Comment on CFPB-2012-0037-0049

It is refreshing to see the CFPB recognize that loan originator compensation and licensing regulations should offer an even playing field for both banks and brokers. The powerful bank lobby has in the past pushed for regulations that put brokers at an unfair disadvantage in terms of compensation disclosure and exempted themselves from the stricter licensing standards imposed on the broker community. I welcome stricter licensing requirements and regulations for all, as long as we are all playing by the same rules. Compensation in this industry has always been driven by the value of the asset (mortgage loan) in the secondary market. The client does not care what the originator or the bank are paid on the loan. All they care about is getting a competitive interest rate. The difference in disclosure requirements to date have confused consumers. The client is only concerned with their final interest rate and actual fees paid by them. Compensation on the loan should remain a secondary market issue whether the loan is brokered or not. Disclosure requirements that involve secondary market driven compensation distort the GFE and make it more difficult for a client to adequately compare offers from a bank vs a broker. Clients want and deserve simplification. Regarding licensing requirements: We welcome any initiative that results in a higher level of education and professionalism in the mortgage industry. Since the SAFE ACT was enacted, we have seen a great migration of loan officers moving from brokerage shops to bank employment. A primary reason for many being that they could not meet the stricter licensing requirements on the brokerage side and the banks are largely exempt. I have worked in this industry all my life. I have a finance degree from a top university, and worked in the banking side before opening my own brokerage in 1998. I am thankful to see the industry enacting more professional and even standards for both brokers and bankers.