Mortgage Rates are Way Down While Loan costs have Risen Dramatically

As I’ve reported over the past year there have been untold changes to the way mortgage loans are being regulated and underwritten. While all the new regulations are in place to provide more transparency and consumer protections, unfortunately, the result is increased time and costs to the consumer.  While I’m sure this is not the result the regulators were seeking, the proof is now available with the release of Bankrate.com’s annual mortgage fee survey.

First, the good news…California is not the most expensive when it comes to mortgage fees and costs.  That dubious honor goes to New York.  In fact, California is the fifth most expensive state in the survey results.  All in all, according to Bankrate.com’s survey, which used a $200,000 loan model, costs increased by an incredible 36% year over year.

And I can understand why.  In my business, I can see that appraisal costs have increased by some 25% and the increase is not going to the appraiser that is doing the work, as a matter of fact, appraisers are making less while the increase is going to the “appraisal management companies” or AMC’s that are mandated by the appraisal regulations implemented known as HVCC.  Loan processing has increased by about 20%, simply because of the increased underwriting appetite for every piece of documentation available and the more time consuming preparation of disclosures. Add what is known as Fannie Mae’s “Loan Quality Initiative” which dictates that every single loan go through a detailed pre and post funding quality assurance process that begins when a file is received in underwriting.

As a loan originator, I am not only required to be licensed by the State of California, I am now subject to the rules under the National Mortgage Loan Registry.  This year, I have had to pass both a state and a national exam, be fingerprinted, have a background check done by the FBI and complete affidavits that required in depth personal and business information.  All of this cost me about $1500 out of pocket.

As a real estate and mortgage professional, I take my responsibility to my clients very seriously.  I am always available to answer your questions or discuss your concerns.

With the complexity in today’s mortgage and real estate market you will benefit from the advice and guidance of an experienced and knowledgeable mortgage and real estate professional.  I’m always available to answer your questions or discuss your concerns.  Just text, call (650 325 7877) or email me 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.

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. National Mortgage License Registry 230411.

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