Chasing Last Week’s Mortgage Rates | How Rates Change

Yesterday, a Seattle area homeowner I’ve been providing rate quotes to told me they’d like to lock if they could have the rate quote I provided him last week when mortgage rates were at an all time low.  Six months ago, there would be a greater possibility that I would be able to offer her the same rate at the same price as last week prior to the Fed’s ruling on how mortgage originators are compensated (referred to as LO Comp).

LO Comp has done two things:

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The Day After the Fed’s Rule on Loan Originator Compensation

Poker Like it or not, the Fed’s rule on how mortgage originators can be compensated is in full effect today.   It’s hard to tell exactly how much this has impacted mortgage rates as mortgage backed securities are being beat up pretty hard from fears of inflation (rates would be higher today regardless of the Fed’s rule).

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Poll Results: How Would You Like Your Mortgage Originator Compensated?


Our poll is over and I’m actually a little surprised by the results: a majority prefers the current most common form of mortgage originator compensation.

Points, based on a percentage of the loan amount received 48.9% of the vote.   Followed by hourly, based on work performed, at 31.1%.  Paying your mortgage originator a flat fee, the same fee for everyone, came in last at 20%.

I hope the FED and Washington State’s DFI reads this… right now they’re both trying to change how mortgage originators are paid. 

Shouldn’t it be up to the consumer?  They have the right to vote with their feet.  If they don’t like how a mortgage originator feels they should be compensated, they can walk.

Our government getting involved with how an industry is paid is very troubling to me.  

Your thoughts?