New NC Mortgage Broker Law - Bans YSP or not?

Mortgage and Lending

Here is the new law

SECTION 3.  G.S. 53‑243.11 is amended by adding a new subdivision to read:

"(16)   In connection with the brokering or making of a rate‑spread home loan as defined under G.S. 24‑1.1F, no lender shall provide nor shall any broker receive any compensation that changes based on the terms of the loan. This subdivision shall not prohibit compensation based on the principal balance of the loan."

SECTION 4.  This act becomes effective October 1, 2008.

I was wondering what this part means.

Does it mean that we are not allowed to changed the YSP after we quoted it to the borrower? For example, if the YSP is 1%, and we're going to be making 2% for the same rate....are we allowed to receive the extra YSP or will we need to be capped at 1%? (There are some states like Maine that enforces this) I'm assuming that this may also apply to points in the front.

I haven't heard from my Corporate legal department yet, but was wondering if anyone has contacted NCCOB for clarification?


North Carolina Refinance

Comments (2)


The Laws in the mortgage market is getting tougher and tougher day by day as a result of the Economic slowdown. I think the law says that we are not allowed to change the YSP After we quoted it to the borrower.

Feb 25, 2009 07:27 PM
Raleigh Mortgage

Great post!


NC Mortgage

505 Clyde Farrell Rd, Apex, NC 27523

(919) 395-8624

May 18, 2012 04:04 PM
SixFigure AgentsandBrokers


We hope you had a fabulous 2014 and you exceeded your goals.

All the best for 2015!

Dec 29, 2014 03:35 AM