President Obama still makes bashing mortgage brokers a staple in his speeches regarding the Consumer Financial Protection Bureau, and some in the industry think it’s time for the self-described progressive politician to get with the times.
On Friday, the president spoke at Lawson State Community College, and as he has since the early years of his first term, brought up mortgage lending in general and brokers in particular.
“And that's why, as part of this reform, we created an independent consumer watchdog with just one mission, and that is to look out for all of you. And it's called the Consumer Financial Protection Bureau – or CFPB. Now, these folks – the CFPB, it hasn't been around a long time, but because of the work they've done — it's not a big agency, but they've already put over $5 billion back into the pockets of more than 15 million families. Because they've taken on unfair lending practices and unscrupulous mortgage brokers.”
On Monday, John Councilman, President of the National Association of Mortgage Brokers, called on the White House to update his speech material to “reflect the current realities of the mortgage business, particularly with respect to individual mortgage professionals” and the role of the CFPB.
"It is my hope, as our President, that you will speak more positively of mortgage brokers,” Councilman says in the open letter to the president. ”They are providing the most cost effective origination channel, the widest variety of programs, and the best customer service. I believe you can honestly be assured that mortgage brokers provide a wonderful alternative to the large banks.”
Councilman cited the extensive efforts by NAMB and its state affiliates to bring about legislative and regulatory reform in the mortgage industry.
“Since the onset of the financial crisis, no one in the industry has worked more diligently than mortgage brokers to prevent a recurrence of those events,” the letter says. “NAMB has worked tirelessly with state legislatures around the country to pass laws regulating mortgage brokers and mortgage originators.”
Councilman pointed out in his letter to President Obama that NAMB has worked closely with the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, "to ensure that a national registry exists so bad actors can be tracked across state lines."
“In July of 2008, Congress passed the S.A.F.E. Act. Due to considerable input from NAMB, it licensed all nonbank mortgage originators, not just broker originators,” writes Councilman in reference to NAMB efforts on the federal level. “Shortly thereafter, the Federal Reserve created an antisteering rule with substantial input from NAMB. These all occurred prior to the formation of the CFPB.”
He also noted that the CFPB’s own records shows mortgage brokers have a good track record with customers.
“The CFPB’s complaint database reveals extreme consumer satisfaction with mortgage brokers, far exceeding that of any other segment of the finance industry, and that mortgage brokers accounted for less than onetenth of one percent of the complaints,” the letter states.