2 Huge Mistakes Mortgage Professionals are Making
Mistake #1: Conducting Business as Usual Like the Old Days
A big mistake that lenders make is with their compliance in originating loans. Many companies that need to be allotting time and staff to remain compliant are lax. Be certain that the enforcement division at the CFPB is not.
We are living in an era when communications coming from lenders can be determined as an offer to provide financing, with a simple tweet or post on social media.
Although the majority of mortgage loan originators (MLOs) in your company have the borrower best interests in mind when they send out emails, promotional flyers, or texts selling your products, MLOs generally do not have the legal expertise to be sure these communications are compliant with the CFPB.
Why the fuss? Just look search the mortgage industry news to learn about the significant fines, penalties, and charges assessed by Dodd-Frank’s provision known as the Unfair, Deceptive, or Abusive Acts or Practices Act . Most of the industry blindly thinks they are fully compliant. It is far from the truth.
Mistake #2: Resisting Change Due to Potential Decline
Many managers & VP fear their MLOs will pushback if they enact restrictive measures and there will an exodus of originators opting for companies that are not so rigid. In that scenario, their competitors will grow stronger and production will fall.
There’s no replacement for leadership, especially when it comes to compliance. MLOs and branch managers need to be partners of compliance, not enemies. The choice to resist change can be critical for a business.