2013-01-18 —

The new rule prohibits steering incentives.  A loan officer or broker cannot be paid more if the consumer takes a loan with a higher interest rate, a prepayment penalty, or higher fees.  Nor can the LO be paid for convincing the consumer to buy additional services from the lender, broker, or an affiliate such as title insurance or mortgage life insurance.  The loan officer or broker can be compensated by way of other models such as on the number or size of loans or the aggregate dollar volume of loans written within a stated time period. 

The rule also prohibits the loan officer or broker from being paid by both the consumer and another person such as the creditor, i.e. dual compensation. 

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