State-Level Lending Law Changes - Does California Have a Price Loophole?

Posted To: Pipeline Press

I received this note/suggestion regarding broker business. " Is California dysfunctional? In California, brokers are typically regulated by the BRE , but also the DBO . The BRE doesn't appear to care much about the LO comp rule, nor are brokers big enough to show up on the CFPB's radar screen. Brokers are able to pick their comp plans with various wholesalers. I am not saying all brokers do this, but I have heard that un-savvy borrowers are locked with a wholesaler with whom the broker has a 2-point comp structure, whereas knowledgeable borrowers are locked with the wholesaler with whom the broker has a 1 point comp structure. The cure for this is one regulator instead of the BRE and DBO. DBO ought to regulate all lenders." Effective June 1, 2017, Maryland passed an act that will change the...(read more)

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