This bill corrects the math formula that causes the customers of mortgage brokers to have a lower cap on the amount of money they can elect to use to purchase loan features, including interest rate buydowns or mortgage insurance for a higher LTV.  This particularly puts lower income customers of a mortgage broker at a disadvantage over other lending channels as this issue accelerates as loan amounts decrease below roughly $125,000.  This correction does not increase the cost to borrowers, income to brokers or the cost of a mortgage.  It simply corrects the math formula used to calculate the maximum amount a consumer can elect to spend so that the formula matches the formula used for mortgage bankers and depository institutuions.

In a December 2015 meeting with CFPB Director Cordray, NAMB offiers were told that CFPB recognizes this issue but they do not have the power to correct it, the fix is legislative.