Mortgage Bankers Turning Down Business: Regulators to Blame?

Lately, we’re hearing way too many stories about mortgage firms turning away business and temporarily scaling back loan channels because they’re too swamped with applications. In the ‘old days’ (pre-crisis) a lender would add more staff or raid the competition and ‘make hay while the sun shined.’ But those were different times. The regulatory scrutiny on mortgage banking is the most intense it’s ever been and lenders are being careful to “do it the right way” for fear of having the Consumer Financial Protection Bureau come down on them like a ton of bricks. Also, as recently reported by National Mortgage News’ Lew Sichelman the Inspector General’s office of the Federal Housing Finance Agency is talking tough about going after lenders who sold crappy mortgages to the GSEs. Who’ll stop the rain?