Brokers accused again of being bad players

keysThe SEC has accused mortgage brokers of originating the majority of the bad loans that went into an $855m mortgage-backed security deal that has landed a lawsuit at Bank of America’s door.

Hmmm…  Interesting view from the SEC,  because mortgage brokers DON’T:

  • Come up with loan programs or guidelines
  • Underwrite loans, or Quality Control loans
  • Fund or Close loans

Mortgage brokers take applications, collect documentation, go over loan options, select the appropriate lender, then send everything to the actual lender for underwriting and approval.  Mortgage brokers do not make any underwriting decisions.

While brokers have become the scapegoat for many of the problems, the reality is that loose loan guidelines, very poor underwriting, and a desire to push everything through the system was the real culprit.



CFPB – LO Compensation Victory

CFPB Proposed LO Compensation Rule Now Open For Public Comments

In case you were not aware, the mortgage industry was very close with having to adjust to a flat fee for compensation. Fortunately, NAMB, in addition to having multiple meetings with top CFPB oficials, was able to get 5 members of 19 SBREFA panelists to represent YOU and the entire industry to help explain why the flat fee was a bad idea.

Here’s a summary of the latest CFPB proposal

In case you are in the mood, please read the 369 page proposal on LO Comp

 Bottom line, here are the victories:

  1. No Flat Fee
  2. LO’s can be compensated on a consumer-paid transaction
  3. Originator qualifications (Bank LO’s need to get licensed!)

Do Your Part – Get Involved and Participate

Every LO should want to comment on this proposal…Public comments are due by 10/16/12 –

Click here for submit your comment – If you will write more than 2000 characters, please attach your comments as a document.

Disparate Impact Still A Problem To Face


NAIHP continues to fight for all small business housing professionals.

National Association of Independent Housing Professionals
July 12, 2012
Breaking News 

As many of you know, NAIHP has been trying to obtain the approximately 45,000 PUBLIC comment letters submitted to OFHEO, (now the Federal Housing Financial Agency -FHFA) in the spring of 2008.

NAIHP submitted a Freedom of Information Act (FOIA) request months ago. That request has been stalled by the agency. In addition, we made a complaint to the Inspector General’s Office, which is in “process.”

FHFA has publicly admitted they used these letters in the implementation of the HVCC agreement. However, they continue to refuse to release them. We are aware the majority of these comments were anti-HVCC, and once made public, will provide evidence the FHFA and the GSE’s mislead Congress, the former NY Attorney General and the public.

On April 11, 2012, NAIHP wrote to CFPB Director Richard Cordray (CFPB now has jurisdiction over appraiser independence rules), outlining the problem and provided a complete background/timeline of the HVCC. Although, Cordray never responded, a government watchdog group did.

On June 4, 2012, Judicial Watch, Inc. submitted FOIA requests to the FHFA, CFPB, the Federal Reserve Board, HUD, OCC, NCUA and the US Government Accountability Office. The requests asked for the HVCC comment letters, all emails/correspondents and any notes regarding the appraisal code. The document request goes back to 2008.

CFPB denied the FOIA request almost immediately. In response, Judicial Watch filed an appeal. That appeal was GRANTED! CFPB is now compelled to submit the required documentation within 20 days. The other agencies are due to respond any day.

Once these comment letters are made public (not to mention internal emails and notes), they will prove HVCC was a sham designed to remove the GSE’s from Cuomo’s fraud investigation. The code was built on a foundation of lies. Moreover, with media support, it will show this code has already caused the loss of tens of thousands of jobs, and directly led to further depreciation of real estate values.

NAIHP also has the support of a major consumer group, who believes HVCC/Appraiser Independence is NOT working and needs to be changed.

NAIHP members will receive regular updates on this and other issues.


CFPB to steal Loan Officers Income – Real Estate Agents Next

May 23, 2012  – Washington D.C. – Small Business Panel and Small Entity Representatives (SER’s) meet to discuss CFPB’s Proposals Under Consideration

The Meeting’s Outcome Flat fees – YES!!!???

Real Estate Brokers – Might be welcome to wage control for you, too!!!

CFPB listening – NO!!  Industry Has to Act – Yes!

 The meeting makes it is clear that amending the Dodd Frank Act is the only way to avoid a January 2013 train wreck!

The Box Score as of May 23, 2012 –

Comrades for Penalizing Brokers (CFPB) – 1; Small Business – 0


go to: http://www.change.org/petitions/petition-to-amend-the-dodd-frank-act and sign the petition – it may be your only hope! Then circulate the petition to 10 or more people you care about.

Read on to learn more about why you better care and act!

On Wednesday in a building on the White House compound about seventeen selected small entity representatives (SER’s) sat with representatives of the CFPB, Office of Management and Budget and the SBA’s Office of Small Business Advocacy. According to information shared by one of the broker representatives: five of those attending were mortgage brokers. The others were from community banks, credit unions and non-profit organizations.

