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Fiduciary Duties for Mortgage Brokers and LOs

In October of 2007, Andrea Negroni wrote an article for Mortgage Banking Magazine titled “Mortgage Brokers–What Fiduciary Duties Exist?” Negroni provides a framework for mortgage brokers to begin learning about case law already on the books where courts have imposed fiduciary duties on brokers.
The National Association of Mortgage Brokers has been quite insistent that brokers […]

20Jun2008 | mf | 3 comments | Continued

Reverse Mortgage Loan Originations Caught up in New State Law Changes

This memo was sent to me by a member of the National Reverse Mortgage Lenders Association:
Member Alert: NRMLA Trying to Resolve Licensing Issues in Washington State
June 2, 2008
Washington state recently passed legislation (SB 6471) that may impact non-depository lenders, as well as the correspondents, subsidiaries and affiliates of depository lenders who make reverse mortgage loans […]

17Jun2008 | mf | 0 comments | Continued

Mortgage Industry Codes of Ethics

Read the Code of Ethics from these three trade organizations.  Don’t worry; it will be a very fast read.

National Association of Mortgage Brokers
National Association of Mortgage Women
For the Mortgage Banker’s Code, follow this link and click on “cannons” from the menu on the left.
What’s missing?
Could some of these phrases be re-worded?  If so how? 
For example from […]

14Jun2008 | mf | 1 comment | Continued

Solutions to the Mortgage Lending Crisis

The mortgage industry crisis is a gift.  Mortgage lending can emerge from this mess and transform itself. I have been co-writing about predatory lending and the ambiguous professional status of retail mortgage salespeople for over 7 years. The industry has traded consumer respect for massive profits.  It does not matter where you work: banker, broker, credit union, consumer […]

13Jun2008 | mf | 0 comments | Continued

What the Space Shuttle Challenger Disaster Can Teach Us About the Current Mortgage Lending Crisis

In this mortgage ethics article about allegiance to rule-following, I will compare the mortgage industry crisis with a classic business ethics case study.
The space shuttle Challenger accident has frequently been used as a case study in the study of engineering safety, the ethics of whistleblowing, communications, and group decision-making.  With Challenger, an O-ring eroded on earlier shuttle launches. […]

13Jun2008 | mf | 2 comments | Continued

Are Mortgage Loan Originators Professionals?

When I ask the question “Are loan originators professionals?” to a group of loan originator students in ethics classes, almost everyone says “yes.”  Anyone can do their job in a professional manner (adjective,) but not everyone is a Professional (noun.) Is your barista at Starbucks or the person who bags your groceries a professional? If […]

13Jun2008 | mf | 17 comments | Continued

WA State Legislative Changes: SHB 2770, SB 6471, SB 6381

The Washington State Legislature has passed three new laws that will go into effect June 12, 2008. 
SHB 2770
Governor Gregoire’s legislation implementing the recommendations of the Homeownership Task Force. This legislation impacts Banks, Credit Unions, the Consumer Loan Act (CLA), and the MBPA. The bill addresses prepayment penalties, negative amortization loans, the federal guidance on nontraditional […]

1May2008 | mf | 6 comments | Continued