From the Editor
By Jim Davis
Jim Davis is editor of Scotsman Guide Residential Edition.
Reach him at (800) 297-6030 or firstname.lastname@example.org.
Congress needs to prepare for a brewing storm
Hurricane Florence lost intensity as it barreled toward the Carolinas earlier this fall. Still, the hurricane killed at
least 47 people and caused as much as $30 billion in damage between the initial wind damage, storm surge and
More than 8 trillion gallons of water were dumped on North Carolina alone, according to one estimate. Entire
communities were flooded in the days after the storm. In terms of dollars, Hurricane Florence ranks as the sixth
worst hurricane ever to hit the U.S. or Puerto Rico.
Many affected will rely on the National Flood Insurance Program (NFIP) to rebuild.
The program, which was started 50 years ago, is expected to cover between $2 billion to
$5 billion of the damage. It’s been a vital government program during those decades,
providing affordable insurance in areas where many homeowners couldn’t
other wise obtain insurance.
But the program has been troubled, in part, because increasingly destructive
hurricanes are causing more and more costly damage. The insurance program
collects less in premiums than it doles out, leaving taxpayers to cover the rest.
Groups such as the Mortgage Bankers Association and the National Association
of Mortgage Brokers, seeking to create stability in the real estate market, have
put out calls of action to not only continue the NFIP, but also to address the
brewing storm on its balance sheet by reforming the program.
In this edition of Scotsman Guide, which focuses on legislation and compliance,
Amy Forester Roberti of the Independent Community Bankers of America takes a hard
look at the NFIP. She writes in the article on Page 35 that insurance rates need to go up
and problem properties need to be addressed.
In another article on legislation and compliance, Burton Embry of Primary Residential Mortgage Inc.
writes on Page 57 about how enforcement of post-recession regulations might seem lax under the current
administration, but rules remain in place nonetheless and should continue to be followed.
On Page 99, authors Kathryne (Kate) M. Morris of the Clark Hill Strasburger law firm and Stacey Geringer of
Collabrian Design & Technology write about how the mortgage industry should take seriously the European
Union’s new data-privacy law and similar U. S. efforts.
United Wholesale Mortgage’s Jeff Midbo and Phil Mastin write on Page 78 about how to survive the nerve-racking auditing process. On Page 120, James L. Murrett of the Appraisal Institute writes about the growing need
for a better regulatory system for the appraisal industry.
In articles exploring other topics, Tim Smith of FirstClose writes on Page 54 about how mortgage originators
can take advantage of home equity lines of credit, or HELOCS, which are expected to increase in popularity over
the next five years. And Angel Oak Mortgage Solutions’ Tom Hutchens writes on Page 68 about why mortgage
originators, especially younger ones, should look to gig-economy workers as a business opportunity.
Enjoy these and other articles in this edition of Scotsman Guide.