EXCERPT FROM ROB CHRISMAN NEWSLETTER
The CHLA has weighed in with a letter to the CFPB, offering “a common sense approach to the issue of LO Compensation flexibility. Commonly an LO makes a loan offer, in conjunction with working with a potential borrower, sometimes for an extended period of time. Then, at the last minute the borrower solicits a competing offer at the last minute, at a lower rate. Unfortunately, under CFPB rules, the loan originator can’t reduce their compensation, in order to make it possible for the lender to match the offer. Result: the lender and LO lose the loan – and the client relationship. The CHLA letter offers a targeted solution to address these circumstances – without opening up the LO Comp rule to loopholes that allow steering or other anti-consumer practices.