The LO Comp Tightrope: Achieving balance between reward and regulation

An Inside Mortgage Finance Webinar

Recorded September 26, 2013


Setting up and managing the compensation of loan originators has never been more of a challenge than it is now.

First there was the Consumer Financial Protection Bureau’s new loan originator compensation rule that required lenders to pick their way carefully through employee benefits, tax and human resource considerations to find a system that motivates existing and new LOs without running afoul of the regulation. Then the CFPB further complicated the LO compensation issue by finalizing a new ability-to-repay/qualified mortgage rule that effectively imposes new compensation restrictions on mortgage lenders.

And most recently the CFPB has sued a lender and its executives for using a bonus system that allegedly rewarded staff for originating mortgages with higher interest rates.

It’s a tough new regulatory world when it comes to LO compensation.

From this recording, you'll learn more about the paths you can follow to satisfy all the intersecting regulations. Our experts discuss the current rule requirements, the steps you should be taking in the final months before the rules take effect, and where you need to watch for rule conflicts. We also look at lessons to be learned from the CFPB’s recent loan originator comp lawsuit.

You’ll hear from:

  • Kristie Kully, Of Counsel, K&L Gates
  • Jay Laifman, Counsel, BuckleySandler

Here’s some of what you’ll learn in the 90-minute recording:

  • What essential steps you should be taking to finish your plans before the January effective date.
  • How amendments and proposals made this summer have changed the new rule, including who it applies to.
  • How the LO comp rule intersects with other new rules, including the ability-to-repay rule and qualified mortgage standards.
  • What lessons you should be taking away from the CFPB’s first LO comp enforcement action.
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After the November elections, how long will it take for a new Congress and White House to pass GSE reform legislation?

I’m confident a bill will be passed the first year.


2 to 3 years. GSE reform is complicated.


Sadly it won’t happen in a Clinton or Trump first term.


Not in my lifetime.


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