 |
|
| NATIONAL ASSOCIATION OF REALTORS® | Videos | Store | Library | Directories | Need Help? |
| Register | Login | My Account | NRDS |
 |
 In This Issue Realtor Insider DC News and Events Report NAR Writes Government Officials on Bank Lending Issues Special Tax Break Available for New Car Purchases This Year FASB Issues Guidelines on Mark-to-Market Accounting Business Report Mobile Spam Legislation Introduced Patent Reform Legislation Passes Senate Judiciary Committee FTC Offers "Red Flag" Compliance Website for Design of Identity Theft Programs Conventional Residential Lending Report Fannie Mae Announces Guidelines for Loan Limits in High Cost Areas Environment Report Wetlands Expansion Bill Reintroduced Federal Tax Report Estate Tax Revisions Recommended in Senate Budget Resolution Housing Report FHA Adopts Fannie Mae 1004MC Market Conditions Addendum Realtor Insider DC News and Events Report  NAR Writes Government Officials on Bank Lending Issues On March 30, 2009, NAR President Charles McMillan wrote to Treasury Secretary Geithner, Federal Reserve Board Chairman Bernanke, Federal Housing Finance Agency Director Lockhart, and Federal Deposit Insurance Corporation Chairman Bair raising concerns that their actions to reduce interest rates and increase mortgage liquidity are not fully reaching the retail level. Rates are still too high. There are even reports of large financial institutions using leverage to gain market share, at the expense of borrowers and small and midsized competitors, and failing to add or support additional lending capacity. Warehouse lending is becoming difficult for smaller lenders to fund, which is reducing the availability of affordable financing and competition. The letter asks that the addressees consider ways to improve the availability of affordable credit at the retail level. NAR Letter Jeff Lischer 202-383-1117, Tony Hutchinson 202-383-1120, Kenneth Trepeta 202-383-1294 back to top Special Tax Break Available for New Car Purchases This Year The IRS has released IR 2009-30 to remind taxpayers of a temporary tax incentive that will be available to them for the purchase of a new car, light truck, motor home or motorcycle during 2009. The deduction is available for the cost of all state and local sales and excise taxes paid on up to $49,500 of the purchase price. The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers. The vehicle must be purchased after Feb. 16, 2009, and before Jan. 1, 2010, to qualify for the deduction. The special deduction is available regardless of whether a taxpayer itemizes deductions on their return. The IRS reminded taxpayers the deduction may not be taken on 2008 tax returns. Bob McNamara 202-383-1268 back to top FASB Issues Guidelines on Mark-to-Market Accounting On April 2, 2009, the Federal Accounting Standards Board (FASB) adopted new guidance on "mark-to-market" accounting rules. Marking the value of securities to market when the markets are dysfunctional has severely impaired liquidity in the commercial and residential mortgage markets, without accurately reflecting the value of the securities. The new guidelines provide flexibility to address this problem. On March 31, 2009, NAR President Charles McMillan wrote to FASB in support of its draft guidance. Members of Congress and industry representatives (financial institutions, investors, auditors, etc.) have increasingly been calling for clarification of the fair value accounting guidelines and the "mark-to-market" accounting application of these guidelines. NAR Letter to FASB FASB Minutes of Meeting Approving New Guidelines Lisa Brechtel 202-383-1090, Jeff Lischer 202-383-1117 back to top Business Report Mobile Spam Legislation Introduced On April 2, Sens. Olympia Snowe (R-ME) and Bill Nelson (D-FL) introduced legislation that would limit unsolicited text messages on mobile phones. The mSpam Act of 2009 would strengthen the authority of the Federal Communications Commission (FCC) and the Federal Trade Commission (FTC) to curb unsolicited text messages by banning commercial text messages to wireless numbers listed on the do-not-call registry. Currently an exemption exists for prior existing business relationships so that REALTORs who text their current or past clients should not be affected by this legislation. NAR will monitor the legislation and work with Congress to ensure that there is no adverse business impact for our members. Read full text of Final Rule Scott Rinn 202-383-7508, Melanie Wyne 202-383-1234 back to top Patent Reform Legislation Passes Senate Judiciary Committee The Senate Judiciary Committee passed legislation this week making important reforms to the patent system. The bill empowers the Patent Trademark Office (PTO) to take a more active role in reviewing claims that patents were improperly issued. The bill also makes changes to address venue and damages flaws in the current patent system. The bill must now be voted on by the full Senate before it moves to the House for consideration. Melanie Wyne 202-383-1234, Scott Rinn 202-383-7508, Ken Wingert 202-383-1196 back to top FTC Offers "Red Flag" Compliance Website for Design of Identity Theft Programs The Federal Trade Commission (FTC) recently launched a new webpage designed to help "creditors" and "financial institutions" comply with "red flag" rules which go into effect on May 1, 2009. The "red flag" rules are designed to identify and prevent identity theft. The website, "Fighting Fraud with the Red Flags Rule: A Guide for Business," describes the entities covered and how to comply with its provisions. Mortgage brokers and mortgage lenders that provide credit, or arrange for credit to be provided, are