Housing Finance, the Rule of Law, and the Responsibility of Change
For more than four decades, I have worked at the intersection of housing finance, regulation, and the rule of law, and if there is one constant in mortgage banking, it is change. Yet the forces reshaping the industry today feel as consequential as any I have witnessed. Understanding what comes next requires an honest look at how the system was built, why its legal and regulatory foundations matter, and what is at risk if we forget those lessons.
My belief in the importance of housing finance is deeply personal. I was born and raised in Queens, New York, the child of Holocaust survivors for whom a home was not a symbol of status, but of safety and dignity. My mother survived Auschwitz as a teenage slave laborer; my father escaped the Nazis, lived in the woods, joined the Russian partisans, and helped save others. When my father pointed out the bank that financed our family’s home as we crossed the Williamsburg Bridge, it left a permanent impression. I understood early that access to fair and reliable housing finance changes lives, and that the systems enabling it must be durable, accountable, and governed by law rather than whim.
My professional path into mortgage banking began not in private practice, but in housing policy. As a college student in Madison, Wisconsin working in the mayor’s office, I helped establish the nation’s first tenant–landlord rental relations board, an experience that pushed me toward law school and ultimately to Washington University in St. Louis. There, under the guidance of Professor Daniel Mandelker, a pioneer in urban and housing law, I worked on early issues involving Ginnie Mae, Fannie Mae, and the emerging world of mortgage securitization. After law school, I joined HUD in 1981, where I spent nearly five years regulating mortgage bankers and litigating enforcement actions. Seeing the industry from the regulator’s vantage point (e.g., how rules are enforced, misunderstood, or stretched) shaped how I would later advise clients when I entered private practice and eventually founded my firm in 1992, at a time when few law firms focused exclusively on mortgage banking.
One of the most meaningful evolutions I have observed since then is the maturation of legal and compliance functions within mortgage companies themselves. Early in my career, many lenders had no in-house counsel and only rudimentary compliance infrastructure. As regulation expanded and the market grew more complex, that model became untenable. Today, the strongest organizations recognize that legal and compliance expertise is not a back-office formality but a strategic necessity. This shift has improved risk management, sharpened decision-making, and, ultimately, produced better outcomes for consumers.
Mortgage banking is, at its core, a relationship-driven business, and over the years I have worked closely with executives who genuinely want to do the right thing. That trust, however, carries responsibility. Effective counsel is not about affirmation; it is about objectivity and clarity. Clients deserve to be told when they are wrong, why they are wrong, and how to correct course. Candor is not a threat to trust, it is the foundation of it. The rule of law depends on advisors who are willing to deliver uncomfortable truths when necessary.
Those principles became especially important with the rise of the Consumer Financial Protection Bureau. Created in response to the financial crisis with good intentions, the CFPB quickly became politicized, relying heavily on enforcement actions rather than transparent rulemaking. The PHH case crystallized why process matters. Agencies cannot rewrite statutes through enforcement or discard long standing interpretations without notice. The Administrative Procedure Act exists to prevent precisely that kind of unchecked discretion, protecting both industry participants and consumers. When process erodes, predictability and fairness erode with it.
More recently, state regulators have stepped more aggressively into areas such as RESPA enforcement, particularly as federal activity has slowed. Consumer protection is essential, but Section 8 of RESPA is narrow by design, addressing kickbacks and referral fees, not broad theories of unfairness. Expanding its reach through creative pleading risks undermining clarity and replacing it with uncertainty. Disclosure and transparency are critical, especially where ownership interests or financial incentives exist, but enforcement must remain grounded in the law as written.
The same tension exists in debates over loan officer compensation. While the current administration shows little philosophical appetite for regulating compensation, unwinding existing rules is far more complex than it appears. Statutory limits, operational realities, and unintended consequences make simple repeal unrealistic. Meaningful reform would require expertise, patience, and a return to notice-and-comment rulemaking. Whether that discipline will prevail remains an open question.
Looking ahead, three forces are likely to define the next chapter of mortgage banking. First, artificial intelligence will fundamentally reshape origination and servicing. The efficiency gains are real, and for the first time in decades, technology may meaningfully restore industry margins. Second, the future of Fannie Mae and Freddie Mac remains the most consequential policy question in housing finance. These institutions are the market, and ending conservatorship without careful planning would jeopardize credit availability and affordability. Incremental changes may occur, but a full release carries enormous systemic risk. Third, new business models (i.e., servicing consolidation, vertical integration with real estate platforms, and data-driven consumer ecosystems) are transforming competition. For mid-sized servicers, these pressures are structural and intensifying.
The United States has built one of the most effective housing finance systems in the world, enabling homeownership, wealth creation, and economic mobility across generations. Innovation is essential, and change is inevitable, but recklessness is not. As technology, policy, and business models evolve, the greatest challenge will be preserving the legal, regulatory, and institutional foundations that made broad homeownership possible in the first place. The future of mortgage banking will be defined not just by what we invent next, but by whether we protect what already works.