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 In This Issue Realtor Insider DC News and Events Report H.R. 384, The TARP Reform and Accountability Act of 2009 Business Report HUD Delays RESPA Required Use Change in Response to Homebuilder Lawsuit Federal Tax Report Senators Discuss Homebuyer Tax Credit Changes Housing Report NAR Speaks to Capacity and Risk Management of FHA State Certification for FHA Appraisers Required by October 2009 Fund Interruption for Rural Housing Guaranteed Loan Program Home Valuation Code of Conduct Final Agreement Announced Realtor Insider DC News and Events Report  H.R. 384, The TARP Reform and Accountability Act of 2009 President Charles McMillan will testify on January 13th in front of the House Financial Services Committee on the "Priorities for the Next Administration: USE of TARP Funds under the Emergency Stabilization Act of 2008". During his testimony, President McMillan will indicate NAR's support for H.R. 384, the TARP Reform and Accountability Act of 2009, because it includes a number of the priorities NAR identified in the Housing Stimulus Plan as necessary for a housing and national economic recovery: (1) foreclosure relief, (2) improving the Hope for Homeowners Plan, and (3) expanding the TARP to support commercial real estate loans and mortgage backed securities. While additional work will be required to get the housing market and the national economy back on their proper footing, this is a good first step. NAR Press Release Supporting H.R. 384 President McMillan Podcast regarding 2009 TARP Legislation NAR Housing Stimulus Plan Draft language of H.R. 384 Link to more information on the Credit Crisis and NAR's activity Tony hutchinson 202-383-1120, Jeff Lischer 202-383-1117 back to top Business Report HUD Delays RESPA Required Use Change in Response to Homebuilder Lawsuit On Tuesday, January 6, 2009 the Department of Housing and Urban Development (HUD) announced that it would postpone implementation of the "required use" provisions of the new RESPA rule for 90 days. The provision was to go into effect beginning on January 16, 2009. However, the National Association of Homebuilders filed suit in late December, seeking a temporary injunction and questioning HUD's authority to make the changes it desired. HUD's changes to the required use provisions would have prohibited homebuilders from from using incentives such as signficant reduction in home price to get buyers to use affiliated settlement service providers. The provision was narrowly tailored and didn't affect settlement service providers' ability to offer incentives. In the starkest examples, a homebuilder might offer $10,000 off the price of a house if the buyer used the affiliated mortgage or title company. Few would give up such an offer making the use essentially required. In contrast, incentives offered by others such as a mortgage company offering a $100 gift card if one used their affiliated title business were not viewed as "required" especially when independent settlement service providers could reasonably match such an incentive or compete on price alone. NAHB's lawsuit remains though the HUD move abrogates the need to seek a preliminary injunction for the time being. Federal Register link to RESPA rule Kenneth Trepeta 202-383-1294, Marcia Salkin 202-383-1092 back to top Federal Tax Report Senators Discuss Homebuyer Tax Credit Changes Senator Kent Conrad (D-ND), a senior member of the Senate Finance Committee and also Chair of the Senate Budget Committee, has made public statements this week urging the incoming Obama Administration to strengthen the first-time homebuyer tax credit as part of the economic stimulus package. Senator Conrad noted "To think that we are agoing to have a package of economic recovery that does not address housing adequately I think would miss the boat." Conrad recommended broadening the credit. NAR has sent him a letter expressing NAR's appreciation for his comments and offering NAR assistance. In addition, NAR has sent letters and made contacts in all the offices of Representatives and Senators who sit on the tax-writing committees. NAR's tax message is that the $7500 first-time homebuyer tax credit repayment feature should be eliminated, the credit should be made available to all purchasers and the expiration of the credit should be extended from June 30, 2009 to December 31, 2009. Finally, NAR has issued a Call for Action so that REALTORS® in the districts and states represented on the tax-writing committees can convey the urgency of this message. Read the Letter to Senator Rangel, Chairman, Committee on Ways and Means