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 In This Issue Conventional Residential Lending Report President Approves Two-year Ban on Banks in Real Estate State Mortgage Regulators Launch Nationwide Mortgage Licensing System--NMLS NAR Urges Congress to Include GSE Loan Limit Increase in Economic Stimulus Package Business Report HUD Releases Record-Setting RESPA Enforcement Statistics In Annual Report NAR Expresses Concerns to FCC on Consequences of Making Do-Not-Call Registration Permanent Federal Agencies Publish Final Rule for Users of Credit Reports on Identifying Address Discrepancy Red Flags Environment Report President Bush Signs Meth Bill; Congress Directs DEA to Address Website Concerns Housing Report HUD Issues Final Rule on FHA Appraiser Roster Requirements HUD Issues Interim Rule on Maximum Claim Amount and Eligibility for Discounted Mortgage Insurance on HECM Loans Conventional Residential Lending Report  President Approves Two-year Ban on Banks in Real Estate On December 26, 2007, President Bush signed into law the FY2008 omnibus appropriations bill which includes a two-year provision prohibiting banks from entering the real estate brokerage, property leasing and management business. NAR was well position to secure a permanent ban. However, due to a last minute objection by Senator Robert Byrd (D-WV), Chairman of the Senate Appropriations Committee, the permanent language was struck and replaced with a two-year ban. In 2008 NAR will be advocating Congress to approve its Community Choice in Real Estate bill (H.R.111/S.413). Lynn King 202-383-1156, Jeff Lischer 202-383-1117 back to top State Mortgage Regulators Launch Nationwide Mortgage Licensing System--NMLS On January 2, 2008, the state mortgage regulators, CSBS and AARMR, launched their new Nationwide Mortgage Licensing System (NMLS). CSBS is the Conference of State Bank Supervisors. AARMR is the American Association of Residential Mortgage Regulators. NMLS streamlines licensing of state-supervised mortgage lenders and brokers and improves supervision by the state regulators. Banks with federal deposit insurance are not affected. The new system will contain a single database for registrants, accessible by each participating state where the firm or individual is licensed or seeking licensing. The system will prevent "bad actors" shut down in one state from moving to another state and starting over. Seven states are part of the initial roll-out. At least eight more will join the system in 2008 and nine in 2009. As of January 2008, regulators from 40 states have expressed their intent to participate. The goal is for all 50 states to use the system. The NMLS website Lynn King 202-383-1156, Jeff Lischer 202-383-1117 back to top NAR Urges Congress to Include GSE Loan Limit Increase in Economic Stimulus Package On January 17, 2008, the National Association of Realtors sent a letter to congressional leaders urging them to include a provision in the economic stimulus package that allows Fannie Mae and Freddie Mac to purchase loans larger than the current conforming loan limit of $417,000. NAR believes that increasing the conforming loan limit to $625,000 would bolster the housing finance market, which continues to be severely stressed, and provide an immediate infusion of much-needed liquidity into the nation's mortgage market. The critical role that the GSEs play in providing liquidity to the mortgage market has never been more evident than it is today. Unlike most proposed stimulus measures being discussed, a national conforming loan limit increase to $625,000 would have a positive, immediate impact on the housing market and the broader economy. Specifically, NAR estimates that increasing the conforming loan limit to $625,000 will strengthen current home prices by 2 to 3 percent and generate $42 billion in increased economic activity. NAR letter to Congress NAR letter to OFHEO OFHEO proposed guidance Jeff Lischer 202-383-1117, Lynn King 202-383-1156 back to top Business Report HUD Releases Record-Setting RESPA Enforcement Statistics In Annual Report HUD responded to 6,622 RESPA-related inquiries and complaints during its 2007 fiscal year, representing a 121% increase over its goal of 3,000. In addition, HUD's 2007 performance represents an increase of 205% over its previous record response rate of 1,355 in FY 2006. The HUD report, dated November 15, 2007, states: "Consumer redress cases returned over one million dollars to consumers who complained about unearned fees, misapplied loan payments, unpaid property taxes, and unpaid insurance premiums … [and] closed twelve formal executed settlement agreements resulting in payments of over five million dollars. Additionally, two agreements were coordinated with state regulatory agencies. In one case, the Department of Justice filed a federal lawsuit on behalf of HUD for violations of the Real Estate Settlement Procedures Act." According to the report (p. 152), HUD has assisted the public by increasing awareness of RESPA-related problems through these increased enforcement actions and penalties, and conducted outreach and training by speaking at industry conferences and providing information to news agencies. View HUD's Performance and Accountability Report Scott Rinn 202-383-7508, Kenneth Trepeta 202-383-1294, Marcia Salkin 202-383-1092 back to top NAR Expresses Concerns to FCC on Consequences of Making Do-Not-Call Registration Permanent On January 14, 2008 NAR submitted a comment letter to the Federal Communications Commission (FCC) on a proposed rule to amend FCC rules under the Telephone Consumer Protection Act (TCPA). The proposed rule requires telemarketers to honor registrations with the National Do-Not-Call Registry indefinitely so that registrations will not automatically expire after the initial five year registration period expires under current law. NAR's letter, signed by Joseph Ventrone, Vice President, Regulatory Affairs and Real Estate Services, stated that making Do-Not-Call registration "indefinite" could compromise the FCC's goal of maintaining a high level of accuracy of valid numbers on the list. Currently, phone numbers are scheduled to automatically drop off the registry after five years. This five-year provision serves as an efficient means to eliminate all numbers that have changed hands, been disconnected or have been reassigned. Realtors® are subject to the Do-Not-Call law as telemarketers