Proposed Federal Reserve Board Rule Contains Provisions to Eliminate the Independent Mortgage Broker!

The Federal Reserve Board has issued a proposed rule that could dramatically harm your business. The public comment period ended on April 8th. Thank you to those of you who sent in emails. These rules are not final, but if they are enacted in their current form they could be harmful to your business.

RULE IMPLICATIONS
-A new category of "higher-cost" loans, which will eliminate all stated and no-doc loans.

-New APR triggers of 3% (1st mortgages) and 5% (subordinate mortgages) above the 10-year U.S. Treasury, causing nearly every mortgage to be classified as a "higher cost" loan. As such, the provisions of the Fed Rule will make financing nearly impossible.

-Requiring all Mortgage Brokers to disclose, before application, what your mortgage brokerage fee (front end AND back end fees) will be on the loan and this cannot change.

-Originators must determine that the borrower has the ability to repay the mortgage for at least 7 years.

A copy of the entire Fed Rule can be found by clicking here. If you have questions, please contact MAMP@MAMP.org.

MAMP would like to thank it's Gold Partner in Education for their continued support:

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