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Dear Friends,

A victory of sorts has occurred in the debate of HR Bill 3915. The legislation was passed by the House 291- 217 and its measures were modified, allowing the YSP or Yield Spread Premium to stay intact. This in essence will allow the continuation of our mortgage industry as the YSP is a form of compensation for mortgage brokers. Additional reforms in the Bill will provide effective & mandatory applications to help end abuses. Most importantly, the consumer will benefit from several measures passed in the Bill.

Nevertheless, there is troubling and confusing verbiage in the Bill as passed which needs to be modified. This includes the concept that lenders are responsible for knowing whether borrowers can actually pay back their loans. If a borrower was unable to pay for a mortgage due to illness, job loss, divorce or other factors, is the lender responsible for these occurrences? And if the borrower misled the bank by stating a higher income on the application, can the lender be sued for this activity? This logic will prevent many persons from purchasing a home if written into law.

Self-employed individuals and other borrowers unable to provide documentation to prove income, would be prohibited from qualifying to purchase or refinance a home. STATED INCOME type loans which benefit business owners and low income borrowers, will no longer be provided, thereby eliminating the ability for these borrowers to pursue the 'American Dream' of home ownership. 

Please see the results by visiting the National Association Of Mortgage Brokers website - www.namb.org.

Nonetheless, we are grateful for this first step. Our understanding is the drafters of the Bill under MA Rep. Barney Frank, with the help of the NAMB, were able to secure a compromise in several measures, where all players in this effort ceded to a modicum of common sense. There's still much work to do in the Senate.

Thanks Again