What NAMB Does for You

Curious about what NAMB is doing on behalf of you? Check the NAMB Government Affairs Homepage for updates on meetings with legislative and regulatory representatives, important issues being reviewed by staff, and more!

 

Legislative Action Center - updated to reflect the most recent action on issues that affect you
NAMB Fights for You - NAMB in the press, on Capitol Hill. Find out how NAMB protects you and your industry
Support NAMBPAC! - If you are a member of NAMB, check out the latest information on NAMBPAC events on donation opportunities (for members only).

 

 

     

Government Affairs in Washington Today  

NAMB Government Affairs Update
Policy Guidance on Supervisory and Enforcement Considerations Relevant to Mortgage
Brokers Transitioning to Mini-Correspondent Lenders

"Before the financial crisis, consumers seeking mortgages were steered toward high-cost and risky loans that were not in the consumer's interest," said CFPB Director Richard Cordray. "The CFPB's rules on mortgage broker compensation are intended to protect consumers from this type of abuse. Today we are putting companies on notice that they cannot avoid those rules by calling themselves by a different name."
 
CFPB Director set a stern tone today when he let the mortgage industry know the bureau is taking official action on the increase of mortgage originating "Mini-Correspondents" in recent years. It would appear there is a push towards a "you are either a mortage broker or a mortgage banker" environment.
 
The Government Affairs Team at NAMB will be issuing official comments next week. It is important for all industry participants to read the official guidance.It does not matter whether you are a mortgage broker or a mortgage banker, you are a mortgage professional and NAMB is here for you...So let us hear your voice. Get involved, get active, and do your part for you industry!
 
In the meantime, if you are operating as a Mini-Correspondent, it is in your best interest to read the press release and official guidance below.
 
Please email the Government Affairs Team with your questions, comments, concerns.
 
FOR IMMEDIATE RELEASE:
July 11, 2014
 
CONSUMER FINANCIAL PROTECTION BUREAU ISSUES GUIDANCE REGARDING BROKERS SHIFTING TO "MINI-CORRESPONDENT" MODEL Bureau Describes Evaluation of Mini-Correspondent Transactions
 
WASHINGTON, D.C. - Today, the Consumer Financial Protection Bureau (CFPB) is issuing guidance regarding mortgage brokers transitioning to a "mini-correspondent" lender model. The CFPB is concerned that some mortgage brokers may be shifting to the mini-correspondent model under the mistaken belief that identifying themselves as such would automatically exempt them from important consumer protection rules affecting broker compensation. The guidance sets out how the Bureau evaluates mortgage transactions involving mini-correspondent lenders. It confirms who must comply with the broker compensation rules, regardless of how they may describe their business structure.
 
"Before the financial crisis, consumers seeking mortgages were steered toward high-cost and risky loans that were not in the consumer's interest," said CFPB Director Richard Cordray. "The CFPB's rules on mortgage broker compensation are intended to protect consumers from this type of abuse. Today we are putting companies on notice that they cannot avoid those rules by calling themselves by a different name."
 

The policy guidance is available HERE

 
 
Mortgage brokers connect borrowers with lenders who underwrite and fund loans. In contrast, a correspondent lender, as generally understood in the mortgage industry, processes applications, provides legally required disclosures, frequently underwrites the loans, makes the final credit approval decision, funds the loans, and sells them to investors.
 
In January 2014, new CFPB mortgage rules took effect protecting homebuyers from risky lending practices. Building upon regulations issued by the Federal Reserve Board in 2010, the rules provide important consumer protections by prohibiting financial incentives for brokers to push borrowers toward risky loans. They also require lenders to include mortgage broker compensation in calculations determining whether a loan meets certain consumer protection standards.
 
The CFPB is concerned that some mortgage brokers may be setting up arrangements with investors in which the broker claims to be a "mini-correspondent lender," when in fact the broker is still essentially just facilitating a transaction between a borrower and a lender. While some brokers may be setting up such arrangements because they intend to grow into full correspondent lenders, the Bureau is concerned that other brokers may simply be attempting to evade consumer protection rules. Today's guidance confirms that mortgage brokers who merely choose to describe themselves as mini-correspondent lenders are not automatically exempt from applicable consumer protection requirements.
 
