Banks enticing originators through fear

by Diana Aqra06 Aug 2013

Industry leaders have expressed concern that originators have not been given a level playing field, with rules governing bank loan officers differing from those governing non-bank originators.

Brian Koss, executive vice president and national head of production for Mortgage Network, a mortgage banker (non-bank) in Danvers, Mass., has argued that licensing laws discriminate against non-bank originators. Koss pointed out that bank loan officers are not required to test for or maintain a state license to originate.

“This puts banks and non-banks on an uneven playing field,” he explained, because banks can apply their own standards for loan originators.

Koss claimed that banks use the discrepancy as a recruitment tool, telling candidates that the need for a license makes it more difficult to work for a non-bank.

Koss criticized lenders for using fear to entice potential employees who could have entered non-bank origination. He expressed concern that potential loan originators in the future may be drawn to banks over non-banks.

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