The Mortgage Prepay Equivalent Yield™ (MPEY™) calculator, just released by the Mortgage Institute For Financial Services Professionals, Inc. (www.mifsp.org), finally answers the age-old question of whether to prepay a mortgage or invest. “People commonly make improper risk comparisons and improper tax calculations when comparing prepaying a mortgage to investment alternatives. The MPEY™ (pronounced MPAY) calculator provides an objective measure of the value of prepaying a mortgage that can be used for comparison to alternative uses. It sets a new standard in financial planning that should be a key disclosure for anyone recommending or selling financial products to homeowners,” says Leon Morris, RMP®, ChFC, CLU, Executive Director of MIFSP.
Defective rent versus buy mortgage calculators found in all fifty statesoverstate the tax benefits of the mortgage interest deduction by more than 300% creating false consumer expectations of housing affordability and suitability that may have impacted mortgage defaults and foreclosures, according to an updated study first made available by the Mortgage Institute For Financial Services Professionals, Inc. (www.MIFSP.org) during 2006.The study tested the accuracy of mortgage calculators made available to consumers as an online financial tool by state and federally chartered banks as well as those found on or through websites of Ginnie Mae, HUD, Freddie Macand the U.S. Financial Literacy and Education Commission and others.“All Rent v. Buy calculators tested were defective and they were not limited to banks,” says Leon Morris, RMP®, ChFC, CLU, Executive Director of MIFSP.
Testing of mortgage calculators and mortgage calculations provided on and through websites for hundreds of banks, mortgage originators, and other financial institutions and financial service providers leads to a report being released by the Mortgage Institute For Financial Services Professionals, Inc. (www.mifsp.org) showing many of the largest national banks along with numerous mortgage originators and others as direct and indirect sources of seriously flawed mortgage calculators and calculations that significantly overstate and grossly misrepresent the consumers’ tax savings from the mortgage interest deduction.“We went to hundreds of websites and tested the mortgage calculators for banks from all fifty states with the largest market share of deposits in the largest metropolitan area in each state. Many of these calculators were shown to overstate the tax benefit of the mortgage interest deduction by as much as 300%,” says Leon Morris, RMP®, Executive Director of MIFSP.
07-Dec-06
Mortgage Interest Deduction More Hype Than Help says MIFSP Many of the largest national banks along with numerous mortgage originators and others are identified as direct and indirect sources of seriously flawed mortgage calculators and calculations that significantly overstate and grossly misrepresent the consumers’ tax savings from the mortgage interest deduction, according to a report soon to be released by the Mortgage Institute For Financial Services Professionals, Inc. (www.mifsp.org). “Consumers may be making unsuitable mortgage decisions relying, at least in part, on calculators that spew out highly inaccurate, misleading and biased information that leads the consumer to believe that their tax savings from the mortgage interest deduction will be far greater than it will actually be,” says Leon Morris, RMP®, Executive Director of MIFSP.
Today the Mortgage Institute for Financial Services Professionals, Inc. (www.MIFSP.org) notified mortgage regulators in all fifty states of its concerns about the growth of mortgage-investment marketing schemes it refers to as “tag team mortgage planning.”In a letter to state regulators, MIFSP expressed concern that many financial representatives and mortgage originators may inappropriately recommend that homeowners pull equity from their homes, and use it to make risky investments without any determination of the suitability of this kind of mortgage-investment model. According to Leon Morris RMP, RFC, CLU, ChFC, FFSI, Executive Director of MIFSP, there could be tens of thousands of people in the mortgage and financial planning industry operating under this kind of tag team business model referring to it as “mortgage planning.” “It’s a real problem when this kind of sales pitch is made to folks who can’t afford to bet the ranch and it’s a sad day for financial planning if we’ve reached the point where a financial advisor’s desire to sell products is so overwhelming he or she doesn’t care that the consumer has to borrow money to buy it. There are over 100 million households in this country and the average homeowner with a mortgage spends 30% or more of their income on a residential mortgage. Therefore, all financial planners, mortgage originators, and others who provide consumers financial advice should at least read a book on mortgage planning if not take a course on the subject,” says Morris.
Even with numerous websites and countless advice columns, what’s still missing is personalized mortgage advice and representation. There’s a Latin saying: “Generale nihil certi implicat.” Its English translation is “A general expression implies nothing certain.” In other words, if your specific situation and needs aren’t addressed, then they may not be talking to you.
