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Banking pro: Brokers a 'shadow industry,' not well regulated

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Mortgage Professional America | 12 Aug 2014, 07:54 AM Agree 0
The head of a banking industry group says that mortgage brokers are part of a 'shadow banking industry' that isn't well-regulated. He also claims that it's 'bad news' when borrowers go to 'these types of financial providers.' What do you think?
  • B. | | 12 Aug 2014, 09:31 AM Agree 0
    I thinks a sad attempt for the banks to try and regain market share. Brokers have always been regulated by the states in which they do business. As already stated, brokers took the brunt of regulation hit from Dodd Frank. Borrower's go to brokers for their ease of access, as well as their ability to offer the main mortgage products at a better price or rate.
  • | | 12 Aug 2014, 09:36 AM Agree 0
    He should be fired. He was trying to bring business back to the banks.
    The mortgage brokerage industry is heavily regulated.
    The head of the mortgages brokers association should try to go on air with the same show to set the facts straight.
    This guy does not know what he is talking about!
  • MIKE | | 12 Aug 2014, 09:37 AM Agree 0
    Very misguided Mr Sanchez!! We have to disclose every nickle we make, can't even lower our fee to compete where Mr. Sanchez can bank 6 points on a FHA mortgage where Brokers share the 6 points with the consumer, I see it EVERY single day. Nice try Mr. Sanchez
  • Ray DeMar | | 12 Aug 2014, 09:37 AM Agree 0
    Interesting since my rates are always toward the bottom of the range in my market. In addition, I have recently been asked for side by side comparisons of rates and fees against Wells Fargo Home Mortgage, Citi and Quicken Loans and our costs were less in all three situations. Most Banks in my area charge origination, processing and / or underwriting fees and we only charge 3rd party fees. As a Mortgage Broker I have had to jump through more hoops IE: Testing and Annual monitoring than the Mortgage Loan Officers at Banks. In fact I know several individuals that could not obtain a Broker License that ended up being hired by Banks -enough said!
  • Michael | | 12 Aug 2014, 09:38 AM Agree 0
    He knows we are better at originating mortgages than they are and he's trying to prey on consumer fears in a sad attempt to scare people away from brokers. We are very regulated, licensed, and audited to make sure that we are following all of the same rules and regulations the banking industry has to including AML/SAR. It was bankers and Congress that caused the mortgage "crisis", but he's beating the same old tired drum about how "scary" brokers are. What we are is educated, regulated, serious originators of quality mortgage products...and proud of it!
  • | | 12 Aug 2014, 09:39 AM Agree 0
    I don't recall mortgage brokers ever having to pay the largest settelement to the government in US History, $16 BILLION, a la Bank of America, for screwing borrowers.

    Perhaps Al ought to mind his own glass home before throwing any more rocks.

  • V | | 12 Aug 2014, 09:39 AM Agree 0
    Obviously, he is miss informed. The brokers offer cheaper pricing than the banks. He just doesn't want the competition. It is the banks who are over charging the consumer...

    Shows his lack of knowledge.
  • | | 12 Aug 2014, 09:40 AM Agree 0
    Mr Sanchez comments are idiotic and ignorant. Mortgage brokers are not only regulated but we are required to get licensed and have to pass numerous tests and are much more vetted than bank originators. Mortgage brokers are really the only shining light borrowers have as if banks have their way borrowers would suffer terribly. Mr. Sanchez has no idea what he is talking about and he should do some research on mortgage brokers before he opens hos mouth again.
  • | | 12 Aug 2014, 09:41 AM Agree 0
    Brokers and their MLO's have to be licensed. Bank MLO's don't. I "rescue" perfectly good mortgages rejected by banks all the time because their LOs don't know how to structure mortgages.
  • Mortgage Man | | 12 Aug 2014, 09:41 AM Agree 0
    Typical banker- crying over spilled milk- it's not enough that brokers are obligated to disclose more information pertaining to the transaction, particularly in the compensation area and are limited whereas the Banks are not. I remember several years ago Credit Unions were granted access to the Banks lending base in a more broad spectrum and the only reply from the ABA was to focus on the fact that credit unions don't pay taxes and we have to so it's not a level playing field.

