Join the FIGHT TO SAVE YSP! 12.04.09
Please take the time to make a difference in your career and take action by joining the fight to save your YSP. Don't complain - Watch, Take Action and PLEASE FORWARD. Thank you.
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socalgeo: (December 05, 2009 2:16pm)
Thanks again for letting us know how we can help make our industry better.
NoMoreAcronyms: (December 05, 2009 8:40am)
Why is it evil to make a living ? Other prices you currently can NEGOTIATE for NOT under attack from our GOVT: Home price, Realtor commission, Car sales, stereo sales , building supplies, food at any farmers market , applicances , Big Screen TV + more.
Angry Appraiser: (December 04, 2009 5:52pm)
Mortage brokers- fight! fight! fight! This is the same thing us appraiser's have been going thru. Same as HVCC, you will have the banks or other enitites controlling your fees. This has to STOP!! and we have to stop HVCC too. This is america!! It is unconsitutional to have our right to make a living taken away or controlled. Next, they will be controling your client base too, like us appraisers. All you mortgage brokers that considered us appraiser's a bunch of cry babys and winers over HVCC, it's your turn to cry if this goes thru. The government needs to stop the witch hunt and implement laws and enforcement services for violators of the rules. Fraud is up with HVCC!!! All the good mortgage brokers and appraisers are paying the price for the crooks out there. Send the violators to jail and let the rest of us thrive in our business' SIMPLE!!
Tim E: (December 04, 2009 4:33pm)
Financelogic(who picked your screen name 1st of all because it doesn't fit your comment)...have you had your head in the sand for the last year and a half???? It amazes me how many people are SHOCKED, SIMPLY SHOCKED (HOW ABOUT BLIND, LAZY, APATHETIC (or simply said that will never happen))...this has been industry news and going on for well over a year...the proposed rule was the biggest deal to hit brokers in years...matter of fact it the almost identical HUD rule was introduced under Andre Cuomo when he was HUD secretary. CAMB did 13 webinars with 300-500 attendees last year asking that we all comment to HUD on the proposed rule....and so many are SHOCKED????? Well maybe you aren't in California...so do you read any industry publications??? They want us to be accurate on our disclosure to the consumer...OMG.... WHERE HAVE YOU BEEN
Owl Tree: (December 04, 2009 3:47pm)
I just emailed the AFL-CIO to see what they think.
Owl Tree: (December 04, 2009 3:43pm)
Maybe what I need to do is call some union boys and see about creating a Loan Originator Union. Maybe I just need to go about as hard Left as I can to get my interests represented in the Great Society II
Owl Tree: (December 04, 2009 3:40pm)
I made my comments, in as rational and polite manner that I could. I suppose the good news is that this will all be coming to a close shortly. HVCC was the nutcracker, and a YSP ban will officially be the coup de grace. I hope not, because I like running my own company. However, if the only alternative is to close Bailey's Savings and Loan and go work for Potter, I suppose it's good timing that the decision will be made right around Christmas.
ILL Appraiser: (December 04, 2009 3:27pm)
All that is necessary for the triumph of evil is that good men do nothing ...
GaryP: (December 04, 2009 2:34pm)
Originally, organizations like NAMB were created to take on a battle like this. However, they're currently broke because of declining memberships. If the mortgage industry doesn't have the werewithal to support NAMB, what makes you think that it is going to come up with the millions of dollars to atake on a legal battle like this. The Fed, or HUD, doesn't have to worry about that. They just go tell the treasury to go print more money, or sell more bonds to the Chinese. Try getting a grip on reality. Why do you think that NAMB withdrew their lawsuit over HVCC? They didn't have the money to fund a legal battle, and besides, it would have been drug out in the courts for years. Do you have the slightest clue as to what it would take to sue the Federal Reserve?
go play with barney frank: (December 04, 2009 2:27pm)
gary P..let me guess you funded 2 loans last quarter and cried like a baby all month pining for the old days! go play with Barney Frank
GaryP: (December 04, 2009 2:23pm)
Beat them at their own game: Sure! $4-5 million should probably do the trick. Why don't we just have a car wash, bake sale, and a garage sale too? That should do the trick.
Beat them at their own game!!: (December 04, 2009 2:18pm)
Honestly, this is a fantastic opportunity to create a lawsuit in regards to this YSP change and perhaps throw in HVCC too to boot. This could be the opportunity some swashbuckling young hotshot lawyer is looking for to make his name.. all the pieces are in place. If we all chip in $100 we can have enough in the kitty to make this happen. For example, the ability to rewrite clients on FHA streamlines and do no point loans is gone now!! How is this benefiting our clients? 6 of my 10 closings last month were no points or fees upfront? I am sure there are many of you out there that do this for your clients too. Lets get this steamrolling people
The Irishman
MortgageMentor: (December 04, 2009 1:43pm)
Someone said; don't complain and don't explain and I agree that, mostly, both are a waste of time.
Action works best and we should be emailing this video to everyone we know or would like to know.
Valueboy: (December 04, 2009 1:40pm)
I told everyone I know that after the Feds beat up the appraisers with HVCC, they would go after the loan agents next (YSB). You guys (loan agents) better fight this hard and not roll over like the pathetic appraisers did (I'm an appraiser). Hey Realtors, you better pay attention, cause after the loan agents get screwed, your next.
TXMAN: (December 04, 2009 1:35pm)
yes we should let them know how we feel, but do not forget that you do not need to provide an alternative for these people. The simple loss of more jobs will resignate to them overall way more than a negative complaint. You can simply state that you do not support the current plan to remove any YSP..... or any other items that you disagree with for their new policies....be careful and please do not let this pass as smooth as they want it to....
Irishman wondering what happened with loans: (December 04, 2009 1:20pm)
Good job Frank and Brian again. This thing needs to get stopped asap. Jaysus i just listened to that NAMB call on the GFE and i was more confused than ever...can you imagine what our clients will say. I might go back and pick potatoes in Ireland now hahahahahah
Hard*ss: (December 04, 2009 1:17pm)
Still whining here. Yes it is a good idea to write these people, just remember they are dumb as a post.
Until we disclose under the same regs as banks the consumer will never have a clear picture of costs. Now get back to work.
Mark: (December 04, 2009 1:12pm)
Financelogic - you have to guarantee the fees on page 2 for 10 days - the period they have to shop. The interest rate you make available for the day you provided the gfe and good through 5 minutes from printing. They are correct on items in box 1. They cannot change no matter what happens. HUDD in Denver is going a gfe and hud1 class on dec 21, you may want to sign up
Mark: (December 04, 2009 1:09pm)
The removal of the YSP from brokers - actually the fact that we have to credit the borrowers puts us at a competitive disadvantage. How do we not do a zero point deal? WE can't. We have to charge to make any money. We used to be able to get paid in YSP and not charge the borrower for our services.
People - please, we need to get organized today and get a suit in place to get this new GFE and YSP mess corrected. WE have the grounds and the proof. Frank and Brian - can you organize a place to pool some money for attorney fees for the lawsuit? If we all gave $100 we could amass a large pool to hire a good attorney.
FinanceLogic: (December 04, 2009 12:48pm)
Just had one of my lenders send out new GFE policies, effective 1/1/10. It states...
