“The Dodd-Frank Act Continues to do More Harm than Good”

Mortgage and Lending with Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 NMLS # 6869



“The Dodd-Frank Act Continues to do More Harm than Good”


The last time I read an update on Dodd-Frank, 40% of the act was yet to be written. Can you imagine that many in this country still think this was a good idea? These regulations continue to hurt consumers rather than help and there is no end in sight to regulations that continue to hurt rather than help consumers and our economy.

We can thank Dodd-Frank for the way the appraisal system works, the CFPB, TRID and the regulation that is creating a new good faith estimate, that no one I speak to understands (it currently takes much too long to get a mortgage closed already, but as of 8/1 it will take even longer), lending restrictions that are keeping many away from home ownership, QM and the list goes on.

We are ending up with more Government intervention because they believe consumers are not smart enough to think for themselves.

Wanted to share the article below on the same topic:


Bankers Say Dodd-Frank Rules Restrict Mortgage Lending

June 15th, 2015  | by Jason Oliva Published in CFPB, News, Reverse Mortgage

Although the Qualified Mortgage (QM) rule has been in effect under Dodd-Frank regulations since January 2014, a vast majority of mortgage bankers expect that new lending rules from the Consumer Financial Protection Bureau (CFPB) will further restrict their lending abilities, according to a recent survey from the American Bankers Association (ABA).

Nearly 80% of banks expect the CFPB’s mortgage lending rules will continue to cause a “measurable reduction” in credit availability, with 19% of respondents calling this impact “severe,” according to the ABA’s 22nd Real Estate Lending Survey.

Compiling responses from 182 participating banks, data for the 22nd annual survey was collected between March 4 and April 17 of this year. Of the survey participants, 68% of respondents were commercial banks and 32% were savings institutions. Many (77%) of the participating institutions had assets of less than $1 billion.

“As expected, the ability-to-repay and QM rules have dampened the housing market recovery,” said Robert Davis, ABA executive vice president, in a written statement. “Combine that with new mortgage disclosures, which are just around the corner, we’ll continue to see a slowdown in what should be the ideal time to buy a home.”

High debt-to-income levels was the most likely reason for a mortgage loan not meeting QM standards followed by lack of required documentation, according to the ABA findings.

Despite these setbacks, bankers did report some positive results, including reporting the highest percentage (14%) of loans to first-time homebuyers in the survey’s 22-year history. Last year this figure was 13%, the highest share of single-family loans reported since 2007.

In other positive findings, foreclosure rates at surveyed banks dropped from 0.78% in 2013 to 0.57% in 2014, while the average delinquency rate for single-family homes also decreased from 2.16% to 1.76%.

As the findings have indicated, bankers are most concerned about compliance and the increasing regulatory burden, followed by economic uncertainty, the interest rate environment and community bank challenges. In terms of regulation, 87% of responding banks said regulations are having a “moderate” to “extreme” negative impact on the bank’s business.

And that includes the burden of complying with the CFPB’s TILA/RESPA Integrated Disclosure, or TRID, implementation. The rule has sparked considerable controversy among many in the mortgage banking industry, especially in recent weeks following the CFPB’s announcement that it would offer a grace period for the rule’s enforcement.

While many mortgage industry stakeholders and trade groups appreciated the move from the CFPB, the appreciation was overshadowed by an industry-wide disappointment that the Bureau did not implement a “hold harmless period” after TRID rules take effect August 1.

“While the bureau acknowledged the implementation challenges of this rule, CFPB’s decision will only provide elicited assurances to bankers in their efforts to comply,” said ABA President and CEO Frank Keating in a written statement.

ABA also believes it is critical to establish a formal transition period for banks, and strongly advocated for restrained enforcement by providing survey data on vendor readiness to the bureau.

In April, the ABA surveyed its banker members in efforts to learn more about the progress their vendors have made in delivering systems to comply with TRID.

Of the approximately 800 bankers that participated in the survey, 74% said they are using a vendor or consultant to assist with the implementation of the TRID rules, while 26% said they were not using these additional parties.

Most bankers (36%), however, noted that their vendors have not yet provided a solid delivery date as to when they will deliver final and completed production software systems to comply with the new rules. The next largest share of bankers (21%) said they expect to receive their completed systems in June.

View the ABA survey.

Written by Jason Oliva


Image courtesy of Stuartmiles/freedigitalphotos.net

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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com



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Kim Johnson
Realty Associates of Florida I Inc. - Coral Springs, FL
Selling South Florida

To say the Dodd-Frank act is a disaster is an understatement! But I don't think anything will be able to stop this train wreck they created!

Jun 21, 2015 10:09 PM #9
Raymond E. Camp
Howard Hanna Real Estate Services - Ontario, NY
Licensed Real Estate Salesperson Greater Rochester

Good morning Joe,

As with any mandates, laws or edicts the government makes 99.9% make no sense.

Make yourself a great day.

Jun 21, 2015 10:12 PM #10
Anita Clark
ColdwellBanker SSK Realtors ~ 478.960.8055 - Warner Robins, GA
Realtor - Homes for Sale in Warner Robins GA

Joe: We do get a 2-month reprieve that I hope keeps getting extended. When the government steps in to "help" the results are often anything but helpful.

Jun 21, 2015 10:49 PM #11
Roy Kelley
Realty Group Referrals - Gaithersburg, MD
Roy and Dolores Kelley Photographs

We should keep these cumbersome regulations in mind at the next Federal elections.

