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Industry orgs backing bills to restore confidence, fight fraud

As the Legislature wraps up committee assignments and gets down to business, banking organizations are finalizing their major legislative issues. Members of the Mississippi Bankers Association (MBA) and the Mortgage Bankers Association of Mississippi, along with the Mississippi Department of Banking and Consumer Finance, are meeting to develop positions on a number of issues.

Mac Deaver, president of the MBA, said the organization expects to introduce and support legislation fighting fraudulent lending practices and to support bills to make certain technical changes to banking statutes. As mortgage woes continue to beset the country, close attention will be paid to any bills affecting that industry in Mississippi.

“Our association will be involved in any proposals that affect the lending process and our ability to serve our customers,” he said. “We favor fair, ethical lending practices and oppose fraudulent ones. At the same time, we oppose any further restrictions being placed on banks in reaction to practices of lenders outside our industry.”

Limiting lending turmoil

The Mortgage Bankers Association is committed that the state will not have as much turmoil in lending and the housing market as the rest of the country, according to Quentin Whitwell, the group’s executive director.

“We stand with the industry nationwide to make sure the market stabilizes, confidence is returned and that we have a greater focus on the values of lending and lending channels,” he said.

He knows of no specific legislation at the state level as most mortgage banking issues are being dealt with at the federal level, but is a bit nervous that there may be an over reaction on the state level.

“We want to make sure legislation is not passed that would over react to perceived problems that aren’t there,” Whitwell said, “That includes attempts to freeze credit mortgage products and to stop bona fide mortgage products that help consumers — anything that could have a reverse affect and take away options.”

State Banking Commissioner John S. Allison says the state’s mortgage statutes need a bit more tweaking after last year’s severe re-vamping of the mortgage act. “We want to ferret out wrong doers,” he said. “I don’t see any earth-shaking legislation this year. It mostly will be technical amendments and housekeeping. We will see what others in the industry are doing and support them.”

Competing in the marketplace

Deaver says the MBA will generally work for legislation that will allow member institutions to compete in the marketplace.

“Likewise, we will oppose any measures that unduly restrict free and open competition,” he said. “We will work with state officials, including the State Banking Department, on several fronts. Also, we expect to be supportive of the business court proposed by Secretary of State Delbert Hosemann.”

Allison says the banking groups will introduce a bill again this year that will add $1.25 to all deeds of trust. One dollar of that amount goes into a fund to investigate mortgage fraud.

“The bill got a lot of traction last year. There were questions about the number of deeds filed, so we came back and did a survey, receiving responses from most counties, including all of the big ones,” he said. “The mortgage industry, the county clerks who will gather the information and the real estate industry support this bill. We all want to ferret out wrongdoers.”

Allison also hopes to see passage of a bill that updates the sale-of-check act as it pertains to transferring money. He says the statute is old and needs beefing up, particularly the bond for sellers of money orders.

“We want to tie the bond to dollar amounts outstanding,” he said. “The change would also take into context pre-paid debit cards and gift certificates, how companies do fees on them and the expiration. We want language to get the full value on these transactions.”

Consumer and investor confidence

Whitwell says the number one goal of the Mortgage Bankers Association is to regain the confidence of consumers and investors by taking a common sense approach and returning to the basics of mortgage lending.

“Toward that goal, we need all lenders to provide education about consumer finance to clients, to provide information of selection of choices for home financing and to make sure clients have all the information they need about all the products offered,” he said.

Contact MBJ contributing writer Lynn Lofton at llofton656@aol.com.


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