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Special Alert: CFPB Consent Order Applies Loan Originator Compensation Rule to Marketing Services Agreements

Buckley Sandler Special Alert

Clinton R. Rockwell, John P. Kromer, Benjamin K. Olson, Jeffrey P. Naimon

On Friday, the CFPB announced a consent order against Guarantee Mortgage Corporation, resolving allegations that the company paid loan originators based on the terms of their mortgage loans in violation of the Loan Originator Compensation Rule (the “LO Comp Rule”). Since inheriting responsibility for the LO Comp Rule in 2011, the CFPB has devoted substantial resources to revising the rule and enforcing its provisions. During that same period, the CFPB brought several actions enforcing the prohibition on referral fees in the Real Estate Settlement Procedures Act (“RESPA”), including an action against Lighthouse Title, Inc. that created considerable uncertainty about the Bureau’s view of marketing services agreements (“MSAs”).

Click here to view the full Special Alert.

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Questions regarding the matters discussed in this Alert may be directed to any of our lawyers listed below, or to any other Buckley Sandler attorney with whom you have consulted in the past.

 

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