Record number of mortgage companies failed in 2009

Dennis Norman

MortgageDaily.Com tracks mortgage company failures on it’s website The Mortgage Graveyard.  According to The Mortgage Graveyard 225 mortgage-related firms in the U.S. ended operations or failed in 2009, higher than any year since they began tracking data in 1998. This was an increase of over 80% from 2008 which saw 124 firms fail.

The annual surge was fueled by a spike in bank failures — which increased more than 400 percent. Banks account for most of the country’s residential originations. Credit union failures, including corporate and state-regulated institutions, were up by more than a third.

Here in St. Louis it appears lenders have fared better and, according to MortgageDaily.com there was only one failure in 2009 and that was Gateway Bank.  According to a story published November 9, 2009 by Mortgage Daily.Com the Missouri Division of Finance reported it took possession of Gateway Bank after “several unsuccessful attempts by the bank’s ownership and management to sell or find new capital. The bank had been an aggressive lender and faced a $2,500 civil money penalty by the FDIC in June and another in May 2008.”

We are likely to see the disappearance of many mortgage companies, or their merger’s with bank partners, in 2010 as a result of tough new rules that took effect January 1st favoring bank-operated mortgage companies over independent mortgage brokers and mortgage bankers.

 

Mortgage information and advice from a St. Louis Mortgage Banker – Part 2 of a series

H. John Frank, Jr., President, Paramount Mortgage Co.

H. John Frank, Jr., President, Paramount Mortgage Co.

By: Dennis Norman

Yesterday I did the first post of my E-View TM with respected mortgage banker, H. John Frank, President of Paramount Mortgage Co. located here in St. Louis.

Today we continue with part two of the E-View TM:

Q-How many states require mortgage brokers/bankers to be licensed? Does licensing protect the consumer in your opinion? If so, how? If not, why not?

A-I don’t know how many states require licenses, but later this year (I believe around the 1st of August) most, if not all, states will adopt a National Licensing Law which will require all companies and Loan Officers to be registered and licensed. Continuing education will be required as well as surety bonds, criminal background checks, fingerprints, etc. will be mandatory. I’m not sure if this protects the consumers, but it surely will cut out’ many of the brokers. The government will begin tracking Loan Officer’s, as well as appraisers, to make sure ‘bad’ loan officers can’t just jump from state to state making bad loans to innocent, uneducated homeowners. Continue reading “Mortgage information and advice from a St. Louis Mortgage Banker – Part 2 of a series

Mortgage information and advice from a St. Louis Mortgage Banker – Part 1 of a series

Dennis Norman

Dennis Norman

By: Dennis Norman

It seems home mortgages are in the news daily lately: record-low interest rates, record-high foreclosure rates, the sub-prime mortgage mess, lack of jumbo loans and so on. It’s confusing at best and causing much concern for many people wishing to buy a home or refinance their existing home mortgage.

H. John Frank, Jr., President Paramount Mortgage Co.

H. John Frank, Jr., President Paramount Mortgage Co.

To find out just what is going on in the home mortgage world today I turned to someone I have known for over 20 years that is a highly respected St. Louis mortgage banker, H. John Frank. John agreed to do an E-View TM to discuss what is going on with mortgages today and to share information to help educate consumers that may be seeking a mortgage.

John was a great source of information and I have a lot to share so I plan to share his E-View TM in a series of posts over the next few days.

Here’s the beginning of my E-View TM with H. John Frank, the President of Paramount Mortgage Co. based in St. Louis, MO: Continue reading “Mortgage information and advice from a St. Louis Mortgage Banker – Part 1 of a series