16 CFR Parts 317 and 318: Mortgage Acts and Practices Rulemaking
My husband Retired from the Military after 27 years, now for the first time, we are able to afford the housing market and purchase a house. However, it is completely confusing to compare mortgage loans. Because NOTHING is transparent. As a fairly intelligent and knowledgable consumer (I spent 6 years working in dealerships with automotive loans), I cannot understand how this has been allowed to continue for so long. It has certainly played a huge part in the mortgage lending scams that abounded over the last several years. I personally was told stories by mortgage loan officers, on how these loans were being put through. A lot attendant left the dealership to become a loan specialist and he was barely able to follow directions in washing and parking cars.
Currently, most every state, requires a complete breakdown of fees charged in every automobile transaction (usually less than $50K) with an accompanying disclosure. Dealers are held to these charges or have to undo the entire deal. Either way they most of the burden in getting it done on time as written falls to them, a smart consumer can apply a lot of pressure or say no.
However, you can go to a mortgage closing worth hundreds of thousands of dollars and the fees have changed from what you were told. You risk losing a preferred rate to dispute them, a home to live in and even the purchase entirely, if they changes are beyond your available funds. When Mortgage underwriters are notoriously slow doing their jobs, the entire rate structure, charges for services, everything goes up for grabs and if falls on the consumer to suffer the consequences. Families have been left homeless over these big gaffes. When so much money is at stake, the Mortgage lenders should be required to have set fees structures publicized along with their rates. Locked in like a rate and can be tiered to the amount of the loan. If they do not complete a mortgage on time (baring customers not providing documentation in a timely manner) then they should have to share the financial burden. For instance they pay down points to the original promised rate. They pay for the differences in costs. Car dealers have done this frequently over the years, although it isn't often discussed or encouraged. Or they offer a substantial set amount to the consumer for the inconvenience, like airline companies used too. There could be a type of mortgage insurance to offset unexpected loan contingencies.
Further more, mortgage loan officers should have to pass a backround check, be fingerprinted, be drug tested and licensed, just as a car saleperson has to be in California. This would deter fly by night criminals from entering the field. Certainly it would help if, they had to pass a test and swear an oath like Notary to perform their jobs.
Those are my suggestions for looking at this fairly unregulated industry. Thank You for reading it.