Executive Essay reprinted from the September 2005 issue of Mortgage Banking magazine (pp. 101-102), with permission from the Mortgage Bankers Association (MBA).

No lender makes high-cost loans. At least that is what every lender will tell you. And that is what every lender is hoping is true. Making a predatory loan in today's environment is the surest way to destroy a mortgage company. Even if a loan officer is successful in getting a borrower to sign the paperwork, the company can't sell it. No one in the market is securitizing these loans because the ratings agencies will not rate them. One of the primary reason companies do not want to make these loans is that it is extremely dangerous from a legal perspective.

This month, we added information regarding Fannie Mae/Freddie Mac's "points and fees" test and revise high cost information for California, Arkansas, Colorado, Connecticut, District of Columbia and Florida. Visit our High/Cost Predatory Lending Page, to review these and the other high-cost memos that have already been posted on the Compliance page of our website.

March 29-April 1 -- Stop by our booth (Booth #239) at the MBA National Technology in Mortgage Banking Conference & Expo at the San Diego Convention Center in San Diego, CA.

Click here to view the 2006 Conference Schedule NOW!

This month DSI posts loan programs of Aurora, and GreenPoint Mortgage Funding, Inc. on its Compliance page. Find out the description of each investor's loan programs, which promissory notes, prepayment riders and addenda are used, and what the rate caps and interest-only periods are for variable rate loans. Visit our Compliance page next month to see other investors' loan programs.

In the first part of my interview with Don Iannitti, President and CEO of Document Systems, Inc. (DSI), we learned about the impetus behind the birth of DocMagic. In this second part of my interview, Don goes on to describe the evolution of the DocMagic technology.

Change Effective March 25, 2006.

Current Wisconsin law prohibits the imposition of a prepayment penalty in connection with a variable rate residential mortgage loan using an approved index (for a list of approved indices, click here). That will change for variable rate, first lien loans secured by an owner-occupied one-to-four family dwelling or mobile home made on or after March 25, 2006. To view a copy of the 2005 Wisconsin Act 128 (2005 Assembly Bill 456) (codified as Wis. Stats. 138.056(3m)), click here. In order to impose a prepayment penalty on such loans, all of the following conditions must be satisfied:

Have you ever changed data in a worksheet for DocMagic for Windows (DMW) or in a websheet for DocMagic Online (DMO) after having already processed the loan data the first time and wished that you could identify only those documents that were affected by your change? With a new enhancement to DocMaster, Document Systems, Inc.'s proprietary software for viewing and printing DocMagic's document sets, you may now readily identify those documents that have changed as a result of modified loan data and print only those documents.

In order to keep DocMagic software users better apprised of document changes and additions as they occur, DSI posts listings of all newly created and revised documents. Here is the list of forms created or modified in February, 2006.