Bill Provides for Creation of Consumer Agency, But Little Else

The bill lays out an ambitious agenda for consumer protection, but leaves the new regulator on its own for how to accomplish those goals in addition to getting itself up and running.

Insurance Networking News, July 2, 2010

Cheyenne Hopkins

While passing a bill that would create a consumer protection agency has proved challenging enough, that task may pale in comparison to actually setting up the new regulator.

The regulatory reform bill lays out an ambitious agenda for the Consumer Financial Protection Bureau, including quickly detailing the scope of its powers and harmonizing regulations that implement two of the most complex lending laws on the books.

But the legislation largely leaves the new regulator on its own for how to accomplish those goals in addition to hiring needed personnel and getting itself up and running.

“While Congress has laid out the structure, it’s going to take a long time and be very complicated to translate the concept into something that works,” said Andrew Sandler, a partner at Buckley Sandler LLP.

Under the final bill, which was approved by the House this week but must still be passed by the Senate, the Treasury secretary must transfer consumer protection powers to the bureau between six months to a year after enactment of the legislation, with the option to extend it to 18 months if necessary.

I have been working with a realtor for 4 months now on a short sale transaction that finally got lenders (2) approval in the middle of June. Upon hearing from the lenders that the transaction was approved the Listing agent Realtor called me to schedule the closing and advised that the seller would be calling me later that day. I did in fact receive a call from the seller that day and was absolutely STUNNED to hear what they had to say.

The property that was encumbered by the mortgage contained about an acre and a half of land and had a house on it. The seller called to tell me that it was their desire to “sell” only half of the property to the buyer (the half containing the house); pay the lenders off and then went on to say that they were going to sell the other half of the property to another person. I advised them that I could not be a party to this transaction as they were attempting to defraud their lenders who had FINALLY approved the short sale transaction.

Posted via email from Title Insurance
Continuing Ed for Title Agents

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HUD Seeks Public Comment on Affiliated Business Arrangements (AfBAs)

July 9, 2010 admin

From: Robert B. Holman, Esq., Chairman of NAILTA Policy and Legislative Committee

Date: June 7, 2010

Re: HUD Seeks Public Comment on Affiliated Business Arrangements (AfBAs)

View the official notice by following this link: http://www.nailta.org/memo-to-members06-07-2010.pdf

The U.S. Department of Housing and Urban Development (HUD) has issued the attached Advance Notice of Proposed Rulemaking (ANPR) regarding the definition of “required use” in the affiliated business arrangement portion of RESPA known as Section 8. This is the first meaningful attempt to address affiliated business arrangement issues since 1996. As an organization dedicated to the preservation of independent title insurance agents and agencies, we want to alert each of you to an opportunity to have your voice heard on this important subject.

As the enclosed suggests, HUD is seeking public comment to strengthen and clarify the prohibition against the “required use” of affiliated settlement service providers in residential mortgage transactions under section 8 of RESPA. HUD has received complaints that some homebuyers are committing to use a builder’s affiliated mortgage lender in exchange for construction discounts or discounted upgrades, without sufficient time to research their contracts or to comparison shop. While this is a narrow review, the ANPR suggests that HUD will entertain actions in addition to or as an alternative to rulemaking that would better address concerns with affiliated business arrangements in residential mortgage transactions.

The public comment period will remain open until September 1, 2010.

To make your voice heard, you can send your written comments to the following by regular U.S. Mail:

Regulations Division

Office of General Counsel

Department of Housing and Urban Development

451 7th Street SW

Room 10276

Washington, DC 20410-0500

or make your comments via email to the following:

www.regulations.gov

In the normal course following the Administrative Procedures Act, after HUD collects data in this ANPR proceeding, HUD’s next steps would be one of three: (i) HUD could decide to no longer pursue the matter, (ii) HUD could decide to continue to deliberate without taking further action at that time, or (iii) HUD could issue a Notice of Proposed Rulemaking, which would include for comment the actual text of the new proposed rule.

Again, we encourage each of you to prepare your own public comments and file them with HUD. Make sure to include the fact that you are a member of NAILTA in your letter to HUD. We want to show our strength in numbers!

If you do not wish to file your own separate comments, but would like to have NAILTA complete a form letter comment for your agency, please let us know and we will be happy to oblige our members.

NAILTA will be presenting its own official and separate comment on the ANPR prior to the deadline.

If you have any questions about the ANPR, affiliated business arrangements or our stance on either, please feel free to contact me via email rholman@generaltitleco.com or by telephone at (800) 344-7445 or by contacting NAILTA’s Public Relations Committee Chairman, Harvey Pollack, at hpollack@nailta.org or HAP@landtitleservices.net.

Posted via email from Title Insurance
Continuing Ed for Title Agents