Craig Ballhagen

Upfront disclosures are the "meat and potatoes" of the home loan that Boise home buyers are applying for. These disclosures are duplicates of the final loan documents that the home buyer will be signing at the end of the transaction.

For many years the disclosures where taken for granted and abused by lenders. What I mean by that is the borrower was never given the opportunity to review and sign these critical documents at least 7 days prior to going to the closing table.

My wife has been an escrow officer for 20 years and would sign 10 to 15 transactions a day. She would come home from work and talk about the frustration of having to prepare the official loan documents, AND take an additional 15 to 20 minutes to have the home buyer sign the documents that were to be signed prior to the appointment.

Signing 2 sets of loan documents on the same day defeats the whole purpose of upfront disclosures. Why does this happen? Lenders are often too lazy or "too busy" to bother. This is a huge disservice to home buyers. The home buyers are given no opportunity to ask questions and make any changes. Instead they are put in a "take or leave it" position. The moving truck was out front and they would lose the house and their deposit if they didn't sign. The home buyers had no choice.

I would ask my wife, and other escrow officers, how often does this happen? They would say about half the time and it would usually be the same mortgage companies over and over. That is the way they did business.

Finally times have changed. As of August 1^st, 2009 the new 3-7-3 rule has been put in place. The new rule means that the home buyer MUST have their upfront disclosures 3 days after their mortgage loan application has been submitted. They must have these disclosures a minimum of 7 days before they can sign their final loan documents. And if there are any changes to the loan terms, there is a 3 day waiting period before the home buyer can go to sign their final loan documents.

It is the responsibility of ALL loan officers to educate ALL home buyers. We need to be the ones who guide the next generation of home buyers. It is not only the right thing to do, but it will be one of the first steps in bringing some credibility back to our industry.

Please go to my first time home buyer "Bill of Rights".

Craig Ballhagen-Guild Mortgage-Boise-208-713-3309

Everyone needs a little levity from time to time. I would like to compile a few "scary stories" from buyers, agents, loan officers, escrow officers and anyone else who can share their experience with others.

Many of us have come across some home loan transactions that we definitely do not want to relive, but we can laugh about now.

Please share your experiences that you have had or stories that other people you know have had. Don't use actual names or places, the idea is not harm reputations or hurt other people's livelihoods, just look at the lighter side of this sometimes crazy industry we are in.

My "scary story" happened a few years ago, I think 2005. I had a couple come to Boise wanting to purchase an owner occupied home using an 80/20 stated income home loan program. They were self employed real estate agents from Southern California. I asked if they were moving to Boise and they said "yes" and we continued the loan process. At that time there was no job seasoning requirements, meaning they could move to Boise with one day on the job and still qualify. One thing I thought was strange was only one of them were going to be on the loan. Which is still ok, many married people do that.

After we completed the mortgage loan application they left my office and we stayed in touch by cell phone because they were heading back out of town. When I called back to ask additional questions, I found out the couple was at another mortgage company in Boise applying for another owner occupied home loan. They were buying the home next door to the home they were purchasing with me. At that point I realized what the couple was doing.

After calling a few Boise title companies I found out the fraudulent couple was buying 3 to 4 homes EACH (all owner occupied) in other markets. The couple was driving from Boise to Vegas to Phoenix to Florida and back to Seattle, all purchasing 3 to 4 home EACH in all of these cities. Talk about scary. Wow! We immediately notified all of the local title companies and canceled their loan.

The kicker was these people were (hopefully not anymore) real estate agents advising their clients to do the same! These people soon experienced their own "mortgage meltdown".

Please send me your "scary stories" in the comment box and I will post them. Maybe we call all learn from these experiences and become a bit wiser. Thank you.

Craig Ballhagen-Guild Mortgage-Boise-208-713-3309