So, at the considerable risk of painting a big target on my back, here goes:
1. Prohibit mortgage brokers from acting as real estate agents for the same principal in a transaction (and vice-versa). This is a total conflict of interest;
2. Establish a separate license for mortgage brokers and require an Agency/Fiduciary relationship with their borrowers;
3. Increase conforming loan limits (currently $417,000) in California to at least $500,000 (median sales price was $586,000 in July). Review every five years for adjustments;
4. Update and/or overhaul the FHA by increasing the loan limits, currently capped at $362,790. This is pretty much worthless for California and is, thankfully, currently being discussed in Congress.
5. VA Loans – see No. 4 above;
6. Require a minimum of 5% down payment (except FHA and VA) unless borrower is Bill Gates or of similar credit.
7. Eliminate pre-payment penalties or, at a minimum allow borrowers to purchase, upfront for a reasonable fee, an “escape clause” from pre-payment penalties after the first year of a loan on homes where the loan-to-value is greater than 95%. Yes, an appraisal is needed, but you would need it for a refinance, anyway;
8. Absolutely, positively outlaw the use of negative amortization loans. No matter how many times it’s explained to people, most still don’t get it.
At this point, I must take a break to go to Starbucks for Kris (it’s part of our pre-nup), so the rest of this post shall become interactive, at least until I return from coffee-land. Go for it:
9. Your suggestion here;
(Since I, Kris Berg, have full access to the Blog Admin Panel and all authority and privilege that goes with the title of Administrator, I have hi-jacked Steve’s post to add my own #9).
Bury this in your front yard:
10. Your suggestion here;