Interview with FHA Commissioner

201003020927.jpgNational Mortgage Professional Magazine recently published an interesting interview with David Stevens, Assistant Secretary for Housing at the US Department of Housing and Urban Development where they discuss the new RESPA changes and the role of the broker in stabilizing the housing market.

When I talk to RMD readers, I’m always asked about the future of the broker in the reverse mortgage business. Steven’s discusses the future role of the broker in the interview:

Q: The mortgage broker has been portrayed as a major culprit in the mortgage mess by both the media and select legislators. How do you feel about that portrayal and how do you feel about the future role of the mortgage broker in getting our economy out of this mess?

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A: I shudder whenever I see someone point the finger of this housing problem at any one particular area of the market. At the end of the day, and I tell this to any audience I speak to, we are all responsible. Anybody in the mortgage and housing finance sector during this boom period and saw the type of financing that was going on, I don’t care whether they are a real estate agent; a mortgage broker or mortgage banker; a loan officer at a bank; people in the ratings industry; economists at virtually all the major banks and the GSEs who said there was no housing bubble; David Bach, who went around on speaking tours and had a number one best-seller with “The Automatic Millionaire,” saying to buy up real estate … everybody is responsible for this issue.

At the end of the day, mortgage brokers are not, by any stretch, the culprits of the mortgage industry’s issues. Mortgage brokers play a very important role because they will reach into areas and serve communities where large institutions do not have the resources to do so. Having access to mortgage financing is a critical aspect of homeownership and mortgage brokers have clearly filled that need for decades.

The key to all of this is responsibility. There are good brokers and bad brokers. Just like the lenders that I have taken action against since I became FHA Commissioner, you have to eliminate the rogue behavior of an industry or the whole industry’s reputation will suffer from it. I think that is the objective of the moves we are making.

Read the rest of the interview at the link below.

FHA Commissioner Stevens clears the air: David H. Stevens details the new RESPA rule and the role of the broker and stabilization in housing

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  • While the words are kind and wise, the actions of HUD and Congress are otherwise. As many of us work diligently to complete new origination requirements, others have minimal new requirements. As brokers and others scramble to comply with new requirements, other retailers have few new rules impacting them.

    The proof will be seen in how many brokers are still standing 12 months from now. Most of us who will not survive will not be put out of business because of a lack of business or violations of procedures or rules that Commissioner Stevens discusses. We will be gone because Congress and HUD have disproportionately and irrationally raised the bar on some originating firms and originators but not on others.

    For many years it was said that as U.S. Steel goes, so goes the nation. We still have a steel industry, just not much of it. While international competition created that change, government action is changing the place of the broker in our industry.

    We all wish the Commissioner the best. We also hope he will produce the actions that match his words and will foster the reversal of the current trend.

  • Everyone knows that small business is the main driver of employment growth. Mortgage brokers are small businesses, and will continue to exist and flourish once things improve. In the meantime some will shake out, just as some large lenders will (SLN for example).

    • Sad to say I remember Savings and Loan Association management teams saying much the same type of thing about 30 years ago. It was because of their demise that brokers became relevant. Is this another cycle in the mortgage industry?

      Hold on tight. This ride could be worse than the most hair raising rollercoaster ride yet.

  • Everyone knows that small business is the main driver of employment growth. Mortgage brokers are small businesses, and will continue to exist and flourish once things improve. In the meantime some will shake out, just as some large lenders will (SLN for example).

  • Sad to say I remember Savings and Loan Association management teams saying much the same type of thing about 30 years ago. It was because of their demise that brokers became relevant. Is this another cycle in the mortgage industry?rnrnHold on tight. This ride could be worse than the most hair raising rollercoaster ride yet.

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