" On the new GFE Box #1 will be a total of all fees charged by the broker (including YSP) and once that is disclosed, it cannot be changed. The rate and YSP can change, but that total charge in box #1 cannot change. Box #2 then deducts the YSP from the total fees showing just how much the borrower will need to ante up for closing."
If the YSP is an overage it must be given to borrower as a credit. YSP can no longer be kept by the broker as compensation.
Now, what I'd really like to know is how we are to fill out page one of the new GFE. It is supposed to be 100% accurate, and also a time frame completed stating how long the rate/fees are valid. Well, you guys know as well as I do that pricing could change the minute after disclosure!
Yammer in AZ: (December 04, 2009 12:36pm)
Do they serve beer at the bowling alley??
Frank Garay: (December 04, 2009 12:33pm)
Well.. I think I'll go bowling.
Commenting on this legislation!: (December 04, 2009 12:31pm)
Honestly the Feds will not read one of our comments. First of all everyone needs to understand why the Fed was set up and how it was set up, then you will understand why, how and who it operates for. It is an arm of the banking cartel, this is the perform storm in american history for the banks to finally squash the competetion and lobby the small business out with unlimited finds and coercian once and for all. Watch the "creature from Jekyll island" on You tube and then think about what is going on. Amazes me the opinions on here without even knowing what you are talking about..would be the same as arguing at a medical conference with doctors that they are wrong and you are right and you know nothing about their industry
Valuequestor: (December 04, 2009 12:26pm)
I don't think this YSP issue compares to HVCC. After reading the posts and the comments from the boyz, people are coming down on all sides of this issue. Most of my Broker / LO friends are taking this in stride and trying to plan for it. They don't anticipate a big drop in income. It does not compare to the HVCC/AMC catastrophe....IMHO. Frank'n'Brian, Wish I could meet you guys in Vegas, but I'm scheduled for the Appraisal Summit & Expo there on the 10th & 11th at the Tropicana. This is the first time I've gone to one of these that wasn't in my backyard. Might as well go to Vegas while I'm still an appraiser. Jeff Schurman of TAVMA, Ron Smith -FHA, and Jim Park the Exec. Director of the Appraisal Sub-Committee are speaking along with others. I want to hear first hand what some of these ass-hats have to say. 14 Hrs. of CE, gambling and drinking. Gee......I hope I don't cause a scene! Anybody else going??
Leslie in Denver: (December 04, 2009 12:25pm)
Here are my comments to the FED: These constant regulation changes are getting completely out of hand.
The borrower(s) only care about two things: 1) How much will my monthly payment be?, and 2) How much money will need at closing? All the other disclosure nonsense is simply that - nonsense.
To deny a mortgage broker the right to make a living is bordering on criminal. To require mortgage brokers to compete with banks, WHO HAVE TO DISCLOSE NOTHING, is more than ludicrous. And these are the same banks who ripped off the American people causing most of the chaos we are still seeing and that is still costing us - THE AMERICAN PEOPLE - huge amounts of money!! Get a life, FED! Find a way to put 1,000,000 mortgage brokers BACK TO WORK, instead of driving more of us to the government-owner poor house. Well, maybe, if the government wants to pay my rent, heat and electric and grocery bill, this might be a good thing! I sincerely doubt that will occur anytime soon. Don't you?
The consumer will NOT benefit from any any of this. It will simply serve to limit his/her choices in the marketplace.
HVCC was an abject failure and now HUD/FHA is assuming the same model for their appraisals. MDIA has only served to further delay the closing process - WHICH COSTS THE BORROWERS MORE MONEY FOR LONGER LOCK PERIODS - and the new GFE and TIL are so monstrously stupid as to inspire awe. I have been to the seminars. There is no shortage of stupidity in Washington these days, and it appears it will only get worse.
Again, FED! Get a life! Talk to the "real" people..... like me and my borrowers. You'll get a real awakening. I suppose that's too much to hope for, right?
mthomas: (December 04, 2009 12:22pm)
i think it is unfair the unequal treatment that mortgage brokers get compared to mortgage bankers. mortgage brokers carry alot more regulatory weight on their shoulders than everyone else in the business.
banks net branchs don't have to disclose ysp or srp. and what about financing for auto loans? dealers mark up auto loan rates to earn back end commissions and don't disclose anything.
Brokers already disclose what we are earning very clearly on the GFE. Why is this not good enough? We already do more than everyone else and this new regulation will just make a mockery of the whole process.
Enforce current regulations instead of trying to make crazy new ones.
Lender: (December 04, 2009 12:16pm)
I appreciate your efforts F & B. You guys do really well at your job and keeping us informed. I for one appreciate it.
spur you are wrong: (December 04, 2009 12:16pm)
let me guess Spur??? you will be able to bank loans come January and you will not have to disclose right..also so you agree that we should not make as much agents who clear 3% on transactions?? I have worked on some very difficult $100k transactions for more than 4 months ( take your pick what were the reasons these files lasted 4 months) and i can honestly say i deserved more than 2.25% commissions..what say you?
joecolorado: (December 04, 2009 12:11pm)
sarcasm-Walmart had a plan in place which was to get rid of ALL competition.There is no one that can compete with Walmart efficiently and effectively for any length of time.subsequently there are fewer options to IT.Walmart could currently effectively mark up most of their merchandise by 25% and there is no effective alternative,the competition is ALL out of business.very simple strategy which is very effective, capitalism at its finest.now we have no choices.The Big Banks are doing exactly the same,look at Credit Unions for example, and see how the banks handled THAT threat.
Sarcasm, Inc.: (December 04, 2009 12:06pm)
Az-Broker-Vet, a very valid point. Regulators are making the assumption that rate is the only point of contention. Why would someone with a career that makes them move every couple of years ever buy a house if they have to drop $6K-$10K every time that they move? With the front loading of APR fees, the customer may receive a rate of 5%, and perhaps and APR or 5.25%, but the effective APR of this loan which is paid out in 2-3 years skyrockets. In a perfect world, we would never lose jobs, our income would increase, and we would stay in our homes until our death at a ripe old age, but I do not see that happening any time soon. I just hope that the voice of reason is heard amidst the deafening silence of good ideas from regulators.
joecolorado: (December 04, 2009 12:03pm)
Glad-If you take out the word"broker" and insert"appraiser".....?Now you see the predicament you will be in as its the same as the appraisers currently.I think that you are looking at the short solution to a very long issue,where ALL of us get the shaft....there is no please and there is no thank you and there definitely isnt any money.This has to be stopped.How can we o about it effectively?someone somewhere must have a solution.If its a union that is needed lets form a union,If its solidarity thats needed, someone tell us how.Where are all the brainiacs of our businesses that cn do this?I dont mind being a sheep following a knowledgeable leader,but I dont want to be led to the slaughter by a group of self serving sycophants currently leading us down the garden path.(AI and ASA to name two)
Frank Garay: (December 04, 2009 11:58am)
SoFLmtgBkr - Right. It's a new mindset for us. Our GFE is nothing more than the cost to get the loan - I love it. The burden of "cash to close" now falls on the HUD-1 with the settlement agents. So yeah, we may be getting estimate HUD-1's, but, so what? This stuff is going to get very very accurate, you watch. Because if the lender approves it - that's basically it (with a few minor variances) I think that once we all get our head around this... it's going to be fun.
