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Industry leaders warn Congress on impact of CFPB rules

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Mortgage Professional America | 15 Jan 2014, 07:50 AM Agree 0
Mortgage and housing industry leaders took swipes at the Consumer Financial Protection Bureau’s new mortgage rules Tuesday during a congressional hearing
  • Bruce | | 15 Jan 2014, 08:18 AM Agree 0
    Well, the big banks got what they wanted - thinning out the ranks. I imagine they will be doing the majority of the mortgages below $60,000.
  • John C Durham | | 15 Jan 2014, 09:12 AM Agree 0
    I hope no one accepts any rules until after some TBTF bankers GO TO JAIL.
  • John - Loan Officer in Houston | | 15 Jan 2014, 09:18 AM Agree 0
    I am a small brokerage business closing under 100 mortgages a year and giving great service to my group of real estate agents and closing faster than all large banks.
    With new QM rules, I am not looking anymore FHA mortgages under $135k which require a lot of time and work (fix credit, source assets, analyze taxes and deductions) as I am losing anywhere between 40 to 60% in my overall compensation plan. First measure I am being forced to take is to let my processor go and do everything by myself.
  • Paul | | 15 Jan 2014, 09:32 AM Agree 0
    Like Congress is going to do something to unwind what they've created? The Dodd-Frank 'work' remains a real estate debacle.
  • Bill Milano | | 15 Jan 2014, 09:50 AM Agree 0
    this industry has changed and the dodd frank bill doesn't help the consumer, it confuses them. All the discloures are not to protect them it to protect the lender. NMLS is all about paying money to the feds every year. I only have a couple of more years in the indjusty and I am gone.
  • Jim Malloy | | 15 Jan 2014, 10:12 AM Agree 0
    Do you think they are trying to collapse the whole thing into something like a single payer system?

    That way the bureaucrats can run the mortgage industry like a public utility; they can "control" housing better. The mortgage officers will all be government employees and we can solute our dear leader from the chest!
  • Steve Reed | | 15 Jan 2014, 10:40 AM Agree 0
    I'm already seeing a much tougher road for first-time homebuyers (and others) due to QM. While this FTHB segment could have helped "fuel" our housing recorvery, yet again, the CFPB and our Government has helped stall recovery. The mortgage industry is not in a good place and neither are our borrowers thanks to over-regulation.
  • Otto | | 15 Jan 2014, 11:01 AM Agree 0
    My name is Otto and I have actively participated in the mortgage origination business now for over 17yrs. I operate a small Mortgage Brokerage business in sunny south Florida, Miami to be more precise. We don’t originate enough mortgages on a yearly basis to be considered by industry standards as “mid-sized”, however we do serve as an in frugal part to our local community and like us small business owners and small shops there are 1000’s like us throughout this great land of ours that are being directly affected by the new mortgage origination caps. Everyone seems to be focused on ferity to the consumer; our politicians speak of personal responsibility and accountability. Something most of us were taught by our Mom’s and/or Dad’s by the time we left grade school. Whatever happened to making the right choices…? These new changes will just serve to squeeze originators out of the business, close local mortgage shops and leave more people out of the American Dream of Homeownership. With respect to all the individuals that work in banks, I just don’t see your local PB “personal banker” or LO “mortgage officer” huffing and puffing after those non-vanilla mortgages. Sure if you have NO – Complications and are a W-2 employee that does not work for yourself, your mortgage should eventually close. What about all those millions of Americans that need help structuring there mortgage, all the small business owners and the self employed? I just don’t see the local big banks running after them for what they get paid. These individuals need the help of a Broker in most part, after all we were always the more affordable option, for both the self employed and the W-2 income earner. Don’t take my word for it, look up the historical statistics for yourself or Broker originations vs. National Bank Originations.
    Capped at a LESS than 3% on total mortgage fees and the further constraints for who pays what, “Lender Paid vs. Borrower Paid” I foresee many seasoned and new generations of mortgage professionals exiting the business as well as Mortgage shops closing their doors all over America. The consumer on the other hand will be faced with less choice and that means less competitionon for their business. At the end of the day the only winner here are the Big Banks that get to keep those Big Yield Spreads all for themselves. After all, with the implementation of QM, should we not have seen a huge drop in rates to the consumer after January 10th, 2014? “Buyer beware” and “be careful what you wish for” are words I was taught as a youngster and they certainly ring a bell here. Thanks Big Government and Thanks to all those uninformed consumers that feed into the media hype driving these “CHANGES”. Don’t get me wrong the status quo was not the answer, but neither was the government reducing consumer choice. People, expecting any government to lookout for our best interest and not being self informed is how the Hitler’s and Stalin’s of the world are born. Don’t expect big brother to take care of it for you, become informed, read more than just one opinion, educate yourself and take personal responsibility for your actions. We will see how all this turns out in 10-20 years, when historical average incomes and home ownership rates fall and more good paying American Careers and jobs are destroyed. It’s a shame that the American spirit of independence is being quieted one entrepreneurial job at a time.

