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The Hidden Lender Loophole That May Cost You Thousands On Your Next Mortgage

If I told you that you could make or save thousands of dollars, but you had to listen to some boring information for 15 seconds, would you do it?

Well here’s your chance to trade just a few seconds of your time for potentially thousands of dollars saved in fees on your next mortgage.

In 2008, Congress passed the Truth In Lending Act as a consumer protection law aimed in part at making the mortgage industry and loan process more transparent for borrowers.

In 2011, they added the Loan Originator Compensation Amendment in an effort to keep borrowers from being overcharged by lenders and wrongfully steered into high cost mortgages.

There you have it. That’s the boring stuff. Now that we have that out of the way, what in the heck does all of this mean to you?

Well it could mean a lot actually. You see, as complex “consumer protection” laws often do, there are loopholes in the legislation. Loopholes that are costing unsuspecting borrowers thousands of dollars. One loophole in particular allows for big banks and other “direct lenders”

who make mortgages, to not have to disclose certain fees or how their loan originators are compensated. They are in fact EXEMPT from this part of the law. Thus a blind spot for consumers was created.

A law that was supposed to protect consumers may have inadvertently created an expensive danger zone for them with this exemption.

Brad Sea, our local mortgage expert with Kentuckiana Mortgage Group, explains the loophole in more detail in the video below and shares a simple way borrowers can defend themselves against this loophole:

The problem is immense. Some of the biggest mortgage lenders in the country are exempt from this law and it’s costing consumers millions of dollars each year.

But as Brad mentions, the solution is simple. When applying for a mortgage or mortgage refinance, spend an extra 5-10 minutes and get a loan estimate from a mortgage broker who is subject to the law and must fully disclose all expenses.

To connect with Brad Sea, visit or by email at

And as always if you have further questions for us on this topic or anything real estate related, you can reach us at

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> 812 Living Group - More than just a real estate company, a community partner <

Kentuckiana Mortgage Group Inc, NMLS# 1793085

Brad Sea, NMLS# 425420

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