PROPOSED FEDERAL RESERVE BOARD RULE CONTAINS PROVISIONS
TO ELIMINATE THE INDEPENDENT MORTGAGE BROKER!
We need your help!
If you plan on staying in this business, you must respond to our National Call To Action.
The Federal Reserve Board has issued a proposed rule that will potentially and dramatically harm your business. The required public comment period expires April8th, 2008. Review the information and links below then follow the instructions. Time is very short - get your comments in today!
The Rule proposes multiple changes to the mortgage industry, which include:
- A new category of "higher-cost" loans, which will eliminate stated and no-doc loans under any circumstance.
- New APR triggers of 3% (1st mortgages) and 5% (subordinate mortgages) above the 10-year U.S. Treasury, causing nearly every mortgage made in America to be classified as a "higher cost" loan. As such, the provisions of the Fed Rule will make financing nearly impossible.
- A new disclosure for Mortgage Brokers only that will require you to disclose, before application, what your mortgage brokerage fee (front end AND back end fees) will be on the loan and this cannot change.
- The Originator to determine that the borrower has the ability to repay the mortgage for at least 7 years.
What can you do?
Please have everyone in your place of business submit comments. THE FED RULE COMMENTS NEED TO BE MADE AT ONCE! NAMB has prepared a 3-page bullet-point summary as an outline which can be accessed on www.famb.org, with guidance on how to write your comments including suggested points. It's very important that you carefully craft your own comments following NAMB's suggested points. In addition, a copy of the entire Fed Rule can be found below. Comments must be RECEIVED (not postmarked) by the Federal Reserve Board no later than April 8th.
You may submit comments, identified by "Docket No. R-1305" by any of the following methods:
- E-mail: regs.comments@federalreserve.gov. Include the docket number in the subject line of the message.
- Fax: (202) 452-3819 or (202) 452-3102.
- Mail: Jennifer J. Johnson, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue, NW, Washington, D.C. 20551.
All public comments will be made available on the Board's Web site at http://federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted, unless modified for technical reasons. Accordingly, comments will not be edited to remove any identifying or contact information. Public comments may also be viewed electronically or in paper in Room MP-500 of the Board's Martin Building (20th and C Streets, NW) between 9am and 5pm on weekdays.
This is a critical time in the mortgage industry and Mortgage Brokers must act NOW! Please mail your letter today.