    I am a Mortgage Broker and retired former banker with 20 years plus lending and compliance experience. I can tell you the problem with the bank's mentality is much like a spoiled teenage child that thinks they deserve something just because they exist- despite the level and of service and commitment. Banks, in general, are horrible when it comes to successfully operating a fixed-rate mortgage department because they don't want to pay for top notch management- in short- they don't really see this as a vital part of their operations- until their customer goes somewhere else to get the level of service and counseling they deserve.

    Wah- get a hanky, look in the mirror and either provide a service at a commensurate level or shut up.
  • | | 12 Aug 2014, 09:43 AM Agree 0
    This guy truly does not know what he is talking about! As a mortgage Broker we are very regulated. We are very transparent to ALL. Much more than the Banking lending institutions. I have worked for banks , direct lenders and mortgage brokers over my 30 years of lending. Mortgage brokers offer much more to the consumer with many more options. We are very regulated and tested annually.much more than the Banking Loan Officers.
  • Michael | | 12 Aug 2014, 09:44 AM Agree 0
    Empty vessels always make the most noise! I thought the industry already purged all of the idiots away. An obvious clueless fool who does not know that mortgage brokers are regulated by the NMLS, by the state, and by each and every lender they do business with.

    You can only do full documentation mortgages these days, every penny has to be disclosed and accounted for, and we only have 3 mortgage products to pick from, Conventional, FHA and VA, so this just makes his musings all the more nonsensical.

    Thankfully only 9 people were watching the Fox program, so his jibberish will fall on deaf ears!


    The mortgage broker industry
  • | | 12 Aug 2014, 09:46 AM Agree 0
    This comment by far is the reason why Brokers are the official punching bag for everyone who's in this business and who is not a Broker. Not only this comment was so out of line, but this guy should not be in a position to make these negative and unfounded statements. By saying such incorrect information, he is hurting business owners lively hood. My message to the general public, please do not listen to such madness.
  • Corey | | 12 Aug 2014, 09:52 AM Agree 0
    Mr. Sanchez is either ignorant, incompetent or purposely attempting to mislead with his comments. If he has any character whatsoever he should either correct his remarks and apologize or resign from his position.
  • Matt O. | | 12 Aug 2014, 09:52 AM Agree 0
    Sounds like someone can't compete in the market place. When all else fails, start talking trash about your competition. This guy doesn't know the first thing about mortgage brokers, except he gets it handed to him every time a better deal from a broker hits his desk.
  • Graham M | | 12 Aug 2014, 09:57 AM Agree 0
    As an old banker I tried to do the best mortgage I could for those who paid me, the bank.
    That meant I was trained to offer the worst mortgage that I thought I could get the borrower to say "yes" to.
    You know, the highest rate and most fees.
    As a banker I was taught to price a mortgage based on the borrowers situation, sophistication and desperation.
    Somehow that made me feel dirty.
    As a broker of the past 20 years I still do the best I can for who pays me, the borrower.
    Now I get paid to arrange the best mortgage that I can for the home owner.
    Agree to pay my up front, fully disclosed fee, only due at settlement and I become the advocate to the judge, jury and executioner, called the underwriter. It seems to me that bankers have a real peculiar perception of what a mortgage broker does.
  • Ryykk | | 12 Aug 2014, 09:58 AM Agree 0
    Can we sue this guy, brokers have such an unfair advantage when it comes to regulations.
  • Barry | | 12 Aug 2014, 10:00 AM Agree 0
    Send your comments to:
  • M Hipp | | 12 Aug 2014, 10:01 AM Agree 0
    I am a private mortgage banker and not a broker and STILL know this guy is an idiot. I think he probably wouldn't even know the difference anyway and is targeting ALL of us that are not FDIC regulated. It's preposterous that someone that high up in an organization would not have gone over his script with the board or a staff member. Unbelievable!!
  • Tom | | 12 Aug 2014, 10:01 AM Agree 0
    Poor Mr. Sanchez. He obviously knows that the banks can't compete with the brokers so of course he would like to eliminate the competition! Apparently consumers are smart enough to know who offers the better deals!
  • Marc Savitt, President NAIHP | | 12 Aug 2014, 10:08 AM Agree 0
    I wrote Mr. Sanchez after viewing the segment:


    With respect to the email I sent you yesterday, I had the chance to review your 8/10/14 interview with Maria Bartiromo.

