Thursday January 19, 2011 8:00 a.m. - 11:30 a.m. Nopales and Ocatillo Rooms Indian Wells Conference Center
Mission Statement: The Committee is a Policy committee. Its mission is to develop C.A.R.'s overall policy agenda as it relates to the practice of real estate. It has original jurisdiction to evaluate transactional issues, legislation and regulation in the following issue areas:
Licensure Liability and Risk Management Real Estate Finance Transactional
Each issue area is managed during the Committee's meeting by an Issue Chair, under the direction of a committee Chair and committee Vice-Chair. The Committee has jurisdiction over issues that are potentially real estate related that do not fall into another committee's jurisdiction. The Committee reports to the Legislative or Federal level of government committee(s), as appropriate, and to the Executive Committee and the Board of Directors.
Presiding: Greg Galli, Chair Virginia Butler, Vice Chair
Issues Chairs: John Schulte, Risk Management and Liability Clay Sigg, Transaction Larry Black, Real Estate Finance Michael Tessaro, License and Regulatory
II. Legislative Update A. Overview of the C.A.R. policy formation process
B. Legislature and state budget developments - Staff update
C. Member mobilization - DeAnn Kerr
III. Sponsored Legislation- 2012 A. AB 392 (Alejo) - Brown Open Meeting Act reform The Brown Act currently requires local government entities to post their agendas 72 hours in advance of scheduled meetings; however, there is no requirement that staff reports be similarly posted. The Brown Act can be satisfied by posting a hard copy of the agenda at a location accessible to the public. This can present a formidable obstacle for individuals and organizations attempting to follow the actions of local governments. C.A.R. originally sponsored AB 392 to require all local government entities governed by the Brown Act to post their agendas as well as staff reports relating to agenda items on their website (if they have a website - the measure does not require the establishment of a website) allowing individuals and organizations to more easily track proposed government actions. In 2011 AB 1344 (Feuer), which requires the posting of agendas on the internet was signed into law. Due to the passage of that measure and cost considerations, C.A.R. will limit AB 392 to require only cities, counties and school districts to post staff reports related to agenda materials on the city, county or district websites. Removing the requirement for special districts eliminates much of the cost that was assigned to the measure.
Status: Assembly Appropriations Committee
B. Degree Broker experience requirements Under current law an applicant for a brokers’ license must have either two years of active real estate experience or have graduated from a four-year college or university with a specialization in real estate. The Department of Real Estate (DRE) has interpreted the "degree" provisions to mean any four-year degree. C.A.R.'s Board of Directors directed C.A.R. to SPONSOR legislation to clarify the law to require "degree brokers" to have an undergraduate degree, with either a major or a minor in real estate in order to claim the experience exemption. C. Tax Assessor Appeal Board - Brown Act open meetings Under current law local assessment appeals boards are not required to comply with the Brown Act, which requires that the public be adequately informed about meetings of local agencies and protects the right of the public to participate in those meetings. C.A.R.'s board of directors voted to SPONSOR legislation to require property tax assessment appeals boards to comply with the Brown Act requirements that apply to other government entities. This legislation will protect the right of the public to participate in local board meetings but will still include provisions to allow closed meeting deliberations for things like personnel matters and litigation related discussions.
D. Retrofit Requirements - burdens on transactions Existing law prohibits required energy efficiency retrofits from unreasonably or unnecessarily affecting the home purchase process. This bill will define "unreasonable or unnecessary effects" for the purposes of this existing law to include any additional upfront costs, time delays or retrofits where the cost of implementation cannot be recovered over the life of the retrofit.
E. Debt forgiveness tax safe harbor - pending federal action The federal government enacted the Mortgage Debt Relief Act of 2007 that permitted 3 years of mortgage debt relief by not requiring borrowers to pay income tax on debt forgiven in a "short" sale. In late 2008 the federal government extended this relief through December 31, 2012. Also in 2008, California enacted SB 1055 which provided conformity with the federal statute for the 2007 and 2008 tax years and, in 2010, California enacted SB 401 (Wolk) which extended the income tax debt forgiveness until December 31, 2012, conforming California to existing federal law. C.A.R.’s Board of Directors voted to SPONSOR legislation to extend the existing January 1, 2013 mortgage income debt forgiveness sunset date provided that the federal government first extends their mortgage debt forgiveness sunset date which is also set to expire on January 1, 2013.
