Acknowledgments

This book is built on public work, and it should say so plainly.

The regulatory architecture it describes was written by people who mostly do not get credited for it. The Consumer Financial Protection Bureau's Know Before You Owe project produced the integrated disclosures that this book spends a full chapter on, along with the small-entity compliance guides that remain the clearest explanation of the TILA-RESPA rule anyone has written. The Department of Housing and Urban Development consolidated decades of scattered mortgagee letters into HUD Handbook 4000.1, and the Department of Veterans Affairs and USDA Rural Development maintain lender handbooks of the same kind. The Federal Housing Finance Agency publishes the loan limits and the price adjustment framework. Fannie Mae and Freddie Mac publish their Selling Guides in full, for free, to anyone — a fact that new loan officers routinely do not know and that would solve a great many of their problems.

The Nationwide Multistate Licensing System and the state regulators who built it under the S.A.F.E. Act created something that did not exist before 2008: a single public record of who is permitted to originate a mortgage loan in the United States. Whatever its frictions, an industry with a registry is a different industry from one without.

The historical chapters lean on a body of scholarship about American housing finance and its exclusions — the work documenting the Home Owners' Loan Corporation's residential security maps and the long consequences of federal underwriting policy. That history is not decoration. A loan officer who does not know it will not understand why fair lending law is written the way it is, or why appraisal bias is an active enforcement priority rather than a historical footnote.

The craft in this book — what to say in the first four minutes, when to lock, how to write a letter of explanation an underwriter will accept, why you re-run the findings before you promise anything — comes from the ordinary accumulated practice of loan officers, processors, underwriters, closers, and account executives who learned it the expensive way. Much of it has never been written down. Any of it that is stated wrongly here is the author's error, not theirs.

Finally: every borrower, property, rate sheet, credit report, appraisal, and loan file in these pages is constructed. The Linden Street file is not a real transaction. It is, however, assembled from the arithmetic of real ones, and every number in it has been checked. If you find one that does not resolve, that is a defect worth reporting.

Released under CC BY-SA 4.0 so that it can be corrected, extended, and taught from.