bTunes Dedication To All Loan Consultants: Seconds by U2

If you’re like many loan consultants, you’re entering into the second quarter thinking you’ll still have second mortgages to structure your deals with. You should think again. Loan-to-value requirements will keep dropping, and you may be returning to old school mortgage insurance for financing greater than 80% sooner than you think. There has already been a wave of HELOC freezes in the first quarter, and the second quarter will bring more tightening for HELOCs and fixed seconds. As home prices drop, it’s inevitable that lenders will drop max LTVs to compensate.

So if you’re overlooking this fact, we’d like to dedicate a great and often overlooked U2 song to you from their third album released in 1983—back when a second mortgage was from a seller or a private party. ‘Seconds’ [iTunes] is a song about impending war set to an infectious military beat, and the chant-like lyrics kick off with the following:

It takes a second to say goodbye.
Say goodbye. Oh, oh, oh
It takes a second to say goodbye
Say goodbye, oh, oh, oh, say bye bye
Where you going to now?

And that question couldn’t be more appropriate. If you’re a broker, will you just seek out another lender to find a new second product? Or will you flee your brokerage and try to get hired by a bank? Either way, the seconds are likely to say goodbye. It’s but one battle in the market war you’ll have to continue to fight as the credit crunch matures.

Or perhaps U2’s Seconds can be interpreted another way: Does it mean that it only took a second for second mortgages to say goodbye? Sure seems like it, they were here in abundance and now they’re not, almost overnight. Or does it mean you’re saying goodbye to the industry all together because you can’t do seconds?

We certainly hope not. Just use this song as inspiration, make it your anthem and find another way to serve clients while your competitors waste time saying goodbye to seconds. Because even if it feels like you have no control, like your just some puppet, you still have to adapt. And remember what the song says: It’s the puppets who pull the strings.

But only the smart puppets like you.