The Mortgage Institute for Financial Services Professionals (www.mifsp.org) has found the right combination for bringing mortgage professionals increased revenues while filling the homeowners’ growing need for objective, competent personalized mortgage advice and representation. MIFSP’s fee-based mortgage advisory services provide a way for mortgage professionals to be compensated for building upon what they already know about the loan process, mortgage products and origination practices, and for applying that knowledge in completely new ways for the benefit of the borrower. “Homeowners often rely on generalized information they get piecemeal from various sources, sometimes getting lost in the deluge of information maybe because they find it difficult to objectively assess loan suitability or because life’s hectic pace leaves little time to sift, sort, or screen all relevant data. We’re showing them that for the cost of a typical appraisal or property inspection, there’s a better way. We believe that independent personalized mortgage advice and representation are services that are long overdue”, says the Executive Director of MIFSP, Leon Morris.
30-Nov-05
Mortgage Based Financial Planning Leads to Development of Multi-Service Mortgage Practice and Ground-breaking Mortgage Advisory Services
Mortgage Based Financial Planning(TM) combines the best practices of three distinct areas in financial services into an innovative financial specialty that’s provided on a flat-fee or hourly fee-for-service basis. This specialty taught exclusively through the educational programs of the Mortgage Institute For Financial Services Professionals, Inc. (www.mifsp.org), expands the operations of mortgage originators, financial planners and real estate agents into a Multi-Service Mortgage Practice.
A patent for the Mortgage Prepay Equivalent Yield (MPEY), a calculation that can drastically change the approach to financial planning and investment planning, was filed today by Leon Morris, RFC, CLU, ACS, ChFC, CME, RMP, FFSI, Executive Director of the Mortgage Institute for Financial Services Professionals (www.mifsp.org). By removing all subjectivity and guesswork from the decision of whether or not to prepay your mortgage, the MPEY changes how consumers save and invest their money. “The Mortgage Prepay Equivalent Yield is unique for each individual; anyone who has a mortgage can avoid unwittingly and unnecessarily putting hard earned dollars at risk, whether it’s one dollar or one million dollars,” says Mr. Morris. He believes that the MPEY should be used as a standard of suitability in financial planning and in recommending or selling financial products.
Mortgage originators and real estate agents qualifying for the Residential Mortgage PlannerÒ designation conferred by the Mortgage Institute For Financial Services Professionals (www.MIFSP.org) are taught a scientific process that results in the determination of the “Mortgage Equivalent Yield”, part of the Mortgage Portfolio Theoryä. The process is used to assist homeowners in making mortgage-planning decisions without taking undue risk with home equity. “Mortgage originators and real estate agents want the knowledge and skills necessary to provide sound ethical mortgage planning advice rather than relying on a tag team mortgage planning scheme for a quick commission.These professionals maybe the first ones consumers look to for mortgage advice and many recognize that a consumer’s mortgage decisions shouldn’t be made in a vacuum and see the benefits of blending sound mortgage advice with ethical financial planning strategies”, says Leon Morris, RFC, CLU, ACS, ChFC, CME, RMP, FFSI, Executive Director of MIFSP.
02-Mar-05
A Plan To Prepay The Mortgage Should Be A Defensive Position In Any Investment Portfolio, Says MIFSP
The Mortgage Institute For Financial Services Professionals (MIFSP) finds that the best defensive position in any investment portfolio, for a person who has a mortgage, is a plan to prepay the mortgage. MIFSP also recommends that disclosure of the guaranteed return and no cost-no risk nature of prepaying the mortgage should be a self-imposed ethics obligation for any financial services professional that sells investments or investment advice.
Having unveiled its own Mortgage Opinion (MO) brand of financial planning in 2003, the Mortgage Institute for Financial Services Professionals (MIFSP) is broadening the base of those qualified to be mortgagor financial representativesTM to include mortgage brokers, loan officers and other mortgage professionals. Today, the majority of consumers are still sitting at the closing table without having discussed the financial aspects of the mortgage transaction with anyone who has a fiduciary responsibility to represent the consumer (mortgagor).That’s because up until now, the consumer hasn’t had his or her own financial representative, but MIFSP is changing that.
ATLANTA (Sept. 19, 2003) –The Mortgage Institute for Financial Services Professionals, Inc. (MIFSP), the premier provider of mortgage training for financial services professionals is set to unveil its own Mortgage Opinion (MO) SM brand of financial planning services on October 17-19, 2003.MIFSP intends to create a resource for consumers who seek independent personalized mortgage advice through its training of financial services professionals to provide mortgage planning, comparative analyses of good faith estimate disclosures and even loan origination services.