IV. Sponsored Legislation - 2011 A. SB 150 (Correa); CID Right to rent There has been a trend among some homeowner associations to adopt restrictions that limit the ability of unit owners to rent their dwellings in Common Interest Developments (CIDs). The imposition of these rental restrictions diminishes an owner's property rights by removing options that were available when the unit was purchased. C.A.R. sponsored SB 150, a re-introduction of C.A.R.'s AB 2259 (Mullin) of 2008, protects the right of a CID owner to rent his or her unit, if that right existed at the time the owner purchased the unit.
Status: Signed by the Governor on July 7, 2011 (Chapter 62, 2011 Statutes)
B. SB 458 (Corbett); Anti-Deficiency C.A.R. initially sponsored SB 458 to revisit the "anti-deficiency" issue of SB 1178 (Corbett, 2010), which was vetoed by Governor Schwarzenegger. As introduced SB 458 would have extended existing anti-deficiency protections to cover the refinance of purchase money mortgages, and new debt (cash out) incurred to acquire, construct or improve the home. C.A.R. and the lender groups reached an agreement to amend SB 458 to instead expand the provisions of existing law (SB 931, 2010) which became effective January 1, 2011. SB 931 requires a first mortgage holder to accept an agreed upon short sale payment as full payment for the outstanding balance of the loan, but does not apply to junior lien holders. SB 458 extends the protections of SB 931 to junior liens effectively providing that any lender that agrees to a short sale must accept the agreed upon short sale payment as full payment of the outstanding balance of its loans and cannot require the short seller to provide funds in addition to the sale proceeds.
Status: Signed by the Governor on July 15, 2011 (Chapter 82, 2011 Statutes)
C. SB 510 (Correa); DRE manager proposal Under current law, the Department of Real Estate (DRE) is only permitted to hold the broker of record accountable for failure to supervise, even if the broker of record has delegated supervisorial responsibility to an office manager. C.A.R. -sponsored SB 510 increases the responsibility and accountability of licensees managing real estate offices by permitting a broker of record to appoint an eligible real estate broker or salesperson to supervise branch office operations, provided that the contract with the office manager is in writing and a notice is delivered to DRE. While principal brokers remain accountable for supervisorial responsibilities, DRE will also be able to hold managers accountable for failure to supervise. This measure was recommended by a DRE Task Force containing REALTOR® members and goes into effect on July 1, 2012.
Status: Signed by the Governor on October 9, 2011 (Chapter 709, 2011 Statutes)
D. AB 278 (Hill); DRE Citation and Fine authority Currently, in order to subject real estate licensees to discipline for any violation, they must go through the Department of Real Estate's (DRE) administrative hearing process. Notice of discipline, no matter how minor the infraction, is published in the DRE bulletin or on the DRE website, widely circulated among real estate agents. AB 278 would allow the DRE to issue a "civil citation" with a maximum fine of $2,500 for minor infractions. Licensees would be permitted to contest the citation through the current hearing process if they wish. The action would not be published in the DRE bulletin, unless there is a contested hearing and judgment, although it could still be discovered in the public record. C.A.R. is sponsoring this legislation to expidite minor disciplinary actions without public censure and the lengthy and expensive hearing process, and to allow DRE staff to focus enforcement resources on serious offenders. SB 53 (Calderon) contains the same "cite and fine" provisions as AB 278 and was signed into law by the Governor on October 9, 2011.
