This from Joel Berg over at the Central Penn Business Journal:
New mortgage laws to require licenses
Exerpts...
By Joel Berg
8/29/2008
New state rules for issuing home loans will help restore confidence in a market burned by fraud and foreclosures, according to local lenders and brokers.
But faith could take time to come back, particularly among investors who buy mortgages from the brokers and lenders who originate them.
One sector hit hard by lost confidence is the market for upscale homes, said Jim Deitch, chief executive officer of American Home Bank in West Hempfield Township, Lancaster County.
"The cost of credit for high-end homes has skyrocketed solely because of the lack of integrity in the origination process," said Deitch, whose bank specializes in mortgage lending. "And it's going to take a very long time for investors to regain confidence in that area."
The road back begins Nov. 4 when the new state rules take effect.
The biggest changes will come for mortgage originators, who work directly with homebuyers to make loans. For the first time in Pennsylvania, originators will need to get state licenses. Under existing law, only companies held licenses.
Industry officials have long pushed for the change. They blame much of today's housing mess, particularly the defaults among borrowers with subprime loans, on the lack of oversight.
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This will go a long way, in my opinion.
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