Sarcasm, Inc.: (December 04, 2009 11:54am)
Are you kidding me? This is GREAT! Pretty soon, I will only have to pay a flat fee of $.10 over what Walmart pays for the things that they sell, and I can buy a car for just $100 over what the dealership pays. This should fit wonderfully with my government sponsored medical plan. Can't wait to have to give up my home for someone the government thinks deserves it more than me.
SoFLmtgBkr: (December 04, 2009 11:50am)
Frank: I appreciate the work you & Brian do. Especially your big picture positive attitude. One side note on RESPA. Vicki Bott, the HUD Deputy Asst. HUD Secty, stated on the webinar that "the GFE is not going to show the funds to close." Am I the only one to recognize the major consumer impact of this? After all the disclosure details are finished at application, the borrower wants to know two things: 'Based on all you've shown me, 1. How much will my Payment be?, and, 2. How much money will I need to close?". For HUD to be so pre-occupied with getting the fees that lenders & mortgage brokers charge fully and completely disclosed (but not banks) shows that their 'hidden agenda' (take away all the tools mtg. brokers & small lenders have when competing with banks) is more important than truly serving and protecting the consumer. That being said, we still have to deal with it. So, put the most positive spin possible on the new RESPA GFE and we Will be able to compete but Not vs the Bank.
Az-Broker-Vet: (December 04, 2009 11:39am)
Sorry guys but I have to give a Big Ole "LOL" to the people that are anti-brokers. If anyone that wants brokers or even YSP gone with then you don’t know anything about the business. YSP is there for so many reasons... one of them is to assist the client with closing costs and if used correctly serves as a tax deduction come the following tax season. Another which goes hand-in-hand with the first, to relieve some of the financial stress to the borrower when closing. They can buy furniture do repairs or even paint the house or even the nursery that color they imagined it. And, yes the other is broker compensation or bank compensation. However way you word it is up to you. A bank can do what they feel just as easy but a broker has the option to use that bank or not. It’s just as easy for a bank to take their Par rate and bump it 1% and still call it Par putting extra proceeds in their pocket at anytime. Today, since they are at competition with different entities they reduce the rate...
CA UMB: (December 04, 2009 11:34am)
Tired of Govt.
Yes, every entity that originate mortgage loans. Just like the new 2010 GFE. Banks & Mortgage Bankers are no longer exempt. All must disclose YSP.
Note:
Correction on my original post. Corr. Either directly from the Borrower or from YSP. No longer cna a LO recieve compensation from both.
Glad to See Brokers Going Away!!: (December 04, 2009 11:19am)
Brokers who disagree with my are not addressing the point of self-regulation or responsibilty for their industry's lack of protecting the mortgage broker way of life and instead insulting direct lenders. My total "junk fees" are $500 and my rates are the same or better than respectable brokers. I support brokers and direct lenders who are assets to their clients. Both have their benefits and negatives. My point is that brokers had the opprotunity to manage this issue for years and instead the dishonest ones (the majority are even by NAMB's own numbers) bait and switched clients everyday. Now the honest ones - the ones who are a benefit to the industry as a whole and to the buyers they serve - will pay the consequences that will be much more harsh than anything the industry itself would have done. If the industry took action, they would not be in this situation. But they were greedy and figured they would deal with the situation when it became and issue.
Lender: (December 04, 2009 11:12am)
The ultimate goal is to have a handful of banks owning and controlling all lending, appraising and real estate sales and do to the public what the credit card companies have been doing to their clients all these years.
Good bye lenders
Good bye appraisers
Good bye real estate agents
Daleppard: (December 04, 2009 11:11am)
To: Glad Brokers are going away;
Are you a flipping idiot? I have worked in a bank, also as a mortgage broker or banker. All rates sheets are somehow tied to ysp.
When I worked for a bank we still had the abillity to price a loan and get a better commission. You just actually see the commission on the hud from a broker. They have to show what they are charging and we all know the banker is making way more on the bank end for the same loan. You're bank is just the one putting the screws to you by not paying you as much of the pie.
Let's also put some on the consumer. If they shop the rates they will get the best deal. If you walk in to a lender today with a 700 credit score and take 6.5% with an origination fee...then you are an idiot!! Plain and simple.
Mortgage & Real Estate Guy: (December 04, 2009 11:10am)
To anyone that says a mortgage broker doesn't earn their income, must actually have no idea of what a loan consists of.Must be the loan officers that take the application and hand the file to their processor and go play golf.The average Real Estate Agent makes 2.48% per transaction for 1/10th of the paperwork, and about the same amount of risk.SPUR stating that a Mortgage Broker doesn't deserve, or has taken advantage of a client when they make more than 2.25%. Are you really that nieve.You take the Average Loan closed by a Bank Loan Officer and compare rates and fees to a Independent Mortgage Broker:Bank Loan Officer 4.26% per loan.Mortgage Broker 1.89% per loan.The compensation to the Actual Loan Officer is IRRELEVANT.Look at total compensation of fees and interest rate delivered to the BROKERAGE/Lender.These numbers come directly from a written report for the Mortgage Division, of the Utah Department of Commerce for the years 2006-2007.I know because I wrote the Report.
denverpro: (December 04, 2009 11:10am)
Don't worry joecolorado the Realtors are about to get there's too! Wait until these foreclosures and short sales flood the market and the government sets the guidelines! We will then have a centralized clearing house (some sudo-governmental entity) that will decide who gets the short sales and REO's! Look for current REO asset management companies to be brought into the governmental fold! This is going to get nasty!
CA UMB: (December 04, 2009 11:08am)
Read the newly purposed Reg Z. The way I understood it's an either /or. YSP for Origination Fee or Directly from the investor. No longer can a LO receive both. Provisions were included for "no cost loans."
Nothing about seperate Agreements. Please supply a link for that veribage
Sick of Govt. : (December 04, 2009 11:02am)
Does anyone know if this proposal pertains to correspondent loans as well?
Mortgage & Real Estate Guy: (December 04, 2009 10:56am)
To Glad Brokers Are Going Away: (cont.) The lack of knowledge expressed by Bank Loan Officers is astounding, in this day of age. The Mortgage Broker generally can explain why interest rates go up/down, give multiple options of multiple products with multiple fee structures. A Bank Loan Officer-looks at a screen that tells him what the Rate and Fees are. It is like comparing an idiot proof Defibrilator, that tells a First Responder to Shock the Patient compared to DEFIB Paddles used by a Doctor or Paramedic. The Doctor and Paramedic, know why the patient has to be shocked, and takes the steps to save the patient. The idiot proof DEFIB maching that sits in every corporate office space waiting for Jack/Jill to go down with a Heart Attack, has to spell out every step to the person using it. Their is a reason the Mortgage Broker is compensated better than a Bank Loan Officer. They actually know what they are doing and why.
