Cheryl Knowlton:
Hi everybody. Cheryl Knowlton with Dynamite Productions here today at Castle & Cooke Mortgage with my dear friend, national training manager, Dan Taylor.
Dan Taylor:
Good afternoon. Good morning. Whatever it is where you are.
Cheryl Knowlton:
Wherever it is, wherever we are.
Dan Taylor:
Yeah.
Cheryl Knowlton:
Yeah. So Dan and I were just talking about all of the exciting changes that are coming to lending, new programs, that whenever we introduce something like that in a class, we seem to get a similar response from people saying, “Oh, I see where this has gone. We’re just going to head right back to 2008. We’re going to offer all kinds of crazy things to all the crazy people.”
Dan Taylor:
Here we go, the wild, wild West again. But no.
Cheryl Knowlton:
Yee-haw. Here we go. But no.
Dan Taylor:
But no.
Cheryl Knowlton:
Because there is something that is distinctly different and I would love it if you’d share with our friends what that distinctly different thing is.
Dan Taylor:
So one of the changes that the CFPB, the Consumer Financial Protection Bureau, put into place was something called the ability to repay.
Cheryl Knowlton:
Oh, what a novel idea.
Dan Taylor:
Isn’t that? How about that?
Cheryl Knowlton:
Hey, hey.
Dan Taylor:
Actually, otherwise known as ATR. So if you ever hear the acronym ATR, it’s the ability to repay and basically it’s a set of guidelines that we follow to say, can Bob Johnson really afford that house or did he just tell you he can afford the house? And so, we back it up with documentation. Typically, if a loan is going to one of the major investors like FHA, VA, then they have a list of things that they will accept, pay stubs, W2’s, bank statements-
Cheryl Knowlton:
Tax returns.
Dan Taylor:
… tax returns, that type of thing. But occasionally there are borrowers out there in the market that maybe they’re self-employed.
Cheryl Knowlton:
Oh, how many of you are self-employed?
Dan Taylor:
Maybe they are. There are a few of them out there. Some folks have a lot of assets, but their income isn’t high. I mean, but they’ve got a lot of assets. They’re pretty liquid. And so, there are other ways that we can use to verify that they have the ability to repay. That keeps us from going back to the wild, wild West.
Cheryl Knowlton:
And that is wonderful.
Dan Taylor:
It is. It is because that wasn’t good for anybody.
Cheryl Knowlton:
It was not.
Dan Taylor:
No.
Cheryl Knowlton:
Well, I think we still need to have tee shirts made to say I survived 2008, especially if we were in the mortgage or real estate at that time.
Dan Taylor:
Either or both.
Cheryl Knowlton:
Yes.
Dan Taylor:
Yeah. We should have some kind of pin, that’s for sure.
Cheryl Knowlton:
A pin at least. All right kids, thank you so much for being here today and hopefully, this was helpful. We’ll see you next time.
Dan Taylor:
Bye now.