Items Tagged with 'LO Compensation'

ARTICLES

  • Legal: Leveling the Playing Field for Mortgage Loan Originators

    Two recent key regulatory developments will bring about important changes for state-licensed and federally registered mortgage loan originators. The first, the announcement of the development of a uniform state mortgage loan originator examination, will ease licensing burdens on state-licensed mortgage loan originators. The second, revisions to Regulation Z promulgated by the CFPB’s discussion of mortgage loan originator compensation matters, imposes new requirements on financial institutions employing mortgage loan originators. When considered together, both of these measures will increasingly bring uniformity to mortgage loan originator operations, whether those operations occur at a bank or at a non-depository institution. Uniform State Mortgage
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  • Originating: Leveling the Playing Field

    The new compensation guidelines for loan officers have sent shockwaves through our industry. We spent months getting ready for it, attending meetings, conference calls and webinars to learn how to best make the transition. Yet there was no way to know the full impact until the guidelines went into effect last month.  To a large degree, the changes have leveled the playing field. We are more in-tune with what our competitors are doing and everyone is earning their compensation the same way. The upshot is that success for the originator will now boil down to just one thing: customer service. As
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  • Originating: Tiger Blood and Adonis DNA

    The Appellate Court’s decision to squash the postponement and drive forward the compensation changes reeks of the work of The Warlock. Only one with tiger blood running through his veins could possibly harness the power to blind the truth and force an agenda that will harm an already ailing industry. The double helix of Adonis DNA went on full display as the Federal Reserve Board flexed its rhetoric and somehow won the most recent showdown. Am I the only one recognizing the similarities of Charlie Sheen’s antics and the way this whole thing is going down? The core of the
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  • The Smoking Gun - LO Compensation

    Lenders Compliance Blog By: Jonathan Foxx, President and Managing Director On April 6, 2011, the TILA loan originator compensation rule (Rule) went into effect, despite the best efforts of numerous industry organizations, a federal agency, congressional legislators, and private citizens to prevent such implementation. Although the NAIHP has withdrawn its appeals case in order to pursue other options, the NAMB continues its legal challenge in the US Court of Appeals - DC.   A week before the April 1, 2011 statutorily effective date a letter was written to FRB Chairman Bernanke, requesting significant revisions to the Rule - revisions
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  • Next Steps in LO Compensation Battle

    The National Association of Independent Housing Professionals (NAIHP) has announced their decision to withdraw from the Loan Originator Compensation lawsuit and focus on other efforts to revoke or change the rule.  The other party to the suit, the National Association of Mortgage Brokers (NAMB) has stated they plan to continue the appeals process while also pursuing additional options.   NAIHP announced their decision after the U.S. Court of Appeals for the District of Columbia lifted a temporary stay and Rule went into effect on April 6, 2011.  Believing that their efforts are better placed in other avenues, NAIHP President
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  • New Rules, Higher Costs for RM Borrowers

    Reverse Mortgage Costs to Rise with Dodd-Frank Financial Reform The changes regarding Loan Officer Compensation have taken effect not only impact how originators can be paid, but will also have a negative impact on the consumer. Simply, the law restricts Loan Originators from earning an Origination Fee and YSP (Yield Spread Premium) on a transaction simultaneously. What this does is force the Originator to make a choice between YSP and charging an Origination fee on their loans. This is a major issue for the consumer because as of April 5th, the cost of borrowing money will be going up,
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  • LO Comp Stay Dissolved - Rule Effective

    The U.S. District Court of Appeals has dissolved the stay against the Loan Originator Compensation rule thereby making the rule effective as of April 5, 2011.  In the ruling, the Appeals court also denied the motions of NAMB and NAIHP requesting expedited relief and further stay against the rule.   The one page ruling stated that the appellants "have not satisfied the stringent standards required for a stay pending appeal." As such, the rule becomes effective today, although the case will continue to be litigated by the U.S. District Court before Judge Beryl Howell.
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  • Fed Files Response in LO Comp Appeal

    The Federal Reserve Board (Fed) has filed their response to the appeal in the Loan Originator Compensation rule lawsuit.  After trial Judge Beryl Howel denied the request for a preliminary injunction temporarily halting the implementation of the rule, the National Association of Mortgage Brokers (NAMB) and the National Association of Independent Housing Professionals, Inc (NAIHP) immediately filed an appeal with the U.S. Court of Appeals.   In the response, the Fed addresses the three areas that NAMB and NAIHP used to support their claim in the appeal.  The first key point is whether the Fed exceeded their authority to
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  • Temporary Stay in LO Comp Suit

    The U.S. Appeals Court for the District of Columbia issued a temporary stay, delaying the implementation of the Loan Originator Compensation rule for five days.  The stay provides the Appeals Court sufficient time to consider the emergency motion for expedited relief and the emergency motion to stay implementation of the final rule.   In the order, the Appellate Court was very cleat that the stay in no way can be construed as any type of ruling on the merits of the case, it is only to provide an opportunity for the parties to respond to the motions and for
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  • CMBP Files Brief Supporting LO Comp Suit

    The Community Mortgage Banking Project (CMBP), with the support of the Community Mortgage Lenders of America (CMLA), filed an amicus brief arguing that the new Federal Reserve Board (Fed) will have "the perverse effect" of denying consumers the opportunity to obtain a lower cost mortgage.   By filing an amicus brief, also known as a "friend of the court" brief, an entity that is not directly related to a lawsuit is able to submit supporting information to the court that a judge can consider in ruling in a case.  “The Fed rule was supposed to address the issue of
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