Daily Real Estate News  |  December 22, 2008  |   Mortgage Brokers Try to Block RESPA Rule
The National Association of Mortgage Brokers has sued the U.S. Department of Housing and Urban Development over changes to the Real Estate Settlement Procedures Act (RESPA) that require yield-spread premiums be credited to borrowers.

The trade group says HUD's final rule would have a negative impact on small businesses.

Under the new rules, the standardized Good Faith Estimate form, which lists expected closing costs, requires mortgage brokers to disclose yield-spread premiums paid by lenders when borrowers take out loans with higher interest rates.

But NAMB argues that bank loan officers are not required to disclose a similar fee known as service release premiums.

The change to RESPA "discriminates against mortgage brokers" and puts them "at a permanent disadvantage in the marketplace," according to the organization.

Source: Inman News (12/22/08)