After reading multitude of Tweets and Blogs about the historic drop in Mortgage Rates yesterday 11/26/08. I asked myself how many of these Loan Officers (LO) are looking out for their current clients and upholding their Fiduciary duty (Big Word for a good amount of mortgage types).

Did your LO call you to tell you he/she just renegotiated (RENO) your Locked loan? Agents/Borrowers did your Lender email or call to inform you on RENO, or did they Just Tweet and email you on how low rates are? Did they educate you on the technicals behind the drop? Did they explain to you that in situations such as yesterdays when we see massive reductions in rates that they have the ability to RENO, or did they just relock at the same rate at another lender to capture an increased YSP and tell you that “we are locked sorry”?

My goal is to create Transparency and push the weak out and Eat Their Lunch while I do it.

Mortgage types are not the only ones who make nefarious moves when the market moves as it did yesterday, I am confident many agents and borrowers immediately started shopping approved loans without consulting there Mortgage consultant on the possibility of achieving a better rate (happened all throughout the 2002-2004 Refi frenzy).

Not all LO are built the same some are Mortgage Planners (all of sudden every LO is one without the CMPS), some are Loan Officers (order takers), some are Just Sells People. If your Mortgage relationship is not blogging, move on find a new relationship. If your lender is blogging, nevertheless the content is empty and lacks Mortgage/Finance relevancy and post relevant News 5 days late, if that’s the case then there just trying to keep up with the times (anyone can set up a blog, you get one free with your Google account).

A Mortgage is still one of the largest investments a individual will make. Just because your LO is in the same Church, Network, or School district doesn’t validate their expertise. It’s Your Mortgage!

Lock RENO Guidelines; please note some lenders charge some will do at no cost:

If rates drop during the rate lock period and the broker requests a lower rate, the loan can be renegotiated for a 0.375% fee. This fee can be built into the discount/premium quoted. This policy cannot be used to increase the compensation for the broker.
Broker may raise the premium to cover the 0.375% fee, but may not make more than the original premium.

Depending on the amount of market movement, the new premium may be lower than the original premium. If the increase in premium is insufficient to cover the 0.375% fee and provide the broker their original premium, the full 0.375% fee will still be charged and the broker will receive a lower premium.

Here’s the rules:

• The rate to the borrower must improve
* Market rate is lower compared to rates at the time of rate lock (improved market).
* Loan will maintain original lock period and expiration.
* Only available on loans with locks of 60 days or less.
* The broker rebate will be capped at the original price.

* Limit one renegotiation per loan.
* File must be received
* Expired locks are not eligible for renegotiation (loans that have been extended prior to original expiration
are eligible).
* Loans that have been Worse Case Priced for any reason are not eligible for renegotiation.

(Lock Renegotiation Policy, CitiMortgage Wholesale Lending 2008)

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