Joe Parsons: (December 04, 2009 10:50am)
...and before I forget, Spur: I find your statement that the "good" brokers are "few and far between" to be, frankly, as insulting as it is inaccurate and unfair.
smackdaddy: (December 04, 2009 10:50am)
GladBrokersGoing,
what a vengeful, petty person you are...While you were being a direct lender making less money, your rates were still higher and you had less products to offer your clients. If your in-house underwriter said no, then your client went to a broker that got the deal closed. Oh, and the broker made twice the money and still gave your borrower a better rate. Its fine that you wanted to work for a direct lender and enrich your company so you could brag that you worked for a big bank.....I worked for a direct lender for 5 years and a broker for 3 years - I too was brainwashed that brokers were somehow "evil"...banks have to perpetuate that myth so they can hide the fact that they are taking so much of the compensation from you. If YSP gets taken away from brokers, yes many brokers may go out of business - but besides the brokers themselves - it will be the consumers that will be hurt - rates will go higher....enjoy yourself - glad you are so excited.
Mortgage & Real Estate Guy: (December 04, 2009 10:50am)
To Glad Brokers are Going Away:You would rather pay .50% to 1.00% Higher in interest rate, with the same upfront fees, just because it came from a loan officer working for a big bank (I wouldn't).2-3% on a loan is not ripping off a customer if their other options are to pay the same amount of fees for a higher interest rate to a bank originator.The Mortgage Broker offers a more competitive loan product than any other part of the industry, has to provide full disclosure of compensation (current HUD), has to complete more initial education requirements, has to complete more continuing education requirements, has to be licensed, regulated by the state and local mortgage division, requires quality control measures, and many (that are FHA approved) have to pay for a FULL CPA audit every year. Bank loan Officers-need a GED, that's it. Based on a report by NAMB, 63% of all Bank Loan Officers don't even need a license to business as a loan officer because the company they work for.
mike: (December 04, 2009 10:48am)
SPUR...Interesting Perspective. FHA is the only government agency not funded by US Tax dollars. It's funded by the UFMIP collected BY THE BORROWER. It has operated this way since the 1930's. You stated that FHA should not be profitable...you can't honestly support that in light of your support of the private sector. The private sector must be profitable or it fails. Supporting non profitability in government is irresponsible and part of the problem!!! I wouldn't have a problem with this if it was 100% market driven. The fact that the Government has become owners in the very banks that are pushing these limits should scare the hell out of anyone who thinks income limits are a good idea. If someone is making 2.25% and they are not getting business because they are charging too much, the market/consumer, if given the chance, will correct this and that broker will die or change to stay competitive......
Joe Parsons: (December 04, 2009 10:46am)
Spur: I am guessing you aren't HUD approved, right? But setting aside your apparent lack of knowledge about these very beneficial programs, I have to take issue with your frankly inane statement that "If you have ever made over 2.25% on any loan you took advantage of your borrower." There are cases where the amount of labor involved truly mandates higher percentage fees. For that matter, smaller loans may dictate higher percentge fees. There are certain fixed costs that we as loan originators and company owners all have to bear. Earning, say, $1,500 on a typical loan--especially those where there is a great deal of work inolved--will not enable the company to meet overhead, make a reasonable profit and stay in business. I think it's fair to say that most of us who have been in business for any length of time (20 years for me) have had occasions where three points or even more was fair compensation.
sburrett: (December 04, 2009 10:42am)
Hey Spur,
How did you come up with 2.25 points is overcharging? That’s a pretty exact figure. Personally I usually target about $5K to 10K per loan regardless of loan size because really does the loan amount even matter?
$100K loan can be just as hard and time consuming as a $2.0 mil loan. So using your criteria if I made $3K on a $100K loan that took months to complete that’s too much but I close a $2.0 mil loan that was the easiest deal ever to complete and I charged 2.125 points, that’s not too much??? Bottom line it’s all about what value you bring to your client. There’s $100 hour attorneys and $1000 hour attorneys. Is anyone complaining about that?
RealtorRob: (December 04, 2009 10:38am)
Really guys? YSP is an inversely proportional way for brokers to make more money by providing a client a better rate. I think a flat fee based on loan size (surprisingly similar to a realtor co-op) would be a good thing. Too many "telemarketing lenders" will get clients into a high rate, high risk loan to pad their own pockets while a lot of the great lenders will get rate shopped and have to make less because the client is savvy. I don't think they should take away the compensation, but it shouldn't be based on the rate, but the loan size. Most brokers make a point on the front and a point on the back, why not just make Originations be the compensation with risk based rate structures? It's like Realtors getting paid more for selling a home under market value and less for above. Just doesn't make sense, except to the bank and the broker.
joecolorado: (December 04, 2009 10:30am)
I am so sorry this is happening to Brokers/independents. This is an abomination that needs to be stopped.What has NAMB done about this?Is AI involved?Is the ASA involved?Is there anything more direct we as appraisers can do to help Brokers?Who can we talk to direct that will give us answers to why this is hapening to a profession and an industry?Are Realtors next?as it seems the only group left out of this slash and burn tactic by banks.....are Realtors.
Glad brokers are going away!!!: (December 04, 2009 10:30am)
Well, I have tried for 15 years to convince my friends who were brokers to not rip borrowers off, but they did any way. No its time to pay for the broker industry's not policing its own membership. A lot of people got rich by ripping off consumers and now the government is going to over do it. We all knew this was coming. Having been a direct lender without YSP for the last 20 years, I havent made as much money as my money grubbing broker friends, but they will be out of the business or working for a direct lender. I think it is wrong to ask to keep the YSP because if it remains, customers will continue to be ripped by brokers. They have no oversight and they can not be trusted to police or regulate themselves. The days of the wild, wild west of brokering loans and making 2-3 points on every deal is gone and you have no one to blame but yourselves (the honest ones) for not taking care of your peers (the dishonest ones). Bye-bye YSP - glad to see you go.
Simplesolution: (December 04, 2009 10:29am)
Appraiser in central california-Exacly now some of the others know how it feels and see what HVCC has done to appraisers. Our fees are now cut in half or more due to the HVCC. It's as if they are trying to drive everyone except for the big banks and their AMC's out of the business.
Besty: (December 04, 2009 10:28am)
The consumer needs to be protected from the Fed's incompetence, the Congress for its capitulation to lobbyists and the Treasury's ability to ignore wrongdoing in the financial markets. Mortgage brokers can only sell the PRODUCTS they are offered. We didn't create the sub-prime market, or MBSs yet changing our method of earnings is the way to go ?? I agree that our industry is very capable of self-regulation, its already happened. Can the above mentioned entities say the same?
SoCal Mortgage Broker: (December 04, 2009 10:23am)
YammerinAZ: Sorry should have posted comment to halfincome.
SoCal Mortgage Broker: (December 04, 2009 10:20am)
YammeinAZ: HUD is recinding the requirement for a maximum 1% origination fee. You should be able to charge competitive origination costs.
perldc: (December 04, 2009 10:17am)
halfincome - FHA changes starting Jan 1st eliminate the 1% origination and will increase our ability to increase fees on the origination fee for FHA loans. you can go on NAMB's website to watch webinar which HUD hosts if you need clarification.
kirkwilliams: (December 04, 2009 10:16am)
SPUR says: "Fannie and Freddie can build strong solid portfolio's while providing us with LTV up to 97%, but they can't do it without our support. The fastest way to get this to happen is to stop doing FHA loans and force the lending to come from the private sector."
