Comments on: Life Without Countrywide

By: Mikew

Mikew — Thu, 17 Jan 2008 18:14:15 +0000

Dude, I am tired of everyone saying brokers have no skin in the game. Its LIES.

I have been fingerprinted, had several criminal background checks, have auditied tax returns, Sign contracts with buyback provisions from the lenders, perform continueing ed for several states, have surety bonds, e&o insurance.

Now just what skin does a retail loan rep have? If he screws up a loan the worse thing that can happen to him is he goes to another bank.

You know who got a lot of skin out of this game. Mozillo—his exit package has a lot of skin. Or Prince…thats a lot of skin. Or the former heads of all the other banks that are no longer in the business. We are tallking close to a billion dollars in exit packages for these guys. There was a lot of skin being made on Wall Street on buying and packagaing mortgage back securities. There was a lot of skin being made by bankers.

Banks would like everyone to forget that they underwrote the loans that are performing poorly. It was there job to do quality control. Shame on them for not being responsible. I guess performing quality control on 1 out of 10 wholesale loans to too expensive.

Shame on them. Greed Greed Greed.

Wall Street and Banks would like to convince regulators that this is the fault of the poor little mortgage broker shops. We never closed a loan they didn’t approve!!!!!

By: Toby

Toby — Thu, 10 Jan 2008 17:50:25 +0000

Mortgage brokerage regulation is at the state level and as such is a patchwork of mostly non-existent or weak laws. Mortgage brokers exists for one reason: They are a cheap and scalable workforce for the “shadow banking system”. No those aren’t the guys flying around in black helicopters, they are the scuritizers and investment houses. As long as there is an appetite for broker securitized mortgages (non-GSE) then brokers will exists. Right now brokers are dead in the water only doing business with the few strict Alt-A and FNMA lenders. The big banks would like nothing more than to get rid of them. I expect that the market will decide if there is a place for mortgage brokers. But be careful what you wish for: it was the alternative finance conduits that created considerable banking competition. Do you really want a hadfull of banks running the lending game?

By: Chris

Chris — Thu, 10 Jan 2008 17:19:27 +0000

Oversight? Training? Wow. We need more government involvement.

That would get rid of all the fraud. Just look at the stock market. No fraud there. Wagging fingers at brokers is one way to go–but regulating them? Dumb

My opinion is that the banks were IDIOTIC for relying on brokers.

MORNIC.

By: scribe

scribe — Thu, 10 Jan 2008 14:25:51 +0000

Matthew, you said:

At least with Wall Street there is the SEC, NASDAQ, NYSE, and corporate oversight in the mode of a ?U-5?. It?s your personal record of everywhere you?ve worked on Wall Street and if you ever committed any boo-boos. We don?t have anything like this in the mortgage industry ? yet.

It’s coming. From Investment News:

National database is in works
FINRA to develop CRD-like system for mortgage brokers
By Rosalyn Retkwa
October 8, 2007
The Financial Industry Regulatory Authority is developing for mortgage brokers a national database similar to the Central Registration Depository.

Working under contract for the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, FINRA is creating a national database ? the National Mortgage Licensing System ? that will be launched in January and cover licensing and enforcement actions in the mortgage brokerage business.

The two mortgage regulator organizations have been developing the system since 2005, said Bill Matthews, a CSBS executive who will serve as president of the State Regulatory Registry LLC, a non-profit organization that will operate the database. He said the system will cost $10 million to develop.

http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20071008/FREE/710080324&template=printart