Brian Chappelle's article was well put, but his conclusion that this problem can be solved with government leaders meeting with industry leaders is misguided. Mortgage industry leaders have almost as little grasp as the regulators of what really goes on at the loan origination level. As proof I offer the any one of the slew of new disclosures that have been required since the meltdown in 2007, including the new Good Faith Estimate and anti steering "safe harbor disclosures."
I recently closed a loan for a mortgage fraud investigator for the Department of Justice. It was clear to me that she did not understand many of the disclosures. The regulators need to meet with honest, front line, boots-on-the-ground industry professionals to create meaningful changes. A standard FHA loan application contains 54 pages of disclosures. Most borrowers just give up and sign them with out reading them because there are so many. The end result is that dishonest mortgage loan officers can get away with more than they did before, and the regulators have made things worse, not better.
United Mortgage Funding LLC