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Year two of the mortgage meltdown, and the proverbial landscape has definitely changed.  Countrywide is just a memory.  Freddie and Fannie spend more time salvaging loans than buying them now.  The Fed has become (or revealed itself as) the very hand of God, as we await the results of the end of its MBS program.   Mortgage lenders and title agencies alike are grappling with yet another mangled, HUD-created mess.  The appraisers are at the throats of the AMCs like never before.  The underwriters are sharpening their litigation skills.  And the abstractors are just waiting for the phone to ring.

 

It’s a very different industry than it was in 2006.  And yet, in other ways, it’s very much the same.

 

Ask someone who knows absolutely nothing about the mortgage industry (your teenager, the mailman, perhaps your friendly local Congressperson) what a title agent, vendor management company or mortgage broker really does, and he or she probably doesn’t have a clue.  To most of America, there’s just one mortgage/real estate industry.  To them, there are no “settlement services.”  An AVM?  Is that anything like an ATM? There’s no “appraisal independence” issue.

 

But, for some reason, within this great (if not slightly punch-drunk these days) industry, the market segments and sub-segments are countless. And almost each and every segment conducts itself as an island unto itself.  The animosity between segments, at times, is breathtaking.

 

I’m probably not in a position to lecture so many bright executives who have been at this, in many cases, longer than I’ve been alive.  But sometimes, I wonder if we’re so busy choking each other that we ignore the fact that we’re falling off a large cliff.  And lately, folks, that cliff is your government and its duly appointed regulators.

 

I see appraisers battling appraisal management companies.    The government’s answer (or, at least, the answer of the GSEs)?  HVCC.  BAM!  Now play nice.

 

I see title agents and closers wrestling with loan officers and lenders.  WHAM!  RESPA “reform” is here to improve your communication.  How’s that working out so far?

 

The mortgage brokers continue their battle for the hearts and minds of the consumers, tooth and nail with Realtors and lenders.  SWOOSH!  A blizzard of regulations and laws have put the entire profession on its proverbial back.

 

What’s my point—beyond that I like to see what funny sounds look like in writing?  My point is that the government, whether it understands what we do or not, is moving to score points with its constituency.  So it’s saving the mortgage industry from itself.  And instead of responding and engaging with one voice, the industry is choosing, more often than not, to continue a decades-old tradition of sniping at its own members.

 

The results are becoming pretty obvious.  2010 is just the beginning of the Era of Unintended Consequences.  There’s plenty more a-comin’, and our industry makes such an easy target.  As a result, the industry is spending increasing amounts of its time trying to figure out baffling and conflicting regulations, or in court, or preparing for court, or preparing for ways to stay out of court.  But then again, what would you expect when the people making the rules don’t understand what we do in the first place?