and are concerned that non-valid numbers on the government-maintained registry are efficiently purged. NAR's comment letter expresses the expectation that technology will be employed to effectively and efficiently remove all numbers that should no longer be on the registry. Finally, NAR asked that the FCC work to ensure that any changes to the TCPA will not increase existing burdens to small businesses and to research and study the merits of appropriate regulatory changes and exemptions to TCPA for small businesses in the future. Scott Rinn 202-383-7508, Melanie Wyne 202-383-1234, Marcia Salkin 202-383-1092 back to top Federal Agencies Publish Final Rule for Users of Credit Reports on Identifying Address Discrepancy Red Flags The Fair and Accurate Credit Transactions Act of 2003 (FACT Act) amended the Fair Credit Reporting Act of 1970 (FCRA), to require six federal agencies to issue joint regulations that provide guidance regarding reasonable policies and procedures that a user of a consumer report should employ when the user receives a notice of address discrepancy. The six agencies are:
Agencies Final Rules Scott Rinn 202-383-7508, Marcia Salkin 202-383-1092 back to top Environment Report President Bush Signs Meth Bill; Congress Directs DEA to Address Website Concerns President Bush on Friday, December 21 signed H.R. 365, the Methamphetamine Remediation and Research Act of 2007 (Pub. Law 110-143), a bill that was strongly supported by NAR. This law directs the Environmental Protection Agency (EPA) and the National Institute of Standards and Technology (NIST) to develop standards for remediation of meth-contaminated properties, set guidelines, and conduct research. The House and Senate Committee reports filed on the legislation direct the DEA to develop standards for listing and de-listing properties on the DEA National Clandestine Laboratory Register. Currently the register lists properties, but also disclaims the accuracy of the data presented. NAR brought this problem to the attention of the House Science Committee and the two Senate sponsors, Max Baucus and Gordon Smith. The House Committee on Science and Technology noted in its legislative report (H. Rpt. 110-8): "[t]he Committee is concerned that the DEA does not have procedures in place to update its website once a residence has been cleaned in accordance with local regulations. The Committee urges the DEA to develop a set of transparent procedures for both listing and de-listing a residence on the `National Clandestine Laboratory Register.'" The report of the Senate Committee on Environment and Public Works included similar language. NAR will continue to work with Congress and all appropriate agencies and officials to ensure that the intent of Congress is carried out. Visit the National Clandestine Laboratory Register Russell Riggs 202-383-1259, Mark Washko 202-383-7526 back to top Housing Report HUD Issues Final Rule on FHA Appraiser Roster Requirements HUD issued a final rule on eligibility requirements for the FHA Appraiser Roster on January 8, 2007. The rule states that only appraisers on the roster may perform required appraisals of properties that are to serve as security for FHA-insured single-family mortgages. Current regulations require that an applicant must be a state-licensed or state-certified appraiser and pass a HUD examination on FHA appraisal methods and reporting. This final rule codifies HUD's longstanding practice that an appraiser's certification or licensing complies with AQB criteria in effect when credentials were issued. This final rule also eliminates the requirement for applicants to pass a HUD test on FHA appraisal methods and reporting, because the test has become duplicative of the national examination requirements for state licensure and certification. Generally, publishes a rule for public comment before issuing a rule for effect. For this rule, HUD found that good cause exists to publish this final rule without soliciting public comment saying that additional public procedure is unnecessary because the purpose of the rule is to formally codify a practice that is already in place. The rule goes into effect on February 7, 2008. Jerome Nagy 202-383-1233, Chere LaRose-Senne 312-329-8455, Megan Booth 202-383-1222 back to top Housing Report HUD Issues Interim Rule on Maximum Claim Amount and Eligibility for Discounted Mortgage Insurance on HECM Loans On January 8, 2008, the US Department of Housing and Urban Development (HUD) issued an interim rule making two technical changes to the Home Equity Conversion Mortgage (HECM) program. First, the rule extends the date for calculating the maximum claim amount in the HECM program from the date of the underwriter's receipt of the appraisal report to the date of closing. This change provides a more easily verifiable and more easily identifiable date. HUD states that the appraisal report received date is not the best date to use in property valuation for mortgage insurance purposes because HUD's reporting systems do not capture the date the appraisal report is received by the underwriter, which means the date cannot be later verified or audited. Additionally, using the closing date will allow for larger equity payments when the Federal Housing Administration's (FHA) mortgage limits increase between the date the case number is assigned and the date the loan closes, in cases where appraised value meets or exceeds the new jurisdictional FHA maximum mortgage. The second rule corrects an unintended consequence that results in a situation where HECM loans that are not in default but have been assigned pursuant to regulatory provisions, and remain in effect, are not eligible to be refinanced with a discounted initial mortgage insurance premium (MIP). This rule would permit such HECM loans to be eligible for the discounted initial MIP upon refinancing, in accordance with the purpose of the HECM program, which is to improve the financial situation of elderly homeowners. The rule previously contained language that restricted the refinance of HECMs by including the term "presently insured" loans. The proposed interim rule removes the phrase "presently" such that refinancing provisions will apply to all existing HECM loans Megan Booth 202-383-1222, Jerome Nagy 202-383-1233 back to top Go to archived weekly reports >> Last Updated: 01/18/2008 Bira de Aquino |
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