Lender-Paid Compensation is a legitimate and consumer-beneficial method of structuring mortgage transactions

WASHINGTON, June 30, 2025 /PRNewswire-PRWeb/ -- The National Association of Mortgage Brokers (NAMB), the first and only national volunteer-led and membership-driven organization representing the interests of mortgage brokers and home buyers since 1973, today is responding to the CHLA's white paper on LO compensation reform which affirms NAMB's support for the concept of Yield Spread Premium (YSP), now recognized as Lender-Paid Compensation as a legitimate and consumer-beneficial method of structuring mortgage transactions. When disclosed transparently, lender-paid compensation allows borrowers to obtain loans with reduced or no out-of-pocket closing costs while enabling mortgage brokers to operate sustainable businesses.

However, NAMB firmly opposes the current rigid interpretation of Loan Originator Compensation (LO Comp) regulations that restrict the flexibility mortgage originators need to best serve their clients. These overly prescriptive rules undermine the original legislative intent, which was designed to eliminate abusive compensation practices not to impose burdensome regulations on legitimate compensation arrangements within mortgage firms.

"NAMB advocates for a return to common-sense regulatory approaches that distinguish abusive behavior from today's transparent and consumer-focused lending models," said Jim Nabors, President of NAMB. "Responsible use of lender-paid compensation is an essential tool in offering flexible, borrower-centric financing options. We urge regulators and lawmakers to update and align LO Comp rules with the realities of today's transparent and competitive mortgage market to protect, rather than hinder, consumers."

NAMB remains committed to championing mortgage brokers' ability to provide competitive, transparent, and consumer-friendly lending solutions. The association calls on policymakers to ensure that regulations intended to protect consumers do not inadvertently limit borrower choice or harm the businesses that serve them.

For more information on NAMB's legislative and advocacy initiatives, visit: https://namb.org/advocacy/

About NAMB: The National Association of Mortgage Brokers has been the only national volunteer-led and membership-driven organization representing the interests of mortgage professionals and homebuyers since 1973. NAMB provides mortgage professionals with advocacy, education, and rigorous certification programs to recognize members with the highest levels of professional knowledge and education. NAMB's active lobbying and advocacy efforts focus on national and state issues, protecting the interests of its members and borrowers. As the leading national trade association for the mortgage industry, NAMB is affiliated with state associations throughout the country and represents the interests of more than 546,800 licensed and registered Mortgage Loan Originators and 49,100 licensed Mortgage Broker and Mortgage Lender businesses throughout the U.S. www.namb.org

Media Contact

Joshua Steinfeld, Steinfeld Consulting, 1 339-225-1581, steinfeldconsulting@gmail.com

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SOURCE Steinfeld Consulting