Potential Class Action Lawsuit: Loan Steering / Yield Spread Premium

Letter from attorney PDF:
http://www.scribd.com/doc/125651087/YSP-Letter-Attorney

I do not qualify for legal action because my loan was initiated in 2004.  However, it is estimated that 60% of all mortgages across the nation contain Yield Spread Premium  (YSP). 

Please take time to review the letter (above) from a law firm in Indiana.  According to the letter, loans initiated within the last 3 years may qualify for legal action... 

You can find Yield Spread Premium on the settlement statement in your mortgage documents.  It will be listed as P.O.C. or paid "outside of closing."  This shows the dollar amount of the kickback your broker received for inflating your interest rate. 

http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_Equity_Theft-0604.pdf

REMAX: Pam Aguirre Refuses The Delivery Of My Complaint Against Scott Veerkamp...

Please take time to review 2 exhibits (below)...

Pam Aguirre is a member of the Metropolitan Indianapolis Board of
Realtors. I mailed a complaint to Pam regarding Scott Veerkamp's
Predatory Lending tactics. The complaint included documentation of
Loan Steering with YSP and Junk Fees. (She refused the delivery of my
complaint.)

This response provides additional evidence that REMAX and the National
Association of Realtors are participating in a "pattern of deception"
with the public. As I mentioned earlier, MIBOR states the following:

1. "REALTORS shall be careful at all times to present a true picture
in their advertising and their representations to the public." 2. "The Code of Ethics is a  promise to the public that when dealing with
a real estate agent who is a REALTOR, they can expect honest and
ethical treatment in all transaction- related matters." 3. "Only
REALTORS pledge to abide by the Code of Ethics, and only REALTORS are
held accountable for their ethical behavior." 

Pam Aguirre had the following statement on her website dated May 1, 2008:  "Pam is a member of the Metropolitan Indianapolis Board of Realtors (MIBOR) where she helps protect the interest of homeowners and increase professionalism in the industry by serving on the board of directors." 

In addition, this statement was included on her website in 2008:  "Pam communicates openly at all times and not only answers questions but supplies additional information whenever possible."

As a member of MIBOR, Pam did absolutely nothing to protect my interest.  She refused to review my complaint against REMAX Central. 

Unfortunately, the REMAX organization consistently uses Bait and Switch tactics to deceive the public.  Here are some examples...

1. Pam "communicates openly at all times" going in---and Pam refuses to discuss my documentation on Loan Steering going out.  2. Pam "helps protect the interest of homeowners" going in---and Pam refuses the delivery of my complaint against REMAX Central going out. 

In my opinion,  Pam should spend less time shopping and more time investigating complaints about Loan Steering and Predatory Lending with REMAX realtors.  This would be a legitimate way for her to "help protect the interest of homeowners."  

Here are some examples of Scott Veerkamp's deception with Predatory Lending tactics... 

"You can trust our Realtors to always keep your interest first and foremost:

Loan 1:  (Property value $150,000)  A. $4,799 yield spread premium  B. $500 processing fee  C. $250 document preparation fee  D. $50 courier fee  E. $35 electronic filing fee  F. $425 administration fee (lender fee)  

Loan 2:  (Property value $120,000)  A. $1,440 yield spread premium  B. $960 application fee  C. $1,920 in "discount points" (paid to Scott Veerkamp)  D. $409 administration fee (lender fee)  E. $150 underwriting fee (lender fee) 

Download Website_Information.pdf

Download Refusing_Delivery.pdf

The Center For Responsible Lending:

http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

CRL and Equity Theft:
http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_Equity_Theft-0604.pdf

Jeff Merkley and Yield Spread Premium:

http://merkley.senate.gov/newsroom/press/release/?id=A09C6A80-537A-4EB1-83C5-31925F046B6F

Scott Veerkamp: REMAX...YSP Scam

Regarding disclosure of Yield Spread Premium, would this be a typical
conversation between a REMAX Realtor and a client?

