Mortgage bankers are getting jittery as Election Day draws near.

At their annual convention in San Francisco earlier this week, 3,600 members of the Mortgage Bankers Association of America fretted about their rate-sensitive futures.

A Clinton victory, widely predicted, would mean higher interest rates and a consequent cooling of the yearlong refinancing boom, they said.

Almost as high on their worry list is the near inevitability of more than 100 new faces in Congress. Many may be primed to push for new consumer regulations and damaging tax changes.

"Clearly the greatest fear is interest rates moving back into double digits," said Angelo R. Mozilo, vice chairman of huge Countrywide Credit Industries, Pasadena, Calif "Once that happens, you've got a real problem."

Such concerns were fanned in recent weeks as rates on 30-year fixed-rated mortgages moved up 50 basis points, to 8.4%. Mortgage rates take their cue from bond yields, which rose amid fears of inflation in a Clinton presidency.

If President Bush wins, mortgage pros speculate, rates would fall - at least in the short term.

Life After Refinancing Boom

Some executives are already preparing for life after the refinancing boom. Cost cutting will accelerate, they predict, and originators will refocus on buyers of homes rather than refinancers. That will mean renewing ties with realty brokers and home builders.

"The companies that didn't abandon the Realtors and the builders for the refinancings are going to be the biggest winners," said Joe K. Pickett, chairman of Bank of Boston's mortgage division.

To be sure, the mortgage world would see some benefits from a Clinton White House.

For example, the candidate supports an expansion of the Federal Housing Administration's mortgage insurance program, long a mainstay of the industry.

Some mortgage leaders also support Gov. Clinton's plans for reviving the economy, such as increased spending on infrastructure.

But even those executives who express no strong feelings about the presidential contest find cause for worry about Congress, which may have as many as 150 new members.

"These new legislators will come to Washington believing they have a mandate from the people to buck the system," warned Herbert B. Tasker, who replaced Mr. Mozilo this week as president of the Mortgage Bankers Association.

Mr. Tasker, who is chief executive of All Pacific Mortgage, Concord, Calif , agreed with colleagues that a slew of consumer protection measures may come out of a new Congress. Among their worst fears: a requirement that all lenders pay interest on escrow accounts for Property tax and insurance payments.

Currently, such payments are required by only a few states. The mortgage industry beat back a federal measure on the issue last year.

Mortgage lenders also expect a legislative reaction to racial data recently released under the Home Mortgage Disclosure Act.

Though bankers now acknowledge a need to lend more to minority borrowers, they need to make sure that any new measures "do not hamstring or add substantially to the costs of originating," said Stephen B. Ashley, chief executive of Sibley Mortgage Corp., Rochester, N.Y.

Deduction in Jeopardy?

Another big fear centers on taxation. As budgetary pressures mount in Washington, mortgage leaders are worried about a congressional move to limit the long-sacred tax deduction for homeowners on mortgage interest payments. That, in turn, could reduce housing demand.

Leland C. Brendsel, chairman of the Federal Home Loan Mortgage Corp., launched a fiery preemptive strike in his address to the convention.

"Taking away the deduction now, even just for those with mortgages above a certain size, would be disruptive, inequitable, and inefficient," Mr. Brendsel thundered.

Given the high level of stress at the conference, it was no surprise that one of the most popular booths in the exhibit hall was that of a company offering on-the-spot neck massages.

Desert Document Services, which provides lenders with software for preparing closing documents, massaged about 150 necks over two days. The rubbing was an outgrowth of the Tempe, Ariz., company's marketing slogan: "Is your doc prep a pain in the neck?"

Mr. Tasker delivered his inaugural address wearing a blue shirt with a white collar - the type favored by his flashy predecessor, Mr. Mozilo. "I had to get one of Angelo's power shirts so I could follow in his footsteps," said the glitz-averse Mr. Tasker.

But Mr. Mozilo had the last word. "Get one with tabs if you really want class," he shouted.

The trade group awarded its highest honor - the Distinguished Service Award - to A. Gary Anderson, a California mortgage banker who died in August at age 52.

Mr. Anderson was chairman and sole owner of Directors Mortgage Loan Corp., Riverside, one of the 20 largest originators in the country. He had spent 24 years in the industry.

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