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. Of course, final proposed regulations have not been written yet. And what’s been unveiled to this industry thus far has caused much anger and resentment toward the young agency. There is much confusion over the idea of ‘flat fee’ compensation, but a close reading of the rule suggests that LOs can continue to earn percentage-based commissions depending on how a loan is funded. But there is one piece of good news in the CFPB proposal: it opens the door to allowing mortgage brokers to eat unanticipated increases in third-party costs, passing that savings onto applicants and using it as a competitive advantage against bank LOs. Then again, the CFPB also has concerns about allowing such practices.
