22 Responses

1. Jeff

   July 26th, 2007 at 2:40 pm

   1

   I believe a national licensing system is the best way to go along with higher educational and training requirements. Our industry is not being viewed favorably due to the actions of a few. Other industries much as insurance and securities require much higher training and licensing standards that have improved their professionalism.

2. Jim

   July 26th, 2007 at 3:13 pm

   2

   I think this is a great idea.

3. Jason Feldman

   July 26th, 2007 at 3:19 pm

   3

   Kyle,

   Here in Illinois we were the testbed for the damn licensing program. Like all government agencies they do nothing to fix the problem, but add a layer of beaurocracy and fees collected by the state. The only thing keeping me from lending to certain borrowers certain programs isnt the state, the federal, UN, Army Navy Airforce… not even the Marines. What keeps me from funding loans to these people is the higher guidelines that the lenders have imposed. But im sure the nearly 600 dollar process I had to go through to get my license (fingerprinting, background search, testing, etc etc) had to help the government. So if they thing helping the government make a few extra bucks is going to help borrowers they are dead wrong.

   Also, look closely… Its the banking leaders who want this put in place. Funny, banks themselves are exempt from needing these licenses and from the other house bills proposed here in Illinnois. The rich get richer and the poor get poorer. As long as these major corporations can squeeze a few extra million into their own pockets they will. I know “I” dont have any lobbiests working for me in the state capital or DC. Here in Illinois we have a housebill that would require all broker customers to send their customers into a mortgage school prior to funding any ARM, and of course, banks themselves are exempt… since subprime consists of less than 10 percent of the market, doesnt that sound a little out of place. So now a guy making 500,000 dollars a year who wants an ARM and has a 800 score can get the loan from the bank (usually at a higher rate) without this schooling… but the same customer would need to take a class (a 250-500 fee) paid by the broker of course even if the loan doesnt close.

   This is simply a measure to put brokers out of business. And if brokers from all over the US dont stick together to fight this, this will be their situation as well. Why not eliminate a few hundred six-figure jobs from the US economy, pay bank employees 40K a year to do the same work, and let the banks pocket the extra cash… I like this plan, in fact, why dont I just give them my savings account now. So not only are they forclosing on these peoples homes, they can come here and take mine too. Why not, if I cant make a living due to government intervention what is the difference between that and “taxation without representation?” Washington is run by corporations, not the people they represent. When do we fight this, AFTER the law is in order?

   Jason

4. Markus

   July 26th, 2007 at 3:22 pm

   4

   I think the National License won’t change a thing! I know of people that have been black listed by a lender, and had their license canceled by the state. Those people have gotten another license, in another person’s name, and continued business as normal.
   People seem to forget the 2 important things about the mortgage process. It’s the lenders, not the brokers that underwrite, review, and make the different types of loan products. If every broker in America was bad, and the lender saw the loan, saw that it didn’t look right, and refused to fund that loan. Most of the problems would stop! But it’s the lenders that offers the option arms, 2-1 buydowns, I/Os, not the brokers.
   The 2nd thing is that people are people! You can put everyone into a 30 yr fixed loan and they would still default. No matter what guidelines you put into place, you will never stop that.

5. Brian Barron

   July 26th, 2007 at 3:25 pm

   5

   In North Carolina all LO’s are licensed and 8 hours of continuing education is required each year. Why do brokers always get all the blame when something in the industry goes bad? Training and education are important but the industry must take care of the small percentage of “bad” brokers. Stricter audit procedures by state or federal regulators on a regular basis; problem brokers detected, reported and prosecuted; self-regulation (don’t just let a bad LO resign and take his bag of tricks to another shop).

6. Charlie Harris

   July 26th, 2007 at 3:34 pm

   6

   I was invited to a round-table last week with our state commissioner re: this subject. Fact is , the national licensing will happen and is mostly a positive thing. Loan originators should be licensed and in a national database. The bad guys get in trouble in one state , then just move to another state.
   Haven’t checked for sure, but there is a rumor that the worst ones finally go to work for C/Wide where the management is equally aggressive and unethical as they are.

