By joining national or state broker associations, you can make a positive difference in the industry

Shawn Von Talge, president, Flat Branch Mortgage Inc.

As published in Scotsman Guide's Residential Edition, May 2009.

In the mortgage industry's boom years, many brokers likely felt that they could let the industry take its course. They were confident that whatever happened wouldn't affect them -- or would affect them positively.

After all, lenders were prominent, mortgage insurers were prevalent and news outlets had other issues on which to focus. In addition, for many brokers, business was booming.

Those times are gone, however, and there now seems to be an all-out assault on the mortgage-broker industry. It seems like everything imaginable is thrown at brokers, and so many are still helping clients achieve the goal of homeownership and doing things the right way.

Indeed, most of the industry's bad actors have likely gone out of business as the U.S. government, consumer-protection groups and consumers took action to rid the market of these unethical mortgage brokers. The onslaught continues, however, making even the most ethical, hardworking and relationship-based mortgage broker consider leaving the industry. But as competition dwindles, prices and costs likely will increase. This ultimately could hurt consumers, the economy and the mortgage industry as a whole.

Mortgage brokers are in a prime position to help protect the industry, consumers and their businesses, however. By joining industry associations such as the National Association of Mortgage Brokers (NAMB), other similar national associations and their state associations, brokers can learn more about the issues facing the industry and take steps to defend it against regulations that may harm the profession and consumers. There also are numerous business benefits brokers can see from joining these associations.

Key issues

The purpose of many of these broker associations is to see the industry grow, to hold mortgage professionals to the highest standards and to protect our profession. These groups stand up for brokers' livelihood by defending brokers' and consumers' interests actively, as well as by fighting laws that seemingly try to make our profession extinct.

Many challenges can affect brokers' businesses. Current issues include the following:

• The Secure and Fair Enforcement (S.A.F.E.) Mortgage Licensing Act: NAMB, other similar national associations and state associations were major proponents of this act's passage and some of the language found therein. The federal law, enacted this past July, requires mortgage brokers to meet higher standards and implements continuing-education requirements, criminal-history and credit-background checks, financial-responsibility standards, and an overall flight-to-quality standard for the industry. These associations now are involved in helping the federal and state legislatures implement the act's requirements.

One part of the act -- the Nationwide Mortgage Licensing System (NMLS) -- likely will soon be a household name among mortgage professionals, if it's not already. The S.A.F.E. Mortgage Licensing Act mandates that all mortgage brokers nationwide be registered, licensed or both through the NMLS. Further, the NMLS will issue a unique-identifier number for registered mortgage professionals, which will help track education, loan performance, any fraud-related investigations and compliance. Brokers who weren't required to be registered or licensed previously must be by July 2010.

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