WSJ: Mortgage Brokers say Wall Street Reform Hurts Competition

The National Association of Mortgage Brokers is rallying thousands of its members by urging them to tell their congressional representatives to oppose the financial-overhaul legislation pending in Congress.

NAMB president and chief executive, Roy DeLoach, told the Wall Street Journal it would hurt competition in the mortgage market by driving small brokerages out of business, leaving fewer to compete with mortgage lenders.

“We’ve told our members: This isn’t good for small business; this isn’t good for consumers,” he said. The group has roughly 8,500 members, down from about 25,000 at the height of the housing market boom.

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Part of the bill aims to curb the type of fees charged on riskier loans and would ban yield spread premiums to brokers and loans officers for steering consumers to a certain type of loan or rate says the WSJ.

For the reverse mortgage industry, the bill is unlikely to totally eliminate yield spread premiums according to people we spoke too.  However, lenders could only offer one rate for each program to prevent brokers from steering consumers into higher margin reverse mortgage products.

The Wall Street reform bill passed the House by a vote of 237 to 192 last week.  A vote in the Senate has been delayed until mid July.

Brokers Mobilize Against Proposed Mortgage Rules

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  • Why don't they call it what it is? This bill is called the “Financial Regulatory reform” bill, if it passes, we will be impacted adversely!

    I want to reach out to all of you for help and to express my deepest concern over what is taken place in our great nation. I see us going further and further away from our values, our beliefs and what we knew as a free and prosperous nation.

    As you know, Wednesday evening, June 30th, the house passed the “Financial Regulatory Reform Bill” (H.R. 4173 Conference Report on Financial Reform).

    The bill still has to go to the senate for final passage. This is supposed to take place the week of July 12th.

    If this bill passes in its present form, it will be the largest transfer of power to the Federal Government in the history of our country. This bill MUST not pass!

    A sound financial regulatory reform bill is needed but not the way this 2,346 page bill is written. The passage of this bill, in its present form, means just about our entire financial industry can be controlled by the Federal Government.

    This means home loans, consumer loans, warehouse lending and traditional banks to main street will be severely damaged. These banks had nothing to do with causing the financial crisis but will be subject to 5,000 pages of new regulations. Consequently, many small banks will have to sell out to larger banks. They just do not have the staff to deal with the massive volume of new reports and rules to contend with. Each and every one of you will be impacted!

    The bill calls for a consumer protection bureau to be established, a committee of people that will have more power than one could imagine over our financial structure. Those of you that have had enough with government take over and government bankrupting this country need to take a stand on this bill. Our industry will be affected drastically.

    We all need to write congressman and senators, not just our own, it is important to write to Democratic and Republican congressman and senators, mainly senators, if you want this bill stopped in its tracts.

    Some of you may disagree with me; I will respect your views but please check out the ramifications first. Those who do agree, need to get out your pens, computers, your phones and start charging forward.

    I feel it is extremely importance for everyone to take action on this critical bill; we only have less than a week to move on it.

    Thank you and God speed,

    John A. Smaldone

  • Why don’t they call it what it is? This bill is called the “Financial Regulatory reform” bill, if it passes, we will be impacted adversely!rnrnI want to reach out to all of you for help and to express my deepest concern over what is taken place in our great nation. I see us going further and further away from our values, our beliefs and what we knew as a free and prosperous nation.rnrnAs you know, Wednesday evening, June 30th, the house passed the “Financial Regulatory Reform Bill” (H.R. 4173 Conference Report on Financial Reform).rnrnThe bill still has to go to the senate for final passage. This is supposed to take place the week of July 12th. rnrn rnrnIf this bill passes in its present form, it will be the largest transfer of power to the Federal Government in the history of our country. This bill MUST not pass!rnrnA sound financial regulatory reform bill is needed but not the way this 2,346 page bill is written. The passage of this bill, in its present form, means just about our entire financial industry can be controlled by the Federal Government. rn rnThis means home loans, consumer loans, warehouse lending and traditional banks to main street will be severely damaged. These banks had nothing to do with causing the financial crisis but will be subject to 5,000 pages of new regulations. Consequently, many small banks will have to sell out to larger banks. They just do not have the staff to deal with the massive volume of new reports and rules to contend with. Each and every one of you will be impacted!rnrnThe bill calls for a consumer protection bureau to be established, a committee of people that will have more power than one could imagine over our financial structure. Those of you that have had enough with government take over and government bankrupting this country need to take a stand on this bill. Our industry will be affected drastically. rnrnWe all need to write congressman and senators, not just our own, it is important to write to Democratic and Republican congressman and senators, mainly senators, if you want this bill stopped in its tracts.rnrnSome of you may disagree with me; I will respect your views but please check out the ramifications first. Those who do agree, need to get out your pens, computers, your phones and start charging forward. rnrnI feel it is extremely importance for everyone to take action on this critical bill; we only have less than a week to move on it.rnrnThank you and God speed,rnrnJohn A. Smaldonern

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