REMAX Realtor:  I can get you a loan at 4.5%, or I can get you a loan
at 5%. I will receive a kickback on the 5% loan for increasing your
interest rate. Which loan do you prefer?

Client: Please give me the 5% loan so you can receive a kickback on
my mortgage. In addition, I want to pay thousands of extra dollars
over the life of my loan so you can deposit the kickback in your bank
account.

REMAX Realtor: Thank you for understanding and appreciating the
benefits of YSP.

Client: You are welcome. As you know, there is a high probability
that REMAX will honor you with a "Lifetime Achievement Award" for your
effort in assisting me with Yield Spread Premium.

REMAX Realtor: You are correct. REMAX requires us to follow a strict
Code of Ethics in the representation of our clients. In fact, we are
required to follow the "Golden Rule" at all times. This is the reason
we are presented with "Lifetime Achievement Awards" each year.

Client: Congratulations on your accomplishments. However, I have one
final question: Should I use Countrywide Home Loans or Wells Fargo to
provide the funding for my predatory loan? I noticed these companies
were listed as "Platinum Sponsors" with members of the National
Association of Realtors.

I think you get the picture... In my opinion, I believe it is more
appropriate to use the word "disguised" when referencing YSP. This is
more realistic than using the word "disclosed."

Why would anyone agree to a higher interest rate if they understood
the financial impact it was having on their mortgage? For obvious
reasons, this is why Senator Merkley refers to Yield Spread Premium as
a "secret bonus payment" and a scam.

Please note: The Center for Responsible Lending and the National
Association of Realtors produced a brochure entitled: "How to Avoid
Predatory Lending." The brochure refers to Yield Spread Premium as
Predatory Lending.

As I mentioned earlier, MIBOR says "Realtors are held accountable for
their ethical behavior." Who is holding REMAX and the National
Association of Realtors accountable for deliberately misleading the
public?

Please take time to review the following articles...

Loan Steering Lawsuit:
http://www.huffingtonpost.com/2010/06/30/countrywide-lawsuit-racia_n_630661.html

Subprime Loan Steering:
http://industry.bnet.com/financial-services/10003019/ex-wells-fargo-loan-officer-details-shady-practices/?tag=talkback;tb-content

Loan Steering Lawsuit:
http://www.dailyfinance.com/story/real-estate/wells-fargo-subprime-mortgage-exit/19548625/

REALTORS and Yield Spread Premium:
http://www.realtyresourcesil.com/Seven-Signs-of-Predatory-Lending.asp

National Association of Realtors and Predatory Lending:
http://www.realtor.org/home_buyers_and_sellers/how_to_avoid_predatory_lending

Center for Responsible Lending:
http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

Center for Responsible Lending:
http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_Equity_Theft-0604.pdf

Senator Jeff Merkley and Yield Spread Premium:
http://merkley.senate.gov/newsroom/press/release/?id=A09C6A80-537A-4EB1-83C5-31925F046B6F

NAR Code of Ethics:
http://www.realtor.org/mempolweb.nsf/pages/code

Scott Veerkamp (NAR):  "You can trust our Realtors to always keep your interest first and foremost."

Loan 1:  (Property value $150,000)  A. $4,799 yield spread premium  B. $500 processing fee  C. $250 document preparation fee  D. $50 courier fee  E. $35 electronic filing fee  F. $425 administration fee (lender fee)  

Loan 2:  (Property value $120,000)  A. $1,440 yield spread premium  B. $960 application fee  C. $1,920 in "discount points" (paid to Scott Veerkamp)  D. $409 administration fee (lender fee)  E. $150 underwriting fee (lender fee) 

kickinbrick: Scott Veerkamp Misrepresents The Public

Loan Steering:  The Center for Responsible Lending estimates that excessive interest rates cost families $2.9 billion each year.  CRL states:  "When a borrower loses a home to foreclosure, society pays the price in the drop in surrounding property values and LOST TAX REVENUES."

