“Here in California why is it that a real estate agent (through their broker of record), can refer business to another, and ask/get a referral fee, while, for a loan agent, we cannot refer business to another loan agent, and get a referral fee, even if it was paid to our broker of record?” Loans are federally governed by RESPA. California’s Real Estate law allows commission splits for the sale of real estate (one could call it a referral). RESPA only governs the settlement process, which starts with the loan, but the sale of real estate is not part of the settlement process. The RESPA rule applies to 1-4 family loans that will end up in the secondary market, and other than a small employee exemption RESPA doesn’t allow anyone to receive “any thing of value” for the referral of a settlement service. No RESPA regulation says you cannot pay or receive a thing of value for the referral of a settlement service (a loan, appraisal, title policy etc.).

RESPA applies to all transactions involving a “federally related mortgage loan,” which “includes most loans secured by a first or subordinate lien on residential property. Home purchase loans, refinances, lender-approved assumptions, property improvement loans, equity lines of credit, and reverse mortgages all fall under the purview of RESPA. RESPA defines a “federally related mortgage loan” with a multitude of clauses, including “any loan which is secured by a first or subordinate lien on residential real property upon which there is located, or will be constructed using the proceeds of the loan, a structure designed principally for the occupancy of 1 to 4 families and that is made in whole or in part by any lender the deposits or accounts of which are insured by any agency of the federal government, or is made in whole or in part by any lender which is regulated by any agency of the federal government; is made in whole or in part, or insured, guaranteed, supplemented, or assisted in any way, by the Secretary or any other officer or agency of the federal government or under or in connection with a housing or urban development program administered by the Secretary or a housing or related program administered by any other such officer or agency; is intended to be sold by the originating lender to Fannie Mae, Ginnie Mae, Freddie Mac, or a financial institution from which it is to be purchased by Freddie Mac…” etc.

Thornburg’s securitization has been delayed, and this is what Thornburg uses in creating their prices and rates. And there are issues with the buyback of the preferred stock. New investors who helped the company a few months ago with a cash infusion have agreed to wait until Sept. 30 for the company to convince its preferred stockholders to tender their shares. (As part of the deal, two-thirds of preferred shareholders had to tender their shares for $5 in cash and 3.5 shar