The guidance sets out some of the questions the CFPB may consider in evaluating mortgage transactions involving mini-correspondent lenders in order to understand their true nature. This evaluation involves examining how the mini-correspondent lender is structured and operating, for example: whether it is continuing to broker loans; its sources of funding; whether it funds its loans through a bona fide warehouse line of credit; its relationship with its investors; and its involvement in mortgage origination activities such as loan processing, underwriting, and making the final credit approval decision.
 
The guidance makes clear that no single question necessarily determines how the CFPB may exercise its supervisory and enforcement authorities, and that the facts and circumstances of the particular mortgage transaction being reviewed would be relevant to how the Bureau exercises these authorities.
 
###
 
The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.
 
 
NAMB SURVEY ON CLOSING COST CREDITS STILL OPEN - Take the NAMB Survey HERE
 
It is extremely important that we get the mortgage credit to consumer information so we can present it to our regulators per their request.  What we are looking for is the following information:
TOTAL number of Loans closed in 2013.
TOTAL Dollar Volume of your loans.
TOTAL amount of Mortgage rebates that you gave to the customer to help pay their closing costs.  This amount will be the sheet price of the loan, minus your Lender Comp, minus any hits and this would be the net amount that you would have given back to the customer to help pay fees and reduce closing costs.

 

NAMB Government Affairs Update
2013 Mortgage Survey - Rebates To Consumers

Last year, the Government Affairs team at NAMB conducted a survey of mortgage professionals to determine the amount closing cost credits given back to consumers at closing. The data overwhelmingly showed that in 2012, mortgage brokerages gave millions of dollars to consumers to help cover closing costs. 
 
Our data helped the mortgage industry get some very positive press and turn some heads in DC. Read the WAPO Story here!
 
We are now conducting the same survey for 2013. Please fill out the short 5 question survey and help NAMB help you.
 

Take the NAMB Survey HERE

 
It is extremely important that we get the mortgage credit to consumer information so we can present it to our regulators per their request.  What we are looking for is the following information:

1. TOTAL number of Loans closed in 2013.
2. TOTAL Dollar Volume of your loans.
3. TOTAL amount of Mortgage rebates that you gave to the customer to help pay their closing costs.  This amount will be the sheet price of the loan, minus your Lender Comp, minus any hits and this would be the net amount that you would have given back to the customer to help pay fees and reduce closing costs.
Your personal information will be kept confidential.  We won't tell the CFPB who you are...But we do want to show them the truth about credits to consumers.
 
We have open lines of communication with our regulators and will continue to work with them to improve the state of housing and do what is best for the consumer and small business mortgage professionals.
 
Just remember, It does not matter if you are a mortgage broker or a mortgage banker, NAMB is here for you...the mortgage professional.  
 
For more information on NAMB's Government Affairs projects or on how you can get involved, contact Rick Bettencourt anytime at governmentaffairs@namb.org.


NAMB Government Affairs Update

Does a 4% Cap on points and fees solve QM problems? 

Mortgage Professionals!!! Realtors!!! Consumers!!!

NAMB needs your assistance. We have been working with regulators, legislators, industry trade groups, and even consumer groups on ideas about how the Qualified Mortgage rule can improved to ensure equal access to affordable credit for ALL consumers.

Please take two minutes to answer this short survey.

https://www.surveymonkey.com/s/NAMB_3percentcap
Your responses will help NAMB get the data to the right people that can help improve the QM Rule.
Let your voice be heard!
 

NAMB Government Affairs Update

2014 Legislative and Regulatory Conference Follow Up! 

Hello Mortgage Professionals!


Well, I'm back here in sunny and cold Boston, Massachusetts after an exciting and extremely productive three days in Washington DC for our 2014 annual legislative conference. Before I get into the debrief and briefly touch upon some of the highlights of our three days in Washington, I wanted to personally and from the bottom of my heart, thank each and every one of the mortgage professionals that came from their individual states to Washington DC to partake in this legislative event. The reason any association efficiently operates and conveys their words of intention, is through membership participation. Now, even though our numbers were little lower than I would've liked, thanks in part to an unsuspecting snowstorm which hit Monday, we should have had more members from our association there with us to pass along the important words NAMB brought to the Hill. I know we can do better and we have to do better, especially as our legislative and compliance environments continually change. So, let's all work to increase our legislative numbers next year to over 250, I think that's a very attainable goal.


