NAMB condemns blame shifting by MBA presidentMortgagePress.comsub-prime, mortgage brokers, foreclosures
'06-'07 President Dinham calls on mortgage originators
to help protect consumers
On May 22, John Robbins, CMB, president of the Mortgage Bankers Association,
delivered a speech to the National Press Club's Newsmakers Luncheon
in Washington, D.C. His topic, "Protecting Consumer's Access to
Credit," discussed the need to protect the availability of
sub-prime mortgage options. In his speech, Robbins recounted the
benefits of sub-prime loans, such as enabling Americans to purchase
their first-ever home and realizing the American dream of
homeownership. Also discussed were some of the factors contributing
to the recent turmoil in the sub-prime marketplace, and some of
Robbins' targets--the mortgage broker, unethical and misleading
brokers, and the lack of licensing in the mortgage broker
profession.
"We need to once again identify the problem: unethical people,"
said Robbins. "Who made this mess? The short-term folks. People who
get a commission when the deal happens. For them, it's the number
of loans that counts. Good loan? Bad loan? Who cares. For them,
it's about the commission."
National Association of Mortgage
Brokers has released the following statement from 2006-2007
President Harry Dinham, CMC regarding Robbins' speech.
"It is truly unfortunate that the president of the Mortgage
Bankers Association has attempted to shift blame away from Wall
Street, federally chartered banks, state-chartered lenders and
underwriters for the sub-prime situation we find ourselves in
today. The hearings in the Senate and House have highlighted the
fact that most residential mortgage loans are quickly sold into the
secondary market; in fact, most lenders are really just brokering
the transaction, but afraid or ashamed to admit it."
"For the people who caused this problem, there's no such thing
as a lifetime customer," said Robbins. "The closest they get is
someone you refi every six months until they sink. They, not people
with marginal credit, are who need to be stopped."
"We all have a role to play in protecting the consumer in the
mortgage process and responsible participants will stand up and say
that," Dinham added. "We agree all bad actors should be held
accountable. We see that in the paper every day ... the $325
million settlement with Ameriquest, lenders
going under for bad underwriting standards, New Century's loan
officer training consisting of a showing of 'Boiler Room.'"
In his speech, Robbins detailed initiatives the mortgage
industry and the MBA have undertaken to directly assist consumers
who are in danger of a foreclosure and those who want to learn more
about lending options. He discussed the MBA's establishment of
foreclosure intervention programs in areas currently at high
foreclosure risk with troubled local economies (Michigan, Ohio,
Illinois, Indiana and Kentucky) by helping train and certify more
foreclosure counselors through a partnership with NeighborWorks America. "Frankly, it's
too easy to hang a shingle and call yourself an expert in
mortgages," said Robbins. "We need licensing of brokers, with a
threshold that will weed out those unwilling to be responsible, to
be held accountable. Some cross the line into pure fraud, and for
them we have laws. But as long as there are scam artists willing to
look someone in the eye and say 'I'm going to get you something for
nothing,' people will be hurt."
Dinham added, "We certainly would agree with the MBA that all
mortgage originators should be held to the same standards of
conduct toward consumers and should be in one registry so that
consumers can be protected [from] the bad actions of all
originators, whether they work in a bank, state-chartered lender,
credit union or mortgage brokerage. NAMB believes Congress should
come forward with minimum federal standards for all mortgage
originators for maximum consumer protection."
For more information, visit www.namb.org.
