Yield Spread Premium | Dodd-Frank Wall Street Reform Act

Yield Spread Premium The term 'Yield Spread Premium' is derived from the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (USA). Yield Spread Premium is a fee or commission paid by a lender to a mortgage loan originator (mortgage broker or retail bank) in exchange for a commitment by a borrower to pay a higher interest rate. A similar fee may be paid by a lender to induce a broker to introduce a borrower to a particular program, such as a loan for a term or rate that is more … [Read more...]

Procuring Cause | Which Agent is the Effective Cause

Procuring Cause Explained Also called the effective cause, especially in the UK. The act or process by which an agent or broker finds a party who carries a transaction through to the stage required by the principal. In order to be the procuring cause or 'effective cause' of a transaction, the agent or broker must be the party that is responsible for bringing about the transaction for which a fee has been agreed; in other words, that transaction would not have occurred without the broker’s … [Read more...]