1. Here is the formula:  Yield Spread Premium and excessive interest rates = loss of tax revenues from mortgage defaults.  2. Clearly, this is one of the reasons for the lack of funding in our school systems.  3. I find it Ironic that Scott Veerkamp has not paid his taxes and FTCSC wants to sue the state over a "funding formula."  4. In other words, Scott wants taxpayers to pay for the lawsuit going in---and Scott feels no responsibility to pay his own taxes going out.  5. On a scale of 1-10 Scott Veerkamp's level of integrity is at ZERO.

http://www.wthr.com/story/12029420/growing-school-districts-suing-over-funding

myftef.org: Scott Veerkamp Ripoff Alert

Please review this article in the Southside Times regarding Predatory
Lending and Yield Spread Premium...

http://www.ss-times.com/2009/02/05/buyer-beware-is-your-realtor-adhering-to-the-nar-code-of-ethics/

Warning Letter To Scott Veerkamp From The Office Of The Indiana Attorney General

Here is the warning letter to Scott Veerkamp:

 

Download Warning_Letter.pdf

 

Scott Veerkamp is the President of the Franklin Township School Board and a member of the National Association of Realtors.  Please ask Scott to post a copy of his WARNING letter from the office of the Indiana Attorney General.  In addition, please encourage Scott to provide a written response to items 1-16 on this website.

Items 1-8 in group A:  1.  I have documentation of a WARNING letter that was sent to Scott Veerkamp from the office of the Indiana Attorney General.  2. This letter was sent to Scott in November of 2008.  3. Here are the questions I have regarding this letter:  A.  Is a WARNING letter supposed to be an example of how Scott Veerkamp was "exonerated" by the office of the Indiana Attorney General?  B. Can Scott post a copy of his WARNING letter for the public to review?  4. Please explain how a $1,440 Yield Spread Premium "protects and promotes the interest of your client."  FYI:  The federal government has banned the use of YSP.  5. Please explain how a $4,799 Yield Spread Premium "Serves Others First."  This is in reference to your OTHER client in Wanamaker, IN.  6. Please provide documentation that shows how you "protected and promoted the interest of your client" when you attempted to sell a $120,000 property on a land contract with a "due on sale clause."  7.  Please explain how you honored your fiduciary responsibility to your client when you made approximately $26,000 on a $120,000 property listed with REMAX Central in your own neighborhood.  8.  Please provide documentation that shows how you "did your very best" when you refused to conduct an open house on a property located "one block down the street" from the house you were living in.

 

Items 9-16 in group B:  9. Apparently, $26,000 was not enough money to justify Scott driving "one block down the street" to conduct an open house on the $120,000 property.  10. David Worley used to work for Scott Veerkamp at REMAX Central.  Scott had an appraisal conducted on the $120,000 property in response to my complaint.  The appraisal was conducted by Bill Worley.  Are David Worley and Bill Worley related?  11. Scott refers to me as licensed real estate agent.  I would like for Scott to provide documentation that supports this statement.  12. Please explain why you removed my property from the multiple listing service after I filed my complaint with MIBOR.  How was I supposed to sell this property if you refuse to conduct an open house?  How was I supposed to sell this property if you remove it from the MLS?  13. The National Association of Mortgage Brokers stated it is not necessary to pay an application fee.  Please explain how a $960 application fee keeps the interest of your client "first and foremost."  14. NAMB says processing fees are a violation of their code of ethics because "they're generally not related to any actual service performed by a broker."  Please explain how a $500 processing fee "protects and promotes the interest of your client."  15. Scott ran an advertisement in Christian Phone Book with the following statement:  "We will do our very best to help you get the lowest possible interest rates at the lowest possible price."  A. Please provide documentation that explains how a $4,799 Yield Spread Premium represents "the lowest possible interest rate."  B. Likewise, please explain how a $960 application fee represents "the lowest possible price."  16. ISBA Code of Ethics:  Please provide documentation that shows how you "met the responsibilities to your community" when you steered people into high cost loans. 

 

I look forward to a written response from Scott Veerkamp on items 1-16.

