An MLO works for a lender that pays a salary plus commission. The commission structure pays 0.75% on the first $300,000 of loan amount and 1% on amounts above $300,000. This compensation plan is:
Correct Answer
C) Permitted because it's based solely on loan amount
This compensation structure is permitted because it varies only based on loan amount, not loan terms. Dodd-Frank allows compensation to vary based on loan amount, and the tiered structure based on dollar amounts is acceptable.
Why This Is the Correct Answer
This compensation structure is permitted because it varies only based on loan amount, not loan terms. Dodd-Frank allows compensation to vary based on loan amount, and the tiered structure based on dollar amounts is acceptable.
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