Draft Letter to Alphononso Jackson
April 1, 2004
Draft for Review
The Honorable Alphonso Jackson
Department of Housing and Urban Development
451 Seventh St. S.W.
Washington, D.C. 20410
Dear Secretary Jackson:
I applaud you for withdrawing the final RESPA rule from Office of Management and Budget review. It demonstrates your ability to work with Congress and your sensitivity to the affect of the proposal on small businesses. The title insurance industry looks forward to working with you on issues of mutual concern.
I understand that OMB has requested that you review certain issues as you proceed in your analysis. I am particularly concerned about the effect of the proposed revision on small businesses, state law, and the title insurance industry. As you move forward in your analysis I would like you to keep several things in mind.
First, settlement agents and attorneys in my district who perform closings typically explain the HUD 1 and any other forms at real estate settlements. They are well aware of problems and concerns. We hope that HUD conducts additional testing on any forms revisions, and uses professionals who work in this area as a resource.
I ask that you devote substantial resources to examining the effect of any proposed rule on small businesses. Small businesses in my community pay taxes and create jobs. I also request your careful consideration of the effect of state consumer protection laws and examination of state anti-tying, anti-affiliation, rate setting, and mini RESPA laws, which should not be pre-empted. Many states have statutes such as title plant laws and anti-kickback statutes that are designed to ensure the quality of the title product and limit payment of referral fees. These laws should be maintained.
I note that OMB has asked for a careful review of packaging. I ask that you take into account current marketplace developments on packaging and its potential evolution, to determine whether an exception to Section 8 is necessary.
Thank you for your consideration of our views.