Status: Senate Floor Inactive File E. AB 771 (Butler); CID disclosure fee limitation. Home Owner Associations (HOAs) are required by law to provide specific documents to prospective purchasers of homes in common interest developments (CIDs). Current law prohibits HOAs from charging fees in excess of what is "reasonable" based on the actual cost of processing and producing these documents. HOAs are increasingly delegating document preparation to outside third party vendors or contractors who, under a 2007 court decision, are not subject to this fee limitation. This delegation of responsibility by HOAs sometimes results in home purchasers being forced to pay additional fees for other documents which are “bundled” with the required documents. AB 771 says that ONLY the fees for the required documents can be charged upon receipt, effectively prohibiting the "bundling" of fees for other documents with fees for the required documents. The bill also creates a form, which must accompany the documents, detailing the documents that are required. This will eliminate any uncertainty for the prospective purchaser as to exactly which documents are being provided.
Status: Signed by the Governor on September 1, 2011 (Chapter 206, 2011 Statutes)
F. AB 392 (Alejo); Brown Open Meeting Act reform Held on Appropriations Suspense file The Brown Act currently requires local government entities to post their agendas 72 hours in advance of scheduled meetings; however, there is no requirement that staff reports be similarly posted. The Brown Act can be satisfied by posting a hard copy of the agenda at a location accessible to the public. This can present a formidable obstacle for individuals and organizations attempting to follow the actions of local governments. C.A.R. originally sponsored AB 392 to require all local government entities governed by the Brown Act to post their agendas as well as staff reports relating to agenda items on their website (if they have a website – the measure does not require the establishment of a website) allowing individuals and organizations to more easily track proposed government actions. In 2011 AB 1344 (Feuer), which requires the posting of agendas on the internet was signed into law. Due to the passage of that measure and cost considerations, C.A.R. will limit AB 392 to require only cities, counties and school districts to post staff reports related to agenda materials on the city, county or district websites. Removing the requirement for special districts eliminates much of the cost that was assigned to the measure.
Status: Assembly Appropriations Committee
G. SB 837 (Blakeslee); TDS tweak for water conservation SB 407 (Padilla), signed into law by the Governor in 2009, requires that all residential properties be retrofitted with low-flow toilets, shower heads and faucets starting with remodels in 2014, all remaining homes by 2017. Additionally, all commercial properties and multi-family homes will need to be retrofitted by 2019. C.A.R. sponsored SB 837 to add language to the Transfer Disclosure Statement (TDS) notifying the purchaser of a property of these impending requirements. The inclusion of this information in the TDS will ensure that sellers and buyers are aware of these water efficiency retrofit requirements and provide disclosure liability protection to REALTORS®.
Status: Signed by the Governor on June 30, 2011 (Chapter 61, 2011 Statutes)
H. DRE Broker experience requirement; approved pending 2012 introduction Under current law an applicant for a brokers’ license must have either two years of active real estate experience or have graduated from a four-year college or university with a specialization in real estate. The Department of Real Estate (DRE) has interpreted the "degree" provisions to mean any four-year degree. C.A.R.'s Board of Directors directed C.A.R. to SPONSOR legislation to clarify the law to require "degree brokers" to have an undergraduate degree, with either a major or a minor in real estate in order to claim the experience exemption.
IV. Action Items A. License and Regulatory - Michael Tessaro, Issue Chair 1. DRE proposed regulations - Update of proposed regulations, including "broker owned" escrow reporting. 2. Other action items
B. Real Estate Finance - Larry Black, Issue Chair 1. State Bar Proposal: Anti-Deficiency in Refinanced Purchase Debt - C.A.R.-Sponsored SB 1178 of 2010 would have extended anti-deficiency protection of purchase money mortgages to refinanced purchase money debt, but was vetoed. While that bill would not have spoken directly to loan modification requirements, but by eliminating recourse on the debt it would have forced a change in the posture of loan modification and short sale negotiations. At the time, C.A.R. rejected a proposed amendment from the bankers to limit the bill's effect only to new loans made after the effective date of the bill. C.A.R. argued that such an approach denied protection to borrowers with existing loans that had no knowledge that they had lost purchase money protection by a refinance, and because of the economic downturn, these were the borrowers who most needed protection. The State Bar of California is reportedly prepared to introduce legislation to do just what was proposed: protect the refinanced balance of purchase money mortgages just like the original mortgage (i.e., no personal recourse) but only to the extent of unpaid purchase money balance (no coverage for cash-out portions of the refinance) and only for loans made after bill’s effective date.