Jun 21, 2015 10:54 PM #12
Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

Dodd-Frank have been screwing up this business for decades.  I have zero objection to the new disclosure timelines.  I've always thought it was a bad idea to get a closing package at 9 a.m. for a 10 a.m. closing (which happens), but there is way more bad than good in the bill as usual out of Washington.

Jun 21, 2015 11:13 PM #13
Beth Atalay
Cam Realty and Property Management - Clermont, FL
Cam Realty of Clermont FL

Good morning Joe, I don't know if it's going to make a difference but I'm glad it was extended till October. This is a complete nightmare!

Jun 21, 2015 11:17 PM #14
Paul McFadden
Paratex - Seattle, WA
Pest Control, Seattle, WA.

Joe: Thanks for the update. I ran into a friend I used to work with last week. He said it's tougher than ever to get deals done plus super competitive. That part of the business I don't miss!

Jun 21, 2015 11:17 PM #15
Fred Cope
Reliant Realty in Nashville, TN - Nashville, TN
Looking For Homes With A Smile

Joe, not only this DODD-FRANK legislation, but the Community Reinvestment Act, as well as DODD & FRANK blocking the audit of Fannie &Freddie, and the Federal takeover of student loans were all contributors to the economic meltdown.


Dodd and Frank were in up to their eyeballs in the downturn.  They were the Chairmen of the Senate and House Banking Committees.  I believe they did the "guilty dog" trick and pointed their fingers at the Bush Administration, Wall Street, and the lending industry.  To look so concerned and innocent, they authored the legislation we now know as DODD-FRANK.  Typical Big Government goulosh: we do not know what is in it, but it sure smells awful.

Jun 22, 2015 12:48 AM #16
Barbara-Jo Roberts Berberi, MA, PSA, TRC - Greater Clearwater Florida Residential Real Estate Professional
Charles Rutenberg Realty - Clearwater, FL
Palm Harbor, Dunedin, Clearwater, Safety Harbor

I thought that the August 1 deadline had been pushed back to October.....

Jun 22, 2015 01:06 AM #17
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy


Coocoo times are here, so many times when the government interferes they end up messing up what is working, because the politicians take it as an opportunity to make themselves stand out and huff and puff pretending to be on the people's side, whereas they are looking at how to get elected next term.  We recently saw that with our oil spill...Disgusting, A

Jun 22, 2015 02:01 AM #18
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC


The Dodd-Frank bill is one that just keeps giving . . . . and very little of it helps the consumers.

Good luck and success.

Lou Ludwig

Jun 22, 2015 03:19 AM #19
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Well - I'm confused for sure.  The reason people don't know is poor explanation of who this hurts by people that oppose it.


Jun 22, 2015 03:41 AM #20
Hella Mitschke Rothwell
(831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

I liked the final HUD-1 coming from my escrow company (whom I trust as a third party), rather than in the future from the buyer's lender incorporated in THEIR paperwork.

Jun 22, 2015 07:49 AM #21
Hella Mitschke Rothwell
(831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

And, yes, it's now supposed to be pushed back to October 1.

Jun 22, 2015 07:50 AM #22
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Joe the Dodd-Frank Act has been a nightmare for the Real Estate and Lending Industries from the day it was created, and I do not expect that to change.  Let me re-phrase that, the only change we can expect from Dodd-Frank is for it to go from bad to worst.

Jun 22, 2015 07:55 AM #23
Fred Cope
Reliant Realty in Nashville, TN - Nashville, TN
Looking For Homes With A Smile

Hella Mitschke Rothwell, To my knowledge, the HUD-1 provided by your Title Company has always gone through the Lender BEFORE the Title Company releases it to REALTORS®.  The order and means may vary, but my processors always had to get a preleminary HUD from the Title Officer which included all Courthouse, Attorney and Realty Firn fees.  That prelim was faxed (emailed) to Lender's Closing Dept.  They added their fees, prepaid interest and other lender related items.  The HUD may go back and forth between Loan Processor, Title Processor, Closing Department, and the processors communicate with Insurance Agency, Aporaiser, Home Inspector, Pest Control Office, Home Builder and Realtor.  Buyers and Sellers generally get a few phone calls as well.  When all items are properly posted and calculated, charged to correct parties, and signed off by Lender and all parties, THEN copies are provided to Agents for review & confirmation.  Hopefully all is resolved before the Federal Reserve concludes bussiness for the day (I believe that is 3:00 PM EST.  If so, the loan should fund.


Experienced processors should be able to roll with the changes under Dodd-Frank.

Jun 22, 2015 03:06 PM #24
David Shamansky
US Mortgages - David Shamansky - Highlands Ranch, CO
Creative, Aggressive & 560 FICO - OK, Colorado Mtg

The whole thing is a load of BS! TO cure defaults a simple go back to basics of underwriting and qualifying a borrower would have worked but this is flat out crazy and most borrowers cringe at the thought of having to go through the process these days. Sad but then again when voters out number WORKERS this is the kind of mess you get

Jun 22, 2015 03:47 PM #25
Michael Jacobs
Coldwell Banker Residential Brokerage - Pasadena, CA
Los Angeles Pasadena Area Real Estate 818.516.4393

Hi Joe -- all under the guise of protecting consumers....yeah, right...

Jun 23, 2015 03:19 AM #26
Ed Macias
Real Estate Teammates - Miami, FL
Miami FL-REO Property Management Multifamily

Disaster. I try to keep myself occupied on the positive than this garbage.

Jun 23, 2015 09:49 AM #27
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Los Angeles CA

Should both Dodd Frank and environmental regulations ease, new home construction could finally expend to address inventory shortages that we have in SoCal since the recovery began. 

Feb 16, 2017 07:13 PM #28
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