required to establish policies and procedures to prevent identity theft. A real estate agent may be considered a "creditor" if s/he regularly arranges for credit to be extended, e.g. regularly pulls credit reports, suggests potential lenders, helps with the loan applications. See NAR's FAQs for further guidance. FTC website NAR FAQs Melanie Wyne 202-383-1234, Scott Rinn 202-383-7508, Ken Wingert 202-383-1196 back to top Conventional Residential Lending Report Fannie Mae Announces Guidelines for Loan Limits in High Cost Areas On March 30, 2009, Fannie Mae issued Announcement 09-08, implementing the 2009 conforming loan limits for high cost areas ("high-balance" loans above $417,000). The American Recovery and Reinvestment Act (ARRA) raised loan limits for high cost areas for 2009 to the higher of the permanent limits in effect for 2009 or the temporary limits in effect for 2008. In most cases the 2008 limits are higher. The guidelines apply to loans delivered to Fannie Mae starting May 1, 2009. The Fannie Mae announcement specifies eligibility requirements for high-balance loans, including: —Loan must be conventional, first-lien mortgages only. —One to four unit properties are eligible. —Loans must be fixed-rate or adjustable rate loans (no balloons). —Loans must meet loan-to-value (LTV) and minimum credit score requirements. For one unit properties with a fixed rate mortgage, the maximum LTV is 90% and the minimum credit score is 700 for LTVs above 75% and 660 for LTVs at or below 75%. For one unit properties with an adjustable rate mortgage, the maximum LTV is 75% and the minimum credit score is 680. For second homes and investment properties, the maximum LTV is 65% and the minimum credit score is 740. Other rules apply to other categories. Fannie Mae Announcement 09-08, Temporary High-Cost Area Loan Limits and Revised Eligibility Requirements for High-Balance Mortgage Loans Jeff Lischer 202-383-1117, Tony Hutchinson 202-383-1120 back to top Environment Report Wetlands Expansion Bill Reintroduced Sen. Russ Feingold (D-WI) reintroduced the "Clean Water Restoration Act" expanding wetlands jurisdiction beyond "navigable" to all waters of the U.S. This is virtually the same bill as the one NAR opposed last year. NAR is working as part of a broad coalition to educate new members of Congress that simply deleting the word "navigable" will not reduce federal-state jurisdictional confusion which has been the subject of several Supreme Court decisions. It could, however, lead to further administrative rulings and litigation that hinders the nation's economic recovery and erodes private property rights. A companion measure has yet to be introduced in the House. Austin Perez 202-383-1046, Russell Riggs 202-383-1259, Helen Devlin 202-383-7559 back to top Federal Tax Report Estate Tax Revisions Recommended in Senate Budget Resolution During 2009, Congress must act on the estate tax. If Congress does not act, the estate tax would be repealed in 2010. Then, in 2011, the pre-2001 law would be reinstated so that the estate tax exclusion would be $1 million and the maximum tax rate would be 55%. For 2009, the exclusion is $3.5 million and the maximum rate is 45%. Finance Committee Chairman Baucus (D-MT) has introduced legislation to make the 2009 rules permanent. The Senate Budget Committee has included a so-called "unfunded reserve" that provides the Finance Committee with budgetary authority to adopt Chairman Baucus's legislation. During full Senate debate on the budget resolution, however, Senators Blanche Lincoln (D-AR) and John Kyl (R-AZ) were successful in adding a provision that would permit the Finance Committee to increase the exclusion to $5 million and to reduce the maximum estate tax rate to 35%. The vote was 51 - 48. It is not known whether the Lincoln-Kyl amendment will be included in the conference agreement on the budget. Linda Goold 202-383-1083, Lisa Brechtel 202-383-1090, Samuel Whitfield 202-383-1131 back to top Housing Report FHA Adopts Fannie Mae 1004MC Market Conditions Addendum Effective April 1, 2009, the Federal Housing Administration will require appraisers to use the Market Conditions Addendum (Fannie Mae 1004MC, Freddie Mac Form 71). According to Mortgagee Letter 2009-09 released on March 23, 2009, this will ensure greater transparency and accuracy of appraisals performed for FHA-insured financing. Properties located in declining markets must include at least two comparable sales that closed within 90 days of the effective date of the appraisal. A lack of available market data must be accompanied by a detailed explanation. FHA states that a declining market is any "neighborhood, market area, or region that demonstrates a decline in prices or deterioration in other market conditions as evidenced by an oversupply of existing inventory or extended marketing times." The 1004MC form will identify a declining trend in the market. FHA reminds Direct Endorsed lenders that both the lender and the appraiser are equally responsible for the integrity, accuracy, and thoroughness of an appraisal submitted to FHA. Mortgagee Letter 2009-09: Adoption of Market Conditions Addendum Fannie Mae Announcement 08-30: Appraisal-Related Policy Changes and Clarifications Jerome Nagy 202-383-1233, Chere LaRose-Senne 312-329-8455, Megan Booth 202-383-1222 back to top Go to archived weekly reports >> Last Updated: 04/06/2009 Bira de Aquino |
  |
 Copyright NATIONAL ASSOCIATION OF REALTORS® Headquarters: 430 North Michigan Avenue, Chicago, IL. 60611-4087 DC Office: 500 New Jersey Avenue, NW, Washington, DC 20001-2020 1-800-874-6500 Terms of Use | Privacy Policy | REALTOR.com | Contact NAR | Site Map |