NAR generally supports the proposed rule but makes several recommendations to mitigate unintended consequences that may negatively impact communities with higher than average closing costs. NAR recommends allowing seller concessions greater than the proposed 3 percent or $6,000; especially in areas of the country with higher closing costs.
Given the concerns about FHA's overall fiscal stability, this bill balances the needs to protect the fund from taxpayer risk, with the need to continue to provide access to safe and affordable mortgage financing. There is not any plan for timing on the House Floor. There is not yet a companion in the Senate.
NAR noted that most PACE loans are in the primary lien position, which means that in the event of a default, these loans get repaid first, even before the mortgage. NAR believes that this first lien position of PACE loans adds an unnecessary risk and may threaten mortgage markets during the current fragile recovery of real estate markets.
On March 26, 2012, Reps. Bachus (R-AL) and Garrett (R-NJ) issued a letter expressing concern to six banking agencies regarding their risk retention proposal, which contained a requirement that securitizers set aside the profits from sales of securities in a “premium capture cash reserve accounts” (PCCRAs).
NAR stressed that it is critical that an anticipated multi-stakeholder process consider all relevant voices on this most important issue—including the small business/independent contractor whose business model is increasingly dependent on internet technologies to innovate and thrive.
Three bills have been introduced by members of the tax-writing committees that would extend the 2007 mortgage cancellation relief that is currently scheduled to expire at the end of 2012.