Grab yer ankles, commissioned loan jockies
Excerpt from article on this website
As for the LO comp rule, brokers and loan officers who work for nonbanks are closely watching the issue because it could directly affect how much money the can earn on a transaction.
For the National Association of Independent Housing Professionals, a key issue to watch is dual compensation where the LO is paid by both the consumer and the wholesaler. “If dual compensation is an unfair and deceptive practice, why are creditors permitted to receive the same?” asked Marc Savitt, president of the trade group. “Dual compensation is not double compensation.”
The Consumer Financial Protection Bureau has proposed a rule that strictly prohibits brokers and their originators from being compensated by both the borrower and creditor.
NAIHP, whose membership includes mostly brokers and appraisers, believes it’s unfair to allow for the paying of servicing-released premiums to mortgage banking firms (creditors) while banning dual compensation.
Although studies are hard to come by, it’s generally assumed that over the past year or so LOs who work for nonbanks are being offered better compensation plans than their counterparts at depositories.
by Cedonulli2 December 10, 2012 5:32 PM
How old is the article C? LO comp went into effect since April 2011 and there hasn't been (for mortgage brokers) the ability to be compensated by both the borrower and the lender since then...
by MichiganTed December 10, 2012 6:24 PM
How hard is it to ban an IP address.
by UrNot2Bright December 10, 2012 7:39 PM
Marv quoted: NAIHP, whose membership includes mostly brokers and appraisers, believes it’s unfair to allow for the paying of servicing-released premiums to mortgage banking firms (creditors) while banning dual compensation.
Somebody should explain to NAIHP that SRPs are payment for a seperate asset and have little to do with the borrower, or, arguably, the broker.
by BuySide December 10, 2012 9:57 PM
If you banned Marv's IP address have posts on this site would disappear.
by MTB December 10, 2012 10:07 PM
It seems the same arguement arises between SRP and YSP. The bottom line is it's money based on the rate. Most companies (including Banks) never service the loan, or had plans to service a loan, so what difference does it make what the definition of SRP is. If banks can charge on the front and back, brokers should be able to do the same - if there're giving the lower rate than if they would be giving if paid on the back only.
by Panama44 December 11, 2012 9:54 AM
Dual comp shouldn't be inclusive of SRP as that is an asset that has a value and is separate from the loan asset. It doesn't belong to the borrower and doesn't impact their loan rate or price.
As far as who should collect the SRP, it should go to the owner of the asset. Whether they want to or are able to service the asset isn't relevant.
A "banker" owns the loan, and thus the servicing asset. A broker does not. It's the ol' skin-in-the-game argument Panama.
by BuySide December 11, 2012 10:57 AM
Perhaps the Broker would like the additional risks and costs a Banker takes as well.
by YATI December 11, 2012 3:01 PM
Ive already told some of you doofs that I have ONE screen name and webby can attest to that. The article was in THIS SITES news yesterday. It was a lot longer than what I clipped and posted.
urnot2bright---I guess your name fits well. Freudian?
by Cedonulli2 December 11, 2012 3:58 PM
This post has probably been posted by one of the hundred of goofballs out there trying to convince brokers that they are better off working for a bank entity than being a broker. Bank Net Branch Recruiter bull. Bank LO= $60k a year job doing twice amount of work. Take your test and make more as a broker goofballs.
by Mortgageguy70 December 11, 2012 4:36 PM
I don't dispute that too much MG70. I just like brokers to earn commensurate with the risk taken. I don't have an issue with YSPs (properly disclosed and credited to the buyer) but I do with SRPs. It's an asset the broker never owned.
by BuySide December 11, 2012 8:08 PM
Brokers can be compensated commensurate with the risk taken. They have way more risk than LOs at banks. They have to spend money on marketing, their own money. They have other expenses that the bank LOs don't ever have to worry about. They have issues that bank LOs dont have to consider. If they are better paid it is because they did more work and/or worked smarter and/or took business risks of time and expense that the bank LOs don't. If you're good at your job, being a broker pays better. If you're average or have no tolerance for risk, work at a bank.
by dbpete December 26, 2012 8:00 PM