CFPB Issues Loan Officer Compensation and Fees and Points Proposal (and real estate commissions)
On May 23, 2012, The Consumer Financial Protection Bureau CFPB held a small business review panel to evaluate proposed changes to the Federal Reserve’s Loan Officer Compensation Rule as well as offer alternatives as to how borrowers can be charged fees and points.
During an exchange with a mortgage broker it what suggested that perhaps even real estate brokerage commissions could be included in the mix of discussion regarding establishing a flat fee option for borrowers particularly when the real estate broker was affiliated with the lender.
NAR raised strong concerns with the CFPB and was told this is just at the investigative stages. NAR pointed out that real estate brokers and agents are not considered financial services providers under our exemption in Dodd-Frank and should not be subjected to an attempt to impose a flat fee arrangement on a real estate broker or agent by the federal government.
NAR also has concerns with other aspects of the proposal and will be weighing in with the CFPB both formally and informally. We are also working with our industry partners to ensure that this proposal does not harm consumer access to mortgage credit nor harm the housing recovery.