SOMB I
What is fraud for housing/property? - ANS--Unsophisticated/ simply planned
-Intent to repay the note
-Smaller losses per individual transaction
-one per borrower, generally
-few misrepresentations per loan file
-those involved generally are not paid for their part in misrepresentation
Production Manager - ANS-Responsible for three types of production: retail, wholesale,
and correspondent
Mortgage Loan Origination - ANS-Originates loans either through direct contact with
borrowers or through indirect contact through real estate agent, builder, or other sources
Processor - ANS-Reviews applications, processes loans, and submits supporting
documents for consideration by underwriters and mortgage insurance companies
Mortgage Broker - ANS-Processes loans and submits them to a wholesaler for
underwriting, funding/closing, and shipping
Underwriter - ANS-Analyzes risk and approves or rejects loan applications as submitted
Private Insurer - ANS-Mitigates risk to investor on conventional loans with LTV in excess
of 80%
Closer - ANS-Concludes the transaction, ensures that documents are properly executed
and proper financial adjustments are made
Quality Control - ANS-Examines and adjusts internal policies and procedures
Shipper - ANS-Prepares and sends closed packages of mortgage documents to
warehouse banks and/or investors
Loan Administration - ANS-Collects payments, manages tax and insurance escrows,
and manages property when necessary
,Warehouse Lender - ANS-Lends funds to mortgage lenders on a short-term basis using
a permanent loans as collateral. Provides interim financing until loans are sold to an
investor
Regulator - ANS-Responsible for control and supervision of public interest
GSE - ANS-Issues securities secured first by the underlying mortgage, then the agency
Wall Street - ANS-Sells securities to investors
Investor - ANS-Buys and holds securities or mortgage loans as an investment
Secondary Marketing - ANS-Communicates with wall street, sets prices, and
communicates loan price, points, and loan types that will fulfill investor commitments to
production team
Main Street (Primary Market) - ANS-Mortgage bankers create mortgage loans for
borrowers
Wall Street (Secondary Market) - ANS-Lenders, investors, and GSEs buy and sell
mortgages created in the primary market
Mortgage Banking Functions - ANS-Loan production, secondary marketing,
warehousing, loan administration
Objective of loan production - ANS--Stream of loan payments
-mortgage servicing rights
Four phases of loan production - ANS-origination, processing, underwriting, and closing
Origination - ANS-solicit customers, provide information & education, and take loan
applications
Processing - ANS-Obtain & verify supporting documents regarding customer and
property
Underwriting - ANS-Analyze risk of default and make loan decision
Closing - ANS-Finalize loan transactions through signing of legal documents and
transfer funds
, Loan Servicing Tasks - ANS--Cashering/ cash management
-investor accounting
-customer service
-escrow administration
-collections
-loss mitigation
-foreclosures/ real estate owned (REO)
Considerations for Making Business Decisions - ANS--Risk
-Win-win
-Confidentiality
-Transparency
-Agreements
-Fairness
-Wisdom
MBA Canon of Ethics - ANS-1. Professionalism
2. Integrity and Confidentiality
3. Public Trust
4. Fiduciary Responsibilities
5. Disclosure of Information
6. Conflicts of Interest
7. Compliance with Laws
8. Non-Discrimination
9. Honesty in Advertising
10. Sanctity of Agreements
11. Competition
12. Ethics Compliance
Product - ANS-Actual loan that is created by bundling features (term, interest rate)
Program - ANS-Categories under which loan products fall (affordable housing programs
may offer borrowers low interest rate loan products)
Creating a loan product - ANS--meeting needs
-pairing needs with programs/products available in the market
-differentiating between what programs/products are easiest to qualify for
-determining what is best for the borrower
What is fraud for housing/property? - ANS--Unsophisticated/ simply planned
-Intent to repay the note
-Smaller losses per individual transaction
-one per borrower, generally
-few misrepresentations per loan file
-those involved generally are not paid for their part in misrepresentation
Production Manager - ANS-Responsible for three types of production: retail, wholesale,
and correspondent
Mortgage Loan Origination - ANS-Originates loans either through direct contact with
borrowers or through indirect contact through real estate agent, builder, or other sources
Processor - ANS-Reviews applications, processes loans, and submits supporting
documents for consideration by underwriters and mortgage insurance companies
Mortgage Broker - ANS-Processes loans and submits them to a wholesaler for
underwriting, funding/closing, and shipping
Underwriter - ANS-Analyzes risk and approves or rejects loan applications as submitted
Private Insurer - ANS-Mitigates risk to investor on conventional loans with LTV in excess
of 80%
Closer - ANS-Concludes the transaction, ensures that documents are properly executed
and proper financial adjustments are made
Quality Control - ANS-Examines and adjusts internal policies and procedures
Shipper - ANS-Prepares and sends closed packages of mortgage documents to
warehouse banks and/or investors
Loan Administration - ANS-Collects payments, manages tax and insurance escrows,
and manages property when necessary
,Warehouse Lender - ANS-Lends funds to mortgage lenders on a short-term basis using
a permanent loans as collateral. Provides interim financing until loans are sold to an
investor
Regulator - ANS-Responsible for control and supervision of public interest
GSE - ANS-Issues securities secured first by the underlying mortgage, then the agency
Wall Street - ANS-Sells securities to investors
Investor - ANS-Buys and holds securities or mortgage loans as an investment
Secondary Marketing - ANS-Communicates with wall street, sets prices, and
communicates loan price, points, and loan types that will fulfill investor commitments to
production team
Main Street (Primary Market) - ANS-Mortgage bankers create mortgage loans for
borrowers
Wall Street (Secondary Market) - ANS-Lenders, investors, and GSEs buy and sell
mortgages created in the primary market
Mortgage Banking Functions - ANS-Loan production, secondary marketing,
warehousing, loan administration
Objective of loan production - ANS--Stream of loan payments
-mortgage servicing rights
Four phases of loan production - ANS-origination, processing, underwriting, and closing
Origination - ANS-solicit customers, provide information & education, and take loan
applications
Processing - ANS-Obtain & verify supporting documents regarding customer and
property
Underwriting - ANS-Analyze risk of default and make loan decision
Closing - ANS-Finalize loan transactions through signing of legal documents and
transfer funds
, Loan Servicing Tasks - ANS--Cashering/ cash management
-investor accounting
-customer service
-escrow administration
-collections
-loss mitigation
-foreclosures/ real estate owned (REO)
Considerations for Making Business Decisions - ANS--Risk
-Win-win
-Confidentiality
-Transparency
-Agreements
-Fairness
-Wisdom
MBA Canon of Ethics - ANS-1. Professionalism
2. Integrity and Confidentiality
3. Public Trust
4. Fiduciary Responsibilities
5. Disclosure of Information
6. Conflicts of Interest
7. Compliance with Laws
8. Non-Discrimination
9. Honesty in Advertising
10. Sanctity of Agreements
11. Competition
12. Ethics Compliance
Product - ANS-Actual loan that is created by bundling features (term, interest rate)
Program - ANS-Categories under which loan products fall (affordable housing programs
may offer borrowers low interest rate loan products)
Creating a loan product - ANS--meeting needs
-pairing needs with programs/products available in the market
-differentiating between what programs/products are easiest to qualify for
-determining what is best for the borrower