    Good Luck, Read, Stay properly informed and above all else be responsible for your choices.
  • Dirk LO in Pa | | 15 Jan 2014, 12:31 PM Agree 0
    All of you are right on point. My point will be is how much tax revenue will be lost by these new rules. In a time where our deficit keeps rising, these bureaucrats have not taken the time to look at how much money will be lost on this issue. If I take a 35% pay cut due to the new laws, and if that would be consistant thru the industry, there are a lot of $$$ in tax revenue that the gov't has now lost. I just keep seeing all of these new rules "to protect the borrowers" just keep costing them more $$$ each time these changes are introduced into the market place. If they only knew what we do!!!
  • Don in Ne | | 15 Jan 2014, 12:56 PM Agree 0
    I have been a Mortgage Banker for over 30 years making mortgages to borrowers that no other Lender would make.I have helped many people over those years. No way am I going to submit myself to that much Govt. regulation and threats of fines to myself. I'm done. I feel sorry for all the Borrowers that will no longer be able to get a Mtg. Loan.
  • Don in Ne | | 15 Jan 2014, 12:57 PM Agree 0
    I have been a Mortgage Banker for over 30 years making mortgages to borrowers that no other Lender would do.I have helped many people over those years. No way am I going to submit myself to that much Govt. regulation and threats of fines to myself. I'm done. I feel sorry for all the Borrowers that will no longer be able to get a Mtg. Loan.
  • Nancy | | 15 Jan 2014, 01:07 PM Agree 0
    Jim Malloy, I have often thought that is what they are trying to accomplish. Control the 2 largest segments of money, finance and insurance. Very Communistic principals at work.
  • Jim Malloy | | 15 Jan 2014, 01:47 PM Agree 0
    Nancy, Notice how the Safe Act, Dodd Frank and the Stimulus Package also were ready to go immediately when the financial meltdown happened? You don't write multiple 1000s of pages of legalize in weeks. The extreme left wing lawyers had it all ready to go, not to solve the problems but to take over. They, "didn't let a good crisis go to waste."
    I hate to sound like a conspiracy guy but if this isn't obvious nothing is.
  • John C Durham | | 15 Jan 2014, 02:27 PM Agree 0
    Uh,...Jim, "The Meltdown" was the result of a conspiracy...of the, at least PART of the, uh...PRIVATE SECTOR.

    Haven't seen research on the politics (Left/Right/Neutral) of the CDO pushers...

    The worst case has already happened and our government, owned by the PRIVATE SECTOR, hasn't done anything except suggest we kill the poor and give everything to the big bank and corporate (THE Private Sector) instead of jail those behind the greatest financial collapse in the history of the Human Race.

    Both Right and Left in Congress and in the Court and in Presidencies opened up the door to those forces to take our nation. It's happened already. You haven't noticed?

    Any talk except Revolution is harmless if you don't even know who did it to you, what it was they did, and when they did it. We have the Constitution and some idea of a government. But, it isn't functioning right now. It's aiming at the wrong people, ie, small and medium size business and we poor people who try to run them.
  • Jim Malloy | | 15 Jan 2014, 02:59 PM Agree 0
    John, I did not say the meltdown was caused by a conspiracy, but the left wing, control oriented, yes, it seems fascist left jumped on it.

    FNMA and Freddie guidelines, in my open, set up and fostered by politicians (your friend Bill Clinton appointed Franklin Raines), set up a system and an atmosphere that caused this.

    Now the craziness of Keynesian economics, which does not recognize the driving force in economics, entrepreneurialism, is further destruction.

    The small business are the job creators, we are what you call "the private sector" and we are being attacked by left wing policies.

    In reality, there really is not "public sector or "private sector", these are Keynesian myths. There is only the economy (what you call the private sector) and the government (what you call the public sector).

    The first thing we need is term limits for the pols. States calling a convention per constitution. If 2/3rds of states call it and 3/4th pass (I believe) we can amend the constitution.

    12 years total in House and Senate (for both) little pay with no benefits. It should be like jury duty for very successful people like it was for the founding fathers.

    Stop the stupid revolution talk.
  • Dirk LO in Pa | | 15 Jan 2014, 03:03 PM Agree 0
    Its funny how Wells Fargo has had nothing done to them. Why? Jamie Dimon is continually being harassed by the gov't bc he said no thank you I don't need your govt $$$$ to bail me out. The reason I believe that Wells hasn't been involved in this mess is that 1- They are writing the new rules. 2- they get to do that bc Warren Buffet is the major share holder of Wells Fargo stocks, and that Barak goes to him for financial advice, Warren is a donor to barak, so Wells Fargo is so deep in the hip pocket of the Gov't, that almost seem exempt from any scrutiny, and or investigations. Why haven't they been charged with anything? I know that they did SISA / NINA mortgages. Where is their accountability? Citi is selling off mortgage holdings by the thousands, and have had big fines as well as bank of America and several other large banks. But where is Wells in the picture? Probably playing golf with POTUS at an undisclosed location paid for by us, getting reassurance that they will not be harmed in any way.
  • Tim K | | 16 Jan 2014, 08:58 AM Agree 0
    As a small broker we are no longer able to accommodate borrowers under $125,000. 2 many are first time home-buyers who need their hands held during the process and often have files that are in need of more processing hours (than well established or move up homeowners). the majority of (Non-licensed, but registered) bank mortgage officer's either do not possess the skill set to help these borrowers or their holier-than-thou banks are unwilling to lend them any money.

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