New mortgage rules are aimed at protecting consumers. (August 4, 2010 / WRDW-TV)
News 12 at 6 o'clock / Wednesday, August 4, 2010
A new law that requires mortgage brokers to get licensed is aimed at protecting you when you're buying a home. But it makes some brokers feel a little odd.
"We kind of felt like criminals in there," said Jenny Caldwell of First Choice Mortgage. "They rolled our fingers, took out pictures and actually sent it to the state."
Beginning in October, originators of home loans will have to be fingerprinted. They'll also get background checks, credit checks, and pass what some brokers are calling a tough exam. Because of it, some loan officers are no longer in business.
"I don't think a borrower cares whether we've passed a test; I think they wanted to be treated right," said Caldwell. "We had some really good loan officers, and just because they couldn't pass a test, it eliminated their position, we had no choice but to terminate their employment."
But Drew May of Augusta Mortgage Solutions says he and managing partner Janice Whitfield have dealt with people who may feel differently.
"We have had situations where a person was turned down for a loan," said May. "It's simply a matter of getting details and getting the story straight."
Hundreds of mortgage companies failed in the last few years. Some were due to improper business practices. The new rules are designed to prevent some of that.
"It's important that the originators have the knowledge base to perform their jobs and to take care of consumers, and that's one of the biggest challenges in the industry," May added.
Loan originators must also be part of a new national registry. It is expected to debut next January.