    While the interview centered around economic recovery, you took the opportunity to slam mortgage brokers with false statements, specifically- "No ones really regulating these folks." Moreover, your additional comments about 31T moving from the FDIC to non-banks seems to infer that as a reason for the slow recovery.

    I'm sure you've heard of the Dodd-Frank Act, the CFPB and the NMLS. Under the DFA and administered by the CFPB and NMLS, mortgage brokers are the most highly regulated segment of the mortgage industry. We are licensed, while banks are only registered. Even before the DFA, brokers were licensed in every state for many years. In your own state of Florida, I believe licensing goes back over 25 years. Your comments were false and misleading and you knew it when you voiced them.

    I expect you as a professional- to publicly apologize to mortgage brokers.

    Since I have not received a reply to my 8/10/14 email, I will now respond publicly to this matter.

    Marc Savitt

    Thanks to MPA for speaking with me and writing this story!

  • Cheryl M | | 12 Aug 2014, 10:08 AM Agree 0
    What I think Mr. Sanchez meant to say is that the MLO industry is a shadow industry not well regulated. So as a broker, and you know of other brokerage houses w/ unlicensed originators working under a "shadow" name other than Lic. MLO, then Mr. Sanchez may be using the general name for this as "broker." If this in fact is the case then he'd be right...Maybe Mr. Sanchez needs to reflect on his statement and clarify himself. Using the word "Broker" in such a general term is thin at best.
  • | | 12 Aug 2014, 10:10 AM Agree 0
    If you want a good deal, a great rate, you will go to a Mortgage Broker, if your smart. Lets face it,. Its big business and big banks want brokers out.
  • | | 12 Aug 2014, 10:16 AM Agree 0
    Please Fox give us a chance to reply to this.
  • G Mac | | 12 Aug 2014, 10:20 AM Agree 0
    Mr. Sanchez is poorly informed, it his statements are indeed his real opinion. Licensed, regulated Mortgage Brokers serve many borrowers that bankers will have nothing to do with. As the poster above stated, we disclose the full costs to borrowers whereas the banks are not required to do so and don't. Currently, mortgage brokers would be similar in nature to independent insurance brokers, not any sort of shadow industry. Were it not for brokers working as fiduciaries and serving clients, competition would be less, banks would charge more than they do now. As an industry, mortgage brokers are lower cost providers of mortgage lending services than banks. For my part, Mr Sanchez, you do not have facts straight. Slanderous remarks are beneath professionals, you are licensed right? Maybe not. For the public, shop and compare, mortgage brokers will save you significant money.
  • | | 12 Aug 2014, 10:30 AM Agree 0
    Absurd! BROKERS ARE HEAVILY REGULATED NATIONALLY AND BY STATE. Get the facts right. Why are the largest banks settling in the courts and paying out billions of $ in fines for illegally ripping off homeowners and selling fraudulent securities?
  • Carolina | | 12 Aug 2014, 10:31 AM Agree 0
    What does this guy think is he out of reality, the mortgage brokers are regulated by the same government agency. Actually mortgage officers in the bank are the ones that do not know a whole lot of information because they can work as mortgage officers without taking the NMLS test. I have over 25 years experience working with most of the big banks but came to know a lot of information about the business when I started working with mortgage companies. The process is more detailed. In today's environment, there are no more bad apples because being compliant is the key to stay in business. Everyone has its own license so you have to watch out for your own self to keep on working.
  • Dave | | 12 Aug 2014, 10:33 AM Agree 0
    He's right and wrong. He's wrong that brokers are like payday lenders if he's referring to rates and fees. Brokers typically offer the same rates and great products that banks do, and often have better rates, which means it can be better for the borrower. Where he's right - brokers are hardly regulated - meaning they don't get examined much. They are subject to the same rules but I know of very few who actually pay attorneys and compliance firms to help them put in place all that's required. Their LOs are about as naive as they come and if you ask them about any kind of compliance question, they'll act as though that's not something they need to know about or they'll say "well our wholesale lenders keep us protected" or "my broker owner would never lead me astray." Whatever. We know numerous brokerages who have no compliance in place, do not handle compensation plans legally, and who market inappropriately. Many are still paying 1099. Many allow their LOs to send mortgages to different lenders with varying comp elections. Most I know pay LOs differently for VA vs. FHA vs. Reverse, vs. Conventional. It's bizarre. Brokers are typically not audited in many states and certainly not for the laws that the CFPB would call them on. Many state regulars have limited regulatory authority that was based on old laws and protocols, not the new rules under the CFPB. They are only reviewed for basic RESPA violations and licensing. There are some states that will never do an examination unless there is an actual consumer complaint. Thus, the brokerage can fly high on no policies and controls, do things illegally, but offer great rates. So let's break out the real issues - brokers offer great products and rates. But brokers typically do not spend a dime on internal policies and controls and choose to ignore them. They figure the wholesale lenders they broker to have their back and as long as the borrower still gets a great rate, it doesn't matter. These are facts.
  • Jim H. | | 12 Aug 2014, 10:42 AM Agree 0
    The other item that was not covered is that as a Broker we have been Tested,had Background Checks done by State and Federal Government along with Finger Printed for both Agencies. We had to do an initial 20 Hours of Education and are required to do 8 Hours Continuing Eduation each year to be able to Renew our License.
    We are Audited by the State that do business in.
    This is in addition to disclosing to the Consumer Every Dime we make unlike The Banking Industry.