I understand the thinking but don't agree. The private sector delivered the calmaity we are in. HUD has been the most flexible program and along with USDA has helped this market limp a long (tax credit didn't hurt) so to say Fannie or Freddie both currently in the emergency room barely breathing is to be the savior at what cost? Already because of the ineptness exhibited by our government giving banks money for nothing banks turn around and lend it back to the government at higher rates and not lending to small businesses (banks making loads)should be a glaring example why Fannie & Freddie as you propose it is NOT the solution. They may be part solution but as I sit here today...no. Good discussion and I wish us all well
GaryP: (December 04, 2009 10:10am)
Spur, when was the last time that you closed a first time home buyer with a conventional loan? Support the agencies? How does that happen? They basically exited a large part of the industry. Admittedly, they got kicked under the bus by the MI companies. Agency guidelines for any loan >80 LTV have become totally meaningless. I don't know about you, but I don't have many firt time buyers with 20% down and a 720 FICO. So, you are saying that I should put my buyers in a lower quality loan so that I can "support" the agencies? We abandoned the agencies out of necessity, not because we could make more money on government loans. Well, I guess that something more than $0 is more, so OK, you got me there.
MortgageAngel: (December 04, 2009 10:01am)
Oh my gosh. Talk about dumbing down America. Aren't they going to declare a National Labotomy Day first?
Thanks for reminding us to behave ourselves and to be professional. Of course we can still whine and moan amongst ourselves.
Spur: (December 04, 2009 9:47am)
The new HUD is long over due. As a mortgage broker for over 30 years I have watched us do this to ourselves. I know there are good honest lenders out there, but they are few and far between. Those of us who are good failed to keep those who are bad under control. If you don't know if you are good or bad its easy to figure out. If you have ever made over 2.25% on any loan you took advantage of your borrower. I don't care how hard the deal was to get funded. It use to be in the 70's and 80's a golden rule that you didn't make more than 2.25% on any loan. Some how we let greed take over and let YSP's get out of control. On top of this we are now making a bigger mistake and that is supporting FHA. Why would anyone want or do an FHA loan? It is nothing more than government ran mortgage lending. I see broker who are fighting government ran health care while doing FHA loans. Are you kidding me. FHA does not have to be profitable to stay in business. They don't have to compete with the private sector. Fannie and Freddie have been good to Brokers for 20 years. When they needed our help we turned our back on them and jumped on board with FHA. Were going to live to regret that move. If Broker don't survive this down turn it will be because we let FHA take over the market. Fannie and Freddie can build strong solid portfolio's while providing us with LTV up to 97%, but they can't do it without our support. The fastest way to get this to happen is to stop doing FHA loans and force the lending to come from the private sector.
halfincome: (December 04, 2009 9:34am)
YammerinAZ - we can't charge 2.5% points in origination fee on FHA deals.....which is 50%-75% of the business right now.....that's how our income will be cut in half. I think most know that we can re-structure the fees being charged on a conventional to still make 2.5%....or less.
GaryP: (December 04, 2009 9:33am)
I would encourage everyone to discuss the impact of this on the consumer when they make their comments to the Fed. I sincerely dount that the Fed gives one hoot about what this does to us or the industry as a whole. Remember the intention of this is consumer protection. My comments addressed what would happen to rates and fees if a huge percentage of independent originators were removed from the market. Face it, the one thing that we have to offer is the ability to keep the big banks honest on rates. If we leave the market, they will continue to gain market share and the cost to the consumer will increase accordingly. I think the Fed may think that having fewer lenders out there may be a good thing. It would certainly make it easier for them to regulate the industry if there is just a handful of lenders left.
Appraiser in Central California: (December 04, 2009 9:32am)
Wow, the ramifications sound exactly like what HVCC did to appraisers.
SoCal Mortgage Broker: (December 04, 2009 9:30am)
If you want to read an eye opener, go to http://ml-implode.com and read Anatomy of a Government Abetted Fraud: Why Indymac/OneWest always forecloses. The article is on the left side under Blogs & Commentary.
MortgageBrokerGal: (December 04, 2009 9:28am)
MKT1: If you don't think the mortgage brokers have lost income over HVCC, think again. How many loans do you think we have lost to the horrendous appraisal process through HVCC? Now, in addition to destroying the valuation system, the government wants to tell the consumer how to arrange their financing. Many of my borrowers, after seeing various loan programs and Good Faith Estimates, have chosen a slightly higher rate to reduce the costs they pay at closing. If this goes away, not only with the mortgage broker lose an important income tool, but the borrower has lost his ability to choose. Just hearing the President talking now about the rating companies' role in the fraudulent sale of MBS's, and the tightening of lender guidelines in the mortgage industry. He may actually understand some of this, but he's got to get a better handle on it, or our industry will never recover.
smackdaddy: (December 04, 2009 9:27am)
Frank Garay, I love your guys websites and updates - but I read the CAMP agrement - it says things like "bad broker" and "unscrupulous broker" and it seems to me to intimate these derogatory terms with a broker who receives YSP and keeps it for her/her own compensation. If that is not what the CAMP letter is saying - then I would like to know what the definition of a "bad broker" or "unscrupulous broker" is? please advise
JFH003: (December 04, 2009 9:26am)
All I know is. it seems the more they try and fix this the bigger the mess gets I say we go back to the way it was in late 80's we had prime lenders and hard money lenders we had YSP's we had all this. The prob here is it was a perfect storm that happened to the industry job losses, high gas prices, etc. stop pointing fingers and work on a recovery. With out brokers it will cost the consumer more. how do you think the banks will get borrowers they will have to pay for advertisement and that will cost the consumer. Stop with all this nonsence. some one better see how much money will come out of this industry, if they take the broker out. and Goverment, you need to think about this, look at all the money you have lost from Mortgage tax and doc stamps that went to the state I bet your looking at billions so get the broker back to work so he can make the state money stop taking away his incentives to be in this business, we need to make a profit just like any other business .
Frank Garay: (December 04, 2009 9:25am)
Fed link works perfect for me... click where it says "click here"..
GaryP: (December 04, 2009 9:21am)
I guess my whole problem with all of the new regs and changes is that they are all focused on regulating an industry that no longer exists. I made that point in my comment to the Fed. Everyone, including Congress, HUD, Fed, and Cuomo for that matter, are trying to regulate something that no longer exists. The industry itself has already put guidelines in place to prevent what led to the crisis. In that, the industry has been self regulating. What we're getting now is over-regulation with little or no regard for what I can only describe as being "unintended consequuences" of this kind of regulation.
Joekool: (December 04, 2009 9:21am)
I think everyone is confusing the fact that there are two separate rule changes here. There is the new GFE which will require mortgage brokers to change the way they disclose YSP. It will require us to charge it to the borrower and the borrower will receive a credit from the lender which they will in turn "pay" the mortgage broker. That is fine as long as you take the time to explain this to your client properly.
The more serious issue is the proposed FED rule that is currently in a comment period through December 24th. This rule is looking to get rid of YSP all together. Any mortgage broker that does not take the time to comment on this in the next 3 weeks is essentially sitting by while our industry is outlawed.
SoulMan: (December 04, 2009 9:18am)
link is broken to the fed site....fyi
Frank Garay: (December 04, 2009 9:06am)
Smakdaddy... You've clearly missed something..
Edog's Ma: (December 04, 2009 9:02am)
Yammer in AZ - you are absolutely right. YSP is not going away for the brokers with the new GFE on 1/1/10. The new GFE just requires the broker to disclose it a different way. There's been a lot of research on the proposed legislation going into effect by end of 2010 and its clear that if YSP goes away for the broker several months down the line, then SRP will also go away for the banker which will mean it will be a level playing field.
