Silicon Valley’s mortgage industry is poised for a shake-up under Congress’ financial overhaul, as an already shrinking brokerage industry might consolidate more and lenders take more market share.

The overhaul, which President Barack Obama signed into law July 21, revamps federal oversight of the nation’s financial services industry with new rules, restrictions and regulatory bodies. The law was proposed in the wake of the mortgage-fueled financial meltdown that sent the United States into its worst recession in decades.

Brokers say the law might make it increasingly difficult to meet loan quotas imposed by lenders, which would force smaller brokerage firms to close down or merge with larger ones. They also said lenders will continue issuing more loans in-house, instead of using outside agents.

Keith Winner, Silicon Valley area manager for Wells Fargo Home Mortgage, said he doesn’t believe the law will hurt his bank’s mortgage business. However, he said the law could have the greatest “negative impact” on brokers and shift more deals to direct lenders such as Wells Fargo.

Read more: Mortgage firms feel heat from finance reform – Silicon Valley / San Jose Business Journal