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 In This Issue Business Report NAR Meets With New HUD General Counsel Environment Report Senate Committee Approves Legislation without Energy Labels Housing Report New Law to Protect Rental Tenants When Home is in Foreclosure Guidance on How to Use the Tax Credit with FHA Loans NAR Calls on Veterans Affairs to Monetize Tax Credit Business Report  NAR Meets With New HUD General Counsel NAR staff met with new Housing and Urban Development General Counsel, Helen Kanovsky and members of her staff, on June 1, 2008. The purpose of the meeting was to introduce NAR staff and highlight NAR key issues currently under consideration by the Department. Ms. Kanovsky was very receptive and requested a number of documents relevant to critical issues before HUD. NAR has provided the materials and will work closely with HUD to ensure that the views of our membership and their clients and customers are addressed as HUD develops policy on issues such as RESPA, FHA mortgages, and other key programs. Scott Rinn 202-383-7508, Marcia Salkin 202-383-1092, Kenneth Trepeta 202-383-1294 back to top Environment Report Senate Committee Approves Legislation without Energy Labels The Senate energy committee approved the building efficiency title of a broader energy and climate bill. Thanks to Realtor visits, heeded calls to action and continuing efforts, the committee reconsidered an initial proposal that would have established and implemented a real estate labeling program. Instead it adopted a bipartisan amendment by Sen. Lisa Murkowski (R-AK) in collaboration with Chairman Jeff Bingaman (D-NM) which concentrates on improving the long-standing existing Energy Star for commercial buildings program. Rather than simply expanding this program to additional building types, under the committee-approved bill the EPA will evaluate, in the form of pilot projects, whether the data that is currently used or other data is more appropriate for measuring building efficiency. Among study elements is how best to measure building efficiency and develop formats for displaying the results in a certificate for covered building types. These are considerable improvements over the draft bill and puts NAR in a stronger position going into a House floor debate over H.R. 2454 by Rep. Henry Waxman (D-CA) which includes prescriptive, transaction-based labeling provisions and was recently approved by the House energy committee. The next step in the Senate is floor consideration although it is not clear whether and when this and other energy titles will be combined with provisions to "cap and trade" carbon emissions to be developed by the Senate's environment committee. House leadership is aiming for floor consideration of H.R. 2454 before the July 4th recess. NAR will continue to work with the members of Congress and make every effort to bring both the House and Senate bills more closely in line with NAR policy. Austin Perez 202-383-1046, Helen Devlin 202-383-7559, Russell Riggs 202-383-1259 back to top Housing Report New Law to Protect Rental Tenants When Home is in Foreclosure S. 896, the "Helping Families Save Their Homes Act of 2009", which became law on May 20, 2009, included provisions to protect tenants from eviction as a consequence of a foreclosure affecting the property being rented. Many examples were seen of families living in rental housing throughout the United States who were evicted without any prior notice when the home where they had lived was foreclosed upon. Much of the time, the rental family had no idea the home was in delinquency or subject to foreclosure until their eviction. The new law requires tenants be given 90-days notice prior to having to vacate, and allows them to stay through the remainder of their lease, if the home will continue to be a rental property. For more information, visit our one-page summary Megan Booth 202-383-1222 back to top Guidance on How to Use the Tax Credit with FHA Loans On May 29, 2009, US Department of Housing and Urban Development (HUD) announced a program that allows borrowers to use the first-time homebuyer tax credit for a down payment or closing costs on a FHA-insured mortgage. Since the announcement NAR has received many inquiries from our members regarding how this impacts first-time homebuyers in their state. Currently, 10 state housing finance agencies (HFAs) offer a product buyers can use that will effectively monetize the tax credit for down payment purposes. Generally, these programs offer tax credit advances with second liens on the home being purchased. The second lien may be "soft" (silent) or require monthly payments but may not result in cash back to the borrower and may not exceed the total amount needed for the down payment, closing costs, and prepaid expenses. The 10 states offering these programs are Colorado, Delaware, Idaho, Kentucky, Missouri, New Jersey, New Mexico, Ohio, Pennsylvania, and Tennessee. Other states are developing programs so members are encouraged to regularly follow up with their respective HFA. For all other states where such programs do not exist the tax credit may not be used to fund the 3.5 percent downpayment required for FHA loans. As always, the 3.5 percent downpayment may be a gift from a family member, employer or nonprofit, charitable organization. FHA-approved nonprofit organizations and FHA-approved lenders may monetize the tax credit for down payments in excess of 3.5 percent, closing costs and interest rate buy downs. Mortgage industry leaders have indicated that this type of product may not be immediately available to consumers. Mortgagee Letter 2009-15: Using First-Time Homebuyer Tax Credits NCSHA State HFA Programs Visit www.realtor.org/2009housingtaxcredit Jerome Nagy 202-383-1233, Megan Booth 202-383-1222 back to top NAR Calls on Veterans Affairs to Monetize Tax Credit On June 4, 2009, the National Association of REALTORS® (NAR) 2009 President, Charles McMillan sent a letter to US Department of Veterans Affairs (VA) Secretary Shinseki asking that VA create a program that will effectively monetize the first time home buyer tax credit for veterans. NAR recommends that the proposed VA program be crafted in a similar fashion to the recently announced program for Federal Housing Administration (FHA) loans, which allows government entities and instrumentalities of government to provide a second mortgage. NAR noted that VA generally offers mortgage products that require no downpayment but there are other uses for the tax credit. Veterans purchasing a home could use a second loan, backed by the tax credit, for closing costs, interest rate buy downs, or to make a downpayment. Monetzing the tax credit for these purposes would reduce the costs of purchasing a home for our country's veterans. NAR Letter to VA on First Time Home Buyer Tax Credit US Department of Veterans Affairs Megan Booth 202-383-1222, Jerome Nagy 202-383-1233 back to top Go to archived weekly reports >> Last Updated: 06/08/2009 Bira de Aquino |
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