GaryP: (December 04, 2009 9:01am)
Yammer, I think you missed something. There will be no 1.5% YSP to give to the borrower to pay your origination. At least not under the Fed rule. We don't know what they are going to allow the originatior to make in compensation. What if they only allow 0.5% or $500? I think that's the whole point here.
MKT1: (December 04, 2009 8:57am)
I understand. Maybe it's time I switch to brokering.
smackdaddy: (December 04, 2009 8:56am)
Why does the CAMP agreement (California Association of Mortgage Professionals) say that brokers are "unscrupulous" if we don't give the buyers the "best rates"? I have loans that no one else could do but because of my level of expertise in getting tax returns amended, debts paid off, credit rescored, etc., etc. - I make those loans happen and my clients get houses!!!! My clients are happy and appreciate my services. Do I charge them a higher than par rate? You bet your booty I do! Is it worth it to a client if a broker goes "above and beyond" to get a deal done? YES. Do I sometimes make 1% origination and 2% YSP on back? YES.....Is it fair? YES.... Maybe politically you have to say I am being "unscrupulous" to make politicians understand. My clients love me and my expertise and professionalism...I am compensated by them - I EARNED IT!!
soldsum: (December 04, 2009 8:53am)
The disturbing fact is that Banks do not have the Same rules to follow as we Mortgage Brokers do, I have been contacted recently by numerous Bankers who offer me the ability to send them loans without disclosing YSP on the GFE. Why to Bankers get a free pass on this? and how to we shine a light on them operating in this slippery fasion?
sus so cal appraiser: (December 04, 2009 8:52am)
Brian & Frank - when you go to Vegas this weekend - can you video your "Conference" so those of us who can not make it can also hear it, and release your conversation with AG staff from your trip to NY. You guys are an inspiration. I'm afraid if "We the People" continue to be to "couch potatoes" and don't become vocal the lobbyst will take control. "We the People" may not have the finances that the lobbyst do - but we have the VOTES.
VinceM: (December 04, 2009 8:50am)
This is really troubling stuff...No other industry has to disclose in such detail the amount of revenue made or produced. I'm NOT opposed to disclosure but at some point... we have to allow the borrower (consumers) to do their due dillagence and let the free market run it course.. XYZ is offering 5.25% and ABC is offering 4.875%...
soldsum: (December 04, 2009 8:48am)
AMEN, CV BROKER AMEN.
Yammer in AZ: (December 04, 2009 8:47am)
I disagree with you MKT1. As a broker, my income will not be slashed in half as you suggested. I don't know if everyone understands how our income will be affected, but let me give you an example as I understand it;
If I want to make 1 origination point and 1.5 ysp as I usually do today, I will still be able to net 2.5 points but I'll structure it a little differently. Under the new laws, I will charge the borrower 2.5 pts and the bank will credit the 1.5 ysp to the borrower. The net affect will be the borrower paying 1 point and the broker will still earn 2.5 points. The main hurdle I see is in learning how to explain this to the customer so they understand why we have to disclose in this manner. Bottom line, I don't see our income being slashed like the appraisers experienced. Make sense?
soldsum: (December 04, 2009 8:45am)
Hello Friends in the Real Estate and Mortgage business, please watch the short video below and join us in the fight to stop Government from intrusive, ignorant intervention in the Mortgage business. We need your help to save Mortgage Brokers ability to compete with Big Banks and using YSP (yield spread premium) is a tool that helps consumers tremendously. I just closed an FHA loan for a client who only had 3.5% of her own money which is the required down payment, the Seller would not contribute... i priced the loan at 5.5% and recieved 2.75 in YSP which paid for ALL of the buyers closing cost through Broker credit, i did the Loan almost for Free by giving up the broker credit but as i always say "half a deal is better than no deal". The fact remains that without YSP this deal would have been DOA "dead on arrival". The consumers NEEDS YSP, end of story.
really tired: (December 04, 2009 8:29am)
I just wonder when all the new regulations will stop. Subprime is gone and now we the federal goverment telling us we cannot make a living. I wonder how many law makers were on the boards of banks and fannie and freddie mac watching subprime loans make alot money doing not saying anything until the crash are the same ones blaming mortgage brokers for the mess. Listen to Barney Frank five minutes and I want to throw up. I feel there are alot more good mortgage people than bad.
CV Broker: (December 04, 2009 8:27am)
Why does profit become a dirty word when it applies to our industry? Realtors are vilified for their commission and mortgage brokers are called crooks for requiring payment for their services. Our contacts, our experience, our broker agreements, our networking, our risk-taking by being self-employed - all to be able to help people and make a living in the process. How is it crooked to expect a lender to compensate us for giving them a loan on which they will make hundreds of thousands of dollars? Wholesale to retail - People can shop at the dollar store or Nordstrom - their choice and that choice should not be able to be taken away by legislation that decides whether we are worth our service.
MKT1: (December 04, 2009 8:20am)
Seems as though the mortgage brokers / loan officers are now going to feel the pain that the appraisers have been feeling. It's not fun to have your income slashed almost in half over night. I have been an appraiser for 15 years and never in that time did my fees increase. Now I find myself like alot of other people, possibly losing my home and business. HVCC rules. Good luck, I hope you have more luck saving your income then the appraisers have had.
Bigg in Colorado: (December 04, 2009 8:19am)
Common Sense- The banks are already benefiting by the Brokers going out of business. It's called market share. I don't blame the banking industry,they are taking advantage of a crisis to increase market share, I'm just pointing out the obvious. They are not your friend. I don't have any idea what Adam Smith or Milton Friedman have to do with that. If you are referring to basic supply and demand and the resulting effect on price then I don't see how you would disagree with me. Less competition and decreased supply will lead to higher prices and more profits for the only institutions left, the Banks.
Who do you think is pulling the strings behind the scene in this ridiculous drama? The politicians are certainly not listening to Brokers.
dazednconfusused: (December 04, 2009 8:18am)
It looks like we need to standardize our fees just as realtors have done. We all need to come together under one entity and wear our "pledge pins" like REALTOR's do.
A standard fee agreement of 2% no matter the loan amount sounds reasonable. We make the Banks only offer broker packages to those in the "UNION". If we all united the banks would be begging for our origination skills.
Frank Garay: (December 04, 2009 8:04am)
Keep posting guys. on way to office. will release in 30 mins.
Frank Garay: (December 04, 2009 8:00am)
LQQn4AWayOut - you're wrong. we are here to stay. the HUD gfe is fine in concept. the page needs some work. I really like it in fact. it's just a different way of competing with each other. it's fine, and, I'll say it.. it's good for the consumer.
leothedog: (December 04, 2009 7:47am)
I just spent the last hour or so preparing a message and sending it to the Fed on why eliminating YSP is not a good idea.
Have you sent them your thoughts yet?
RobP: (December 04, 2009 7:45am)
It's comical that a politician makes laws for an industry it knows nothing about. It's like GM hiring a CEO that knows nothing about cars, which is probably why he just stepped down. Bernanke and the boys should step down too-or at least "step off".