7. Joe Rivello

   July 26th, 2007 at 3:54 pm

   7

   Universal licensing for lenders is an excellent idea. It will help weed out the scam artists and standardize lending policy. I do not, however, favor National licensing for brokers. I think the states could do a better job of regulating the industry at their own level rather than have the government intercede. In my state of Florida, we are required to pass a 40 hour course to get licensed and then 14 hours of continuing education every two years to keep the license active.

   As usual, brokers, as a whole, are taking the hit for the greed of a few.

8. Mike

   July 26th, 2007 at 4:07 pm

   8

   As several repsondents have already noted, I don’t believe this solves the problem. I support NAMB’s lobbying efforts to create a national registration/database for ALL originators, whether licensed or not in an effort to identify and weed out the bad players.

9. DELE

   July 26th, 2007 at 4:17 pm

   9

   I have no issue with have a national license - if it is applied equally to everyone in the business - bank employees included. I do understand that the banks have federal regulations that they must abide by, but if a national license is not equally applied, it seems to me that anybody that wants to hide his/hers/their bad deeds just goes to work for a bank and no one will be any wiser. I have heard that once the public can access this registry, all of the brokers personal information will be available - name, home address, telephone number - this is unacceptable.

10. jim

    July 26th, 2007 at 4:22 pm

    10

    great idea, maybe then the sharks will finally get the message. I am a consumer and client also I have been in my clients shoes and it doesnt feel good when you get takened or put your trust in someone that takes you too the cleaners. The industry created the monster time to pay the piper.

11. Jon

    July 26th, 2007 at 4:30 pm

    11

    No one is talking about the “nature” behind the problems in the financial sector. The truth is that the lending industry created trillions in wealth for big business and homeowners ( equity ) during the refi boom. Midway through the glory days, lenders found a way to keep it going, or extend the lifecycle with a nasty NEG AM loan. They pushed this mortgage product down through the retail channels into consumers laps claiming that it was “good”.

    “Sure Mr. customer, your payment is only $759, not $1289. We are helping you save money”, they said. Few originators told the truth because it’s very easy…too easy… to lie in the lending industry, you just don’t tell, and the consumer will never know. Not until they find their payment going up, then they try to refi OUT of that bad loan, only to find out that they now have a 3% Prepay that was never disclosed. WAMMO! Million of consumers are now in that very spot. And people wonder why values are dropping, foreclosures are at historic highs and it only appears to be getting worse.

    Of course only few “can” refi because they have sucked most of their equity out already, and the little they had left is now gone with the value slump.

    Unfortunately, NO ONE is talking about the solution. YES National licensing is a step, by what we need is to stop letting lenders pimp out high commission loans to consumers. LO’s shoiuld be training to be financial advisors, not scheming order takers. Too bad all those LO’s and wholesale reps that were making $400k a year didnt save any money. Tough times ahead folks. DiTech’s ad says “people are smart”, NO people are sheep and don’t know whats good for them. They don’t do their research before they sign, and they don’t want to learn even if their was a nice book or tool for them

12. Ted Allen

    July 26th, 2007 at 4:31 pm

    12

    The problem with National loan officer licensing is the difference in state law. Just as you do not have National Realtor licensing I do not see how national loan officer licensing works since each state has different laws governing the issue

13. Marilyn Moo

    July 26th, 2007 at 5:00 pm

    13

    I think mortgage loan officers should be licensed to get the unethical people off the streets.

14. bolatito

    July 26th, 2007 at 5:33 pm

    14

    i agree with the licensing thing, just as the real estate agent are required to seat for a test and we should be accounted for that also. it will sift through the crooks and unserious loan officers!!!!!!!!!!!

