Why do I need a Loan Originator Compensation Policy?
The Federal Reserve’s Final Rule about loan originator compensation and steering takes effect on April 1, 2011. The rule is intended to protect borrowers from unfair lending practices stemming from loan originator compensation practices; and it applies to “mortgage brokers and the companies that employ them, as well as mortgage loan officers employed by depository institutions and other lenders.” *(See FederalReserve.gov.)
After April 1, 2011, loan originators can no longer be compensated based on the rate or other loan terms.
You must have compensation policies in place that comply with the Final Rule.
Not only can a written LO compensation plan help you implement policies to comply with the Federal Reserve’s Final Rule, but various investors and agencies may require you to have one as well.
Want to learn more? Call 877-250-5243 or email info@mortgagecomplianceadvisors.com.
Get an LO Compensation Policy within 48 hours
Instead of dealing with the time and frustration of writing a compensation policy yourself, let Mortgage Compliance Advisors complete a policy for you within 48 hours.
Choose from one of our three policies tailored to fit your organization type:
- Wholesale lender
- Broker
- Retail correspondent
What’s included in the policy?
Your policy is designed to provide a good foundation for your loan originator compensation plan. We will send your LO Compensation Policy in Microsoft Word format so that you may easily edit and add your own internal policies and procedures in the future.
Each LO Compensation Policy goes into detail about:
- Background and explanation of the Federal Reserve’s Final Rule
- Allowable forms of compensation
- Loan originator expenses, price variances, and quality penalties
- Explanation of Anti-Steering and Safe Harbor
- Responsibilities designated to specific employees
How do I get started?
To request more information, sample pages, or to order a policy, click an icon under Contact Us at the top right or call 877-250-5243. info@mortgagecomplianceadvisors.com
