29 responses so far ↓

• 1 Paul // Nov 2, 2007 at 8:12 am

  I signed yesterday at #260. The petition is almost up to 15,000 now.

• 2 Rhonda Porter // Nov 2, 2007 at 9:41 am

  Thank you for sharing this! I’ll be sure to pass this along to fellow mortgage brokers.

• 3 Paul // Nov 2, 2007 at 11:12 am

  Thanks Rhonda! That petition count is amazing; it’s up to 32,000 already!

  In addition to the petition, here’s who to Contact.

• 4 Gina Gardner // Nov 2, 2007 at 1:44 pm

  You guys already know how I feel about this. I’m onboard totally!passed it to everyone I know also. thanks for getting the word out!

• 5 Paul // Nov 2, 2007 at 2:59 pm

  Thanks Gina!

  The following is an update from NAMB:

  Dear NAMB Member:

  We continue to work in good faith with Chairman Frank and his staff on HR 3915, “The Mortgage Reform and Anti-Predatory Lending Act of 2007.” Chairman Frank and staff for the House Financial Services Committee have been willing to have an open dialogue on our concerns on this bill. The process has been and continues to be transparent. We are working diligently to ensure that the bill is revised to include language that is acceptable to the broker industry.

  We know this is a critical and stressful time. We understand all of your concerns. However, we are asking each of you to please refrain from calling or emailing your Congressional Representatives on HR 3915 at this time. We are working hard to resolve the concerns that you have on your ability to earn a living and operate a successful business. We do not want to place in jeopardy the efforts that are underway and the gains that we have achieved so far.

  Allow the process to work. We will update you on the next steps once we are clear where the final language in HR 3915 stands. Expect this in the coming days as the official debate on HR 3915 is scheduled for next Tuesday, November 6th. Again, we are working around the clock in good faith to ensure that a revised bill addresses and resolves many of the concerns that we have communicated to Chairman’s staff.

  In the meantime, it is critical that you continue to learn about this bill and the process. Staying informed will ensure you are ready to act when that time comes. Please note that we will be holding the second national teleconference on HR 3915 today, November 2nd at 7:00 pm EST (6:00pm CST, 5:00pm MST, 4:00pm PST). This is a free call.
  The teleconference information for today’s call is below:

  Friday, November 2nd: 1-800-214-0745 Pass code: 648439.

  As a reminder, there may be a limited number of lines available for this call, so please call in early to guarantee a spot. You will be placed on hold with music until the moderator begins the teleconference.

  Thank you to everyone for your overwhelming interest in this critical issue. We look forward to hearing from many more of you on today’s scheduled call, but please feel free to call (703) 342-5900 or contact governmentaffairs@namb

• 6 Gina Gardner // Nov 2, 2007 at 3:46 pm

  Also passed it on to Realtors. Anything that makes it harder for them to close a deal (like cash-strapped borrowers having to come up with more funds up front to buy a house) should be of great concern to them . And yet not one agent I asked was aware of this pending legislation that could put an additional clamp on an already ailing industry.

• 7 Todd Carpenter // Nov 2, 2007 at 4:56 pm

  I added a few links around the blog that will direct people to this post.

• 8 Trace // Nov 2, 2007 at 5:39 pm

  HR 3915 Information and Resources

  This bill is flawed legislation could have severe consequences on Mortgage Brokers and Consumers. This bill is a lose / lose proposition for lenders and consumers. Voice your opposition to HR 3915!

  RESOURCES:

  HR 3915 News, Resources, and Information: http://www.ipagio.com/hr-3915-mortgage-reform-act.php

  NAMB Teleconference Information: http://www.ipagio.com/hr-3915-namb-teleconference.html

  HR 3915 Summary: http://www.ipagio.com/hr-3915-mortgage-reform-act-summary.html

  HR 3915 Full Bill Text: http://www.ipagio.com/hr-3915-mortgage-reform-act-full-text.html

  This is bad legislation that can have serious repercussions for mortgage brokers and more importantly consumers, do not think this can’t affect you.

• 9 Carl Pruitt // Nov 2, 2007 at 7:55 pm

  I encourage every loan officer to issue their own press with their local dateline and Congressman or Senator’s name mentioned. Put your phone number and state you are available for interviews. There are good websites where you can do this for free and it will show up on searches for a few days.

• 10 Todd Carpenter // Nov 3, 2007 at 1:36 am

  Nobody’s stopping you from starting one yourself Jillayne.

• 11 Paul // Nov 3, 2007 at 8:29 am

  Hi Jillayne,

  I appreciate your comments and I respectfully disagree.

  The fact is that mortgage brokers have been on an unfair playing field with banks/lenders for some time now. Semantics aside, lenders make YSP but don’t disclose it to the consumer. Is that fair?

