While details are limited, mortgage executive urges brokers to stay updated on latest news
While the details are still limited, mortgage experts are starting to talk more about potential changes to the Loan Originator Compensation Rule, also known as LO Comp.
The discussion began when the Consumer Financial Protection Bureau (CFPB) submitted a rulemaking to the Office of Information and Regulatory Affairs (OIRA) on June 4, something called “Loan Originator Compensation Requirements Under the Truth in Lending Act (Regulation Z); Rescission."
Now, nearly two months later, details are still limited as to what potential changes this could mean. But one mortgage executive is urging brokers to pay closer attention to any news regarding the issue.
Valerie Saunders, chief executive strategist of the National Association of Mortgage Brokers (NAMB), is concerned that changes could be bad news for mortgage brokers.
“NAMB is closely monitoring recent developments regarding the CFPB Loan Originator Compensation (LO Comp) rule under the Truth in Lending Act (Regulation Z),” Saunders told Mortgage Professional America. “The LO Comp rule, originally implemented following the Dodd-Frank Act, established requirements and restrictions on how mortgage loan originators may be compensated, primarily prohibiting compensation based on loan terms and dual compensation arrangements.”
Changes wanted
Saunders made it clear that it’s not that the mortgage industry hasn’t wanted changes to the LO Comp rule over the years. But those changes don’t include rescission.
“NAMB is actively monitoring this regulatory development and will continue to engage with the CFPB and other stakeholders throughout this process,” Saunders said. “While the mortgage industry has generally sought revisions to the rule, the potential complete rescission would present challenges that require careful consideration.”
She noted that rescinding the rule would still make the industry subject to the remaining parts of the Dodd-Frank Act, which could cause issues.
“Of particular concern is that even if the CFPB rescinds its LO Comp rule, the underlying statutory provisions from the Dodd-Frank Act would remain in effect,” she said. “This could potentially subject the industry to broadly stated statutory prohibitions without the regulatory guidance and safe harbors currently provided by the CFPB's rule.”
Staying informed
She said NAMB would continue to engage with the CFPB and others involved in any potential change to make sure they are aware of industry concerns.
“As this regulatory process unfolds, NAMB will monitor all developments related to the potential rescission of the LO Comp rule,” Saunders said. “We will advocate for the interests of mortgage brokers and loan originators, engage with the CFPB, OMB, and other stakeholders to ensure industry perspectives are heard, and communicate updates to our membership as new information becomes available.”
As the process continues with little in the way of public details, Saunders said it is important for brokers to keep up to date with the latest news.
Mortgage attorney Marty Green of Polunsky Beitel Green highlights the extensive regulatory and administrative hurdles—including SEC filings, market coordination, and structural decisions—that make a year-end launch ambitious at best.https://t.co/xo4iAztwxy
— Mortgage Professional America Magazine (@MPAMagazineUS) August 21, 2025
“The regulatory review process through OMB has been extended to over two months, but NAMB will remain vigilant throughout this period,” she said. “We understand the significant implications that any changes to the LO Comp framework could have on our members and the broader mortgage industry.
“NAMB will continue to work tirelessly to ensure that any regulatory changes serve the best interests of mortgage brokers, loan originators, and the consumers they serve. We remain committed to fostering a regulatory environment that promotes competition and consumer choice in the mortgage marketplace.”
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