This meeting is one of the required steps in the CFPB’s rulemaking process. This precedes its upcoming notice for proposed rule making which will implement specific mortgage or mortgage related provisions of the Dodd Frank Act.

On May 9th the CFPB posted, quietly and without public announcement in the Newsroom area of its website, a release that described the process. The information in the release conflicted with the information in its Outline of Proposals but so few picked up on the event that except for some media attention, no one even knew there was a six page instruction sheet for the people who attended the May 23rd meeting. The information sheet listed the questions the Small Business Panel was seeking input on. But, no one knew they could send answers to the Bureau.

If you want to read their questions and send your answers you can do so by going to www.immaag.com and using the link on the home page to read the well hidden document and get the email address to send your answers.

The CFPB has not reached out beyond the selected SER’s to notify industry about what is happening or to let others know that six page document exists. Answers to the questions in those 6 pages were to form the foundation of the May 23rd D.C. meeting.

Your cause for concern!

There are several things which should cause concern to everyone who cares about housing recovery, free markets, and their future to serve as a mortgage professional, real estate professional or even to be an American adult who aspires to own, buy, rent, sell, invest in or refinance real estate:

1)                   Nothing in any document prepared by the CFPB indicates they are listening to input they are receiving from anyone. They are ignoring input about how wrong the Dodd Frank Act is in its approach. They do not appear to care about proof that its “corrections” just like the ones in the FRB’s loan originator compensation rule will harm or already are harming consumers and industry. In fact, if the initial report from one of the broker participants at the meeting is true, not only is the Bureau not listening, it plans to be even more rigid in its rule making and appears bent on over-stepping its authority just as the Federal Reserve Board did before it!

2)                   The May 23rd meeting implied that the “flat fee” approach to origination fees is real and it is not just an additional fee allowed to provide flexibility in creditor paid transactions which is enabled by the Bureau’s “exemption authority”. It appears the CFPB may believe it should be the only compensation. Is this true? Frankly, it is impossible to tell from the conflicting information contained in the two May 9th postings on the CFPB’s website and reports from the meeting. But, at least one SER at the Wednesday meeting is absolutely sure that is what the group took away with it.

3)                   In discussing flat fees the same SER came away with the conclusion that even though Real Estate Brokers are exempt from the CFPB’s supervision (See Section 1027 of the Dodd Frank Act) the Small Business Panel representative implied in the discussion of affiliated businesses that flat fees are being considered for real estate commissions. NAR – what do you think about that?

The conflicting information between the CFPB’s own written documents, the confusion about what the Dodd Frank Act requires or allows, and the uncertainty about what the CFPB intends to do should serve as a strong motive for you

to act and act now!

If the CFPB repeats the Federal Reserve Board’s approach to its notice for proposed rule making, even thousands of comments will not de-rail what appears to be a runaway train headed directly at you and every American who aspires to be involved in owning real estate — if that is the case you have only one seriously meaningful way to stop this assault on you and your customers –

You must support the initiative to amend the Dodd Frank Act – you must step up, sign and circulate this petition.

Go to: http://www.change.org/petitions/petition-to-amend-the-dodd-frank-act and sign it TODAY then share it with 10 friends and so on.

Yes, we must still respond to the inevitable notice for proposed rule making. But the only sure way to prevent what appears to be an act by the Comrades for Penalizing Brokers (CFPB) to decimate your business and harms millions of consumers is to take away their authority to do it.

Act TODAY! And help this go viral — tell everyone you know to Act.

The petition is going to be shared with the Congress in June. It has over 5,200 signatures today  but it needs 100 times that. We have a chance to stop the CFPB by amending the Act that gives them what they think they have to do. But only you can make it happens and it only takes seconds and no money!

 Don’t put this off or think someone else will do it!

If you don’t do it, no one will!

CFPB and Frank Dodd costs consumers more to get a home loan

The new CFPB (Consumer Financial Protection Bureau) is destroying the mortgage industry because of the bad Frank / Dodd Financial Reform laws.

This continued government overstepping will again cost the consumer MORE, not less to get ahome loan.

Sign the NO petition at http://tinyurl.com/73qpyox

Comment: “I am an industry professional. The comp rule in Dodd-Frank iis forcing me to overcharge borrowers of higher loan amounts. I also can no longer offer discounts for borrowers who refinance multiple properties with me at a time. Who is helped by this?”

Comment: As a mortgage lender, I have basically stopped doing loans under $100k. The reason, I do not make enough money to justify the time. I am not alone. Fact is this is harming low-end homebuyers. It is FAR too overreaching.

Comment: Frank Dodd, despite all its good intentions, has made it more difficult to obtain a mortgage and more difficult to understand closing costs. It needs to go if we’re looking for housing recovery in earnest.

