The Big Squeeze - Countrywide Limits Broker Compensation

Countrywide issued a communication to its brokers today limiting compensation on all loans to Countrywide to 4 points, including yield spread premium (back points or YSP).  While 4 points may seem egregious to some, it is the first step at banks actively restricting total compensation to brokers above and beyond traditional federal and state guidelines.   The following is an Important Message regarding Broker Compensation.  Dear Valued Business Partner:  Consistent with evolving industry standards within the wholesale lending environment, Countrywide®, America's Wholesale Lender® will be modifying the current Broker Compensation Policy for all broker-originated loan transactions. Effective Thursday, April 3, 2008 at 8:00 p.m. (PT), the maximum allowabl