Three major trade groups are trying to convince at least one federal lawmaker to ask the Government Accountability Office to look into the causes what is supposedly a marked increase in foreclosures.

Historically, the main reasons families lose their homes are job loss, divorce or major illness. And the National Association of Mortgage Brokers, Mortgage Bankers Association and American Financial Services Association are betting that's still the case.

More importantly, they're hoping that abusive lending practices lead only to a small portion of repossessions by unscrupulous lenders.

Proponents of get-tough legislation at the national, state and local levels maintain that predatory lending is now a root cause of foreclosures, "but they don't have any figures" to prove their case, NAMB President Harry Dinham said in a wide-ranging interview late last month.

The three groups "would like to see an impartial, third-party study" of the exact causes of foreclosure, and believe that the findings will quiet activists who want to place what brokers and lenders see as overly burdensome restrictions on their ability to serve borrowers, especially those with less than perfect credit.

"Certainly, abusive lending practices are the cause of some foreclosures," Dinham, a Dallas mortgage broker, said. "But they not they big problem the consumer activists make them out to be." NAMB also is taking its case against so-called "trigger lists" to Congress, and is looking for another White Knight to carry the group's banner for a national lending law that puts all lenders and brokers on an even footing.

Because the Federal Trade Commission "seems to have no stomach" to act against credit repositories which sell the names of mortgage applicants who have asked for their credit scores, the 15,000-member brokers group says lawmakers need to step in to protect consumers from "wholesale calling" from unscrupulous telemarketers.

"How many good things have you gotten from somebody calling you on the phone?" Dinham asked.

The NAMB is not only worried that the clients of member-brokers will be bombarded by unwanted telephone solicitations, some of which may be bogus. It also is concerned about the possibility of identity theft by scam artists who misrepresent themselves as lenders.

Credit bureaus "are selling lists to people indiscriminately," the NAMB president said. "We need to do something so that borrowers' information is not shared recklessly."

The group is in the process of preparing a leaflet members can give to clients that explains how to "opt out" of pre-screened offers of credit.

"Opting out is the process of removing your name from lists supplied by the consumer credit reporting companies Equifax, Experian, Innovis and TransUnion," the pamphlet explains, adding that it won't affect anyone's ability to obtain credit or improve their credit scores.

The NAMB also is searching for a new standard bearer to lead the charge for federal, one-size-fits-all predatory lending legislation. The group's previous champion, former Rep. Robert Ney, R-Ohio, is now serving a prison sentence for his involvement with lobbyist Jack Abramoff.

Currently, the brokers are trying to convince Rep. Barney Frank, D-Mass., the new chairman of the House Financial Services Committee, and Rep. Maxine Waters, (D-Calif.), among others, that enacting a suitability standard is unnecessarily burdensome and will create more problems than it will solve.

"We don't want to do something that will cut off product," Dinham said, "We need legislation that will help the consumer without completely throttling the industry." NAMB also is advocating better disclosure, both at the time of application and at the loan closing. MBA President John Robbins also is staunch supporter of disclosure at application and closing.

In addition, Dinham said his group is in "full support" of regulations that require lenders to qualify borrowers who seek adjustable rate mortgages at the fully indexed rate. "That is something that really helps consumers," the Texas broker said.

Published: February 7, 2007

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When Lew Sichelman first started writing about housing in 1969, he was the youngest real estate writer in the country. Now, 37 years later, he's one of the oldest -- and most decorated. He has been rated the top housing columnist in the country by the National Association of Realtors as well as by his peers in the National Association of Real Estate Editors. Indeed, NAREE has recognized his work on numerous occasions. One year - due to his advancing age, he can't recall which one - he earned top honors in the annual NAREE Journalism Contest in three out of the four major writing categories. It was the first time one writer has won so many NAREE awards in a single year. Known for his ability to make even the most difficult topics understandable, Sichelman also has been honored by the National Association of Home Builders and the Mortgage Bankers Association. He began providing in-depth coverage of and consumer-oriented information about housing and housing finance at the Washington Daily News, where he was real estate editor. He held that same position for nine more years at the Washington Star, which purchased the News in 1972. The Star, a so-called "writer's newspaper" which also had the misfortune of being an evening paper, was put out of its misery in 1981, and Sichelman, who had begun self-syndicating his column in 1978, decided to become a full-time columnist. Today, his column, "The Housing Scene," is distributed by United Media to newspapers throughout the country. He also is on the staff of National Mortgage News, an independent newspaper which is considered the bible of the mortgage business. And he writes for numerous other publications, including MarketWatch.com, where he answers readers questions once a week, Sports Illustrated (don't ask), RealtyTimes.com, BigBuilder and others. Sichelman is married, the father of five and grandfather of eleven.