Consumer advocates decry lending proposal
Industry players are calling it a technical clarification. Consumer advocates contend it's a much bigger and badder deal, weakening protections for mortgage borrowers.
What they're arguing over is legislation in the General Assembly about "table funding," a little-known -- and in Maryland, little-used -- type of mortgage lending.
Table-funded loans are made by mortgage-broker companies in their own name, rather than in the name of a lender, but are immediately sold to a lender who will provide the actual funding, according to HUD. That's different than typical mortgage brokering, where the loan is closed in the lender's name, and from cases where borrowers work directly with lenders that fund the loans themselves but sell them on the secondary market to Fannie Mae, Freddie Mac or others in the mortgage-backed securities business.