NAMB Pens Letter to CFPB on LO Compensation Regulations
March 20, 2019
The National Association of Mortgage Brokers (NAMB) has requested that the Consumer Financial Protection Bureau make immediate changes to Loan Originator compensation regulations.
In a recent letter sent to CFPB Director Kathy Kraninger, NAMB President Richard Bettencourt addressed two specific initiatives: Permit voluntary reductions by Loan Officers to their compensation in response to competition, and to allow reductions to compensation when the Originator makes an error.
NAMB suggests one sound solution would be to permit the consumer or creditor to pay, in addition to the Loan Originator’s fixed lender-contracted commission, a flat payment. NAMB also believes the CFPB should re-examine the rationale for the three percent cap on points and fees for Qualified Mortgages and either increase that amount, remove items that are double counted, or explore other ways to combat steering. NAMB believes such a solution would help resolve the problem of fewer low-loan amount mortgages.
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