Approved by the NAMB Board of Directors on Sunday, June 22, 1997, the borrowerbroker disclosure agreement seeks to clarify, in writing, how mortgage brokers add value and are compensated. By signing this agreement, borrowers will acknowledge their awareness of the role their mortgage broker will play in the loan process. Brokers using this agreement will better be able to defend themselves against allegations of improper loan fees, or borrower's confusion regarding the broker's independent contractor status. The model form is designed for voluntary use and should be modified to meet any state or local requirements.
NAMB MODEL MORTGAGE LOAN ORIGINATION AGREEMENT
(MUST BE ADAPTED TO CONFORM TO APPLICABLE STATE LAW)
You, the applicant(s), agree to enter into this Mortgage Loan Origination Agreement with (Name of Company) as an independent contractor to apply for a residential mortgage loan from a participating lender with which we from time to time contract upon such terms and conditions as you may request or a lender may require. You inquired into mortgage financing with (Name of Company) on _________(date). We are licensed as a "Mortgage Broker" under (Name of Law).
SECTION 1. NATURE OF RELATIONSHIP
In connection with this mortgage loan we are acting as an independent contractor and not as your agent. We will enter into separate independent contractor agreements with various lenders. While we seek to assist you in meeting your financial needs, we do not distribute the products of all lenders or investors in the market and cannot guarantee the lowest price or best terms available in the market.
SECTION 2. OUR COMPENSATION
The lenders whose loan products we distribute generally provide their loan products to us at a wholesale rate. The retail price we offer you--your interest rate, total points and fees--will include our compensation. In some cases, we may be paid all of our compensation by either you or the lender. Alternatively, we may be paid a portion of our compensation by both you and the lender. For example, in some cases, if you would rather pay a lower interest rate, you may pay higher up-front points and fees. Also, in some cases, if you would rather pay less up-front, you may be able to pay some or all of our compensation indirectly through a higher interest rate in which case we will be paid directly by the lender. We also may be paid by the lender based on (i) the value of the Mortgage Loan or related servicing rights in the market place or (ii) other services, goods or facilities performed or provided by us to the lender.
By signing below, applicant(s) acknowledge receipt of a copy of this signed Agreement.
MORTGAGE LOAN ORIGINATOR
Approved by NAMB Board, June 22, 1997