Mortgage pros make their money from the ignorance of those who aren’t in the mortgage industry. It is in the pros interest to keep mortgages as complicated as possible and filled with as many mysterious fees as possible.
I’m a capitalist but I have sympathy for Elizabeth Warren and the Obama administration and Obama’s consumer protection bureau and its efforts to simplify the mortgage process and to help consumers avoid shady fees.
In the current mortgage process, it makes little sense to comparison shop among different loan offerings because each mortgage loans has its own special deals and fees. By simplifying the mortgage process, it will be easier for consumers to compare offerings and to choose the best one for them.
The public is welcome to comment on these proposed changes. mortgageloanorgination@cfpb.gov and email to your heart’s content.
The Los Angeles Times reports:
The preliminary proposals, unveiled Wednesday, also would prohibit incentives to steer consumers into higher priced loans.
“We want to bring greater transparency to the market so consumers can clearly see their options and choose the loan that is right for them,” said Richard Cordray, the agency’s director.
The 2010 financial reform law that created the consumer bureau mandated that it address mortgage fees and qualifications of mortgage originators.
One proposal the agency is considering would require flat origination fees so that consumers could more easily compare mortgages. The amount of work required to originate a mortgage doesn’t vary with its size, so agency officials argued that the origination fee shouldn’t either.
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