Our mortgage division wants to do a campaign where the buyer will receive a lender credit if purchasing a home from a specific builder. We are not the financing bank of the builders properties.

I've read the FILs, RESPA and other discussions and have not been able to find anything prohibiting this (since we are not the financing bank for the builder) - but, this request makes me nervous.

Any thoughts?

There is no Sec 8 issue as long as the lender credits are going to the borrower.

Please ignore this if there's a case on point, but it sure looks like the builder receives a "thing of value" if a mortgage lender selectively drives business his/her way. I see this as a different case than a general promotion that is not builder-specific. In all cases, the credit to the borrower causes no concern.

Disclaimer: I tend to be ultra cautious when it comes to Section 8 because the lenders I supported designated ME as the company representative who would do the year at Club Fed if I guessed wrong!

My other reaction to this arrangement is why? What makes the bank so anxious to dip into the stockholders' dividends in order to help this particular builder succeed?

thanks!