The State Bar, at the recommendation of its Debtor/Creditor rights committee will sponsor legislation with a similar effect, but only applicable to loans made after the effective date of the bill. 2. Proposed legislation: Prohibition on "dual tracking" of foreclosure and short sale actions by lenders. C.A.R. has been asked to support legislation to limit so-called "dual tracking" of foreclosure and short sale negotiations. Legislation is not in print at time of agenda preparation, and staff will hand carry information to committee. 3. Other action items
C. Risk Management and Liability - John Schulte, Issue Chair 1. Real Estate Fraud Prevention Fund surcharge on real estate recordings - Existing law imposes a $3 surcharge on recording of real estate related documents, but does not apply the surcharge to documents necessary to transfer property. The proposal from the California Distric Attorneys Association will increase the surcharge from $3 to $10, but the sponsors have indicated that the revised statute will exclude any escrow documents. 2. Other action items
D. Transactions - Clay Sigg, Issue Chair 1. REO Seller Exemption from TDS (Transfer Disclosure Statement)* Please see included Issue Briefing Paper on whether C.A.R. should sponsor legislation to repeal the exemption from the TDS that currently applies to REO sellers. 2. Other action items
V. Reporting Items A. Distressed Property Task Force
B. "Door to Door" ordinance, City of Yorba Linda* Please see the included update, requested at the September meeting, regarding the status of an ordinance requiring registration and background checks for "door to door" sellers. The existing ordinance has not been applied to REALTORS
C. License and Regulatory - Michael Tessaro, Issue Chair 1. DRE Commissioner appointment process - Update on the progress of appointment 2. Bills of others
- SB 376, Fuller; Manufactured home financing Existing law defines a "real estate broker's" scope of practice to include a person who, for a fee, solicits or negotiates loans for the purchase of real property. SB 376 would expand the scope of a "real estate broker" license to include individuals who arrange loans secured by manufactured housing. This C.A.R. supported measure would allow manufactured housing dealers to use a mortgage loan originator endorsement on their real estate license to originate financing for personal property mobile homes and avoid the need for an additional licensing requirement for mobile home sales.
Status: Assembly Floor Inactive File Position: Support
D. Real Estate Finance - Larry Black, Issue Chair 1. Qualified Residential Mortgage (QRMs) Update On August 1, 2011, C.A.R. commented on the proposed rule on risk retention, implementing section 941 of the Dodd-Frank Act. Section 941 requires lenders that securitize mortgage loans to retain a percentage of the risk unless the mortgage is a qualified residential mortgage (QRM) or is otherwise exempt. The proposal would have defined a QRM using excessively stringent underwriting standards that would have forced the majority of homebuyers, especially in high-cost states such as California, to pay more in spite of qualifying for a prime loan.
Proposed Definition of a QRM would: • Require an 80% LTV, which requires a 20% down payment. • Limit the mortgage payment to 28% of gross income and 36% of all debts. • Require that the borrower is not currently 30 or more days past due on any debt obligation. • Require the borrower must not have been 60 or more days past due on any debt obligation within the preceding 24 months. • Require the borrower must not have, within the preceding 36 months, been through bankruptcy, foreclosed on, engaged in a short sale or deed-in-lieu of foreclosure, or been subject to a Federal or State judgment for collection of any unpaid debt. C.A.R. QRM Comment Letter
2. New “Mortgage Tax” Legislation recently signed into law by President Obama taxes housing to pay for the extension of the payroll tax, and maintain Medicare payments and unemployment benefits.
Despite REALTORS® strong opposition to the diversion of housing resources to pay for non-housing uses, increases in Guarantee Fees on Fannie/Freddie mortgages and premium charges for FHA loans are being used to pay for the extensions. These increases will translate into additional costs for homebuyers and will divert fees needed to minimize the loss exposure of the government-sponsored enterprises, investors, and ultimately, the taxpayer.
