An Open Letter to Anthony Casa
Anthony Casa, in response to your comments on social media regarding my recent article, I hope you accept my sincere apology. I never meant to offend you in any form or fashion.
I can only assume you did not read the entire Brokers vs Bankers Article that I wrote, as I cannot determine how it would have upset or offended you to the point you felt a need to threaten me and/or my Company.
Nothing I stated was untrue; or at least no one has pointed out any untruths. I even praised what you have been able to accomplish with the association in a short period of time. I will reiterate it again; I have always had the heart of a broker and am still very much a fan of that model today.
Not all loan originators will be a fit for Geneva Financial, and if some find themselves in broker platforms, I wish them all the best. When we have an originator move to Geneva from the broker channel, I do not put it in the face of all brokers. Maybe we were just a better fit. The beauty of the two models is that it creates more choices, for the originator and the consumer.
What you don’t know is that since the publication of my article, and the webinar we held shortly thereafter, I have had numerous broker companies reach out to me, and a few actually meet with me in person; for guidance. I did not view this as a recruiting opportunity, and it was not the motivation of the publication. I have spent many hours to date, and many more since the publication, trying to help up and coming mortgage brokers build their business within the “spirit” of the laws and regulations that govern our industry. In fact, I have been doing this most of my career.
While I have had these meetings and conversations with hundreds of originators and owners from broker channels over the course of many years, I do understand that it is still a relatively small sample size. Of those that I have spoken with, all allow the loan officer to change the price the consumer transactionally based on the wholesale lender the loan is submitted with.
In most cases the loan originators compensation also varies transactionally based on the wholesale lender the loan is placed with. Clearly a violation of Loan Originator Compensation Laws and arguably a Fair Lending violation. Many don’t know that they are in violation because the wholesalers do not regulate what the brokers are doing; with regards to LO Comp and Fair Lending.
Ignorance is not a defense. Many know, but turn a blind eye to the regulation as they believe it is common place in the industry and no one is looking. And unfortunately, many do not care. Those that argue that it is a matter of “interpretation,” have not even read the regulations.
Several of the brokers I have spoken to pay 1099 on HUD transactions. Pay loan officers that are licensed real estate agents’ compensation on HUD transactions when the loan officer is also acting as the real estate agent on the same transaction. The list of infractions is long.
While the CFPB may not be currently enforcing rules and regulations, states are finally starting to pay attention to Federal regulation. It was just announced in HousingWire that New York has created its own division for consumer protection and enforcement. Many other states will follow. Those brokers, and bankers that intentionally, or unintentionally violate those very regulations discussed here will likely face unpleasant repercussions from their practices. The same may be said for the individual originators who knowingly or unknowingly operate outside of the rules. Again, ignorance is not a defense.
One can certainly say that brokers have an advantage because they are simply not playing by the same rules that larger banker institutions play by. When you charge whatever you want on a transactional basis, and forego all compliance costs, there is an economic advantage. Having the luxury to violate Compensation Laws and Fair Lending, knowingly or not, gives brokers a competitive advantage. These laws were created to protect the consumer; and they do when followed. Many of us in the industry may not agree with all regulation, but it is our obligation as licensed mortgage professionals to abide by the “spirit” of all laws to protect the consumer, and our industry.
It seems I am providing a free service that the associations do not. Why, you may ask? I care deeply about my industry and the impact it has on this country. Why aren’t brokers, the originators employed by brokers, and the broker associations standing up for the protection of the consumer, aside from just pitching “lower rates” ?
As an industry, if brokers and bankers worked side by side to promote consumer protection and at the same time abide by the “spirit” of the regulation, we would all be better for it. Everyone would win, most importantly homeowners.
Please don’t misinterpret any of my messages to be an attack on brokers. They are not. I am fully aware that bankers are also largely guilty of many regulatory violations. Bankers are no saints. That is an article for another day.
I invite you to call me at any time (602-793-6383 / firstname.lastname@example.org). We shouldn’t be enemies. I am on the side of the broker, and I would also like very much to be on your side. If you wish to continue to threaten me and demonize “retail” bankers, that is your prerogative. I will continue to lend a hand to anyone that wants to be a better, more compliant, mortgage professional. They too know how to reach me, and often do. I hope to talk with you soon.
Maybe we can help each other make a positive mark on this industry.
CEO | Founder