So the big news is, H.R. 3370, the Homeowner Flood Insurance Affordability Act, sponsored by Reps. Michael Grimm (R-N.Y.) and Maxine Waters (D-Calif.), passed 306-91 on Tuesday, March 4. That is such a win for our consumers and homeowners throughout the United States. It was also kind of nice, that the vote and passing of that legislation happen to occur on the same day of my wife's birthday. Not the kind of present she would've liked, but, nonetheless she and I were both ecstatic! As of the writing of this particular email, the bill has been brought back to the Senate and has been read for the first time. As new information comes from the Hill, I will pass along to you. I would like to take this opportunity to thank my Flood Insurance Task Force Chair, Kimber White and NAMB Board of Director & Florida President Valerie Saunders. They did an absolute incredible job in tabulating data and statistics which was passed along to our legislators to assist them in their voting. The California Association of Mortgage Professionals, led by George Duarte was also instrumental in lobbying this important initiative.


Tuesday night many of the mortgage professionals in Washington DC took a few minutes before parting their ways, and offered some input as to how each of their meetings went on the Hill. The feedback was overwhelmingly positive regarding the qualified mortgage and the existing provision which includes lender paid compensation to a broker in the 3% points and fees cap. Every professional I spoke to indicated their elected official understands this particular issue is flawed and needs to be addressed. I can say from my own personal experience, that my five congressional meetings and my two Senate meetings all yielded the same results; they understand it needs to change and to do so would create a level playing field for all consumers. So, we'll be working very diligently on following up with our elected officials with data to support our proposals.


Revising the FHA Loan Limits was also at the center of each of our discussions, and again, those conversations were met with very favorable results. There will be some exciting and new information being published later next week, and as soon as it's been made available we will share it with all of our members. Great Job California Association of Mortgage Professionals (CAMP) in assisting our GA Team in effectively conveying the importance of FHA Reform. Thank you!


The last, but certainly, not least highlights of the conference was commentary from our guest speakers! Ken Markinson from the Mortgage Bankers Association called in and provided our members with some excellent positions and opinions the MBA are currently working on and are excited to help NAMB in the future. FHA Chair and President Elect John Councilman took some time to speak with FHA Commissioner Carol Galante. Again, thank you so much Commissioner Galante for making time to call in and discuss some important FHA issues with the NAMB leadership and its members.


CFPB Director, Office of Financial Institutions and Business Liaison Dan Smith, stuck at home due to the snowstorm, was gracious enough to join us via a telephone conference call to answer some important broker questions! The BIG QUESTION he helped address answered the ever puzzling question regarding Borrower-Paid Compensation. He confirmed, that you can reduce your Borrower Paid Compensation below your agreed Lender Paid Compensation amount. HUGE WIN for Brokers!!!!


Raj Date, the Managing Partner of Fenway Summer, actually took the time and risked the elements to show up at our conference and speak to our members in person! Raj Date is the former Dep. Director of the CFPB and the brainchild behind what could be the very first Non-QM Wholesale Lender, Fenway Summer. Raj was a huge hit and an incredible speaker who provided us with some information insight to his goals and objectives for his company all the while keeping the conversation very light and entertaining. It truly was an excellent presentation.


On behalf of our entire association I would like to personally thank Raj Date, Dan Smith, Carol Galante and Ken Markinson for their time!


So, there you have it! NAMB Lobbying on behalf of all Mortgage Brokers and Bankers located in every corner of the U.S. How about you become of a part of something bigger than yourself and join the ONLY trade association that is lobbying for beneficial changes on your behalf each and every day.


Thanks again!


Sincerely,


Richard M. Bettencourt Jr., CRMS, CMHS

Government Affairs Chair

NAMB Government Affairs Update

2014 Legislative and Regulatory Conference Follow Up

H.R. 3370 - Homeowner Flood Insurance Affordability Act of 2013 Passes

On Tuesday, March 4, 2014, NAMB members from all over the United States braved the record cold temperatures to represent mortgage professionals, small businesses, and most importantly, consumers to lobby for H.R.3370, the Homeowner Flood Insurance Affordability Act of 2013 by Grimm. NAMB's lobbying efforts on Capitol Hill helped sway some votes to address the unintended consequences of the Biggert-Waters Flood Insurance Reform Act which would have left consumers facing skyrocketing premiums and downward pressure on home values.