 

 

Jim Bruggenschmidt

 

 

NAR:  "How To Avoid Predatory Lending"

http://www.realtor.org/home_buyers_and_sellers/how_to_avoid_predatory_lending

 

The Center For Responsible Lending:

http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

 

CRL and Equity Theft:
http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_Equity_Theft-0604.pdf

 

Jeff Merkley and Yield Spread Premium:

http://merkley.senate.gov/newsroom/press/release/?id=A09C6A80-537A-4EB1-83C5-31925F046B6F

 

myftef.org: Scott Veerkamp Loan Steering

Predatory Lending is a major contributor to the economic turmoil we are currently experiencing.

 

Here is an example of what I am talking about: 
Scott Veerkamp / Predatory Lending  (Franklin Township School Board Member.)

 

Please review this information from U.S. Senator Jeff Merkley regarding deceptive lending practices:
"Steering payments were made to brokers who enticed unsuspecting homeowners into deceptive and expensive mortgages.  These secret bonus payments, often called Yield Spread Premiums, turned home mortgages into a SCAM."

 

The Center for Responsible Lending says YSP "steals equity from struggling families."   
1. Scott collected nearly $10,000 on two separate mortgages using YSP and junk fees. 2. This is an average of $5,000 per loan. 3. The median value of the properties was $135,000.  4. Clearly, this type of lending represents a major ripoff for consumers.

 

http://merkley.senate.gov/newsroom/press/release/?id=A09C6A80-537A-4EB1-83C5-31925F046B6F

Scott Veerkamp: Deceptive Advertising

In doing some research on the Code of Ethics, I found the following
information listed on the RE/MAX International website: "The REALTOR
you hire adheres to a strict Code of Ethics and professionalism while
protecting ownership of property." "In the U.S., all of our agents
are members of their local REALTOR board and uphold the associated
strict Code of Ethics."

Please be advised that I am providing evidence of "Bait and Switch"
advertising on behalf of Scott Veerkamp and his organization. Scott
and his company ran the following advertisement in Christian Phone
Book: "We will do our very best to help you get the lowest interest
rates possible at the lowest possible price."

Upon review, you will see two examples of "Bait and Switch"
advertising in this message. Please take time to review the following
examples...

Example #1: A $4,799 Yield Spread Premium does NOT represent "the
lowest possible interest rate." Again, I refer you to the Center for
Responsible Lending and their definition of Yield Spread Premium: "A
YSP is a cash bonus that a broker receives from a lender for placing
borrowers in a loan with a HIGHER interest rate than the lender would
accept. The higher the interest rate, the higher the premium received
by the broker." "The effect of YSP is to steal equity from struggling
families."

Example #2: A $960 application fee does NOT represent the "lowest
possible price." As discussed earlier, the National Association of
Mortgage Brokers says it is not necessary to pay an application fee.
Therefore, "the lowest possible price" for an application fee is ZERO.
With regard to advertising, the Better Business Bureau defines "Bait
and Switch" in the following manner: "A "bait" offer is an alluring
but insincere offer to sell a product or service which the advertiser
does not intend to sell. Its purpose is to SWITCH consumers from
buying the advertised merchandise or service, in order to sell
something else, usually at a HIGHER price or on a basis more
advantageous to the advertiser."

After reading this description, it is evident Scott Veerkamp meets all
of the requirements for "Bait and Switch" advertising. Here are 4 key
points to review: 1. Obviously, Scott was not sincere about offering
"the lowest possible interest rate" or "the lowest possible price" to
his clients. 2. He simply used these statements as "bait." 3. In the
next step, Scott "switches" his clients to Yield Spread Premium and
junk fees. 4. Clearly, these HIGHER fees are more advantageous to the
advertiser.

In doing some additional research on the Code of Ethics, I found the
following information listed on the Metropolitan Indianapolis Board of
Realtors website: 1. "REALTORS shall be careful at all times to
present a true picture in their advertising and their representations
to the public." 2. "The Code of Ethics is a promise to the public
that when dealing with a real estate agent who is a REALTOR, they can
expect honest and ethical treatment in all transaction- related
matters." 3. "Only REALTORS pledge to abide by the Code of Ethics,
and only REALTORS are held accountable for their ethical behavior."