15. Rodney Brooks

    July 26th, 2007 at 5:46 pm

    15

    I always hoped that licensing would wash out some of the bad apples in our industry. Somehow, I can’t help but feel there is a great potential for national licensing to completely miss the mark. I’m afraid the little guy may end up getting the shaft in the long run. Still, I would like to see the “bad guys” out of the business.

    I really must admit though, I like incompetent loan officers. When a realtor has a poor experience with some incompetent LO and I deliver exceptional service on time, I earn their business for life.

16. Frank J Nese Sr

    July 26th, 2007 at 6:45 pm

    16

    Standardazation is a great idea if only one entity held the raines and created standardized legislation as well. Which should be the feds.

    What is available now is a mix of standards from one State to another,
    very confusing and expensive. If the above applied it should override all mass confusion created by States.

    This idea has been floated in the past it appears the States do not want to give up their control of lisensing or legislation for what ever reasons.

    If you find a way for us to follow one set of guiidelines for every State including lis as well as agents I would be for all this.

17. Linda

    July 26th, 2007 at 10:04 pm

    17

    Licensing by testing is a nice try.
    I take several tests for the compliance of the states that require them and don’t mind at all. However, I have not heard that those states have less of an issue with foreclosure or fraud than those that do not have testing requirements.
    While training, competency and background checks need to be in place to keep the “bad guys” out of Dodge, there is always a loophole for these types.

    Remember, drunk drivers and safe drives take the same licensing test; the rates of DUI are unchanged by the testing/licensing procedure.

    To my old blonde brain, it seems that folks who would benefit the most from education and testing would be the consumer.

    A few hours in high school would at least familiarized the uniformed public about credit and what happens when you don’t, cant or won’t pay any bill, including your mortgage.

    You want to buy a house? Take the test to see if you have what it takes!

    After all isn’t that what current lynch mob regulators are expecting us to discern? Are we not being blamed for lending to those who asked for the loan and are now complaining that they got it?

18. Brad

    July 27th, 2007 at 2:48 pm

    18

    Reading the first 16 posts, I agree with bits of what everybody has said. I am a mortgage originator for one of the largest banks in the country. I also have 13 years of brokering mortgages prior to moving to the bank.

    Two things you need to know about the bank: I was surprised that I did NOT need a license to work at the bank and second, they train us like crazy. I have never been through so much training in my life.

    A national licensing regulation is fine, but the bank employees should take it like everyone else. Good thing for me is that I will have already had all the training I need to pass the test, no matter how hard it is.
    I don’t think this is a broker vs. bank issue.

    Some folks here and in Congress are trying to blame the mortgage lenders for the foreclosure mess, but remember this- the loan officer talked the borrower into the loan, not the lender. Loan fraud is on the rise and again, I don’t think that is the fault of the lender either, bank or not.

    Admit it, the refi boom brought some scum-bags into our business because they follow the money. License or no license, they came anyway and a state regulation with no teeth is not going to stop them.

    Licenses for real estate salespersons, brokers, and loan officers in most states are WAY TO EASY to get and hence, half these folks have no business being in this profession. We handle and advise our clients about more money and important things then most lawyers and you know how hard it is to become a lawyer. (If you don’t, try looking over a Bar Exam…)

    Consumer education is very important and needs to have a place in solving the problem too, because contrary to what DiTech says,
    “people” are NOT smart and a worker in fast food will sign up for a rotten mortgage just as fast as a doctor.

    Another thing everyone needs to remember is that lenders will develop loan products that they think will be profitable and that is why they are in business. Remember the free market people? Mortgage lenders are not pimping bad products. If they can sell them in the secondary market, then they will and let the secondary market take the risk- oh wait, that’s what happened and now look who’s loosing billions of dollars.

    Let’s keep each part of the giant mess into its respective corner and handle each one properly. If they try to write a national licensing law for loan officers and expect it to solve the problem that caused the non-prime market meltdown, they are sorely mistaken.

    The mess we see in the country today is the convergence of greed, lack-of-ethics, lack-of-responsibility, and stupidity.

