person who introduced
MBBA-NH college scholarship winners: Jennifer Berntsen
and Ian Gausch. Both will receive a scholarship to pay
for their college books. Jennifer is majoring in
nursing at the University of Rhode Island, and Ian is
attending the University of New Hampshire where he is
majoring in food services management. (Ian and
Jennifer's
scholarship essays will
be reprinted in future newsletters.)
A special thank
you to our immediate Past President Ralph Coppola of Residential Mortgage Services, Inc.
who was always readily accessible to appear at legislative
hearings, media interviews, and various events related to
the mortgage finance industry. His knowledge of the
industry was also appreciated and proved beneficial to our
industry, especially with his recent meeting with the
governor on the possible refinance loan tax.
As we begin a new
year, the new board of governors is prepared and equipped to
deal with the changes and challenges we all have ahead of us
this year. Please
click here for a list of the 2009 - 2010 board of
governors.
The annual dinner
was supported, in part, by our Preferred Corporate Partners.
Throughout the year their monetary support helps the
association deliver worthwhile programs at an affordable
cost to the membership. Thank you for your continued
support. PCP applications are being mailed for the
2009 - 2010 year to all primary contacts. We hope our
current PCPs continue and encourage others to sign up.
Below is a list of our 2008 - 2009 PCPs:
MBBA-NH Offers First-Time Home Buyer Tax Credit
Brochure
The federal government is offering a tax
credit of up to $8,000 for qualified first-time home buyers
purchasing a principal resident on or after January 1, 2009,
and before December 1, 2009. MBBA-NH public relations
committee has created an informational brochure on this
program for you to use and distribute to others in your
office and to Realtors.
Click here for a
copy of this brochure. When reproducing the brochure,
print on both sides. You will also need to trim the
brochure to make it bi-fold.
Programs Schedule
July 21, 2009 - Golf outing at Wentworth By
The Sea, Rye, New Hampshire, with the Massachusetts Mortgage
Bankers Association.
Click here for more information and to register.
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