HUD Announces Mortgage Guidelines- But Can't Enforce Them

The Department of Housing and Urban Development says the new rules will help buyers understand broker's fees will limit fee increases, and they are currently seeking legislation to give them the power to enforce the rules.

"The rules update requirements of the Real Estate Settlement Procedures Act, known as Respa, a 1974 law that sets standards for home-purchase transactions. HUD Secretary Steve Preston said changes were needed because "many people made uninformed decisions" in taking out loans. That, he said, contributed to a surge in mortgage defaults.

HUD, which pushed ahead with the rules despite opposition from lenders and others involved in mortgage transactions, estimated the changes will bring savings of nearly $700 in loan-closing costs for the typical consumer.

In a news conference, HUD officials conceded they lack legal authority to penalize violators of the rule. Legislation would be required to give HUD those powers. But they said state and federal regulators of lenders and brokers can insist on compliance with federal rules and that the threat of class-action suits may keep lenders in line."

Full Story: HUD Unveils New Rules for Mortgages

Comments

Book cover of the Guide to Graduate Planning Programs 4th Edition

Thinking about Grad School?

New! 4th Edition of the Planetizen Guide to Graduate Urban Planning Programs just released.
Starting at $24.95

Prepare for the AICP Exam

Join the thousands of students who have utilized the Planetizen AICP* Exam Preparation Class to prepare for the American Planning Association's AICP* exam.
Starting at $209

Wear your city with style!

100% silk scarves feature detailed city maps. Choose from six cities with red or blue trim.
$55.00
Book cover of Where Things Are from Near to Far

Where Things Are From Near to Far

This engaging children's book about planning illustrates that "every building has its place."
$19.95