Dodd-Frank Act - Title XIV: Mortgage Reform and Anti-Predatory Lending Act

Subtitle A: Residential Mortgage Loan Origination Standards

Duty of Care (Section 1402) – Requires all loan originators, subject to regulations prescribed by federal banking agencies in consultation with HUD and FTC to:

  • be qualified and licensed and registered, when required
  • include on all loan documents any unique identifier of mortgage originator provided by Nationwide Mortgage Licensing System and Registry. Requires CFPB to prescribe regulations requiring depository institutions to establish and maintain procedures to assure and monitor depository institution, operating subsidiary and employee compliance with requirements of section 1507 of SAFE.

Prohibition on Steering Incentives Prohibition

Prohibits mortgage originator from receiving from any person, or any person from paying mortgage originator, directly or indirectly, compensation that varies based on terms of loan (other than amount of principal).

With the exceptions below, generally prohibits a mortgage originator from receiving from any person other than consumer, who knows or has reason to know that a consumer has directly compensated or will directly compensate mortgage originator, from paying mortgage originator any fee or charge except bona fide third-party charges not retained by creditor, mortgage originator, or affiliate of creditor or mortgage originator.

Intended to prohibit yield spread premiums or other similar compensation based on terms including rate that would cause originator to “steer” borrower to particular mortgage products.


Does not limit compensation to originator based on principal amount of loan. Also, does not restrict person other than consumer from receiving, or person other than consumer from paying, origination fee or charge if

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