An open question in the proposed Ney-Kanjorski bill is the treatment of yield-spread premiums paid to mortgage brokers, according to E. Robert Levy, executive director of the Mortgage Bankers Association of New Jersey.Speaking at the regional conference of mortgage bankers associations in Atlantic City, Mr. Levy said the bill -- which would establish a national lending standard -- is ambiguous on whether the computation of what constitutes a high-cost loan would include the YSP. He interprets the bill as now written to include the YSP in the calculation. Current federal law does not. Another issue raised by Mr. Levy is that the bill includes the term "reasonable tangible net benefit." That term has been included in other state laws, including New Jersey's, and is undefinable, he said. Michael Petrie, chairman of the Mortgage Bankers Association, added that what could derail Ney-Kanjorski is the release of the Home Mortgage Disclosure Act data. The raw data, which do not include other factors such as credit scores, could become a public relations nightmare because a disproportionate number of high-cost loans might have been made in low- and moderate-income neighborhoods.

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