Yield Spread - This week, I overheard a loan officer talking to a borrower about yield spread. He explained to the borrower that if he qualified for a 6.5% interest rate, he could get him a rate an eighth of a percent higher, it would make his payments $5 to $10 more, but he could use the difference to cover the closing costs. Wow. That's the first time I've ever heard an originator take the time to explain a YSP to a borrower and use it for the benefit of the borrower and not as a way to increase their commission on a loan. Maybe there's hope for our industry yet.
Identifying a borrower - Did I say there may be hope for us? Twice this month, I called borrowers to confirm an appointment and make sure they had proper i.d. only to have them tell me that their i.d.s expired several months, even years ago. And both borrowers refused to go to the Secretary of State before the scheduled appointment to get it renewed. Interestingly, this particular mortgage company requires their originators to obtain a copy of the i.d. and social security card up front. So both appointments had to be postponed. Now, how did it even get to this? Someone does their job properly at the start, this never happens. But the mortgage brokers aren't upset with themselves for not following or ignoring their own required procedure. Nope, it's the notary that takes the hit. Have we really learned nothing this past year? It's probably just a slow week for the title company that handles this lender, but I can't help but sort of wonder how a company that usually sends me five or six signings a week sent me none last week. Is it because they'd rather deal with someone who doesn't bother with the little things like making sure the proper person is signing? I hope not. It's too bad that we as signing agents still have to worry that doing things right, protecting the lender, the title company, and preventing fraud, can possibly cost us a regular client.
Backdating - I guess I'm not the only one. A signing agent colleague was recently asked to backdate a document from a company that he works with regularly. Of course he refused, but his immediate thought was, "there goes that business." Thankfully it did not cost him his relationship with this client, but the fact that we still worry about it shows the industry has a long way to go. Integrity sometimes comes with a cost.
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