Read the Letter to Senator Conrad, Chairman, Committee on the Budget Linda Goold 202-383-1083, Megan Booth 202-383-1222, Samuel Whitfield 202-383-1131 back to top Housing Report NAR Speaks to Capacity and Risk Management of FHA The House Financial Services Committee held a hearing on FHA's oversight of its loan originators. NAR submitted a statement reinforcing the importance of the FHA mortgage insurance program. FHA's market share is expected to grow to 30% in 2009, from a low of 2% in 2006. To best manage this increased capacity, NAR urged Congress to work with the new administration to appropriately fund the staffing and infrastructure needed to complete the modernization of FHA. A recent actuarial study demonstrated the FHA is adequately managing risk and has sufficient capital reserves, but with continuing housing price declines, additional oversight may be warranted. NAR urges Congress to allow FHA to use some of their reserves to upgrade their antiquated computer systems and hire more staff to handle the larger volume of mortgages. NAR Statement on FHA Oversight of Loan Originators Jerome Nagy 202-383-1233, Megan Booth 202-383-1222 back to top State Certification for FHA Appraisers Required by October 2009 Beginning October 1, 2009, all Federal Housing Administration (FHA) Appraiser Roster appraisers must be state certified to conduct appraisals for FHA-insured mortgages and to remain on the FHA Appraiser Roster. The appraiser must be certified general or certified residential for the state in which the property is located. This effective date applies to appraisers in all states and territories. Effective October 1, 2008, the Federal Housing Administration began accepting new applications only from state-certified appraisers. This is a result of the Housing and Economic Recovery Act of 2008, signed into law on July 30, 2008. The act states that FHA can only accept appraisers that are certified by a state or a nationally recognized organization. Apprasiers must also demonstrate verifiable education in appraisal requirements as established by FHA. A mortgagee letter providing additional details is expected in the coming weeks. HUD Information for Appraisers Mortgagee Letter 2008-39 Revised Eligibility Requirements for FHA Roster Appraisers Key Provisions of HERA Jerome Nagy 202-383-1233, Chere LaRose-Senne 312-329-8455, Megan Booth 202-383-1222 back to top Fund Interruption for Rural Housing Guaranteed Loan Program On January 5, 2009, the US Department of Agriculture's (USDA) Rural Development Office announced it will temporarily exhaust funds for its Single Family Housing Guaranteed Loan Program (SFHGLP) on or about January 9, 2009. The program is running out of funds because the federal government is operating under a Continuing Resolution (CR) through March 6, 2009, and because demand for the SFHGLP is at a historic high. USDA Rural Development will continue to accept and process applications but will issue conditional commitments "subject to receipt of Congressionally appropriated funds." Funding for disaster areas declared in 2008 or areas affected by Hurricane Katrina may become available sooner. USDA Rural Development Megan Booth 202-383-1222, Kenneth Trepeta 202-383-1294 back to top Home Valuation Code of Conduct Final Agreement Announced On December 23, 2008, the Federal Housing Finance Administration (FHFA) announced that Fannie Mae and Freddie Mac will implement a revised Home Valuation Code of Conduct (HVCC) effective May 1, 2009. The HVCC is based on an agreement between Fannie Mae and Freddie Mac and New York State Attorney General Andrew M. Cuomo to help eliminate conflicts of interest on mortgage appraisals. The code applies to lenders that sell single-family mortgage loans to Fannie Mae or Freddie Mac. According to the agreement, lenders may not accept an appraisal report if the appraiser is retained or selected by any third party, including mortgage brokers and real estate agents. Any employee of a lender may select appraisers only if the employee is appropriately trained and is wholly independent of the loan production staff and process. The Independent Valuation Protection Institute (IVPI) will establish a telephone hotline to receive complaints of violations against the Code from appraisers, lenders, other entities, or consumers. IVPI will also create a publication to promote best practices for independent valuation. NYS Attorney General Press Release FHFA Press Release Jerome Nagy 202-383-1233 back to top Go to archived weekly reports >> Last Updated: 07/21/2009 Bira de Aquino |
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