We are proud members of the Upfront Mortgage
Brokers (commercial and residential). To be quite frank, it is sad that true UMBs are quite
rare within the industry. In most cases, it is because
the majority of finance professionals can NOT adhere to the
following UMB guidelines.
- The broker will be the customer's representative
or agent and will endeavor to act in the best interests of
the customer.
- The broker will establish a price for services
upfront, in writing, based on information provided by the
customer.
- The price may be a fixed dollar amount,
a percent of the loan, an hourly charge for the broker's
time, or a combination of these.
- The price or prices will cover all the
services provided by the broker. This includes loan processing,
for which customers always pay a broker or lender.
- On third party services, such as an appraisal,
ordered by the broker but paid for by the customer, the
broker will provide the invoice from the third party services
provider at the customer's request. Alternatively, the
broker may have the payment made directly by the customer
to the third part services provider.
- Any payments the broker receives from third
parties involved in the transaction will be credited to the
customer, unless such payments are included in the broker's
fee.
- If the broker's fee is 1 point, for example,
and the broker collects 1 point from the lender as "yield
spread premium", the broker either charges the customer
1 point and credits the customer with the yield spread premium,
or charges the customer nothing and retains the yield spread
premium.
- The broker will use his best efforts to determine
the loan type, features, and lender services that best meet
the customer's needs, and to find the best wholesale price
for that loan.
- The wholesale prices from which the broker's
selection is made will be disclosed at the customer's request.
- When directed by the customer, the broker
will lock the terms (rate, points, and other major features)
of the loan, and will provide a copy of the written confirmation
of the rate lock as soon as it has been received from the
lender.
- If a customer elects to float the rate/points,
the broker will provide the customer the best wholesale float
price available to that customer on the day the loan is finally
locked.
- The broker will maintain a web site on which
its commitment to its customers is prominently displayed,
along with any other information the broker wishes to convey.
- A broker who displays mortgage prices on
its web site must indicate whether the prices are retail or
wholesale. If they are retail, the markup must be shown. If
they are wholesale, the broker must indicatethat the prices
do not include the broker's fee.
~ Copyright Jack Guttentag 2004
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