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

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...]