    Hey, just like in President Bush’s office- what a coincidence…

19. Judy Rainsberger

    July 30th, 2007 at 7:03 pm

    19

    The Natl. system, I think would help in some respects. for more uniformity, which is definitely something that is not in place now. The guidelines need to be the same across the board on some loans, Is someone going to give the lenders the guidelines to lend with? What would be wrong with a temporaty freeze on rates, prices, and above all mortgage increases on variable rates products. You cant tell me these banks cant do something to HELP. If the thought is to TRULLY turn this around, then enact a freeze, or grant extensions, or workout loans for a year possibly, something to help with the present mortgages. These lenders ARE able to do something. Yes, I agree there are some lenders out there that are not worthy of license, as well as some brokers. But there are also cases where, Why do customers sign for loans when their payments and/or rates are “Way” off from what the officer told them? Shame on them and those people I dont feel sorry for. It takes maybe 50-100 to work an account on a yearly basis, when current, but 2500+ for a foreclosure, eveyone cant be bad people for what they did on their home refinances or purchases. If we dont try and handle this situation now and do something things will only get worse, instead of better. America will soon be the “land of the homeless”

20. Brazos

    August 1st, 2007 at 4:37 pm

    20

    I think they should audit the Brokers quarterly, as well as the Banks. If Brokers are required to get their license so should originators at the banks. Also, why don’t they regulate car dealerships too.
    What about people that have their license for money laundering, aggravated assault and drug dealers. What about people that have been fired for fraud or shredding documents? These guys/girls now are licensed because they weren’t caught and served time. My point is this-when someone has made a six figure income for 8 years, and they’ve had trouble in their past over 30 years ago-now they can’t get their license in the Lone Star State because of all the other crooks. What type of business should that person do now? Why don’t we take a vote and ask the consumers what they want? No, one asked them to lie -and beg for that house. Maybe those guys that made all that money at CW-AMQ, bla, bla should come back and refi them out of those ARMs again, but pay their employees the money that they deserved instead of a few thousand bucks.

21. Bob

    September 12th, 2007 at 5:31 pm

    21

    I can see no reason why a national, consistent licensing strategy would be a problem for anyone in this business, broker or banker. At present there are a large number of states that require no licensing at all and many are restrictive in allowing people from other states to close loans in them.
    In my mind this makes no sense. Today’s world requires moves to various states and when my clients want me to find a loan for them, in say Florida or Hawaii or Texas, why am I not able to perform that function seamlessly?
    Education requirements and licensing for all is the answer. Like it or not if we are ever going to be a “profession”.

22. Dannette

    September 13th, 2007 at 4:45 pm

    22

    I am a licensed broker and lo in Ohio. I favor licensing if not for fact to get some of the people who jumped into this industry with both feet to get rich quick. I have been in the industry going on 17 years now. The biggest issue with the whole licensing things is: no mattter what kind of licensing you do, it is the ethics that is a problem. National licensing will get rid of some of these jerks in the industry that give us all a black eye, however, the states licensing these people has got to be accountable for following up on complaints. For example, we had a client come to my office “after” he had closed asked if I could undo what was done. Of course I could not. The guy bought a $45000. 00 house was charged $18000 in fees and his payment was over $1000.00. The lender funding the loan was as much at fault, but the poor guy could not help but be dismayed and of course I could do nothing.
    One thing that might help, when the state agencies come to audit your office they call you and tell you they will be there next week on Wed at 9:00am. (that gives that unethical broker/lo plenty of time to clean up their bad deeds) The agencies should not tell anyone when they are coming and show up. Some of the unethical stuff will be brought to the states attention. Another things is to make the title agent/auditor/appraiser as much a tattle tale as anyone, if something unethical is brought to their office. They should have an outlet to contact someone, they are part of the process and in some cases part of the problem.
    I encourage the state/national level to go forward but at least put some guidelines in place and spend some of that licensing money on doing thier job of follow up and follow through.