Three Percent Cap on Fees

A new effort is underway in Congress to amend current law, called the Truth in Lending Act, to broaden access to where people can obtain mortgage loans and other related services.  A bill has been introduced, H.R. 685, called the Mortgage Choice Act of 2015, that would have all financing providers use the same rules to determine whether a loan meets the Consumer Financial Protection Bureau’s Qualified Mortgage test. Loans must meet these guidelines to be approved.

The current guidelines are inconsistent, creating different rules for mortgage bankers, mortgage brokers, and affiliate services compared to big retail lenders. This limits the ability of mortgage brokers and bankers to provide loans to low and moderate income consumers.

The California Association of REALTORS® is part of a broad coalition that supports the effort to create a level playing field through impartial and consistent rules for all lenders. The end result is a greater opportunity for consumers to obtain a loan at a fair price.