Previously, Scott Veerkamp deliberately misled the public when he
presented the following statement on one of his websites: "As a
Christian business owner, it truly is the desire of my heart to not be
a "Superstar," but rather a "Super Servant" with the hope of achieving
excellence by keeping the interest of my clients above all else."

Please note: Yield Spread Premium and Junk Fees represent the extreme
opposite of the statement listed above. In fact, Predatory Lending
puts the public at risk for serious financial harm. Unfortunately,
this is the same public Scott Veerkamp claims to be "Serving."

CRL and Loan Steering

http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

NAR: Golden Rule... or Greedy Rule ?

I have discovered an interesting fact about the National Association of Realtors.  When money is involved, the "Golden Rule" is quickly transformed into the "Greedy Rule."

Here are two examples...

Loan 1:  (Property value $150,000)  A. $4,799 yield spread premium  B. $500 processing fee  C. $250 document preparation fee  D. $50 courier fee  E. $35 electronic filing fee  F. $425 administration fee (lender fee)  

Loan 2:  (Property value $120,000)  A. $1,440 yield spread premium  B. $960 application fee  C. $1,920 in "discount points" (paid to Scott Veerkamp)  D. $409 administration fee (lender fee)  E. $150 underwriting fee (lender fee)  

Media Censorship, YSP, and Predatory Lending

The local media will not cover my story on YSP because REMAX spends a lot of money advertising with major media outlets.  For obvious reasons, REMAX wants to keep this information hidden from the public.  In my personal opinion, this represents an example of "media censorship."

As you know, Scott Veerkamp was allowed to express his thoughts and feelings about Toni Morrison in the traditional media.  He referred to her book (Song of Solomon) as "garbage."  Freedom of speech allows Scott to express himself in this manner.

Unfortunately, I have not been allowed to express my thoughts about Scott Veerkamp in the traditional media.  To date, I have been forced to communicate my information in the following manner:  1. Hard copy documentation  2. Email  3. Blogs  4. Twitter

You are probably wondering if I have contacted "investigative reporters" with this information.  The answer is yes...

It is obvious their voice has been silenced by REMAX and "Big Corporate Money."  The media knows I have mounds of documentation to support the information in my articles.  Nonetheless, the traditional media refuses to cover this story.

This is my belief:  If you can prove you are telling the truth, the public has a right to hear your voice.

In fact, this is the perfect example of Wall Street versus Main Street.  In this case, "Big Corporate Money" has used its influence to keep this information out of the media.  In other words, they want the people on Main Street to absorb the financial repercussions of this scam.

Here are the questions I have regarding the mortgage meltdown:  A. What keeps us from bailing out the people that were ripped-off and lied to by Predatory Lenders?  B. Why do we keep bailing out Wall Street firms that were preying on consumers?

Essentially, the government is rewarding Wall Street for preying on the public.  The consumer gets burned in two different ways:  1. Predatory Lending:  In the beginning, consumers were misrepresented with deceptive mortgages that were difficult to understand.  As you know, these mortgages were loaded with Junk Fees, Yield Spread Premium, and Prepayment Penalties.  2. The bailouts:  In the next step, the victims in this scenario were asked to bailout the companies that initiated the Predatory Lending.

Here is an example of what I am talking about:  Wells Fargo is nationally recognized for their Predatory Lending tactics in the subprime market.  They consistently used deception to steal equity from the public.  Nonetheless, the government gave Wells Fargo $25 billion in bailout funds.  The victims in this scenario received nothing from the government---yet they were asked to support the bailout. 

