Brian, you have faulty thinking with this mortgage brokers don’t have compliance costs rant and are killing lenders off. The wholesale lenders that have incredible back office compliance departments are the ones that saw this broker boom coming. Dodd-Frank did not set price controls for lenders; brokers are the ones under price controls on what they can make per loan. Lenders have all the price setting ability and can make all the money they want in the backend. If you really want to have fair competition, remove price controls on mortgage brokers. Lenders need to figure out how to compete against the wholesale lenders that have great compliance systems that are utilized by the broker channel. That cost is shared by the mortgage broker in the wholesale lenders’ pricing. Did I mention there are price controls set by the govement on broker income? I am sick and tired of the mortgage broker being the scape goat for the meltdown and, now, the reason inefficient lenders can’t compete. The smart lenders utilize all distribution channels and we are seeing that playout now.
It was an interesting show today and I certainly agree with you about the mortgage broker channel experiencing growth.
Jeez, if I remember correctly, (and I do as I am still paying the price….) it was the appraisers, not the brokers, who were blamed for everything in the meltdown. (No Doc Liar Loans, 125% LTV etc. aside….) We are apparently owed an apology.
You are spot on, JP!
Nothing will change until ALL leftists are voted out of office.
This is complete BS- I’m sorry. You clearly don’t understand broker operations, comp, or compliance today.
I am not sure where the gentleman in the first comment thinks that Private Mortgage Banking LO’s do not have price constraints. We have the same comp price constraints that everyone has. I think that EDUCATION needs to be a key topic for Frank and Brian in the future on how each side does truly work. YES, we have price constraints. I have NO ability to give credits or give a client a lower rate based on my compensation guidelines that are LOCKED IN. So please, if you don’t understand the comp rules, don’t state something you don’t understand.
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