My friend Alan Vanderheiden sent this to me:

May 14, 2008

Hello,

I hope you are well and enjoying this spring weather.  This is a wonderful time of year to live on Amelia Island.

I want to spend a minute discussing the changes that continue to take place in the mortgage industry.  The times.....they are a changing.

The biggest development continues to be guideline and processing changes by lenders.  Products and pricing continue to evolve....almost on a daily basis....and it is a full time job keeping up with current trends.  There are three areas that are important:

• Lead times.  Most every lender has been a victim of the slower economy and reduced business levels.  In addition, most every lender is doing all it can to remain in the "black" with a rash of bad press and bad earnings.  Lenders have cut staff in an attempt to reduce overhead and improve the bottom line.  Far too often the more experienced associates have been shown the door in favor of the lower pay rolls of less senior workers.  The price we are paying is longer turn times in underwriting and inexperienced processors trying to close loans.  
• Guidelines.  In years past, the underwriting guidelines were published and well known.  Most anything that was approved by Fannie Mae or Freddie Mac was good enough.  No more.  I'm seeing more lenders exercise their own "risk management" policies regardless of the guidelines and traditionally accepted practices of our government friends.  A big part of my job is knowing what a lender will require in certain situations.  That has changed.  It's like hitting a moving target....and it's challenging.
• Setting the correct expectations.  A big part of the business today is setting the right expectations with customers.  I've had very well qualified customers tell me that they are not going to pay for the sins of the past.....they may not get a loan.  I'm encouraging patience and understanding.  Communication is more critical than ever before and having the lead time to complete the transaction is very important.  Experience is also critical.  Being able to look at a borrower's profile early in the process and determine where the challenges lie is important.  Give the right amount of time most any issue can be solved.  It's the last minute surprises that can give us all heartburn. 

I will continue to work hard for you and our customers.  I do believe things will improve and our business will become more predictable again.  Until then I will stay focused on the trends of our industry and your continued trust.  Please call on me anytime I may be of service.

Have a great week!