In summary, it is obvious that "deception" has played a critical role in this financial crisis.  Clearly, no one would agree to pay a higher interest rate if they understood the financial impact it was having on their loan...

http://www.realtor.org/home_buyers_and_sellers/how_to_avoid_predatory_lending

http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_Equity_Theft-

http://www.naca.net/predatory-lending-practices/

http://jmb27.posterous.com/email-response-from-remax-agent-dick-gaylord

http://www.realtor.org/mempolweb.nsf/pages/code

http://www.cbsnews.com/stories/2009/02/09/eveningnews/main4788018.shtml

http://www.bnet.com/blog/financial-business/ex-wells-fargo-loan-officer-details-shady- 

http://www.dailyfinance.com/story/real-estate/wells-fargo-subprime-mortgage-exit/19548625/

http://iphone.indystar.com/posts/22137

Scott Veerkamp (NAR):  "You can trust our Realtors to always keep your interest first and foremost."

Loan 1:  (Property value $150,000)  A. $4,799 yield spread premium  B. $500 processing fee  C. $250 document preparation fee  D. $50 courier fee  E. $35 electronic filing fee  F. $425 administration fee (lender fee)  

Loan 2:  (Property value $120,000)  A. $1,440 yield spread premium  B. $960 application fee  C. $1,920 in "discount points" (paid to Scott Veerkamp)  D. $409 administration fee (lender fee)  E. $150 underwriting fee (lender fee) 

www.ftcsc: Scott Veerkamp / Deceptive Lending

Upon review of my documentation, you will see that Scott Veerkamp must have "skipped class" the day they held ethics training at the National Association of Realtors.

NAR and the Center For Responsible Lending produced a brochure entitled:  "How to Avoid Predatory Lending."  Please take a moment to review this information from the NAR website...

http://www.realtor.org/home_buyers_and_sellers/how_to_avoid_predatory_lending

NAR says:  "Here are some common problems with predatory loans."  (I have included examples from my personal experience with Scott Veerkamp.) 

1. High interest rates and fees: 
Example A:  $960 application fee.  Example B:  $500 processing fee.  As discussed earlier, the National Association of Mortgage Brokers says it is not necessary to pay "application" fees and "processing" fees.  Therefore, the cost of these items should be ZERO as opposed to $1,460. 

2. Loan "Steering": 
Example A:  $4,799 Yield Spread Premium.  Example B:  $1,440 Yield Spread Premium.  The Center for Responsible Lending states the following with regard to Yield Spread Premium:  YSP is "a bonus a lender pays to reward a mortgage broker for placing or "steering" a borrower into a higher-cost loan than the borrower qualifies for."  "Yield Spread Premiums are a destructive feature of the subprime market because they give brokers an incentive to act contrary to a borrowers best interest."  "The effect of YSP is to steal equity from struggling families." 

3. Broken promises, "Bait and Switch.": 
Example A:  "As qualified professionals, we'll guide you through the entire home buying experience and assist you in being an educated buyer."  Example B:  "We will do our very best to help you get the lowest interest rates possible at the lowest possible price."  Example C:  "You can trust our REALTORS to always keep your interest first and foremost."  Example D:  "Keeping the interest of my clients above all else."  Example E:  "Serving Others First."  Example F:  REALTORS are required to "protect and promote the interest of the client" at all times.  Example G:  REALTORS are required to follow the "Golden Rule" at all times.  Example H:  "The term REALTOR has come to connote competency, fairness, and high integrity."

In addition, NAR says you should ask the following question:  "Does the lender belong to a trade association with ethics requirements for members"?  In my case, the answer is yes.  Scott Veerkamp is a member of MIBOR and the National Association of Realtors.

The article also encourages people to do the following:  "Share predatory lending "horror" stories with regulators, other consumers, REALTORS, counseling groups, housing professionals, and the media."  As everyone knows, I have taken their advice on this issue.  I believe it is important for consumers to be aware of Predatory Lending tactics in their community.

In closing, please review the articles below from the Center for Responsible Lending.  This will give you a better understanding of the "Bait and Switch" tactics some brokers use when misrepresenting their clients.

http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-110507-final.pdf

http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_Equity_Theft-0604.pdf

www.ftcsc: Scott Veerkamp / Predatory Broker

Please review this information from U.S. Senator Jeff Merkley regarding deceptive lending practices.  Senator Merkley makes the following statement in his letter to the President:

"Steering payments were made to brokers who enticed unsuspecting homeowners into deceptive and expensive mortgages.  These secret bonus payments, often called yield spread premiums, turned home mortgages into a SCAM."

