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Press Release              Contact: Jodi Greenblatt
                    (703) 342-5852

Nationwide Residential Mortgage Licensing System: Fatal Flaws Persist
CSBS and AARMR Continue to Push Initiative With Fatal Flaws

Washington, D.C. – November 17, 2006 – A regulatory initiative to create a nationwide licensing standard and registration system for residential mortgage originators continues to be fatally flawed according to the National Association of Mortgage Brokers (NAMB).  

The initiative, sponsored by the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR), is solely focused on the mortgage broker community and excludes originators at banks and other federally regulated financial institutions from participating.

In a statement dated November 3, 2006, the NAMB Consumer Protection Sub-Committee outlined several areas of concern regarding the proposed CSBS/AARMR registry, and concluded that “NAMB’s continued participation in the CSBS/AARMR effort should not be considered an endorsement of the current proposal.”

On November 4, 2006, the NAMB Delegate Council unanimously endorsed the Committee’s statement and urged NAMB’s member states to oppose any effort to pass enabling legislation or regulations that do not mirror the principles outlined in the NAMB Statement.

 “We support a nationwide license registry only if it includes all mortgage originators.  It just doesn’t make sense to include some and not others because all consumers should benefit regardless of the distribution channel chosen,” said NAMB President Harry Dinham. 

He said that NAMB has long-advocated a national licensing standard that is evenly applied to government-regulated banks, credit unions, mortgage bankers, lenders, brokers and all employees of these entities.

He also noted that more time needs to be spent considering the type and amount of personal information that would be included in the registry. “The current proposal subjects individuals to a burdensome and intrusive data collection protocol. In fact, much of the data for the registry is not even legally required in many states.”

Part of the registry’s goal is to create an outlet for consumers to lodge complaints against licensed professionals. Dinham said that CSBS and AARMR have not worked out the details of the complaint resolution process.

He said the complaint process must meet the needs of consumers while protecting licensed originators from financial harm that could occur due to frivolous claims.

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The National Association of Mortgage Brokers is the voice of the mortgage broker industry with more than 27,000 members in all 50 states and the District of Columbia. NAMB provides education, certification and government affairs representation for the mortgage broker industry, which originates over 50% of all residential loans in the United States.