Here’s another installment from Albuquerque lender Eric Chavez of Loan Logic.
In this video, Eric talks about overregulation of the mortgage industry and how even the simplest loans now require reams of paperwork to pass underwriting.
“So what’s the cost of being under regulated? Over regulation! Aaargh!
So recently we just closed a refinance for a client of ours who was refinancing their investment property and all they were trying to do was lower their monthly payment, which they did, they saved some money, but let me show you what the result of over regulation was. This. Aargh! (Eric holds up a file that’s thick with papers). Probably close to a thousand pages, a thousand pages that we had to prove this person could afford to make the payment on a loan, by the way, that they were already making the payment on! They were trying trying to get a smaller payment, so somehow now with all of this regulation it takes a thousand sheets of paper to prove someone can make their mortgage payment.
Listen, I get it, there has to be regulation, we have to stay away from the liar loans but we need to get common sense back into underwriting, get people into these new loans and get business and the economy moving again.”
Thanks Eric, you are right on point with this! Things have gotten out of hand. Here’s to hoping that soon regulations will ease up – within reason.
Eric Chavez does mortgages and home loans right here in Albuquerque NM.
Thanks Eric, and keep up the good work!