California Mortgage Association Conference
Our office is a member of the CMA. It is the leading association for Hard Money Brokers.
We just returned from the 2016 CMA Winter Conference. Attendees included Hard Money lenders, lawyers, servicers, insurers and Hard Money lobbyists.
The purpose of the Conference is to keep Members abreast of the constantly evolving lending rules and regulations. This allows us, and you – as the Lender – to operate safely within the law.
We make it a point to attend all 4 Conferences offered per year.
I suggest you make sure any Broker you do your loans with is doing something other than the required continuing education to protect you as the Lender in Hard Money loans.
ITEMS of NOTE…
The Conference covered many relevant topics. Two items that have really come to the fore in our operation are 1. Servicing of loans and 2. Qualification of Investors.
Servicing Loans: Lynn and I have never serviced loans in our office and likely never will. For many Hard Money lenders it is a big profit center. It was just never our bag. We did though, provide certain elements of servicing as a customer service to our Investors. We’d make phone calls to late payers, write dunning letters if need be and really just gave service after the sale.
It has come to the point now though, that our counsel to Investors is to definitely have the loan serviced. Especially with the volume of Dodd/Frank regulations, many of which apply to what you as the Lender must comply with in administering that loan after close of escrow.
The suggestion is a little self serving too, as it would take the burden of that follow up out of our hands and place it in the hands of a qualified and licensed Servicing company. Because, to be honest, it is time consuming considering the volume of loans we now do in my office and the number of Investors we have on the books.
It is peace of mind for $20 per loan, per investor. That is what is charged by Superior Loan Servicing, to whom we refer to the most. They are on top of the laws that apply to handling Borrowers on loans during the term of the loan and its ultimate reconveyance. You can also check with Redwood Trust Deed Services, Inc.
Ask us to set up your next loan for servicing.
Qualification of Investors: In the past, if you had some money and said yes to a Trust Deed Offering, we put you into that loan as the Lender. As of January 1, 2013, the BRE mandated we qualify Investors. They came up with BRE Investor Questionnaire Form 870.
As the Broker, I must have that current form in your file in order for you to be the Lender on a Hard Money loan. I have to make a judgment call, based on that Form 870, as to your ability to be an Investor. It must be renewed every 12 months to determine your further ability to qualify as an Investor in Trust Deeds.
I mention it, because we have instituted a policy of follow up on this Form 870 in our office. It is a necessary evil for you as the Lender. So if Arlene or Eileen calls to get this form updated, it’s the law!