Posted by Ilene C. Seidel on 6/22/11 3:22pm
Msg #387289

Mortgage Company Incentive?

I just closed a loan for a major bank, just a conventional refi. The original loan same thing.
Borrower shows me an email stating the bank will be giving her an incentive for closing the loan.
Who/What? Aren't incentives illegal? If not what kind of incentive could it be? I've never heard this before from a borrower. She's asked the loan officer when I was there he was evasive.

Reply by MW/VA on 6/22/11 4:42pm
Msg #387307

Yes, probably illegal, but I wouldn't make it my concern. You have a limited role & as long as you do your job, that's it, IMO.

Reply by Julie/MI on 6/22/11 4:47pm
Msg #387309

I just closed a chase and they are giving some kind of 1percent deal on something or other if you close a mortgage. Is that what you mean/

Reply by Ilene C. Seidel on 6/22/11 6:26pm
Msg #387335

Julie that's not the lender however the bo received an email stating she would receive an incentive after the loan funds. It's very vague she tried to get the loan officer to elaborate but he was very evasive and rude to her on the phone. I didn't know lenders could give incentives for a mortgage. How is the 1% deal handled, do you know?

Reply by GWest on 6/22/11 7:14pm
Msg #387339

The only incentive with Chase that I am aware of is that they will send you a check once a year for 1% of the total annual loan payments (there is a max) if you set up automatic payments. The automatic payments must be through a Chase account or no rebate given, so you have to open a checking account with them if you don't have one already. Not sure for how many years, but I did see this awhile back and they also advertized this on TV.

Reply by Ilene C. Seidel on 6/23/11 5:27am
Msg #387371

Thanks GWest.

Reply by Ilene C. Seidel on 6/22/11 6:24pm
Msg #387332

I know what my responsibilities are MW, Thanks anyway.

Reply by Moneyman/TX on 6/22/11 10:30pm
Msg #387359

Maybe the bank is giving them a toaster? - LOL n/m

Reply by James Powell on 6/23/11 8:30am
Msg #387378

Why would the incentive be illegal?

The only incentives (kickbacks) that are illegal under RESPA are between parties supplying services. There has never been any restrictions on giving the consumer money or incentives. The only exception might be an incentive to the consumer that was dependent on using a particular ancillary company. That is still a gray area.

Reply by S Peterson on 6/23/11 1:54pm
Msg #387412

It's called HARP, the government is paying the incentive...

or really the taxpayers. Google it. It stands for Home Afforadable Refinance Program. Check the top of the Mortgage Commitment, it says it right there.