LQQn4AWayOut: (December 04, 2009 7:40am)
The Mortgage Banker as we know it today (Broker or Correspondent) will be a thing of the past in 36 months.. let's face it folks, they have been trying to weed us out since this market crashed.. My next job may have "would you like fries with that" in my job description.
Joe Parsons: (December 04, 2009 7:25am)
As disturbing as some of these regulatory trends and proposals surely are, and however much some may want to blame the problems on the present administration, please keep in mind that Ben Bernanke was appointed by GW Bush, Not Obama.
GaryP: (December 04, 2009 7:23am)
Mom & Pop, Its no secret that Barnie Frank and Chris Dodd and others have decided that the mortgage broker is the official cause of the mortgage collapse. The folks in DC need a scape goat and we have been nominated for that position. After all, how much have you contributed to their re-election campaign fund? It couldn't be Fannie, Freddie, or the big banks, could it? No, of course not, they're good guys, after all. Just look at how much they contribute to their campaigns. Above all it has to be someone's fault, and they certainly couldn't have had an role in all of this could they?
SF Big Dawg: (December 04, 2009 7:20am)
First off thank you guys for all you are doing. It is nice that we have a voice out there for us. Second I hope that the appraisers out there get on the band wagon and support their motgage counterparts who worked harder for their industry then there were able to do (HVCC). It is a shame that congress can go ahead and make changes without thinking about the consequences. If you get it to where the mortgage brokers are more of a part of the process you will put more people back to work and the customers will get a better deal. I had a customer come in yesterday and showed me what they were offered from one of the big boys and the rate was beyond 103! That rate was quoted 2 days prior and I could have beat the rate by 1/2 a point. If this passes it will do away with competition and the consumer gets screwed. If we want to get rid of the idea of too big to fail then get more competition not less. Without competition a lot of people will never get a home as the banks will tighten up
Common Sense: (December 04, 2009 7:15am)
Bigg, No one benefits over the long haul if anyone goes out of business. Try reading a little Adam Smith or Milton Freidman. I agree there does seem to be a conspiracy to scapegoat brokers at the moment, but when do you need a scapegoat? When you're being accused of course! I'm simply stating that blaming the banking industry is not productive. The government's only legitimate role is in protecting free enterprise and defending all of our right to operate legitimate businesses. We need to all stand up against big governement, not fight among ourselves.
GaryP: (December 04, 2009 7:15am)
I must admit that I like the idea of losing deals to other LO's that don't take the time to accurately fill out a GFE. I've always tried to be as accurate as possible on my GFE's and end up losing a deal to another LO is that is either sloppy or to be honest, a bait and switch artist. I think there are a lot of issues with the new GFE, but that is one change that I welcome. It's sort of hard to try to explain to a client that they are being conned, or given inaccurate information, without sounding like coming off sounding like you are a cry baby over losing the deal. Yes, Mr. Borrower, you will have to pay for title fees and set up escrow. Just because the other guy didn't bother filling out those fields and just sent them whatever is on the their calyx template doesn't make those costs go away. I'm sure you, and most good LO's are more than familiar with that situation.
God: (December 04, 2009 7:13am)
Boy, that was a low key approach to the morning's show. Made it kinda boring. It's important info, but I fell asleep 3 times during the 4 minutes. I'm still gonna click on the docs and links section below but it was boring.
TC Jax: (December 04, 2009 7:06am)
I sat in a meeting with the NAMB lead counsel Joe Falk on Tuesday of this week. YSP is not going away or is SRP. Mr. Falk intimated that the YSP to be paid to the MB business(or whatever we will be called)is still under review and in the comment period (ending at the end of this month). He felt that taking away YSP would hurt the small mortgage business owner. The flat fee being discussed will either be a specific dollar number or a percentage that will be paid to THE LOAN OFFICER. The individual loan officer will be capped at this "flat fee/ percentage" per loan. The YSP is still being discussed for the MBB. If YSP is taken away from the small MBB's, we will get a warehouse line and fund the loans (through the lender) being able to receive SRP. Many lenders are putting this plan in place currently to provide warehouse lines to solid MBB's. The sky is not falling, although there looks to be challenges for compensation to the loan officer moving forward with a capped commission.
Mom&PopBroker: (December 04, 2009 7:05am)
The only reason they just dont come out and say no more brokers is because of the opening for a class action. So instead, they are going to regulate, cut, legislate, and increase costs to make it virtually impossible for the honest hard working small broker to exist.
Frank Garay: (December 04, 2009 7:05am)
GaryP, You're right, it goes to the borrower but it does not go away. And it's available to us to give to the borrower the way it is today. Each rate will deliver a certain YSP, you pick what you want. The fed rule makes a set flat fee, virtually no choices for you. the new HUD way is just a different mind set. You decide what you want to make on any deal and that's it. You can do whatever you want. I actually really like the HUD way. It will make it easier to operate in MHO. And it will level the playing field, allow for honest compensation and what's more is it really is PRO Broker in my opinion! Our webinar will be out soon.
Bigg in Colorado: (December 04, 2009 6:53am)
Common Sense- you really believe that the Banks are acting in the Brokers best interest and that this is all a Government conspiracy? Who do you think Government (Obama et al/Congress) is listening to? Follow the Money friend. I agree that this Big Government Cabal in DC right now is leading us to ruin. I just am pointing out who is pulling the strings here and the Banks are not the Brokers best friend in this regard. Ask yourself, who benefits if the Brokers go out of business?
GaryP: (December 04, 2009 6:53am)
Frank, you must be hearing something different than what I am. I attended RESPA training recently and was told very directly that any YSP has to be paid to the borrower, not the originator. The only way that the originator can be compensated is through origination points. Now, I assume that the origination can be increased and offset with by YSP on the GFE, but that's going to go against the intent of creating a new GFE that will allow the borrower to more effectively shop the loan. That's the whole intent of the new GFE isn't it?
GaryP: (December 04, 2009 6:48am)
Bigg, I am an independent retail LO with a mortgage bank. We made the change from being a broker to retail branch earlier this year. The Fed rule does impact SRP, and not just at the big banks. Correspondent lenders and retail folks like me will be impacted too. That was the point that I was trying to make in my earlier post. The Fed rule addresses all "indirect compensation," including the SRP that we reail and correspondent folks can continue to be paid under RESPA.
pgh mortgage guy: (December 04, 2009 6:46am)
thank GOD you guys are waking up to the REAL problem in our industry - HVCC is a pimple on our ass.........THIS will put millions out of a job - WAKE UP PEOPLE and lets tell the fed what's up!!!!!
headed to law school: (December 04, 2009 6:44am)
Insurance Broker - yeah, I've decided to leave the industry - going to law school in the fall. The lawyers won't ever see their fees capped, 'cause all the legislators are lawyers - lol
Frank Garay: (December 04, 2009 6:44am)
GaryP - it's just you. HUD did not do away with YSP. It's there and you can use it. We will be doing a webinar on it soon. You can still make money, just up front, and you can still use ysp to pay cc's and do no cost loans through the HUD rule. Trust me, the HUD version is a million times more workable than this fed rule, and if the fed rule goes through the HUD version is out. So download the overview, and post your comment.