    You cannot call us UNREGULATED, if anything the Banks are not Regulated correctly to disclose to the Consumer what they are making.
    They sell the Consumer on that they are not Charging an Origination Fee for the Rate they charge, and if you compare our Rate to theirs you will see 25 to 50 basis points above our rate which equates to a tidy sum of money.

    They don't want things on an even playing field and have for years tried to tie all the problems in our Industry on Brokers.
    Who's paying all of the Billions of DOLLARS just to get the Government off their backs without a total Audit and the other bad thing is that this MONEY DOESNT TRICKLE DOWN TO THE CONSUMER THAT IT HURT!!!!!

    There's your Unregulated entities.
  • broker | | 12 Aug 2014, 10:45 AM Agree 0
    Sounds like Mr. Sanchez has lost too many deals to his local broker to me? I jumped over to the banker world for a couple of years and oh man had no idea the margins that bankers make & all the fee's they charge. I'm back to being a broker and happier giving wholesale rates everyday.
  • | | 12 Aug 2014, 10:56 AM Agree 0
    Clearly this gent is misinformed. Much like the lobbyist a-holes the put Dodd-Frank in place. I steal mortgages from "Big bank" every single day by using the tenants of good customer service, competitive pricing and faster turn times. Period. I recently lost a deal to Wells Fargo, PRIOR to application because "He wanted to go with the devils he knew." That was 35 days ago and he still hasn't closed. Might lose the contract actually. Oops. Big bank hides it's profits behind the fact that they are notoriously regulated. Just because there are a lot of rules to follow, doesn't mean they are not making a killing. Anybody ever heard of a monopoly? Keep this up and that is what you will have. Good luck to all my broker peeps out there. The American people would not even know they are getting hosed if we all stop fighting and let Wells take over.
  • Bill Ladewig | | 12 Aug 2014, 10:58 AM Agree 0
    The previous comments are Spot ON! I could not agree more. His remarks are simply one competitor trying to crush another.
  • BP | | 12 Aug 2014, 12:37 PM Agree 0
    He is about as bright as a dark room!
  • broker who had 135 satisfied mortgages herself | | 12 Aug 2014, 12:40 PM Agree 0
    I just had to laugh. Mr. Sanchez, you are soo funny!
  • DR | | 12 Aug 2014, 12:54 PM Agree 0
    I've seen the self-righteous banker mentality before, but in saying that brokers are not well-regulated, Mr. Sanchez is either ignorant or dishonest, take your pick. Neither option is good. Sounds like sour grapes to me.
  • Steve Owen | | 12 Aug 2014, 01:15 PM Agree 0
    Let the games begin! Regulation is sold to the public as protection for the consumer, but it's real purpose is to prevent competition and make it harder for new entrants into a profession or industry. It has been fairly clear from the beginning that Dodd-Frank would benefit large financial institutions at the expense of the consumer and, particularly those smaller entities who will find compliance more difficult.
  • Gary H. | | 12 Aug 2014, 01:56 PM Agree 0
    Mr. Sanchez doesn't have a clue or he is in the bank's pocket. The banks couldn't burn the brokers badly enough and those that are left are more heavily regulated than the banks. The banks do not disclose APR the same way, they hide their profits and make excuses why brokers shouldn't be in business. Fact is I work 6 days and am even here in the afternoon on Sunday. Try to get a bank to be there at 6 or 9 or a weekend. We often sign agreements with investors that we are the seller's of originated paper and the banks are the purchasers and that we have full accountability even if it isn't our fault. Not sure what PLANET this "nincompoop" lives on. I do know who butter's his bread!! Banks couldn't steal the market share although I give them a "A" for effort, when they have to compete with brokers who actually care and provide unsurpassed service.
    The Dodd Frank and the QM is what screwed the consumer. Appraisal fees nearly doubled and costs went up to compensate the added admin cost to lenders. MAYBE HE SHOULD PICK ON THE BUILDERS that REQUIRE their "preferred lenders" to do financing or they add costs to the consumer, or better yet the politicians that are too busy playing golf when they should be protecting our borders.

