affordability

Every lender or investor with an “a” in their name seems to be subject to rumors and news in recent months. (More on Flagstar and American Pacific below.) Know anyone named “Bernadette”? The name is actually Latin for, “The act of torching a mortgage.” (Yes, it is cutting edge humor like that which brings you back.) Burning liens isn’t a topic, but paying them off early is, and with mortgage rates off of their highs, early pay offs, or EPOs, were a conversation topic at the conference this week. And with it, loan officer compensation follows. Can a lender pay an originator based on pull through? Yes. Can lenders pay different originators under different payment plans, as long as the originator sticks with one plan? Yes. Can a lender, if they comply with state labor law, ask for compensation back after an EPO or EPD? Yes, and it may depend on the contract signed by both parties at the beginning of employment. As always, consult your in-house counsel or a lawyer well-versed in mortgage banking. While we’re on originators, occasionally I am asked about training for brand-spanking-new loan officers. No, this is not a paid ad, but veteran LO Tanya Blanchard has created Madison Chase Academy, “6 Months to 6 Figures: A Loan Officer’s Guide to a Profitable Business” with a sneak peak on the website. (This week’s podcast is sponsored by Richey May, a recognized leader in providing specialized advisory, audit, tax, technology, and other services in the mortgage industry and in banking.)