You may have heard about recent changes to laws protecting homeowners from mortgage broker abuses. One of these changes has to do with the fee known as mortgage yield spread premium. I’ve written about yield spread premium before as a way your mortgage broker can double, even triple their commission at your expense.
Recent mortgage legislation prohibits mortgage brokers from taking both an origination fee and yield spread premium on your home loans. Sounds like a win for homeowners right? Not necessarily, according to this recent article on the mortgage 101 website homeowners will need to be more careful when choosing a broker to arrange their home loans to avoid overpaying.
“you’re going to see two options,” says Reggie Green, a loan officer at Firstline Mortgage/Crossline Capital in Chandler, Ariz. according to Foxbusiness. “Pay all the loan officer’s compensation upfront or take a higher rate and the loan officer gets totally paid through the rate.”
You can learn more about finding the right broker to arrange your next home loan when refinancing without overpaying the origination fee or lender junk fees by checking out my free Underground Mortgage Refinancing Videos.