Reality Check – Are mortgage brokers the root cause of the housing crisis?

Reality Check – Are mortgage brokers the root cause of the housing crisis?

Much of the blame for the Subprime Housing Crisis has been disproportionately directed at Mortgage Brokers. As a mortgage broker/originator since 1993 and a member of a group that many blame for the housing crisis, my views are biased and probably a tad defensive. However, blaming mortgage brokers for the foreclosure problem is like blaming auto dealers for global warming. The only way to truly understand what caused the housing crisis is to break down the mortgage financing process and understand it’s complexities; both upon consumers and amongst the industry participants needed to get financing in place. The number of people, documents, & steps required to complete a transaction in order to obtain home financing makes the mortgage process one of the most complex transactions a consumer will face in their lifetime. ¬†The process has remained difficult despite advances in technology.¬†Increased workflow complexity is stifling production. As with anything not understood & studied, incorrect conclusions have been drawn about the […]

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