 The bill was passed Tuesday night with 238 cosponsors and is expected to pass the Senate as is. (Details Here)

 Special thanks to the California Assocation of Mortgage Professionals, the Florida Association of Mortgage Professionals for their efforts with this legislation and the NAMB members that represented their states this year. 

 Also, if you have the opportunity, please thank Provident Funding for their sponsorship of this year's legislative conference.

 This bill's passage is just another example that your voice does count and why it is important to invest in your industry.

 In addition to lobbying for the flood insurance fix, NAMB members voiced their concerns over the QM's 3% cap and the inclusion of brokerage entity compensation as well as the FHA loan limit reductions. We also had an intriguing discussion with our keynote speaker, Raj Date, about the non-QM market and the roles mortgage professionals will play serving the underserved. Overall, although it was a little cold outside, but we were successful.

 I hope to see you all at the NAMB National Conference in Las Vegas (9/13-9/15). Last year we had more than 2,000 registered attendees. This year is expected to be bigger given the new lending environment and new opportunities. Please visitwww.nambnational.com for more information.

Just remember, It does not matter if you are a mortgage broker or a mortgage banker, NAMB is here for you...the mortgage professional. 

NAMB Government Affairs Update
The QM is Here, The QM is Here...
Tell Your Story...

We are already hearing stories from mortgage professionals of consumers being pushed into rebuttable presumption and higher priced mortgage loans due to the FNMA LLPA's. We are hearing from mortgage professionals that all the investors have different interpretations of QM, Points and Fees, Rebuttable Presumption, etc. Bottom Line, there is lots of confusion and ultimately, borrowers are already having issues with access to credit.

So, WE NEED YOUR HELP.

NAMB SURVEYThe data collected from previous surveys has been instrumental in "telling your stories" and has opened lots of eyes in Washington, D.C. Please help us continue the fight.

Also, don't be afraid to call your representatives and let the hear your stories too.

GA Update - 164 Mortgage Broker Entities Gave $64m Back to Consumers in 2012


Special thanks to the 164 mortgage broker entities which sent us their mortgage credit to consumer stats from 2012. We are still compiling the data to deliver to our regulators and would love to get some more feedback.

So, here is how we need your help. Watch the video, support your industry by joining NAMB if you are not already a member, and help us fight the unintended consequences looming from the Dodd-Frank Act and the Qualified Mortgage.

It is extremely important that we get the mortgage credit to consumer information so we can present it to our regulators per their request.  What we are looking for is the following information:

  1. TOTAL number of Loans closed in 2012.

  2. TOTAL Dollar Volume of your loans.

  3. TOTAL amount of Mortgage rebates that you gave to the customer to help pay their closing costs.  This amount will be the sheet price of the loan, minus your Lender Comp, minus any hits and this would be the net amount that you would have given back to the customer to help pay fees and reduce closing costs.

This information will be kept confidential.  We are not going to publish this information, however, it has been used by some companies to show Realtors that you are giving back to the customer to help them, and it has been very successful.

We have open lines of communication with our regulators and will continue to work with them to improve the state of housing and do what is best for the consumer.

Joint Trade Group Issue Brief_ HR 1077 

Support Bills HR1077 and S949


  

View and share the video above as it describes why HR 1077 and S 949 are important for consumers in plain language that everyone can understand. Your representatives in Washington, D.C. as well as your colleagues need to see why the 3% in its current form will hurt free markets and fair competition. 


Special Thanks to NAMB Member, Ruby Grynberg of Salmon Bay Community Lending for producing this wonderful video and allowing us to share.

GA Update - QM Might Make Credits to Consumers Obsolete

NAMB leadership had a very busy and productive 2 days in Washington, D.C. last week meeting with regulators, industry partners, hill staffers, and legislators. Four NAMB member companies we used as samples gave over $1.6m back to consumers in 2012 alone!

Our regulators were very fascinated by this and want more data. This will help us get meaningful improvements to the QM. So, here is how we need your help. Watch the video, support your industry by joining NAMB if you are not already a member, and help us fight the unintended consequences looming from the Dodd-Frank Act and the Qualified Mortgage.

If you are a mortgage broker, please calculate the amount of credits you gave back to consumers in 2012 and send it to us. We have open lines of communication with our regulators and will continue to work with them to improve the state of housing and do what is best for the consumer.

We need your help and support with this! Click here to view the letter we need you to fill out so you can help!

Joint Trade Group Issue Brief_ HR 1077 

 

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