Players laud CFPB move

by Justin da Rosa10 Aug 2015
Originator support has been pouring in since the CFPB took a stance discouraging lenders from using marketing services agreements.
“Smaller brokers have a hard time competing with the larger broker who has deep pockets and ‘purchases’ the business of Realtors by paying the rent, food for open houses, office equipment, (and) trips,” writes one commenter on Mortgage Professional America. “I welcome a level playing field.”
Several comments were made in support of the CFPB’s stance against the agreements, many arguing that they cheapen the industry and the value originators provide to clients.
“As a mortgage professional I am happy to see the CFPB on the case. There are so many underhanded arrangements in our industry it makes us look like organized crime at times,” writes another reader. “I hope they go after some of the questionable underwriting arrangements the mortgage insurers have with the lenders next.”
The agreements are a common practice in the industry, but the CFPB says they’re too easy to abuse. The agency has gone after several lenders in recent months, issuing fines for alleged kickbacks and other MSA-related violations, according to HousingWire.
Still, some industry players believe nothing can be done to truly crack down on MSAs.
“Not going to do a thing (because) most MSAs have already been renamed CSAs; slightly different structure same result,” another commenter writes.
Click here to read the original article.


  • by Cheryl M | 8/10/2015 10:42:33 AM

    I also believe the CFPB needs to look further at the Real Estate Company too or go straight to NAR. They're not all on the same page regarding having deep knowledge of the financial industry and compliance. Such as Keller William, ReMax, etc... take a quick trip to one of those offices in mid to large city demographics they all have those "bank agreements" laying out for customers to either take with them, posters, banners, brochures/business cards, etc. Another that comes to mind Ryan Homes which steer all there new home build customers to there very own in house mortgage company. Quicken Loans has a deep marketing agreement steering those in Real Estate/Attorney offices...Quicken Loans keeps feeding leads when they agree to use Quicken, no Quicken, no about too easy to abuse. I realize there are those long term relationships that have been hard to build in these industries; however, where is the long term relationship with an online site? It's also not just the larger banks either as noted in your article such as Wells, as we know larger mortgage banks; add too those local regional banks and credit unions. Now that we all know these marketing service agreements are risks, who's going out there to tell the Real Estate (NAR) industry about these new "rules" and their marketing agreements they're sitting on are now risk of abuse?

  • by Ken Senior LO CT | 8/10/2015 10:55:59 AM

    Many real estate offices like Bershire Hathaway, Century 21, Ravies have agents that constantly steer and lie. They tell the borrower that they must use their office mortgage company or they may very well lose the home. Do you believe it and it is being allowed or overlooked. I personally see many wrong doings and there should be legistlation not allowing real estate offices to be directly associated or engaged in the mortgage business. They do profit from the steering! Where is CSPB on this matter? Happens all the time.

  • by Will, LO Houston, TX | 8/10/2015 11:35:15 AM

    From my experience, the biggest abusers are the mid to large builders and their "preferred" lenders. They blatantly even write it in the contract that they will only pay the OTP or provide other credits IF you use their preferred lender(s). What they don't tell the home buyer is that the mortgage fees/rate will be higher with their lenders.
    Hey the money has to come from some where! This is exactly what RESPA is concerned about. Steering clients into higher priced options due to kick backs.
    I really hope the CFPB cracks down on these arrangements since RESPA doesn't seem to want to address it. When I called RESPA to complain, they told me that the builder's have convinced RESPA that these are just a part of "negotiations." What? Really?
    Maybe RESPA is getting kickbacks from the builders too!


Is TILA-RESPA a good or bad thing long term?