Florida Mortgage | YSP and new Regulations

Residential Lending's perennial pariah is YSP - Yield Spread Premium. This single line on the HUD Closing statement is a bone of contention for basically everyone in the lending community. Simply defined, YSP is the amount of commission paid to a Mortgage Broker by the lender.

Florida is talking about a new regulation starting this October 2007 that would require the Mortgage Broker to disclose YSP anywhere in time during the loan process from Rate Lock to final disclosure which is 72 hours prior to closing.

The Transparency movement in Real Estate and Lending is forcing this issue right now... as if it is the be all end all to corruption in brokering. Many Mortgage Brokers are now moving to the "Flat Fee" system where they disclose right up front how much they are earning on a loan.

I personally don't have a real issue with YSP not being visible.... but that's because I don't take advantage of my clients.

To learn more about the controversy regarding YSP and how Transparency and government regulations may or may not have the desired effect read: Florida Mortgage | YSP and Your Loan