Talk:Yield spread premium

Breech of nPOV

In my opinion, items 1-3 are partisan and reflect the positions of non-upfront mortgage brokers. The article, as such, is biased in favor of mortgage brokers.

Item #4 (Upfront Mortgage Brokers) is needed to recreate balance. —The preceding unsigned comment was added by 70.110.12.146 at 06:06, 25 July 2006

This page is like an ad for so called Up Front Mortgage Brokers (links and all). References need to be eliminated or trimmed. —The preceding unsigned comment was added by 69.231.56.199 at 01:14, 14 November 2006

This page is very biased to mortgage brokers. YSP is how mortgage brokers line their pockets at the expense of their customers. This was clearly written by a broker. —The preceding unsigned comment was added by 199.173.226.227 at 02:11, 6 December 2006

So how do direct lenders/banks line their pocket's? They do not even disclose what they really make on the borrower's loan. —The preceding unsigned comment was added by 65.2.112.183 (talk) 04:02, August 23, 2007 (UTC)

The Upfront Mortgage broker thing is an advertisement with links and all. This is a joke! —The preceding unsigned comment was added by 69.231.96.42 (Talk) at 01:22, 30 December 2006

So how does someone get aroung the YSP or even Brokerage fees? —The preceding unsigned comment was added by 192.25.240.225 (Talk) at 17:54, 24 January 2007

As long as there are "zero point loans," this argument between retail bank originators and mortgage brokers will exist. The thing to remember is that mortgage brokers must disclose the yield spread premium and bank originators do not. This is prima facia evidence that the playing field is not even between mortgage brokers and bank originators. I have been on both sides of that issue, as both a mortgage broker and bank originator. If they remove YSP, then borrowers will have to go to a bank to get no point loans, and they will inevitably pay more as there will be much less competition. —Preceding unsigned comment added by Rmporcelli (talk • contribs) 15:14, 29 March 2009 (UTC)

Nothing is free. No closing costs loans are done by the broker increasing the rate to a point where the YSP covers all the costs (including broker fees). Brokers need to make a living too. YSP is generally disclosed on the HUD...keep an eye out. —The preceding unsigned comment was added by 76.167.237.138 (Talk) at 05:55, 26 January 2007

Conventional Mortgage Brokers don't want people to know about UMBs. Anybody who is considering buying a loan, however, needs to understand that not all mortgage brokers are conventional brokers. Some are not. —The preceding unsigned comment was added by 70.110.5.44 (Talk) at 09:30, 24 February 2007

I generally agree with most of the above comments. I think the article slightly biased in favor of mortgage brokers. I had to laugh at this part-- "Although the borrower is not charged the fee directly, the borrower does pay the fee indirectly by accepting a higher interest rate in exchange for lower fees." Oh yeah? Except for times when they actually pay higher fees. I've seen loans where sales broker, mtg. broker, lender, attorney, title co. all were paid more than average for the individual services provided. Some of those cases both the buyer/borrower and seller take a bath at the expense of all the other parties. Bottom line question is how to improve. Maybe more education and disclosure can help. —Preceding unsigned comment added by 208.61.112.107 (talk) 12:14, 10 December 2007 (UTC)

This whole Article IS a point of View - The bottom Half of the page hardly gives any citations - Did The Editor have Fannie and Freddie write this page ? —Preceding unsigned comment added by Kim0290 (talk • contribs) 13:58, 9 June 2010 (UTC)

Cleanup Call - "anti YSP" non-neutral POV

This article could use more cleanup than I'm able to take on. It seems to be written in a "anti YSP" non-neutral POV, by use of phrases like "they point out that there are truly legitimate reasons", suggesting earning a commission for doing a mortgage is illegitimate. Also "and hide how much YSP they will receive until closing", which is again not true. Non-UMB brokers may discuss their YSP with a borrower the same as a UMB broker would, and act in accordance with UMB guidelines while not calling themself a member of the UMB program. The implication that any non-UMB broker is dishonest or acting against the best interest of their customers is a gross POV violation. I won't go so far as to flag the whole article as a POV violation, but someone with more wiki experience should re-write some of this article. Some mention should be made that wholesale lenders which also work with the public (such as banks) have higher retail rates than wholesale rates. In my experience for a vanilla 30-year fixed rate perfect credit borrower, a bank's retail rate would pay about 1% to 1.5% YSP through their own wholesale channel. Of course, there are also many non-bank wholesale lenders that do not work with the public at all. Jonathan Roy 19:45, 1 June 2007 (UTC)

Is "hide how much YSP they will receive until closing" really "not true"?

