Be prepared: Staying in compliance

by MPA30 Jun 2014
By David Lykken
Special to MPA

Among the most difficult issues facing lenders today is staying ready for compliance investigations from auditors. Take a look at any of the popular industry websites, magazines, radio programs, or television shows and you'll find that compliance is probably the number one hot topic.
I recently had the opportunity to discuss compliance in detail on my Lykken on Lending radio show with a few guests and several regular commentators. The question was raised as to which issues are seen most by lenders who are examined by auditors. Some of the key issues that we're seeing include implementation of regulations, QM issues, and loan officer compensation issues.
The compliance-related issues that organizations face most frequently varies from state to state, but there is one common issue that lenders struggle with across the board: preparation. It's easy to get caught up in the day-in, day-out activities of everyday business. Once you've got your organization in compliance, it can be very easy to fall out of it if you aren't paying attention. Most of the organizations who get into trouble with auditors seem to be those who have simply been negligent.
There's a lot of fear circulating the industry. It's tough to keep up with all the regulation, and we're all afraid we're going to get caught off guard. That is why we've got to be proactive in staying in compliance. It has to be a deliberate focus of our everyday business processes. Don't let the pressure from regulators get the best of you. Keep yourself in check. Don't be scared; be prepared.

David Lykken is 40-year industry veteran who has been an owner operator of three mortgage banking companies and a software company. As co-founder and Managing Partner of Mortgage Banking Solutions, David consults on virtually all aspects of mortgage banking with special emphasis executive leadership development, corporate strategic direction and implementation as well as mergers & acquisitions. A regular contributor on CNBC and Fox Business News, David also hosts a successful weekly radio program called “Lykken On Lending” ( that is heard each Monday at noon (Central Standard Time) by thousands of mortgage professionals. Recently he started producing a 1-minute video called “Today’s Mortgage Minute” that appears on hundreds of television, radio and newspaper websites daily across America.


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