    Old story. Consumer is a bit more educated and weary of "the sky is falling" tactics.
  • | | 12 Aug 2014, 02:36 PM Agree 0
    Mr. Sánchez is very likely to be in the Bank's pocket. It took me three years to put a mortgage together as I counseled and assited a family get a mortgage approved. This was after 5 years of loosing the family home and feelings of displacement. Does Mr. Sánchez know of any Bank willing to spend the time and effort to help our community? Of course, after I turned over a new homeowner, the servicers and Banks have tried to persuade in hopes of getting the business. You know what the homeowners response is. The commission was misely as the mortgage amount was very small. Yet, I feel a great sense of accomplishment. The Dodd Frank did no favors to the Bróker originator cutting our commission, thus charting our demise. The Banks are powerful, they can wait for as long as they need to.
  • | | 12 Aug 2014, 03:24 PM Agree 0
    I am a banker, and feel that Mr. Sanchez was totally out of line. I underwrite for and purchase mortgages from a mortgage broker who runs one of the most reputable, compliant firms around. Their disclosure requirements far exceed what we within the bank are required to do.
  • Northern California Appraiser | | 12 Aug 2014, 04:06 PM Agree 0
    Lumping mortgage brokers in with payday lenders is inaccurate, unfair & downright sleazy. Mortgage brokers are heavily regulated & not at all like payday lenders. As an appraiser, I used to work with a number of reputable mortgage brokers. This guy is a disgrace.
  • Chris in Boston | | 12 Aug 2014, 05:33 PM Agree 0
    Dodd Frank was the death knell for my small mortgage brokerage operation. I was now unable to offer LOWER rates if I wanted to, because of limited compensation options dictated by CFPB regs by the alleged white knight, Liz Warren. Nearly twenty years in biz, no complaints, honest living, and the regulatory and licensing changes knocked me out. Wake up, Mr. Sanchez. How did HE do on the licensing test, which we brokers had to pass but his people did NOT have to pass!?
  • Thomas Murray Jr | | 12 Aug 2014, 05:41 PM Agree 0
    The first problem here is that this was reported on FOX News. FOX News will eat their young for a shot at hyping anyone or any story for a better rating. They're not a real news channel, and they'd be hard-pressed to find many who find their reporting very credible.

    Need anyone be reminded that this Alex Sanchez is the same person who proposed legislation in Florida that would take away due process in foreclosure cases, allowing banks to take away homes without filing a foreclosure complaint, and would take away the right for a homeowner to contest the foreclosure.

    This guy has no merit, credibility, or ethics, in my opinion. Nor does FOX News. They both do, however, a great job of uninformed, reality-tv style reporting.
  • Louisiana Broker 4 Life | | 12 Aug 2014, 05:43 PM Agree 0
    Wow! You would think that someone in that position would not be that ignorant about todays mortgage origination landscape. Brokers are constantly competing against the banks even though the playing field is NOT even when it comes to complete disclosure of mortgage products. Sounds to me like the banks keep getting their asses handed to them because they continue to hire the ones that cannot pass national or state required test as a mortgage broker/ mortgage originator. Mortgage Broker and Loan Originators are LICENSED by the NMLS. Bank employees are registered through the NMLS. Wall Street needs to know the difference. Would you want to invest in a portfolio of mortgages done by LICENSED individuals that have proven through testing that they know exactly what they are doing or would prefer to invest in a bank that employs a bunch of "mortgage broker rejects"? Mr. Sanchez and cry all he wants and make false accusations by trying to belittle the mortgage broker. The fact of the matter is, we are claiming back our market share. Day by day, mortgage by mortgage! Thank you Mr. Sanchez, for motivating me and thousands of other mortgage brokers to keep kicking your bankable ass!
  • Nicholas Corso | | 13 Aug 2014, 05:06 AM Agree 0
    Good Job in replying to him. He doesn't have a clue of what we do and how we have options to offer clients. The bigger banks have always lobbied against us to of course regain 100% of control.

