Theme: Mortgage Brokerage Industry in decline. Taylor, Bean and Whitaker closes doors.
August 20, 2009Article submitted by: 911 Foreclosure - Loan Modification Advice
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After many years of providing mortgages through it’s mortgage broker network, Taylor, Bean and Whitaker closes shop after the Feds barred the company from originating any new FHA loans. Ginnie Mae also terminated the company’s ability to issue mortgage-backed securities.
Without the FHA or an alternative financing offer, the only company only option was the close their doors. The executive staff contacted the entire company conveying their dismay that another option was unavailable. Now understand we’re not talking about a small potato; Taylor Bean and Whitaker had over 2,000 employees at this time.
TBW was raided by the Federal Government on August 3rd, 2009 in Ocala, Florida.
Observe that I put “raided” in quotes? This extends from a media term invoking thoughts of Al Capone being chased by Elliot Ness. But in all actuality, this search was warranted. Taylor, Bean and Whitaker had failed to submit required financial reports which raised the red flag. It was also stated that TBW failed to disclose irregular transactions, further raising the alert of Fraud.
The company was incorporated in 1982 as a small town retail mortgage firm. But in the past decade or so, TBW had grown substantially to become one of the top mortgage wholesalers in the country.
The downfall of Taylor, Bean and Whitaker is another blow to the mortgage brokerage industry which has witnessed literally hundreds of sources of loans go belly up. As FHA mortgages become more popular as the loans become the mortgage program of choice for borrowers with lower down payments, more and more brokers are closing up shop. The process to become FHA approved is quite substantial and most brokers cannot meet the FHA requirements. Those brokers that have their FHA designation are finding themselves in the enviable position of having far fewer competitors..
What comes to the next evolution of the mortgage industry? Well, pay attention because we’re already pulling back the veil. Mortgage borrowers can choose from a Governmental Lender Service or from the remnants of the once powerful brokerage networks. But Who’s LEFT!? Only a few small Local Lenders that still portfolio their own Loans. I hope you can see that your choices are being eliminated since it becomes harder and harder each day to find a broker. Now you may choose a fixed rate - oh, you can choose 30 or 20 or even 15 years or one of a couple of adjustable programs left - 5, 7 or 10 year fixed rate products that convert to floating rates after the fixed rate portion ends. Is that what you call choice? Well that’s all that’s left! And you call this good for business.