Comments of the Week: Naming the Mortgage Vibe

Mortgage & Real Estate

One of the comments that came in this week may be the best short description of this year’s mortgage industry vibe. From reader Brian Blanchard: “So many rules. So little guidance. Welcome to lending in 2014!”

It’s great to get thoughtful comments on features, such as the recent one about the hard time surviving spouses are having with reverse mortgages if they are not yet 62 and their spouse with the home equity conversion mortgage (HECM) predeceases them. Reader Augie Zolezzi points out “The reverse mortgage when used properly is a very good tool. Both spouses need to be over 62 years old. If one is under that age there will always be a problem. Maybe an insurance policy as part of the package would work. If one dies the policy could pay the home off. Nothing is simple unless it is planned out. The reverse is just one tool.”

The same feature brought in another response, from reader Donna D: “Have had two younger widows that I know have horrific problems with reverse mortgages because they were too young to be on the mortgages. They found that they would lose their homes because reverse mortgages take such a big bite out of equity every month and the mortgage needs to be paid off within a year of the borrower’s death, they both tried to save them with a regular mortgage. That of course did not work. One went to foreclosure and the younger spouse died depressed. The other is trying to get hers sold.  By the way, neither spouse was put back on title after the reverse mortgage was made so they did not even have a legal interest in the property!”

Readers often add some insight to the features we write. The following comment was added to the alert titled “Distressed Homeowners Tricked by ‘Securitization Audits’” by Michael Wallace: “Legally who owns the note is whoever it is endorsed to. That is all the court cares about. The problem is most of these notes are part of mortgage securitizations and in the case of private RMBS, it is difficult to determine who can make a decision in discussing loss mitigation options.”

Here’s another one: The following comment was added to the alert titled “Sole Proprietors Face Hurdles Obtaining QM Loans” by Kristeen Smith: “In addition, loans can still exceed the 43% DTI for the time being in many cases.”

Despite our many efforts to be perfect, we occasionally accept correction from our readers. So re: the alert titled “CFPB Provides New Guidance on Appraisal Disclosures” brought reader Allen Maulsby’s remark: “It’s ECOA not QM that requires this.”

Reader David Kelsay wasn’t impressed by a feature on FHA and minority lending. Here’s what he had to say: “Census TRACT, not track. And where’s the analysis of race/ethnicity vs. funded loan amounts to confirm that minorities are disproportionately, or even proportiniately, affected by reducing the limits in these markets?  You can’t just report that the 30 census tracts have high minority populations and, therefore, minorities are adversely impacted.  That’s a stupid syllogism.”

Maybe so. But it’s spelled “proportionately,” not “proportiniately!”

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