Government News

November 8, 2002

ALTA NEEDS YOUR HELP

1. CONTACT HUD ON THE PROPOSED RESPA RULES

2. CONTACT YOUR CONGRESSMAN AND ASK THEM TO CONTACT HUD

BACKGROUND: On July 29, HUD issued proposed revisions to its Real Estate Settlement Procedures Act (RESPA) regulations that would fundamentally alter the way in which mortgages and real estate settlement services are marketed and priced. Comments are due October 28, 2002. The proposal would scrap the existing rules and forms for the disclosure of settlement cost estimates by lenders that have been in place for almost 30 years and substitute two radically new regimes. Under a “Revised Good Faith Estimate with a Tolerance” regime, lenders would provide binding estimates only for major categories of lender and settle-ment charges, with a requirement that the final charges for those categories not exceed the estimates (or exceed them only by limited tolerances). Under the second regime, lenders could provide consumers with an abbreviated disclosure, and would be given an exemption from the antikickback provisions of Section 8 of RESPA, for a “guaranteed mortgage package” (GMP) consisting of a loan and all settlement services. Please see RESPA Updates on the ALTA homepage for further details. http://www.alta.org.

ALTA has already filed its comments with HUD and a copy is available on the ALTA site [Click Here]. ALTA encourages members and state associations to submit their own comments to HUD in order to influ-ence the outcome of the proposed rule. HUD will be counting the number of letters received on this issue, and the concerns expressed. Consequently, we encourage you to take four steps:

1. SEND A LETTER TO HUD expressing your views on the Rule. Letters must be mailed. HUD will not take e-mails or Faxes. Click here for sample letter.
2. SEND A COPY OF YOUR LETTER TO YOUR CONGRESSMAN. Ask your Congressman to send your letter to HUD and have him ask HUD to pay attention to the points you expressed. Click here for access to the information you need for your Congressman and sample letter.

3. If you have a closing operation and satisfied customers, ASK YOUR CUSTOMERS TO SEND A LETTER to HUD urging that HUD continue to allow purchasers and sellers of real estate to be able to choose their settlement service provider. Click here for a sample letter.

Please send copies of all your letters to ALTA, Attention Ann vom Eigen, ALTA Legislative and Regulatory Counsel.
FAX 888-FAX-ALTA, e-mail service@alta.org