NAMB calls House passage of HR 3915 a victory for consumers and small business: Warns Title III provisions will harm consumersMortgagePress.comHR 3915, NAMB, YSP, HFSC, Barney Frank, Mortgage Reform and Anti-Predatory Lending Act of 2007
The National Association of
Mortgage Brokers has applauded the House of Representatives for
passing HR 3915, the Mortgage Reform and Anti-Predatory Lending Act
of 2007 by a vote of 291-127 and lauded the preservation of
mortgage originator compensation through the yield spread premium
(YSP) as a victory for borrowers and small businesses.
The yield spread premium is a legal payment paid by a lender to
a Mortgage Broker and it is an integral tool used by Mortgage
Brokers to offer borrowers flexibility in the amount of cash they
will need in order to close on a home loan, said NAMB President
George Hanzimanolis. We thank House Financial Services Committee
Chairman Barney Frank and Rep. Gary Miller for working in earnest
to ensure that Mortgage Brokers can remain competitive in the
Hanzimanolis also thanked Reps. Frank and Miller for their
assistance in ensuring that consumers will continue to be able to
have the option of obtaining zero-point or no-cost loans from
Mortgage Brokers and lenders.
Chairman Frank and I worked closely together to reach consensus
on subprime lending reform, stated Rep. Spencer Bachus, Ranking
Member of the House Financial Services Committee. Our efforts
resulted in a bill that will achieve two very important goals:
Implementing reforms that will help protect consumers from
predatory lending practices, and preserving working Americans
access to consumer credit.
HR 3915 includes the creation of a national registry of all loan
originators regardless of where they work in the mortgage industry.
It also establishes strict national standards for all mortgage
originators that include criminal background checks,
fingerprinting, continuing education and testing.
Although the bill does not require loan officers of federal
depository institutions and their affiliates to comply with these
enhanced professional standards, it does recognize that all
originators, whether they work for a bank, lender or Mortgage
Broker, must also be part of the national registry. While NAMB has
always recognized the burden that it will place on small Mortgage
Brokers, it has supported and recommended this provision from the
NAMB believes the national registry of all originators will be
effective protection for consumers against bad actors in this
industry, Hanzimanolis said. Its all-inclusive national scope means
mortgage originators who break the law cannot move from state to
state or company to company without being detected. We commend
Chairman Frank and Rep. Bachus, the Ranking Member of the
Committee, for including all mortgage originators.
However, NAMB continues to have concerns over Title III in HR
3915. Particularly troubling to NAMB is the lowering of the points
and fees trigger for high-cost loans under the Home Ownership and
Equity Protection Act (HOEPA) from eight percent to five percent,
and the inclusion of all costs and fees charged to the borrower.
This measure would adversely affect many people by making it
impossible to obtain mortgage financing. NAMB will continue to work
with policymakers on this issue.
For more information, visit www.namb.org.