The Mortgage Press:Media Alertmortgagepress.comConsumer Reports, Sub-Prime, credit rating
We at The Mortgage Press occasionally come across articles or
reports in mainstream print media, radio or television that may
directly impact the mortgage industry. For the purpose of keeping
our readership informed of media reports that may have potential
for consumer impact, The Mortgage Press has developed the "TMP
Media Alert" program. The following is the first installment:
Publication: Consumer Reports January
2001 Edition
Article Title: "New Assault on Your Credit
Rating--Sub-Prime"
Sub-Heading: Think you have great credit?
Think again. Changes in how credit is reported are giving lenders
new reasons to charge more for loans. But you can fight
back.
In advance of the article's publication, Consumer
Reports invited the media to participate in an audio press
conference in which mainstream and trade journalists had the
opportunity to speak with its authors and Consumer Union's team of
legal advisors. The Mortgage Press participated in this event in an
effort to present numerous industry initiatives designed to protect
the consumer that were not discussed in the article's contents.
We fully understood that the article was printed and prepared
for release, and there was nothing we could do to change its
contents. However, with the high number of mainstream media outlets
invited to participate in this press conference, it was important
to discuss the "missing links" that were not discussed regarding
mortgage reform and other industry objectives. We did not want the
other participants to leave with a feeling that the entire mortgage
industry "exploits confusion," "charges high rates" and "keeps a
'lid' on information."
The article does contain valid points for the consumer involved
in the process of applying for credit--mortgage, credit card and/or
auto loans. But, as is often the case, the voices of all parties
are not heard over the most vocal of those involved. Comments in
the article are sure to present increased pressure on the industry
and result in inquiries from consumers and local media outlets.
Selected disparaging comments included:
++"The mortgage industry is an industry that targets populations
they consider vulnerable."
++"You may have heard about sub-prime lending from the
voluminous bad press about predatory loan practices, which strip
unsuspecting low-income customers of their homes, money and
property."
++"With the help of sophisticated credit-scoring models, lenders
are rummaging deeper into consumers backgrounds, enabling them to
reclassify some formerly prime customers as sub-prime. The benefit
to the lender: increased profits."
As the National Association of Mortgage Brokers stated in a
recent weekly e-mail update, "Knowledge is power." We suggest that
you get a hold of this article, arm yourself with its contents and
prepare yourself with a response to any inquiries. While we cannot
stop what is said about our industry, as inaccurate as it may be at
times, but we can remain informed and respond to baseless and
uninformed attacks.
If you hear or see any article or report that you feel needs
to be circulated to our nationwide readership of 272,000 mortgage
professionals, forward the original article, audio or videotape to:
Joel M. Berman, President, The Mortgage Press, Ltd., 1220 Wantagh
Avenue, Wantagh, N.Y. 11793 for consideration.