In addition, Senator Merkley references an article in the New York Times entitled "Predatory Brokers."  The article makes two important statements regarding predatory lending:  1. "The first step must be to outlaw the kickbacks that lenders pay brokers for steering clients into costlier loans."  2.  "The most clearly unethical form of payment is the so-called yield spread premium." 

NAR members are supposed to help their clients avoid predatory lending tactics.  The code of ethics requires them to follow the "Golden Rule" in the representation of their clients. 

If Scott Veerkamp was applying for a loan, would he select a mortgage that is loaded with yield spread premium and junk fees?  The answer to this question is obvious.  Unfortunately, Scott refuses to comply with the "do unto others" philosophy in the code of ethics.  He uses NAR as a selling tool to build trust with his clients. 

After gaining trust, he "blindsides" his clients with YSP so he can receive a kickback on their loan.

This concept is called "steering" and it can be very costly for consumers.  No one would agree to a higher interest rate if they understood the financial impact it was having on their loan.  This is why Senator Merkley refers to yield spread premium as a "secret bonus payment."

Please take a moment to review two examples of predatory lending using YSP and junk fees: 
Loan 1:  (Property value $150,000)  A. $4,799 yield spread premium  B. $500 processing fee  C. $250 document preparation fee  D. $50 courier fee  E. $35 electronic filing fee  F. $425 administration fee (lender fee)  

Loan 2:  (Property value $120,000)  A. $1,440 yield spread premium  B. $960 application fee  C. $1,920 in "discount points" (paid to Scott Veerkamp)  D. $409 administration fee (lender fee)  E. $150 underwriting fee (lender fee) 

I have provided documentation Scott collected nearly $10,000 on two separate mortgages using YSP and junk fees.  This is an average of $5,000 per loan.  This type of lending represents the extreme opposite of "protecting the interest of the client." 

As I mentioned earlier, predatory lending can cause serious financial harm to the unsuspecting public.  Therefore, I agree with Senator Merkley when he says yield spread premium has turned the home mortgage industry into a "SCAM."

YSP and Prepayment Penalties

Please review these two statements from the Center for Responsible Lending regarding YSP and prepayment penalties...

Yield Spread Premium:  1. "Many lenders pay this premium---essentially a kickback to brokers---only when the loan has a prepayment penalty that helps trap the borrower in the higher-cost loan long enough for the lender to recoup the cost of the payment to the broker."

2. "Because YSP's encourage prepayment penalties, these kickbacks not only make loans more expensive from the beginning, they also effectively penalize borrowers for developing good credit over time."

Obviously, this information makes it difficult for NAR to say Yield Spread Premium "protects and promotes the interest of the client."

www.ftcsc: Scott Veerkamp / Preying On Consumers

David Knight, David Wright, and Sheryl Owen grabbed a "ringside seat" at REMAX Central closings.  They helped Scott Veerkamp prey on the unsuspecting public with deceptive lending tactics.

I find it interesting that Scott refers to himself as a Christian Businessman.  He wants people in his community to believe he is praying for them.  In reality, he is preying on them.  Please do not be fooled when he describes himself as a "Christian Super Servant."

Upon review, you will see he uses the following entities to gain trust with the public:  1. NAR Code of Ethics.  2. ISBA Code of Ethics.  3. Indian Creek Christian Church.  4. Christian Phone Book. 

In my personal experience, Scott will literally say anything to gain access to your money.  Here is the perfect example:  "You can trust our REALTORS to always keep your interest first and foremost." 

Again, a $4,799 Yield Spread Premium represents the extreme opposite of this statement.

Elizabeth Warren: Yield Spread Premium Information...

Elizabeth Warren:
http://www.law.harvard.edu/news/2007/10/03_warren.php

Legal Information: Yield Spread Premium

We believe that the circumstances surrounding the issuance of Yield
Spread Premiums are potentially actionable under state and federal
laws, as long as the claims are brought within 1 to 2 years from the
occurrence.

