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Dodd Frank

posted Jan 9, 2011, 10:37 AM by Massey Kouhssari   [ updated Jan 9, 2011, 11:29 AM ]

The amendment to” REGULATION Z “of the Truth in Lending Act (TILA) which takes effect on April 1, 2011 is going to cut brokers commission by 50 percent due to the new laws on broker commissions. Most importantly it will hurt the consumers, here is how:


The sad part is that the customer will no longer have as many choices as they do now when it comes to pricing. As an example at given loan amount I may charge the client 1.0 point at 4.250%, 0.5 point at 4.375%, or 0.00 points at 4.500%; in all cases making 1.0 point, and disclosing that to the customer. Under the new rules the 0.5 point option will go away, since we will be prohibited from mxing comensation; it either comes from the borrower OR the lender not both. Only the customer suffers. It is clear that a politician wrote the law with clearly no experience in the lending industry.
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