Mortgage relationships

The Cape Law Society has formulated a general guideline for attorneys when contracting with mortgage originators. The committee agreed that, in principle, there can be no objection to attorneys contracting with mortgage originators provided that a number of conditions are met. These include:

1) there is no fee sharing, direct or indirect;
2) the contemplated contractual arrangement does not exclude any person or party; and
3) there is full disclosure to the party employing the services of the mortgage originator, usually, the purchaser.

The committee also said that, while it does not endorse any mortgage originator's proposed arrangements, it was unlikely to raise an objection if certain principles guided the parties to the arrangement.

Mortgage origination guidelines and National Association of Mortgage Originators.