YSP is not there to encourage brokers to sell higher rates. The wholesale lender makes the same no matter what rate on the rate sheet the broker selects. YSP allows the consumer to get a NO point loan. If you get rid of YSP, everyone will have to pay points for their rate. Most people can’t afford this. and most people when given both optins, choose the higher interest rate with NO points and yes the broker is compensated with YSP in this case.

Regarding the GFE: sure, I just got one from my broker, and yeah, the YSP is there, way over to the left of the page, away from all the other pertinent info in the righthand column so that I didn’t even notice it at all until I studied the GFE for the third time! Needless to say, there was no explanation included with this tidbit of information–no clue as to how this may in fact have me paying a lot more for my house over the long haul.

The fact remains that the whole reason the YSP exists is to encourage brokers to sell clients higher-interest loans. Otherwise why don’t they pay you just a straight commission regardless of the interest rate? Again, it would be one thing if the average mortgage broker said, hey, this is how I get paid by the bank, but here is how it breaks down for you in terms of your interest rate difference. If you’d like the lowest rate possible, then let me know, but you might have to make up the difference by paying me or my company a fee directly. You know, something honest like that.

I couldn’t disagree more, YSP as a broker is disclosed by law on the HUD-1 every single time. It is also checked as a percentage on the GFE Please reread my orginal posting; if you want to your options as to low interest rates, fees and potential benefit, find a good honest broker and ASK. Seriously, ask for options, look at a few lenders, spend some time and ask some questions. And remember, if it sounds too good to be true, then it probably is. If you ever have any questions for me just say the word.

and GEE, LOOKS LIKE THIS IS PUBLISHED.

Gee, I wonder if you’ll publish this…

Thanks for your input. You can call it comission, profit, income, I think labels such as that are meaningless. Bottom line is that YSP as broker is disclosed on a good faith estimate, and again at settlement. There are numerous other disclosures out there that vary by state. If it matters to the customer so much why don’t they ask?? Personally though I don’t really think it’s any of your business what I make on a loan. I am getting life insurance tonight. I have no plans to ask him what his comission is on our policy. I decided what I wanted as far as coverage and type and then shopped who had the lowest rate. That’s what a person should be shopping on a mortgage. Rate, fees and service. To say it’s sneaky is not being totally honest and as I just pointed out the questions really is irrelevant. Throwing rocks at the profession isn’t really needed either. There are good and bad brokers out there just like in any profession. What I would like to see is that fly by night guys and the scam artists gone which is starting to happen.

Idiots like Rob Blake do what they do because it gets him attention. Without taking his stance, none of us would know of this obnoxious snake oil salesman. Thank you for calling this guy out, it’s about time! I really feel sorry for anyone he has duped or actually gives him the time of day. There’s one born every minute and there’s always a guy like Rob handing out the Kool-Aid.

Guys like you may not be well known, but you should pat yourself on the back for doing things the right way and not looking for niche marketing to exploit at the expense of your clients, and the integrity of the industry.

Steve D., President e-clu, Los Angeles CA

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