C.A.R. recently sent comments letters to the California Congressional Delegation expression opposition to this new law. Read the letter
3. GSE and Federal Housing Administration REO Disposition In August 2010, the Federal Housing Finance Agency (FHFA), the U.S. Department of the Treasury, and the Department of Housing and Urban Development (HUD) published a Request For Information (RFI), seeking input on new options for selling single-family real estate owned (REO) properties held by Fannie Mae and Freddie Mac (GSEs), and the Federal Housing Administration (FHA).
The FHFA, Treasury and HUD requested input on what was essentially a proposal to expedite the disposition of the REO inventory currently on their books, as well as their expected future REOs. The RFI put forward three different models: • The GSEs and FHA partner with a third party to rent out a portion of their existing REO inventory. • The GSEs and FHA do a bulk sale of a portion of their REO inventory to investors (anywhere from $50 million to $1 billion in size) who would then be obligated to rent those units out. • The GSEs and FHA do a bulk sale of a portion of their REO inventory to investors with no restriction. This would mean investors could rent and/or sell as many or as little of the properties as they see fit.
The RFI was extremely vague on any details and was asking for the industry and interested parties to submit what they believe the bulk sale process should look like.
Recently, the regulatory agencies released a response to the comments submitted to the original RFI. While still lacking in many details, it is now clear a pilot program will be implemented within the coming months, possibly by the time of the C.A.R. Winter Business Meetings. While the response lacked details of what the pilot program will look like, it does appear that a rental requirement will be part of the program.
4. NAR Real Property Valuation Principles At NAR’s November business meetings in Anaheim, the NAR Appraisal Committee considered adoption of “Real Property Valuation Principles.” While supportive of the principles, NAR has decided to table this issue until their May meetings so the newly created Real Property Valuation Committee (which is replacing the Appraisal Committee) may review and vote on the principles.
See Link for Proposed NAR Real Property Valuation Principles
5. GSE and FHA Loan Limits REALTORS® have successfully extended the current FHA and GSE loan limits on an annual basis since 2008. Congress again extended the FHA loan limits for two-years during the last session of Congress in 2011. However, unlike prior years when the loan limits for the both the FHA and the GSE were extended, Congress did not extend the loan limits Fannie Mae and Freddie Mac. This marks the first time that FHA loan limits have been above GSE loan limits.
C.A.R. will continue to ask that Congress recognize California as a “high-cost” state and be given loan limits on par with other high-cost areas such as Alaska, Hawaii, Guam and the U.S. Virgin Islands.
6. Consumer Financial Protection Bureau a. Mortgage Complaints In response to the mortgage crisis, the Consumer Financial Protection Bureau (CFPB) has created a mortgage complaint site on their webpage. The purpose of this page is for the consumer to officially file a complaint regarding the application for a loan, servicing problems, loan modifications or any other issue they may have with the lender. This will allow the CFPB to assist and track the complaints against lenders. https://help.consumerfinance.gov/app/mortgage/ask
b. Good Faith Estimate The creation of a workable Good-Faith-Estimate (GFE) that will meet the requirements of RESPA and TILA has been an issue regulators have struggled with for over a decade. One of the CFPB’s first actions upon becoming operational was to begin acquiring comments and critiques of proposed new GFE layouts intended to ease and clarify the mortgage shopping experience. http://www.consumerfinance.gov/knowbeforeyouowe/
7. National Flood Insurance Program Update On Dec. 17, 2011, Congress extended National Flood Insurance Program (NFIP) authority through May 31, 2012. This latest extension was a part of H.R. 2055, the so-called megabus conference report combining the remaining nine appropriations bills to fund the federal government for FY2012. NAR is urging Congress to use the additional time to complete work on a 5-year NFIP re-authorization bill (H.R. 1309) to provide certainty and avoid further disruption to real estate markets.
8. Rural Housing Program Oversight Update The Rural Housing Service (RHS) continues to experience delays in funding the Section 502 single family loan guarantee program. This program provides zero-downpayment loans to low-income rural families (defined as those making less than 115% of local area median income). In 2009, the program provided financing for approximately 85,000 families in rural communities.
