Kathy Williams, head of loan operations for Continental, said her bank would try to reduce loan fees and other costs for borrowers in the Abbey/King pipeline.
"We were concerned that these people get loan help if they still wanted it," Williams said. "They have been through a horrible time and have lost a lot of money and time."
Rates hit 20-year low
Home-loan rates hit a 20-year bottom last October when the national average for 30-year, fixed-rate loans was 6.83 percent. Other than an occasional blip, rates have been rising since. The market is now nearly two full percentage points greater than last fall's record lows.
Also last fall, the state created the Office of Financial Institutions in an attempt to better protect consumers in money matters, including oversight of mortgage brokerages. Brokers had virtually gone unregulated until the state's new mortgage brokers bill brought them under the Department of Financial Institutions umbrella last year.
Bley served as the state's Supervisor of Banking for the past two years.
"A broker's trust account is used as a depository for the borrower's money," Bley said. "It should be used to pay for the borrower's appraisal, credit report . . . not for the broker's personal use or for other business. When rates go up, the brokers who have not paid for their loan locks, often try to do so out of the trust account. Then, we hear from appraisers, and credit reporting agencies because they are not getting paid.
"In the legal profession, if an attorney abuses a client's trust account, the attorney is disbarred. The same can be said of mortgage brokers. They are going to find themselves out of business."
Tom Kelly is a private real-estate consultant. His column runs Sundays in the Home/Real Estate section. Send questions and comment to: Tom Kelly, P.O. Box 70, Seattle, WA 98111
Copyright (c) 1994 Seattle Times Company, All Rights Reserved.
