Aug. 19, 2007

By Chris Gillow/Frontiersman

Mat-Su - After years of planning by members of the mortgage industry and local government, Gov. Sarah Palin recently signed House Bill 162, which protects residents against unethical loan practices, which is a big problem in the Mat-Su Valley. “This bill will give the state an opportunity to regulate and to get rid of bad seeds in the industry,” said Cris Skinner, a Mat-Su Valley Realtor and president of the Alaska Association of Mortgage Brokers. Skinner spent more than two years helping finalize the bill. With a strong moral background, which comes from her upbringing and being a former member of the U.S. Marine Corps, Skinner strives for ethical excellence in her industry.

“The ambition to work on the bill came from the belief that everyone should be able to own a home without putting them in any kind of financial or credit distress,” she said.

A majority of the regulations in HB 162 focus on unethical and uneducated methods of many loan originators, Skinner said. In Alaska, especially cities like Wasilla, the mortgage industry is flooded with mortgage brokers willing to sacrifice a consumer's best interest to make an easy sale.

For one local family, which asked to remain anonymous because of an ongoing investigation, the fraudulent acts of an allegedly shady mortgage broker and homeowner led to a series of disheartening events.

“We told the [loan originator] we only make $4,000 dollars a month,” said the home buyer. “At $4,000 we didn't qualify for the loan, but the originator told us, ‘That's fine, you have potential and you don't have to prove it.'”

And so the problems began for an innocent family looking for a new life in a new home.

With construction still underway on their dream home, the owner and builder of the house offered the family a hefty cash-back deal if they helped complete the building, the buyer said. After agreeing to the deal, and unknowingly entering into an illegal agreement, the family soon lost all confidence in the arrangement.

“We had to start building with our own money, so we didn't have anything left in the bank,” the buyer said.

While HB 162 will help protect home buyers from slipping into similar situations, there is a lot of work that must be finished before the law will take effect in July 2008, Skinner said. Until then, prospective buyers need to become familiar with loan operations and make sure they feel comfortable with their financial situation before signing any agreements.

“Buyers can help themselves by going to mortgage lenders that are licensed,” said Duane Mathes, a Realtor with Dynamic Properties.

Locating an affordable home for clients is the main goal, Mathes said. Basically, Realtors and other professionals shouldn't be setting their clients up for bankruptcy. Those that do so knowingly should be accountable.

“I believe that the American dream of home ownership should come easy, without the financial struggle that some of these folks have been put into with these loan programs,” Skinner said.

For more information about House bill 162 visit the Alaska Association of Mortgage Brokers Web site at www.akamb.com.

Contact Chris Gillow at 352-2284 of chris.gillow@frontiersman.com.