At their November business meetings, NAR discussed the idea of moving RHS out of the Department of Agriculture and combining it with the Department of Housing and Urban Development (HUD). At those meetings NAR took the following position:
“That NAR strongly oppose combining the Rural Housing Service (RHS) with the Department of Housing and Urban Development (HUD). However, if there is a consolidation, the uniqueness, efficiency, and resources of the two agencies must not be reduced, and NAR should seek to ensure that there is no disruption of existing programs.”
9. GSE Reform On July 6, 2011, Representatives Gary Miller (R-CA) and Carolyn McCarthy (D-NY) introduced H.R. 2413, the Secondary Market Facility for Residential Mortgage Act of 2011. The Miller and McCarthy bill is a comprehensive secondary mortgage market reform bill that espouses many of C.A.R.’s and NAR's GSE principals and recommendations. C.A.R. is supportive of this bill because it maintains a government role within the secondary mortgage market, which is required to ensure the viability of long-term mortgage financing for consumers (e.g. 30-yr fixed-rate mortgages).
In addition to H.R. 2413, California Congressman John Campbell introduced H.R. 1859, the Housing Finance Reform Act of 2011, with Democratic member Gary Peters (D-MI). HR 1859 would also comprehensively reform the mortgage finance system, but would set up multiple private companies in the marketplace with the government offering a catastrophic guarantee of their securities.
Fannie Mae and Freddie Mac (Government Sponsored Enterprises or GSE) have now been under the conservatorship of the Federal Housing Finance Agency (FHFA) since September 2008. Reforming these mortgage giants, which guarantee or own roughly 50 percent of all outstanding mortgages, is a top priority for both sides of the isle.
Besides H.R. 2413 and HR 1859 there have been many different proposed ideas, but perhaps the toughest question facing the Administration and Congress is what, if any, role should the government play in the housing finance market? The House Financial Services Leadership have introduced over a dozen smaller bills which have already begun hearings and sub-committee markups. These smaller bills stand no chance at making it to the President’s desk and are more for press headlines than anything else. It remains unclear when the Senate will attempt to address the GSE reform issue; however, their delay seems to indicate a good possibility the issue will likely wait till after the 2012 elections.
10. Bills of others - SB 1137 (Perata) Sunset extension proposal. SB XXX (Corbett) is proposed to extend the 2013 sunset on the existing foreclosure law which requires foreclosing lenders to seek out borrowers and attempt to avoid a default prior to foreclosure. C.A.R. was neutral on the previous legislation.
E. Risk Management and Liability - John Schulte, Issue Chair 1. Mortgage Assistance Relief Services (MARS) Short Sale Rule On July 15, 2011, The FTC announced that it will forbear from enforcing most provisions of its MARS Rule against real estate professionals who assist consumers in obtaining short sales from their lenders or servicers.
This forbearance of enforcement will only apply to real estate brokers (and real estate agents under their direction and control) who are:
1. Licensed and maintain good standing pursuant to any applicable state law requirements; 2. In compliance with state laws governing the practices of real estate professionals; and 3. Assisting or attempting to assist a consumer in negotiating, obtaining or arranging a short sale of a dwelling in the course of securing the sale of the consumer’s home.
Now that the Dodd-Frank created Consumer Financial Protection Bureau (CFPB) is operational, they have assumed oversight of this implementation and enforcement of MARS. CFPB has reopened the issue for comments and both C.A.R. and NAR will be resubmitting our opposition to the MARS rule applying to both the short sale transaction and to members engaged in real estate licensed activity. C.A.R. Legal NAR MARS Podcast
2. Short Sale Addendums On November 18, 2011, at the request of REALTORS® and the American Land Title Association (ALTA), Freddie Mac amended its policy regarding its mandatory short sale affidavits. The purpose of the affidavits is to prevent fraud by requiring the buyer, the seller, the real estate brokers, the escrow/closing agent, and any transaction facilitator to make various certifications (including that the short sale is an arm’s length transaction and the buyer will not resell within 120 days unless there are substantial improvements). Servicers were required to implement the changes by January 1, 2012. Each servicer covered by the policy must update its forms to comply with the revised policy. REALTORS® are encouraged to make sure they are signing an updated form and, if presented with an old form, are well-advised to request the servicer to update or allow amendments to the form before they sign, to avoid potential liability issues.