Comment: I feel strongly that our Congressional Representatives and Senators need to be made aware of the serious adverse effects of Dodd-Frank Act. Dodd-Frank not only harms the financial industry as a whole but more importantly it harms the very group it claims to help, the consumer. I agree that an independent evaluation should be conducted and due diligence should be done before any additional initiatives of the Dodd-Frank Act are implemented. If this is done objectively, our leaders will see that the only true solution is to eliminate Dodd-Frank all together.

All mortgage brokers are gone, so the housing industry is fixed? WRONG

The real estate industry is a mess… But who is to blame, and who is fixing it?

IN the panic and adolescent reaction to the sub prime mortgage meltdown, Congress led by two totally unknowledgeable politicians, Barney Frank and Chris Dodd, ran amok in Washington with a 2800 page bill to reform the world; we only hope more intelligent heads will begin to prevail and correct the mess those two have made. Part of that mess was a pathetic, thinly hidden attempt to get rid of mortgage brokers. Seems to have worked… Last I saw, mortgage brokers now only account for about 6% of the mortgage loan business, where in 2006 – it was something like 60%.

Has it works? Watch another great video by Frank and Brian of TBWS

Fed Rule on Compensation – The insanity explained

CONSUMERS: The Federal Reserve just made loans more expensive…

The Federal Reserve Bank (which is NOT a government agency, but a PRIVATE BANK) was able to convince the Courts to allow their asinine sweeping new lender rules to take effect (April 5th) while the case winds it’s way through the court system. Below is simple video from TBWS Daily which puts the rule into perspective.

Buying bananas, or buying a home… Consumers don’t care what the seller makes, they just care that they shopped, and got the best possible deal in the market. But take away competition (can your hear me Washington?), and everyone suffers.  In July, the Dodd/Frank Financial Reform law will come into play making mortgages even more expensive and costly to consumers with even less options, except going to the overpriced banks!

What are your thoughts?

Federal Reserve Bank Conspiracy Explained

The Federal Reserve has been busted in a major scandal.

St Paul, MN: On April 1, 2011 – sweeping new mortgage broker and mortgage lender changes go into effect which will stifle competition, reduce loan options, extend the housing market recover time, and increase interest rates and closing costs to home owners everywhere.

The rules made no sense to anyone, yet the Federal Reserve marches on with a cocky attitude, completely unwilling to listen to trade groups and those in the mortgage business explaining how damaging these new rules will be.

NOW WE KNOW WHY! People who previously did studies which produced positive outlooks towards brokers and small lenders NOW WORK FOR THE FEDERAL RESERVE BOARD and magically have a different attitude AND have have their voices silenced – WOW!

Another great video from Frank and Brian over at www.tbwsdailyshow.com

What are your thoughts? Login and POST!

Get the word out – be sure to Share via Twitter, Facebook, Blogger, etc!

Senators ask Bernanke to STOP Federal Reserve and LO Comp

Fed Chairman BernankeSenators David Vitter (R-LA) and John Tester (D-MT) have written a bi-partisan letter to Chairman Bernanke of the Federal Reserve Board asking him to STOP the boards overreach of the TILA (Truth-in-Lending) act as it pertains to Loan Officer Compensation

The rule, set to start April 1, 2011 dramatically changes and overburdens the mortgage lending world, which could inflict harm to small business mortgage brokers, their loan officers and their entire staff.

Read The Letter To Bernanke

The letter says ““We remain concerned the Federal Reserve has not fully evaluated the impact of this rule on the housing market,” and ““We urge you to delay the implementation of the loan originator compensation rule so that these provisions can be better coordinated with forthcoming TILA regulations and the impacts of loan concentration can be more thoroughly studied.”

Two lawsuits were also filed this week asking for injunctions against the Federal Reserve over the rule. One by NAMB (the Nation Association of Mortgage Brokers), and the other by NAIHP (National Association of Independent Housing Professionals).

Federal Reserve Board files Motion to Consolidate NAIHP & NAMB Lawsuits

Federal Reserve Board files Motion to Consolidate NAIHP & NAMB Lawsuits

The Federal Reserve Board filed a Motion in U.S. District Court to consolidate lawsuits filed against them by the National Association of Independent Housing Professionals (NAIHP) and the National Association of Mortgage Brokers (NAMB).

READ the actual Lawsuits

This move was predictable by the Fed, according to Marc Savitt, NAIHP President.  The only reason NAMB was originally assigned a separate Judge, was because their legal counsel failed to acknowledge another related case (NAIHP), had previously been filed.

NAIHP has always believed a united front, would enable the industry to prevail in this matter.

Savitt indicated he is looking forward to working with NAMB to achieve success for consumers and the mortgage and housing industry, while NAMB’s attitude appears to be very negative towards NAIHP?

I’ve read both lawsuits. I’m no big shot lawyer. In my humble opinion, I like the NAIHP suit a LOT better?