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#2242081 - 09/04/20 05:58 PM Secondary Market
kathomas Offline
New Poster
Joined: Jul 2020
Posts: 2
For those banks that are correspondent lenders on the secondary market, who is in charge of compliance on these loans? Our name is on the docs as the lender and then after approximately three days they are sold. Thanks!

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Lending Compliance
#2242083 - 09/04/20 06:12 PM Re: Secondary Market [Re: kathomas]
Truffle Royale Offline

10K Club
Joined: Jul 2003
Posts: 17,251
You are.
Treat every loan as if it's not going to be bought by the investor. Make sure everything is the way it should be. You don't want to have to buy back the loan because there's an error the investor doesn't want to live with.

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#2242091 - 09/04/20 07:37 PM Re: Secondary Market [Re: Truffle Royale]
RR Sarah Offline
Diamond Poster
RR Sarah
Joined: Mar 2004
Posts: 2,449
Up North
Also, check the contract with your investor. The contract should tell you under what conditions you may have to buy back the loan (compliance errors, etc).
Sometimes you have to burn a few bridges to keep the crazies from following you.

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#2242109 - 09/06/20 03:15 AM Re: Secondary Market [Re: kathomas]
Richard Insley Online
Power Poster
Richard Insley
Joined: Oct 2000
Posts: 9,819
Toano, VA
This is an asset quality issue. Look at your promises in the contracts between you and the investors. Your bank represents and warrants each loan you deliver to be free of legal/regulatory defects. Like any other product you sell, there should be sufficient quality controls in place to assure that you deliver no less than the fully compliant paper you offered for sale to the investor.
...gone fishing.

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