By TRINA MURPHY
APR, LOE, VOD, TILA, LTV… No wonder folks applying for a mortgage are dazed and confused. Who can blame them? I’ve been a mortgage lender for over 23 years and these acronyms can still confuse me. I’m not sure how our fixation with acronyms began. Was it our inherent need for speed and efficiency? I mean who can dispute that “LIBOR” is much easier to spit out than “London Interbank Offered Rate”. Or maybe it’s our need to appear intelligent. I once overheard a mortgage loan officer respond to a clients question regarding interest rates something like this: “Well, that is a tough question to answer. I’ll need to order your FICO and VOE. Then I’ll determine your DTI and the TLTV and with the MBS market so unstable FNMA published rates are difficult to predict”. OMG!
However, please have pity on us loan officers. Our well intentioned regulators require loan officers to obtain a NMLS license by passing the SAFE test. We take 8 hours of continuing education each year to learn about RESPA, HMDA, TILA, CFPB, QM’s, and much more. Will the madness ever stop! I once worked for a lender who even had an “acronym” manual published with all the other corporate manuals. It was about 10 pages long. Crazy!
As the manager of Missoula’s Guild Mortgage, I’ve implemented a simple yet fun way to help us through this mayhem. When clients come to their initial application appointment if the loan officer uses 3 acronyms during the meeting we’ll treat the client with a coffee card for a free beverage at one of our fine coffee houses in town. Let’s face it, none of us loan officers are perfect and sometimes we need a friendly reminder to ‘Just say no’… to acronyms that is!
Key: APR-annual percentage rate, LOE-letter of explanation, VOD-verification of deposit, TILA-Truth In Lending Act, LTV-loan to value, LIBOR– London Interbank Offered Rate, FICO-Fair Isaac Corporation (shortened to FICO in 2009), VOE-verification of employment, DTI-debt to income, TLTV-total loan to value, MBS-mortgage backed securities, FNMA-Federal National Mortgage Corporation, OMG-oh my gosh, NMLS-Nationwide Mortgage Licensing System and Registry, SAFE-Secure and Fair Enforcement for Mortgage Licensing, RESPA-Real Estate Settlement Procedures Act, HMDA-Home Mortgage Disclosure Act, TILA-Truth In Lending Act, CFPB-Consumer Financial Protection Bureau, QM-qualified mortgage
For over 20 years it’s been my privilege to help people finance their home ownership dreams. A lot has changed in the industry in those 20 plus years. My experience as a mortgage lender and manager is more important now than ever in navigating my clients through one of life’s more challenging adventures. The assistance I provide is complemented by working for Guild Mortgage, a company that pairs the resources of a large company with the efficiencies of a small one. I am proud my team consistently delivers smooth loan closings. That’s because we understand that it’s not just a house, it’s your home. Branch NMLS # 398152 Individual NMLS # 392310 NMLS ID # 3274