Please see http://www.mtgprofessor.com/A%20-%20Mortgage%20Brokers/hud_and_yield_spread_premiums.htm

Specifically, if the broker is required to put in a "range of compensation" - say 1-5% in the est. HUD-1, she is still hiding the true fee - she knows it when the loan is locked in, the borrower won't learn it until closing.

Regarding "some non-UMB broker may share the amount of YSP" (hence act like a UMB) - this might be true, but in my experience I haven't met a non-UMB who would (called several when shopping for my mortgage.) In fact, when confronted, all explicitly refused - some politely, some not so.

The article makes contradictory statements regarding the disclosure requirements of YSP on the GFE. In parts, it states that the 2002 RESPA proposed legislation would have required the disclosure, in parts, it states a compensation range must be disclosed, one person added a statement that the exact amount must be disclosed on the GFE. Somebody with legal knowledge should provide clarification with citations. It likely varies between states.

I'm familiar with the MTG Professor's web site, it's a great resource. Perhaps the comment about hiding YSP is correct in general. I only lend in FL and so I'm biased by Florida law. Currently YSP in FL must be disclosed as a specific dollar amount up front, and then re-disclosed once a rate lock is placed. I've updated the article accordingly. There's a new federal bill being voted on next week that has many good things, but the impact on YSP is unclear and controversial. We'll see if it passes or not, which would lend some nation-wide clarity for the issue. You are correct that disclosure laws are mostly state-specific at the moment. The national bill is at least far superior to some of the states which have passed bills outlawing anything other than full doc loans (even VA IRRRL and FHA Streamline refinances). (Jonathan Roy 22:10, 2 November 2007 (UTC))

Globalise tag

This page discusses a US only topic without any wider context. The terminology is obscure and uses many terms with US only meanings. simonthebold 13:00, 25 July 2007 (UTC)

This entry is both biased, and incomplete. The entry takes a clear point of view in discussing the issue and does not address the simple economics of retail vs. wholesale pricing. Additionally, the entry makes no mention of SRP and how banks and direct lenders earn revenue above cost-pricing. Finally, the entry is simply incorrect in defining the term "par" pricing as the rate the borrower "qualifies" for. This is an inaccurate representation of par pricing. Par pricing is the wholesale cost of funds to the lender, not the standard retail pricing to the borrower. Therefore, a broker or correspondent banker is not earning fees in excess of "what the borrower qualifies for". Rather, he or she is earning margin above the wholesale cost of funds. This retail pricing is analogous to pricing in the auto industry. —Preceding unsigned comment added by 70.232.128.20 (talk) 21:03, 29 July 2008 (UTC)

Inaccurate as of 2010

Not only does this page have all the problems listed above, it is also inaccurate as of January 1, 2010, as it ignores the new Real Estate Settlement Procedures Act (RESPA) requirements that a good faith estimate (GFE) of charges must be given to each borrower, and that the GFE must contain any yield spread premium (YSP). Also, the new RESPA rules require YSP to be a credit to the borrower, which fundamentally changes the nature of the beast. —Preceding unsigned comment added by 66.235.60.31 (talk) 14:46, 11 April 2010 (UTC) RESPA rules problem is No one cares - Even on the GFE If the broker does not disclose - IT will cost you more to take him to court than you will gain  !--Kimmy (talk) 14:13, 9 June 2010 (UTC)

npov

Hardly any citations are given on this entire page - I guess the Editor is a broker or a CEO for Fannie and Freddie.I say delete the whole article until facts can be backed up --Kimmy (talk) 14:09, 9 June 2010 (UTC)

NPOV

I concur that the tone of this article overall does not reflect proper neutrality. The problem is rampant throughout, but immediately in evidence from the second sentence of the first paragraph all the way through the entire first section and beyond. The tone suggests a desire to defend the YSP from critics, whose criticisms are not given appropriate weight in context. Duncanci (talk) 07:37, 17 August 2010 (UTC)

Removal of commercial link -- February 2011

I removed content sourced to mtgprofessor.com, a non-notable commercial website promoting a broker association. No matter the stated credentials of its webmaster or author, the website does not meet WP:RS or even WP:EL. Flowanda | Talk 13:26, 24 February 2011 (UTC)

TNT

I've blown up the article due to the long-standing problems discussed here. Feel free to restore any content that is both verifiable and meets NPOV. power~enwiki (π, ν) 23:39, 24 October 2017 (UTC)