  In 2002 HUD had proposed a change to RESPA with regards to YSP. The FTC studied that proposal and released a report in 2004:

  “The study finds that the disclosures are likely to confuse consumers, cause a significant number of consumers to choose loans that are more expensive than the available alternatives, and create a substantial consumer bias against broker loans, even when the broker loans cost the same or less than direct lender loans.”

  This isn’t about fair and ethical. This is about bank lobbying.

  Unfortunately, mortgage brokers are generally fragmented and don’t have the same influence. We’ll do our part to change that here on Todd’s blog.

  Have fun with your ‘ethical lending’ thing, Jillayne, although if you are truly for consumers, then I suggest you change your focus or change the title.

• 12 Paul // Nov 3, 2007 at 11:37 am

  Hello again Jillayne,

  My name is Paul, but others in my mortgage company know me by my titles. Gee, what are they, let me think. Hmm. COMPLIANCE department, auditing department, training department. Hi, that’s me Jillayne and I’ve managed to do that successfully since 1996 at the same location.

  Also, perhaps you aren’t aware that mortgage brokers charge less than direct lenders. That’s right, Jillyane, “Brokers are not bankers”. Brokers charge LESS than bankers.

  Do some research Jillyane and then come up with a business plan that helps consumers, ok?

  Thanks Jillayne.

• 13 Todd Carpenter // Nov 3, 2007 at 12:41 pm

  Jillayne, OF course I know about your organization. Here’s my problem. You want me to pay $100.00 to say I’m ethical. Or, pay $100 for you to advocate required education for brokers (which you will directly profit from). I’m not saying that what you are doing is not admirable, but it’s also self serving.

  I’m no fan of NAMB either. My dues are five years overdue. That NAMB is leading this charge is irrelevant to me. This is a bad bill. I’m not a broker, It won’t effect me directly. It will hurt consumers, and the crooks will still find ways to be crooks.

  Asking brokers to police themselves is wishful thinking. Crooks are crooks. We need government regulation. We always will. It’s just that the government is not yet on track.

• 14 Paul // Nov 3, 2007 at 2:54 pm

  Todd, if it makes you feel better, you can send me $90 and I’ll say you’re ethical…

• 15 Todd Carpenter // Nov 4, 2007 at 12:26 am

  I just talked to Jillayne by email. For some reason, my Spam Filter has determined her to be spam. She is not. I’m still trying to figure out what happened to her comments.

  I think this thread is drifting. The focus should be on the bill itself. Please help me keep it that way.

• 16 Paul // Nov 4, 2007 at 10:04 am

  My apologies Todd & Jillayne.

  Back on track with this thread.

  Let’s listen to the worlds worst explanation of YSP.

  http://tinyurl.com/2bzlj2

• 17 Hamp Yonce // Nov 4, 2007 at 2:17 pm

  This would make more sense.
  What if the new regulation was something like this?

  In the future, the borrower could not be charged anything but credit report fee and appraisal fee. I mean nothing. No markups allowed, invoices in file.

  The originating channel would have to build in all the costs such as UW Fee, Flood Cert, Tax Service, Wire Fee, Broker fee etc… into their pricing. No lender or broker fees on HUD1. None.

  The yield spread premium or eqivalent would be the only income to the originator.

  Noone would have to disclose it. It wouldn’t be necessary, because it would be boiled down to the rate being the only, or more clearly, the main variable.

  This would practically mandate that all seller concessions would be discount points or prepaids/escrows. Lets say only those items could be paid by the seller (or rolled in to a refi). Therefore, reducing the rate and reducing the investor exposure and borrower risk. Let seller pay inspections too.

  Cash to close over and above the down payment would become a non-issue.

  Levels the Banker Broker playing field and makes shopping a breeze. If the Rate is better, the deal is better.

  Lenders would probably have to start pricing in tenths to deliniate there pricing advantage or lack of.

  You could effectively eliminate the GFE, and replace with rate quote/lock agreements already in existence.

  It doesn’t address fraud but it handles the consumer issues neatly while throwing in the level playing field for Originators.

  I can’t think of why it wouldn’t work. Can you? I think it would be an improvement. Talk about it. Brainstorm. We need to cahnge Barney’s thinking..

• 18 Paul // Nov 5, 2007 at 2:36 pm

  We have a revised bill that appears to preserve YSP for prime loans.

  http://tinyurl.com/2yfuts

• 19 Dana Bain // Nov 7, 2007 at 1:45 am

  Sorry Dana. That’s a great article, but I can’t reprint it here without the permission of the Wall Street Journal.

