By Admin on May 30, 2008 in Renting & Real Estate
ponderplus asked:
Can a Mortgage Broker be held liable for pushing a loan through approval knowing that the borrower has little or no chance on making the payments on a monthly basis?
Content
Can a Mortgage Broker be held liable for pushing a loan through approval knowing that the borrower has little or no chance on making the payments on a monthly basis?
Content
What is this, another example of “pass the buck” responsibility? No, a mortgage broker can not be held liable for a borrower’s inability to pay. They don’t “push it through” approval; it is their job to present it to lending agencies and secure financing for the borrower, and that is what they do.
claudiacake | May 30, 2008 | Reply
depend on the “buy-buy” clause of the investor you sent it thru. If you charged YSP and it went into EPD “early payment default” they will sue the broker for the YSP commision along with try to have you have the borrower refiance off there warehouse lines. If this occurs the broker will then go after you
Good Luck
mtgguy | Jun 2, 2008 | Reply
If they commit fraud.
And so can the borrower.
Brokers don’t push through anything………they submit the loan. They have no control over underwriters that work for the lender.
Mortgage Brokers are not the lender…….they submit to the lender the file…..
Now if they enter fraudulent info they can be liable just like the borrower.
Open Book Advisors™ | Jun 5, 2008 | Reply
No. The mortgage broker doesn’t approve loans, the underwriter that works for the lender does, and the underwriter simply is following guidelines provided to him/her by an investor that is willing to purchase loans that meet a certain criteria.
Part of the mortgage bust needs to Fall on the hands of the borrowers…you need to KNOW if you can make the payments or not, and not rely on the lender to be a financial babysitter.
Mary B | Jun 7, 2008 | Reply