Democrats, Bush Square Off Over Housing Relief
Washington Post (03/20/08) P. D1; Birnbaum, Jeffrey H.; Montgomery, Lori
The White House is working closely with Capitol Hill legislators on proposals that would help new home buyers and small investors nationwide by toughening up rules that govern mortgage lending. Meanwhile, House lawmakers reportedly are on the verge of approving a multibillion-dollar program to prevent hundreds of thousands of home foreclosures. The outlook for the plan is uncertain, though, as President Bush continues to balk at broad legislation to bail out strapped homeowners. Democratic congressional leaders believe the president will compromise eventually, at the urging of Treasury Secretary Henry Paulson and other senior members of the Cabinet.
Mortgage Industry Backs Bill to License Loan Officers
Arizona Daily Star (03/18/08) Smythe, Christie
Mortgage lenders in Arizona say they support a bill in the state Legislature that would require loan originators to be licensed. Sponsored by Rep. Bill Konopnicki (R-Safford) and Sen. Jay Tibshraeny (R- Chandler) the measure would establish basic education standards for loan officers, require background checks, and allow the Department of Financial Institutions to keep track of loan originators. Similar legislation failed in previous years, but the current crisis in the mortgage market has the industry thinking long and hard about providing greater protection to home buyers. "Mortgage brokers are pushing this on ourselves," says Arizona Association of Mortgage Brokers President Stan Lund, who has been a long-time advocate of licensing requirements. "We want our industry to be regulated and licensed."
HUD Official Says Respa Reform Can't Wait
American Banker (03/17/08) P. 9; Terris, Harry
The public comment period on HUD's proposed revisions to the Real Estate Settlement Procedures Act ends May 13, but more than a half dozen trade groups representing the mortgage industry insist that more time is needed to review the nearly 300-page document. However, Federal Housing Commissioner Brian Montgomery says the process should not be delayed. According to Montgomery, "It is no longer acceptable to stand in the way of millions of Americans who are crying out for clarity when it comes to the biggest purchase of their lives."
A proposal formally introduced on March 14 would create a four-page, standard good-faith estimate detailing settlement costs and loan terms; it would limit how much closing costs can rise at the settlement table, and it also call for legislation that would beef up HUD's enforcement powers. The agency says borrowers would save an average $518 to $670 per transaction, or $6.5 billion to $8.4 billion per year overall, if the rules are implemented.