Common Sense: (December 04, 2009 6:42am)
Bigg--Divide and conquer, that is Obama's plan, and you are buying into it. He wants us to all blame each other and therefore not provide mutual support as he takes over our industries one by one. He has already taken the auto industry and much of the banking industry. Did you complain then? He's pushing legislation to create a "department of Regulation" to oversee us all. Now he's going after health care and energy. Each time this congress passes a bill you lose some of your freedom. Face it, if we do not all stand up against ALL big government and soon, we will wake up one day and this forum will be outlawed and we'll all be living in little concrete tenements, dependent on the government for every waking need.
GaryP: (December 04, 2009 6:40am)
One more thing. Isn't this essentially price fixing by the Fed? I would think that there are some serious constitutional issues with that. What other industry has been regulated to mandate profits? I have a feeling that this will eventually get as far as the supreme court, but only after the mortgage industry, at least as far as we know it, is fundamentally destroyed. I wonder if the powers that be's goal here is to have a bunch of hourly LO's taking apps at the big banks for $8/hr., with the corresponding level of service that that will get you.
Hammer: (December 04, 2009 6:38am)
Glad to see you guys beating this bell again. Good idea to provide a comment template. For the record, I have it on a good source that these comments are ALL READ. It is imperative that people don't just cut and paste.......
Bigg in Colorado: (December 04, 2009 6:38am)
The dirty little secret that the Banks hope the public never discovers is that they can still receive SRP. Giving them an unfair advantage over Brokers.
GaryP: (December 04, 2009 6:34am)
Is it just me, or are you guys totally oblivious of the fact that whatever the Fed does on this, HUD has already done away with YSP through the RESPA change that goes into effect in a few weeks? As I understand it, the Fed rule would only have an impact on mortgage bankers that get paid through SRP, not YSP like brokers do. The Fed rules seems more sweeping and addresses all indirect compensation to LO's, YSP and SRP. I sat in on a recent NAMB conference call and they seemed totally absorbed on the Fed, with no mention of RESPA. When RESPA was brought up, they said that they thought that implementation would be delayed. Well, guess what, it's not! Can someone please tell me how changing the proposed rule is going to help brokers when HUD has already taken YSP away?
Insurance Broker now Mortgage Banker and Insurance Broker: (December 04, 2009 6:27am)
oh and a followup I have multiple contracts through multiple MGAs for Multiple Insurance companies. Who Do I put the cases through? The one that gives me the biggest contract where they get about the same rate as the other insurance company. As a Mort Broker I had differing YSP from different Lenders for the same rate and would put Borrowers through the company that would pay the highest YSP for the same rate as the other lender...... wait isn't that what I do in insurance? Hmmmm isn't that the same as my insurance business? Not saying you shouldn't make concerns known but be ready to deal with it and either start career training and get out of mortgages or adapt. RESPA/GFE reform is getting Bad Title Companies and now it's time to go after Realtors need to be capped, they ALSO had their fair share of blame in this whole mess... that is a whole other discussion.
RP: (December 04, 2009 6:19am)
Was curious if anyone sees a negative to this: a yield spread rate can be offered to the borrower if they are also given an option of a par rate with points. From a broker perspective I don't see much of a downside to that?? From a regulator standpoint they are also getting what they want.
Bigg in Colorado: (December 04, 2009 6:16am)
Follow the money guys, it's the banks and their willing accomplices in government. Interesting how the democrats vilify big corporations, banks, wall street, when it suits their agenda (courting the little guys vote)and then turn around and implement policies that screw the little guy and help the banks/wall street/big corporations.
Bigg in Colorado: (December 04, 2009 6:10am)
The Banks have been trying to put Brokers out of business for years! This latest salvo may just do it. They have obviously subscribed to Rahm Immanuel's philosophy, "A crisis is a terrible thing to waste."
Frank Garay: (December 04, 2009 5:51am)
Mountain Guy - Nope this DOES NOT have to go through Congress! The Fed Reserve Board can just do it...
Nuke 'em 'til they Glow: (December 04, 2009 5:48am)
@takebackdc & Frank as I've said that Hueesin Obana is elected all everyone will be left will be left with in out pockets will be change! He and his cronies have no idea how to fix the mess we;re in and everyone keeps beating aroung the bush and saying we're in the Great Recession. HELLO Earth to DC... we' in a DEPRESSION! Start reporting the REAL unemployment numbers which are in EXCESS of 25%!
Insurance Broker now Mortgage Banker and Insurance Broker: (December 04, 2009 5:44am)
@ Big Mac: Exact;y the Insurance industry has been that way for years and I was insurance LONG before I was in Mortgages. Ditto! Train is already at the station.
Mountain Guy: (December 04, 2009 5:44am)
Smackdaddy:
At least it has to go through Congress for you guys. Many members of the appraisal community had their income (typically just a fraction of the typical mortgage commission) cut in half by the actions of 1 corrupt AG. You guys need to make your voices heard and hope that your representatives do something about it.
I hope for your sake that their decision on whether or not your industry needs a 50% pay cut doesn't happen to need to be made on the same day the Congress needs to decide on whether they need to give themselves another pay increase. They might be a little distracted that day.
Good luck!
JohnTheHeckler: (December 04, 2009 5:41am)
Well said Smack Daddy. Spend 30 minutes laying down professional smack.Our industry is under attack and some of us are sleeping through it.All people that view this should.
Frank Garay: (December 04, 2009 5:28am)
takebackdc - I guess they got it!
takebackdc: (December 04, 2009 5:26am)
People voted for change........
smackdaddy: (December 04, 2009 5:23am)
Why is it that Congress gets to vote 50% cut in pay to Mortgage Brokers and cap executive pay on Wall Street? - and at the same time - Congress votes themselves pay raises and steals money from American citizens called taxation. Right now, mortgage brokers are under assault. From the new GFE to the goal of eliminating YSP. From Barack Obama to Ben Bernake this government is literally threatening my livelihood and yours as well. This is MADNESS!!!
DWakeFL: (December 04, 2009 5:17am)
With the regulation in our industry, it seems that the government should also regulate what every insurance company, attorney or doctor earns. The over regulation is out of hand.
Big Mac: (December 04, 2009 5:07am)
Yes this a move toward practices in the insurance industry. That system works well and offers reasonable, yet lucrative commissions. Brokers will be forced in this direction. We need to deal with it. We will select lenders based on overall pricing and commission rates. We will still have the latitude to recommend lenders based on clients best interests. You are swimming up stream boys, wake up and get on the train, it ain't slowing down. Just be at the table for us to make sure we can continue to participate.
Mortgage Jer: (December 04, 2009 4:53am)
When are we as an industry going to stanup up and telL it like it is, we didn't create this mess NO broke designed 110% mortgage program. Or leveraged MBS at 38 TO ONE. We nee to stop apologizin for the bank's mess.I know they have a stronger lobby,but we need to stop helping them. Why is it that the borrowe only needs to fear us? We need to stop this perception, not play into it.
just sayin': (December 04, 2009 4:38am)
Welcome to the new world order. More bureaucracy, more paper, more legislation, and less income. Another move for the government to suppress the people and force reliance upon it. How will this effect the banks? Won't.
Please show me in the Constitution where the Federal Reserve has this authority...jut sayin'.
spdr134: (December 04, 2009 4:22am)
What has our world come to when it seems all we do as citizens is fight a losing battle against excessive government regulation. It is time to shake up our legislators and vote out all congressmen intent on growing the federal government.
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