MORTGAGE BROKERS-What Fiduciary Duties Exist?
Negroni, Andrea Lee, Raha, Joya K., Mortgage Banking
A debate is simmering in the mortgage industry about whether mortgage brokers who arrange loan transactions act as agents of potential borrowers, or whether they are merely middlemen without agency responsibilities. The compensation structure by which mortgage brokers are paid fees by both borrowers (origination fees) and lenders (yield-spread premiums) has fueled the fire of this debate. * When brokers are paid commissions by both parties to a loan transaction, confusion results about whom the brokers actually "work for." Unfortunately, there is little legal guidance to answer the question "Whom do mortgage brokers work for?" There is some case law, and a few states have enacted laws on …
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Publication information: Article title: MORTGAGE BROKERS-What Fiduciary Duties Exist?. Contributors: Negroni, Andrea Lee - Author, Raha, Joya K. - Author. Magazine title: Mortgage Banking. Volume: 68. Issue: 1 Publication date: October 2007. Page number: 128+. © 2009 Mortgage Bankers Association of America. Provided by ProQuest LLC. All Rights Reserved.