Ryan is a graduate of Penn high school and local Osceola & Granger resident. He went to IU to study political science before realizing he wasn’t blessed with the right temperament for it. He came to banking and mortgage lending after working in retail stores like Target & Barnes & Noble through school. There, he was blessed with opportunities to lead others and found a conviction for developing others and ended up running bookstores for 8 years before taking his first step into banking.

MutualBank gave him an opportunity in February of 2009 and he has never looked back. In his ten years there, Ryan ended up being responsible for dozens of retail branches and found a love for lending that inevitably sent him at full speed into the 'magical' world of Mortgage Banking. Blending the conviction for developing others, and the passion for lending, he was able to continue to advance his career. Ultimately, he landed in his current role of VP of Mortgage Lending at Teachers Credit Union where his favorite thing to do is to learn something new, and tell anyone who’ll listen to him about it!

Click here to watch Ryan & Al's interview video!

In the mortgage education world, we don’t see shocking headlines very often but when we do, they are like this!

On January 18, 2022, the CSBS announced that 44 state regulators led by the California DFPI reached settlements with 441 mortgage loan originators. Those fines totaled $1.2 million.

What was alleged?

An NMLS-approved education provider in California was accused of providing false course certificates of completion and taking courses on behalf of those MLOs.

How was this discovered?

If you have ever taken an online course, you know that you are prompted to complete a BioSig-ID authentication by drawing numbers or letters in 4 boxes at the beginning of, and periodically throughout the course. The intent is to verify that the person taking the course is actually the licensee. When BioSig is activated, the software also tracks the person’s progress through the course from the time they start to the final exam. If there is no record in the BioSig reports, this indicates that a course was not taken.

What was the settlement for the MLOs?

MLOs agreed to surrender their license for three months (92 days), pay $1000 for each state they were licensed in, and complete NMLS-approved education including a 20-hour pre-licensing education course and an additional 8 hours of continuing education. Further, the 28 hours of education must be taken in either a live or live webinar format, not online.

What does all of this mean to you?

Well, if you are one of the 100k plus MLOs that were NOT listed in this enforcement, then this is good news. YOU did the work the right way, and no one should get credit for completing CE unless they did exactly what you did.  Completing CE in a compliant manner each year makes license renewal go smoothly and your ability to originate is not interrupted.

What’s new for 2022?

The NMLS is requiring that all webinar CE attendees have a working Webcam and keep it on throughout the training. The requirement takes effect June 6, 2022. Based on MLO feedback, Diehl will offer CE webinars before June 6 without a Webcam and after June 6 with a Webcam.

At Diehl, we create a new course every year and update the state CE courses as well. While you will have to complete CE like you do every year that covers NMLS required topics, Diehl’s CE courses present this information in a surprisingly engaging way. We also want you to get the most value out of the time you have to spend taking CE, so we cover things that are changing in the industry, new developments, what's ahead, and ways you can protect your license.

When you sign up through the IMBA your association benefits as well. The revenue generated can help fund initiatives that support your association’s efforts to deliver even more value to you. We hope to see you for CE in 2022!

Resources:

State Regulators Settle with Hundreds of Mortgage Loan Originators over SAFE Act Education Requirements | CSBS

REES Background Document - Public.pdf (csbs.org)

Scott Weghorst, CMB®, MBA

President

Diehl Mortgage Training and Compliance

One of the biggest bottlenecks in the mortgage process right now is the appraisal.  In some markets it is taking over 3 weeks on average to obtain an appraisal and at times even longer.  The appraisal industry has been contracting and has not been able to keep up with the recent mortgage boom.  If you have patience and time on your side, that may not be an issue.  However, most transactions are time sensitive – a contracted closing date or a contractor waiting to start a renovation.  Thankfully there is something that is helping alleviate the pressure on the appraisal industry in general and on some specific transactions – Appraisal Waivers.

Enter the Appraisal Waiver. 

