Mortgage Loan Originator's Compensation

[jala]

One of our clients, a bank, attended a seminar put on by the ABA (American Bankers Association).

According to one of the speakers at the seminar, if a Mortgage Loan Originator (MLO) receives any salary/comp based on any bank profit, they would not be able to participate in the bank's retirement plan.

Has anyone heard of this?

[K2retire]

I haven't heard of this, but recently had a call from a bank client who insisted on amending their document to exclude the commissions paid to their mortgage people. I wonder how we can get more information on this seminar.

[masteff]

Nothing like a good needle in the haystack hunt.... It may have to do w/ recent amendment to the Fed's Regulation Z on comp to loan originators. http://www.federalreserve.gov/bankinforeg/regzcg.htm "The rule also prohibits any person from paying compensation to a loan originator for a particular transaction if the consumer pays the loan originator's compensation directly."

If that is what's happening, then what the original poster heard seems offbase... I don't get from "no other comp on a particular transaction" to "cannot participate". But I could be missing some serious nuance of the change. And banks may be making serious changes to their loan originator comp plans which may have other ramifications from the bank's point of view.

Edit: also found this: http://jholzknecht.wordpress.com/2011/08/1...ensation-rules/

[jala]

The information in the links that you provided did help.

Thank you for your assisting with this.