Any inquiries can be directed to the following:
Price Waicukauski & Riley LLC
Re: Yield Spread Premiums

The Hammond Block Building
301 Massachusetts Avenue
Indianapolis, IN 46204

REMAX Realtors: Disclosure of Yield Spread Premium

Regarding disclosure of Yield Spread Premium, would this be a typical
conversation between a REMAX Realtor and a client?

REMAX Realtor: I can get you a loan at 4.5%, or I can get you a loan
at 5%. I will receive a kickback on the 5% loan for increasing your
interest rate. Which loan do you prefer?

Client: Please give me the 5% loan so you can receive a kickback on
my mortgage. In addition, I want to pay thousands of extra dollars
over the life of my loan so you can deposit the kickback in your bank
account.

REMAX Realtor: Thank you for understanding and appreciating the
benefits of YSP.

Client: You are welcome. As you know, there is a high probability
that REMAX will honor you with a "Lifetime Achievement Award" for your
effort in assisting me with Yield Spread Premium.

REMAX Realtor: You are correct. REMAX requires us to follow a strict
Code of Ethics in the representation of our clients. In fact, we are
required to follow the "Golden Rule" at all times. This is the reason
we are presented with "Lifetime Achievement Awards" each year.

Client: Congratulations on your accomplishments. However, I have one
final question: Should I use Countrywide Home Loans or Wells Fargo to
provide the funding for my predatory loan? I noticed these companies
were listed as "Platinum Sponsors" with members of the National
Association of Realtors.

I think you get the picture... In my opinion, I believe it is more
appropriate to use the word "disguised" when referencing YSP. This is
more realistic than using the word "disclosed."

Why would anyone agree to a higher interest rate if they understood
the financial impact it was having on their mortgage? For obvious
reasons, this is why Senator Merkley refers to Yield Spread Premium as
a "secret bonus payment" and a scam.

Please note: The Center for Responsible Lending and the National
Association of Realtors produced a brochure entitled: "How to Avoid
Predatory Lending." The brochure refers to Yield Spread Premium as
Predatory Lending.

As I mentioned earlier, MIBOR says "Realtors are held accountable for
their ethical behavior." Who is holding REMAX and the National
Association of Realtors accountable for deliberately misleading the
public?

Scott Veerkamp: "Bait and Switch" Advertising

Scott ran the following advertisement in Christian Phone Book: "We
will do our very best to help you get the lowest interest rates
possible at the lowest possible price."

As discussed, Yield Spread Premium and Junk Fees represent the
"extreme opposite" of the statement above. In fact, Predatory Lending
puts the public at risk for serious financial harm. This is the same
public Scott Veerkamp claims to be "Serving."

Articles Regarding Loan Steering and Predatory Lending

Loan Steering Lawsuit:
http://www.huffingtonpost.com/2010/06/30/countrywide-lawsuit-racia_n_630661.html

Subprime Loan Steering:
http://industry.bnet.com/financial-services/10003019/ex-wells-fargo-loan-offi...

Loan Steering Lawsuit:
http://www.dailyfinance.com/story/real-estate/wells-fargo-subprime-mortgage-e...

REALTORS and Yield Spread Premium:
http://www.realtyresourcesil.com/Seven-Signs-of-Predatory-Lending.asp

National Association of Realtors and Predatory Lending:
http://www.realtor.org/home_buyers_and_sellers/how_to_avoid_predatory_lending

Center for Responsible Lending:
http://www.responsiblelending.org/mortgage-lending/research-analysis/ib-ysp-1...

Center for Responsible Lending:
http://www.responsiblelending.org/mortgage-lending/tools-resources/ib011-YSP_...

Senator Jeff Merkley and Yield Spread Premium:
http://merkley.senate.gov/newsroom/press/release/?id=A09C6A80-537A-4EB1-83C5-...

NAR Code of Ethics:
http://www.realtor.org/mempolweb.nsf/pages/code