Senators Ask Fed to Delay Loan Officer Compensation Rule

In the latest regarding the Federal Reserve’s pending loan officer compensation rule, senators David Vitter (R-La.) and Jon Tester (D-Mont.) co-authored a letter sent March 11 to Fed Chairman Ben Bernanke, which requests a delay in the implementation of the rule.

“We are concerned that this rule, which becomes effective on April 1, 2011, may have the unintended effect of further increasing concentration in the home mortgage market,” the letter stated.

The letter follows two recent lawsuits that aim to impede implementation of the rule. The first was filed early last week by the National Association of Independent Housing Professionals and the second came from the National Association of Mortgage Brokers, which said the rule “could cause devastating and irreparable harm to small business mortgage brokers, their loan officers and their entire staff as of the rule’s April 1, 2011 implementation date.”

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The Fed later announced it hoped to consolidate those two suits.

View a copy of the letter.

Written by Elizabeth Ecker

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  • I am happy to see senators David Vitter (R-La.) and Jon Tester (D-Mont request a delay of the compensation programs effective of April 1, 2011. It will be interesting to see if the two senators can delay the effective date.

    It is also good to see a Democrat and a Republican co-authoring this letter together. The new compensation plan had very little thought put into it when it was formulated or maybe it is because those that put it together had little knowledge of what they were doing? The impact this will have on the small to medium size broker will be devastating.

    Here again, the new compensation rule was designed to eliminate the small only to have the large dominate. This is just one other move toward eliminating capitalism and taking a large step toward socialism.

    I wish the two senators a bundle of luck, I sure hope they pull it off in conjunction with the other law suites!

    John A. Smaldone

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