As someone that has been in the real estate and mortgage business for some 30 years you can well imagine that I’ve seen a few changes.  One thing I’ve noticed about business cycles is that there always seems to be plenty of blame to go around when things go wrong.  New regulations designed to make sure “that” whatever “that” was) doesn’t ever happen again come out of Washington faster than they can be integrated into business and society.

When the real estate bubble burst in 2007 there was plenty of blame heaped upon lenders and Wall Street.  One of the rallying cries from Washington is that the mortgage lending process needed major overhauling so that consumers would no longer be fooled by lenders and mortgage brokers.  And disclosures have been around a long time. Did lenders and Wall Street really need a “financial crisis” to figure out that approving loans without income verification or having no equity or making loans that allow  the balance to go up rather than down would dramatically increase lenders risk?  Now I want to be clear, I fully support disclosure and anything that helps borrowers compare rates, costs and fully understand the advantages and disadvantages of various types of loans.

  Late last year I recall reading stories with headlines like this from the LA Times “Home loans will hold fewer surprises” Consumers win with federal rules that require mortgage lenders to spell out all fees and penalize those who lie. The rules go into effect in January.  The first two sentences of the article described what was to come, “Anyone who has purchased or refinanced a few homes has probably learned to dread the closing statement, which all too often included a pile of new or inflated fees that your lender had never before mentioned. Those days are nearly gone forever, thanks to new government rules on real estate settlement that go into effect in January.”

Although I’m sure it has happened, I’ve been in the business a long time and quite frankly never “surprised” any client of mine with “new or inflated” fees, nor have I ever known anyone that did.

Now let’s fast forward to the present.  A myriad of new rules and regulations to make the process more transparent and understandable for you, the consumer, are now in effect.  So I hear a collective “sigh of relief”?

Recently I printed a set of disclosures for two clients that are buying a home together. There were 80 pages of documents  Yes, that’s right these are the new, consumer friendly loan disclosures.  The package for each borrower is some 40 pages.  They must be reviewed and signed by the borrowers before we can move forward and in many cases, any change requires a 3 day review process.

It took a conference call lasting 45 minutes to review the documents with my clients.  Do you think these clients feel more informed today then they might have say six months ago with the “old” disclosures?  I seriously doubt it.  After about 10 minutes they just wanted to know where to sign so we could move on with the process.

I should mention that if consumers have any questions about the new disclosures they can go to the Department of Housing and Urban Development  website and review the 52 pages of frequently asked questions on HUD’s website. 

By the way, have you noticed that “online lenders” seemed to have vanished?  Could it be that it now takes more than someone with minimal training working in a call center to explain and answer questions from consumers?  Or could it be that, by the end of this year loan officers and mortgage originators must be licensed at the national level? And yes, I am registered with the National Mortgage Lending System (NMLS).

My advice, now more than ever, you need an experienced and trustworthy loan officer and real estate agent on your side.  If you or someone you know is thinking about buying or selling a home, this is valuable information.  I am always available to answer your questions or discuss your concerns. Simply text, call (650 325 7877) or email me (russ@brokerruss.com)  for a prompt response.

If you are in the San Francisco Bay Area, I invite you to take a look at our Resource Center, www.AboutBayAreaHomes.com. There you will find links for active home listings, including bank owned and short sales, home loan information,  market activity reports, home seller strategies, staging and decorating, a suite of 19 calculators, plus my book, “Let’s Make a Deal, The Insiders Guide to Buying and Selling Real Estate” and more. Of course I am always available to discuss your real estate or mortgage related questions or concerns, just call, text or email me for a prompt response.

Russ Boyd and his team professionally assist buyers, sellers and homeowners in the Peninsula Communities of the San Francisco Bay Area. They serve clients in San Mateo, San Francisco, Santa Clara, Alameda and Contra Costa counties. Licensed as a Real Estate Broker by the California Department of Real Estate, 01264240.