Economy/Credit/Housing Issues Ping List
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This would put over 100,000 loan officers/mortgage brokers out of business. And it would make it much more difficult for low income borrowers to buy homes. This must be stopped!
From the way these financial companies have been run, the possession of an advanced business or finance degree from a prestigious university gives its possessor the same appreciation for long term consequences as that of a crack whore, but without the whore’s ethics and sense of self preservation.
Nothing beats causing a problem, and then angrily demanding solutions to the problems your past legislation caused.
Too little . . . Too late . . . ‘Nuff said here on FR.
When these clowns get done our children will no longer be able to afford a home, they will be destined to become renters for life. I can't argue with the guy's statement.
Just what I want, government rules to protect me from myself.
bring back usery laws that somehow became vapor, reinstate bankruptcy protection, and get rid of credit reporting.
I am glad to see that this bill, which, if passed, would bring devastation to the housing market, the general consumer, and to the economy, has finally made it out of the shadows and into the mainstream where the public can view it and judge it. And judge it they should.
This monstrous, badly written bill is a classic case of the road to hell being paved with good intentions. Barney Frank no doubt has glossed over the full spectrum of the bill’s tenets when he brought the Republican endorsements on board, as most of the politicos don’t have time to read or digest the stack of documents piled on their desk. What I am sure that Mr. Frank said to swing the endorsements his way is that this bill represents sweeping changes that are desperately needed in the industry, but did not disclose the full ramifications of ALL of the Titles of this bill. I wholeheartedly agree that the predators that have a tendecy to swim around this industry (or for any other industry, for that matter) need to be reined in and held accountable for misdeeds and bad practices. But to force loan officers, originators, and mortgage brokers to carry exorbitant bonds is tantamount to the government invoking a police state on an industry that comprises a great portion of the economic structure in the U.S. The bill and its vastly vague wording opens the door for loose interpretation of the law, thereby giving those same lenders who contributed to the current economic debacle free license to charge extortive rates and make it difficult for all but the priveleged to achieve homeownership. The mortgage brokers in this country have long been a buffer between bank high retail rates and what the customer can afford. Taking them out of the picture makes the consumer a fatted calf, ripe for the slaughter. And even should the broker manage to stay in operation with all of the overhead costs piled on him, he will ultimately find failure when he has his source of income sheered asunder.
Yield Spread Premium (YSP) is a misunderstood facet of mortgage lending. It represents the cost of doing a loan, contrary to popular beliefs held by uninformed people. Yes, YSP can generate big bucks for the unscrupulous, but when utilized by those with ethics and an interest in doing business for longer than a couple of months, it represents a cushion by which the homebuyer can survive the closing of a home loan. The profit generated through YSP often absorbs a hefty portion of closing costs, particularly for those people whose personal liquidity is in short or non-existent supply. Take away that facility, and you will find fewer and fewer homeowners (who have the credit, but not the money to do a loan), and you will find a much different, but equally explosive economic situation. Competition dies down, and prices/rates go up. The lenders who push inflated retail rates (and who do not have to disclose their SRP (Service Release Premium- the money paid to lenders when they sell a pool of mortgage loans on Wall Street), although the SRP is considerably more than any broker will ever see on a single loan) will go unchecked and the economy will see inflation on a biblical scale.
H.R. 3915 represents some good points, but in its current state is a powderkeg with a few that will burn down within the first eighteen to twenty-four months after the law goes into effect. But by that time, the country will be rocked to its very economic foundations, a situation for which we may not easily recover.
In summary, please urge your Congressmen and Congresswomen to vote NO on this bill, send it down for revision, and help safeguard the consumer, the housing market, and sveral hundred thousand jobs.
Somebody should tell Barney the horses have already been stolen from the barn.