Loan Think

The Supreme Court in Freeman v. Quicken Loans No. 10-1042 ruled that federal regulators cannot use RESPA as a price-setting statute to stop lenders and other settlement service providers from charging excessive fees or even “unearned” or bogus fees for which no service is provided.

Although the U.S. soccer team lost to Brazil the other night we can thank the interest rate gods that investors, world wide, keep buying our Treasury bonds, driving prices up and bond yield downs. In the past I've joked about a 30-year fixed rate loan at 2% and I'm starting to believe that it could happen.

With all the troubling news coming out of Washington for lenders these days, the U.S. Supreme Court delivered a much-needed win to the industry last week. In Freeman v. Quicken Loans, the U.S. Supreme Court held that no cause of action existed under RESPA for a lender’s retention of a marked up fee.

If you’re looking for a patch of brightness in the national job numbers that came out Friday morning look at the mortgage brokerage employment line: broker firms added 2,300 loan officers and other staffers to their payrolls in April.

The Consumer Financial Protection Bureau this week decided to delay the issuance of a final "qualified mortgage" rule until after the Nov. 6 elections. The scoop was first reported by National Mortgage News on its website Thursday. This new development has prompted many loan officers and nonbank lenders to speculate that maybe (just maybe) the CFPB will delay its compensation proposals until well into next year.

Back in the year 2000, when Franklin Raines held the title of chairman and chief executive officer of Fannie Mae, Rep. Richard Baker, R-La., sponsored the Housing Finance Regulatory Improvement Act. This bill not only asked for increased oversight over Fannie and Freddie but also recommended unifying the regulation of Fannie and Freddie under one roof.

There has been a ton of confusion surrounding the Consumer Financial Protection Bureau’s 37 pages of rule making on mortgage compensation. We just want to point out that the rule is far from settled.

Roughly 18 representatives of the residential lending industry sat around a table this past Wednesday at the Treasury Department in Washington with various members of the Consumer Financial Protection Bureau. According to those in attendance, the messages delivered by the CFPB were loud and clear: (*)Flat fee compensation is a done deal. Deal with it. (*)CFPB wants licensing and regulatory parity for banks and nonbanks alike. (*)If you have payments made to affiliates your life will be more complicated and difficult. (*)The CFPB doesn’t care that its mortgage compensation proposal will destroy the lending industry and hand the business over to the nation’s largest banks.

Credit unions continue their bid to become a real player in the mortgage industry.

What if flat fee loan officer/mortgage banker compensation prevails?