• 20 Dana Bain // Nov 7, 2007 at 1:48 am

  http://www.opinionjournal.com/forms/printThis.html?id=110010826

• 21 Dana Bain // Nov 7, 2007 at 1:57 am

  How about just the link info

  A Sarbox for Housing
  How to restrict lending to the poor for years to come.

  Tuesday, November 6, 2007 12:01 a.m.

  http://www.opinionjournal.com/forms/printThis.html?id=110010826

• 22 Todd Carpenter // Nov 7, 2007 at 2:10 am

  Great thanks Dana

• 23 Paul // Nov 7, 2007 at 4:46 pm

  “No provision of this subsection shall be construed as…restricting a consumer’s ability to finance origination fees to the extent that such fees were fully disclosed to the consumer earlier in the application process and do not vary based on the terms of the loan…”

  I believe the statement above would prohibit YSP, which IMO is at odds with the following:

  “No mortgage originator may receive from any person, and no person may pay to any mortgage originator, directly or indirectly, any incentive compensation (including yield spread premium) that is based on, or varies with, the terms (other than the amount of principal) of any loan that is not a qualified mortgage (as defined in section 129B(c)(3)).”

  The intent was to allow YSP for ‘qualified mortgages’ or what would be prime-type mortgages, but this would be overridden by the first citation in the same bill.

  Both of the above are in the managers amendment and seem to be fighting with each other.

• 24 ten // Nov 8, 2007 at 11:38 am

  a compromise might be elimination of prepay on subprime, ysp cap at 3 with prime and 2 with subprime. But limiting profit in a free market is not the american way. Will uncle frank target used car salespeople next?

• 25 Paul // Nov 8, 2007 at 11:46 am

  Shhhhhhhh, be vewwwy, vewwwy quiet; I’m hunting morgage bwokers, heheheheheheh

• 26 GinaGardner // Nov 8, 2007 at 12:55 pm

  Agree with the fact that bankers at least in Nevada gave had their boots on the necks of brokers for a long time. I worked for an originator that was considered legally a broker despite that fact that we funded 99% of our own loans–we brokered on occasion. We are hamstrung in our efforts to market jointly with Realtors (okay for banks, not for us), required to disclose YSP when banks are not, and restricted in our marketing where banks are not. It increases our relative cost of doing business and helps banks in their attempts to gain a stranglehold on the market.

  I think any originator that sells loans, whether brokers or warehouse line originators, or banks that sell to balance their portfolios should all be restricted to the same disclosure (NOT YSPs)and documentation requirements for the protection of investors, not borrowers (borrowers have plenty of protection but we can’t put guns to their heads and make them read it).

  As for portfolio lenders? That reminds me of an incident at LAX during a long security line. As the LA Dodgers filed past impatient passengers, one woman burst out, “They shouldn’t get special treatment just because they’re famous!” The guard replied, “Lady, the Dodgers have their own plane. If they want to blow it up that’s their problem.”

• 27 Paul // Nov 8, 2007 at 4:02 pm

  The guard replied, “Lady, the Dodgers have their own plane. If they want to blow it up that’s their problem.”

  But pulease don’t blow it up over the stadium during a home game, lest we have contagion.

  ‘Cause the foot bone connected to the leg bone…

• 28 Johnny Furlong // Mar 24, 2008 at 2:17 pm

  I don’t know if you will post this, but let me tell you what SYP has done to me. My Mortgage Broker never told me about it or disclosed it. When asked what it was at closing he said it was nothing but a fee the Mortgage Company pays him and doesn’t effect me. He also said I only approved for the 9.8% ARM but not to worry. In 30 days I could refinance because the house would show on my credit and that if I refinance with the same mortgage company they would waive the huge prepayment penalty.

  When my wife and I started looking for a house we had 9 years of really good credit. My wife had a 780 and me a 690-710 FICO.

  He lied, he was paid over $2800.00 to get me in that 9.8% ARM with that mortgage company (which means he got me in a rate about 2% higher then what I qualified for).

  We are now suing him and the mortgage company because we couldn’t afford the mortgage he put us in…don’t tell SYP keeps anything fair. It is a kickback plain and simple and any mortgage broker who willing does this and not get the absolute best rate for his client is NOT working in their best interest…and that makes it unethical and illegal.

  Mortgage Brokers that want to use SYP are scum just like ambulance chasing lawyers!

• 29 Todd Carpenter // Mar 24, 2008 at 2:39 pm

  I’m happy to post your comment here Johnny. From the details you’ve given us, you obviously didn’t get the best deal you could have. I suggest you shop around next time.

  I will disagree with you about YSP’s legality or ethical status. It’s no more wrong for a broker to earn YSP than it is for a grocery store to earn profit on selling milk. How much they collect is the issue. Like I said, it’s your duty to shop around.

  The broker you worked with lied to you, but it’s the lie, not the practice of paying YSP that wronged you.

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