    In my opinion we need more people on our side politically, were working against the ones that have money "banks" where as if we had politically more spokes persons we could possibly turn the tides its the ones in power that make decisions. Yet we all know we add value to our industry.
    If you would keep me posted as to the turn out of this individual.

  • Frank Previte | | 13 Aug 2014, 02:42 PM Agree 0
    How is it that this person, apparently ignorant of how mortgage brokers work, gets to be a spokesperson for a banking industry group? Mortgage Brokers don't make mortgages (for the most part), they don't make any rules, they don't approve any mortgages, they don't make any mortgages, they don't close or fund any mortgages. All of that is done by, for the most part, either a mortgage banker or ........uh uh uh, a bank.

    For years the largest banks had both a retail and wholesale mortgage business. Both competed and coexisted happily. Well, that may not be totally true as the mortgage broker business had over 60% of all originations. Then when the market blew up (again, mortgage brokers didn't make any of those mortgages) the banks wound up with nearly all of the business and they tried to squeeze the mortgage brokers out. Now mortgage brokers probably don't account for more than about 10% of originations. In California, the big banks account for over 80% of all originations. Why would they want to go back to the previous structure--unless it was a more profitable business model?

    I'm from Houston and we have a very successful community bank here. It is Prosperity Bank USA. Their strategy was to go around and buy up small community banks giving all the benefit of size so they could compete with Citi, Chase, BoA, etc. Apparently it was a good business plan as they now have 246 locations and Forbes ranks them in 2014 as the No. 1 best bank in the U.S.

    Since the spokesperson for the banking group doesn't know what is going on maybe he should visit with Prosperity and learn what is going on by successful community banks?

    It was bad enough that the Deputy Director of the CFPB, Raj Date, also seemed to misunderstand how mortgage brokers worked, at least in his presentations at banking seminars. The CFPB rules over mortgage brokers and mortgage bankers with an iron fist, so both are extremely regulated.

  • Walter Moody | | 13 Aug 2014, 02:44 PM Agree 0
    They never change their spots.
  • | | 14 Aug 2014, 12:05 PM Agree 0
    I will not put 100% of the brokers in the same bag but there is a lot of abuse in the broker business Industry, this is a fact and it can't be denied. I've seem comments about them being regulated, by who? who is seriously making sure they comply with regulations and licensing? when is the last time a broker was audited by HUD? don't get upset and insult somebody who had the guts to tell the truth about the broker Industry. I've seem the abuse and control they exercised. FYI the mortgage bankers association does not represent the big banks.
  • Deeps | | 14 Aug 2014, 01:23 PM Agree 0
    Mr. Sanchez is so mis-informed as to make one wonder about his knowledge base. Since all Mortgage Loan Originators are Federally and State Licensed, to lump them in with Payday Lenders is clearly a scare tactic. He seems worried that Mortgage Brokers offer the public a strong, regulated alternative, and should know that the mortgages originated by Mortgage Brokers end up at the same government agencies, large banks, and mortgage conduits as his mortgages Incidentally, quite a few Payday Lenders are owned by Banks and Credit Unions...
  • | | 14 Aug 2014, 01:26 PM Agree 0
    Wow! Mr Sanchez, you obviously have no idea of what you were speaking about. I am also shocked that Fox News would broadcast your comments with them being so far from the facts. All you did today was to make yourself look ignorant and out of touch with the mortgage industry. I am disappointed in your comments and even more disappointed in Fox News for broadcasting them. Here is a revelation for Fox News, how about reporting the facts or stay away from the topics your reporters don't understand.

