Ok, let me first say the concept makes me uncomfortable but I have been asked to research it so here goes. Many of our Loan Officers are protesting that we do not allow them to take the applications and handle the loans of their own famly members as our policy considers it a conflict of interest. Their take is that their family and friends are some of their best origination resources and not being able to assist these people through the process is bad customer service and also impacts their compensation. They also bring up the point that in most cases unless the last name matched we wouldn't even be able to detect that they were doing it.
I realize that the files pass through so many reviewing hands that it would be difficult for a loan officer to sneak by a lower rate or waive fees or skip documentation steps. I can't find it prohibited anywhere or maybe I just am not looking in the right places, but it still leaves me feeling like it's not a good idea, even from appearances sake. However, I am willing to consider it if it can be done in a reasonable way. Anyone have any thoughts or experience on this they can share?