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In recent testimony submitted to the U.S. House Financial Services Subcommittee on Housing and Finance, NAMB—The Association of Mortgage Professionals, has again urged Congress to take swift action to protect lower income consumers from the unfair loan origination process created by the Dodd-Frank Act. Citing the disadvantages placed on potential homebuyers seeking smaller mortgages under the current interpretation of Dodd-Frank by the Consumer Financial Protection Bureau (CFPB), NAMB called on Congress to provide new clarity through the legislative process as soon as possible.
“NAMB continues to be very concerned that the difference between the lender and broker QM points and fees cap is harming consumers, “said John Councilman, CMC, CRMS, NAMB president. “Lower income consumers who are seeking a loan below $150,000 will likely have difficulty finding brokers who can do their loan. After lender fees are added into the overall fees, the broker pays their originator, and then the processing fees are added, these loans would actually cost the broker money to originate.”
Click here to read NAMB’s submitted written testimony to the U.S. House Financial Services Subcommittee on Housing and Finance’s hearing titled, “TILA-RESPA Integrated Disclosure: Examining the Costs and Benefits of Changes to the Real Estate Settlement Process.”
“This kind of situation forces brokers not to be active in the very markets where broker originators actually live and where there are no bank branches,” said Councilman. “Survey after survey shows that brokers could save these borrowers money and give them better service if the same points and fees cap that is in place for lenders was followed.”
Councilman concluded, “Consumers are paying a high price for the perceived protections that Dodd-Frank is supposed to be offering. Studies show that closing costs have increased by thousands of dollars due to the overly complex disclosures and continual re-disclosure caused by Dodd-Frank, not to mention the legal reviews now necessary for each loan.”