    The truth of the matter is only to get hired by the banking side. This was because of relaxed regulations on FDIC covered mortgage originators. FDIC regulated banks are required to have their mortgage originators take a test that can be retaken several times a day, until they pass. A broker can only take the SAFE Act test once in a 30 day period for the first three attempts, then they are required to wait 6 months between tests until they pass. FDIC covered mortgage originators were not federally required to have clean credit and were not required to have continuing education. Brokers are required to meet those standards. So let me ask Mr. Sanchez. When 2/3 of the brokers were kicked out of the mortgage industry in 2010 because they could not meet the Federal and State requirements to be a licensed mortgage originator, why did the banks hire those individuals? Why were they allowed to hire those individuals? If Federal and State regulations deem them unfit to work as mortgage brokers, why were they fit to work as bankers? Now, bank mortgage origniators must be registered with NMLS but aren’t required take and pass the SAFE Act Federal test, pass a fitness and credit test and obtain a NMLS license to originate mortgages. So let me ask you Mr. Sanchez, who has more stringent regulations to follow?
  • | | 14 Aug 2014, 01:33 PM Agree 0
    First sentence in the 2nd paragraph should have read as: The truth of the matter is that a lot of brokers couldn't transition into getting licensed as a mortgage originator so they left the broker side of the industry and got hired by the banking side.
  • | | 14 Aug 2014, 02:32 PM Agree 0
    The MBA does not represent the big banks, they represent mortgage bankers that are not FDIC approved. the LO's have to go trough all the testing requirements and obtain licensing to operate and be able to originate mortgages. the difference with mortgage brokers is the level of responsibility with every mortgage originated. the broker Industry needs and should require more scrutiny given their low level of responsibility after the mortgage is funded.
  • Sherry Brockenbrough | | 14 Aug 2014, 02:39 PM Agree 0
    Was this CEO / President Alex Sanchez confused? Has been in a cave for the last 4 years? Mortgage Brokers must past a Federal / State Licensing Test that I can assure most "bank" Loan Officers could not pass. Extensive back ground checks are done, and proof of financial wellbeing is just a small part of the Licensing process for a Mortgage Broker.
    Mortgage Brokers are highly regulated, licensed mortgage professionals. The same cannot be said about the Bank mortgage lenders that are FDIC insured. How quickly Mr. Sanchez has forgotten, or perhaps he never really understood the “To Big To Fail” mortgage debacle perpetrated by those big highly regulated banks, Wells Fargo, Bank of America, Chase, and on and on we could go. Those highly regulated banks wrote the guidelines, provided the money and promoted poorly conceived greed laden mortgage products that nearly through this country into a full blown depression.
    Before Mr. Sanchez has diarrhea of mouth, he should certainly consult with one of his staff, talking heads usually have someone feeding them information he may want to consult a new puppeteer.
  • SBHarkness | | 20 Aug 2014, 01:08 PM Agree 0
    I am reading that Mr. Sanchez does not have a clue what he is talking about and NOTHING could be further from the truth! He knows EXACTLY what he is talking about and the man went on National TV and LIED to the American people. This whole mortgage meltdown as it has come to be known was seen as an opportunity by the too big to fail banks to regain market share. Up until that point the independent mom & pops mortgage brokerages served the local communities they lived in. When the crisis hit the mega-banks were quick to pass the blame to the mortgage brokers who did NOTHING but sell the mortgage programs the banks designed including the so-called liar mortgages (I hate that term because it not accurate, but that's a different subject). The mega banks wholesale sales reps were in the mortgage brokerages pushing this mortgage called the Payment Option Arm that actually has a feature where by if the homeowner makes the minimum payment his mortgage balance goes up the next month because the minimum payment was not sufficient to cover all the interest. Was it the Mortgage Broker that designed these mortgages? No, it was the mortgage banks, like the ones Mr. Sanchez represents. By the way it was also the mortgage banks that underwrote these mortgages. It was the mortgage banks that securitized these mortgages for sale to Wall Street. Have you heard of any mortgage brokers being sued for multi millions of dollars for everything from defrauding the public to defrauding the investors that purchased the securities? As far as not being regulated Mr Sanchez knows this is a flat out lie. We have to disclose were every dime goes unlike the mortgage banks who can pack money on the back end the consumer never see's. There is allot wrong in the Country right now with a bought for Congress, and it is men like Mr Sanchez and his cronies that own not only the House and Senate, but SCOTUS as well.
  • MikeH | | 21 Aug 2014, 11:04 AM Agree 0
    I think in Florida, you have bankers with 50 cents in net worth... Nobody is a broker down there...
    They are all bankers...
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