Here are the key changes:
• The certification is made based on “the best of each signatory’s knowledge and belief.” Freddie has retained the statement that a signatory making “a negligent or intentional misrepresentation” agrees to indemnify the servicer and Freddie Mac for losses. The addition of the knowledge standard significantly reduces this liability. • Only a signatory who makes a negligent or intentional misrepresentation, based on the best of his or her knowledge and belief, is responsible for indemnifying the servicer and Freddie Mac for any loss. No signatory is responsible for the certification of any other signatory. • Although Freddie Mac is requiring all signatories to sign one affidavit, the amended policy no longer allows the affidavit to be an addendum to the sales contract.
3. Bills of others a. SB 221, Simitian; Small claims court $10,000 jurisdiction - Under current law small claims courts have jurisdiction over actions in which the demand does not exceed $7,500. SB 221 expands this demand amount to $10,000 until January 1, 2015. This increased demand amount applies to all actions except for those involving bodily injury, which will only go to $7,500 or less. C.A.R. supported this expansion as it would allow more actions to be handled in a small claims court.
Status: Signed by the Governor on July 8, 2011 (Chapter 64, 2011 Statutes) Position: Support
b. AB 37 (Huffman) Smart meters - This measure would, amongst other things, require utilities to provide alternative options to the installation of radio frequency Smart Meters, and halt the installation of radio frequency Smart Meters until the alternatives are both identified and available. While C.A.R. continues monitoring this measure as it moves through the legislative process, the author has stalled the advancement of the measure because the Public Utilities Commission (PUC) has determined that they would authorize PG&E customers the ability to opt-out. The bill will remain alive and intact until the PUC concludes the proceedings.
Status: Assembly Utilities and Commerce Committee Position: Watch
F. Transactions - Clay Sigg, Issue Chair 1. Federal Short Sale Legislation
a.. H.R. 1498 On April 12, 2011, Representatives Tom Rooney (R-FL) and Robert Andrews (D-NJ) introduced H.R. 1498, the "Prompt Decision for Qualification of Short Sale Act of 2011". This legislation makes it mandatory for mortgage servicers to reply to a short sale application within 45 days of submission. If the servicer fails to provide a decision to the short sale applicant within that time period, the application is deemed approved.
b. H.R. 3164 On October 12, 2011, California Congresswoman Susan Davis, along with Congresswoman Jackie Speier and Congressman Mike Honda introduced H.R. 3164, the “Short Sale Transparency Act of 2011.” The legislation would require when a short sale for a Fannie Mae or Freddie Mac property is denied based on the offer price not being sufficient, the GSE would have to inform the prospective buyer how much more is need to approve the transaction.
2. Fannie Mae REO Platform Back on Dec. 7, 2011, Fannie Mae launched the HomePath Online Offers Program to collect offers and manage the offer-submission process on properties listed on HomePath.com. Agents and brokers representing buyers are now required to submit offers exclusively on HomePath.com.
The HomePath Online Offers Program is designed to ease and create transparency during the offer submission process with the following features: • An easy to use, self-service offer submission system that can be assessed through HomePath.com • A transparent offer process that keeps Selling Agents informed of the status of their clients’ offers on HomePath properties listed on HomePath.com • Improved communication between the Selling Agent and the Listing Agent regarding offers on HomePath properties listed on HomePath.com
3. Bills of others - AB 935, Blumenfield; $20,000 foreclosure tax This measure would prohibit a county recorder from accepting a notice of trustee’s sale for recordation unless the mortgage servicer pays a foreclosure mitigation “tax” of $20,000. The recorder will hold the money in trust until a trustee deed of sale is filed at which point the money would be deposited into the Foreclosure Mitigation Fund. The funds will be available for a number of purposes including K-12 education and community colleges, public safety, redevelopment, small business loans and mitigating the effects of foreclosure. However, should a notice of rescission be filed with the recorder the $20,000 would be returned to the servicer. C.A.R. opposes AB 935 because it will discourage lenders from extending mortgages to homebuyers and increase costs of foreclosure.
Status: Held in the Assembly Banking and Finance Committee Position: Oppose