In 2011, Fannie Mae and Freddie Mac started a joint project for collecting appraisal data electronically.  That project was the Uniform Collateral Data Portal (UCDP).  The appraisers began providing not only the PDF but also XML format (a data file) with every appraisal on a home.  The data files are submitted to the UCDP where they are compiled in a database.  Over the following 6 years the UCDP compiled enough data to be able to establish a valuation model for properties and a risk model for appraisals.  At the end of 2016 Fannie Mae began offering appraisal waivers when there was sufficient data to determine the value.  Though Fannie Mae led the way, Freddie Mac was quick to offer appraisal waivers as well under the name Automated Collateral Evaluation (ACE).  In addition, lenders selling to the GSEs need to run the appraisal data through Fannie Mae’s Collateral Underwriter or Freddie Mac’s Loan Collateral Advisor and receive a risk score.

How do I know if a property is eligible?

There are several factors that are considered when determining if a property is eligible for an appraisal waiver.  The major factors that are considered are the loan purpose, property type and LTV/CLTV.  See the eligibility matrix below for specifics.  In addition, per Fannie Mae you are much more likely to receive an appraisal waiver if there was an acceptable appraisal completed on the property more than 6 months and less than 6 years prior to the current transaction.

Eligibility Matrix

Transaction Types	Fannie Mae Appraisal Waivers	Freddie Mac ACE
Loan Types
Purchase
Primary Residence	Up to 80% LTV/CLTV	Up to 80% LTV/CLTV
Secondary Residence	Up to 80% LTV/CLTV	Up to 80% LTV/CLTV
Cash-out refinances
Primary Residence	Up to 70% LTV/CLTV	Ineligible
Secondary residence or investment property	Up to 60% LTV/CLTV	Ineligible
Limited cash-out refinances
Primary or secondary residence	Up to 90% LTV/CLTV	Up to 80% LTV/CLTV
Investment property	Up to 75% LTV/CLTV	Ineligible
No cash-out refinances	Same as limited cash-out refinances	Up to 80% LTV/CLTV
Relief refinances	Ineligible	Ineligible
Construction conversion and renovation	Ineligible	Ineligible
Property Types
Properties with estimated values of $1M or greater	Ineligible	Ineligible
Single-family 1-unit properties	Eligible	Eligible
Condominiums	Eligible	Eligible
2- to 4-unit properties	Ineligible	Ineligible
Manufactured homes and co-ops	Ineligible	Ineligible
Properties with resale restrictions	Ineligible	Ineligible

What else do you need to know?

There is one exception to the eligibility matrix above - homes in rural high-needs areas.  The borrowers must also be low to moderate income borrowers.  If the borrower meets these two requirements, then LTV ratios up to 97% and CLTV ratios up to 105% (with a Community Second) are acceptable and eligible for an appraisal waiver.  Even though there is an appraisal waiver on these transactions, the lender is still required to obtain a property inspection and warrant that the property is safe and structurally sound.

If you pay attention to the message that you receive in Desktop Underwriter (DU) or Loan Product Advisor (LPA) you will notice that your eligibility message does not assign a value to the property.  Instead, what the eligibility message states is whether the value submitted is accepted.   As a result, the estimated value of the property may have an impact on receiving an appraisal waiver.

The availability of data on the eligibility rate of submissions to DU and DO is limited.  However, the FHFA prepared a White Paper evaluating the waivers in 2018.  They reported that in January 2018 3.7% or submissions to LPA were eligible for an ACE and in March 2018 10% of purchase transactions submitted to DU were eligible for and appraisal waiver.

More in depth and specific information is available on the GSE’s sites.  To find out more about these offerings see the links below:

https://www.fanniemae.com/appraisalwaivers

https://sf.freddiemac.com/tools-learning/loan-advisor/our-solutions/ace-automated-collateral-evaluation

https://www.fhfaoig.gov/sites/default/files/WPR-2018-006.pdf

Greg Pilling Mortgage Loan Originator, NMLS# 873570 Teachers Credit Union gpilling@tcunet.com