Agenda Summary - Appraisal
Agenda Summary2007 Appraisal Committee
National Association of REALTORS®
2007 REALTORS® Conference & Expo
Venetian Resort Hotel &Casino
Lando 4302-4303, Level 4
Tuesday, November 13, 2007
2:00 PM - 4:00 PMChair: Vic Knight, Chapel Hill, NC
Vice Chair: Richard Koestner, Davenport, IA
Committee Liaison: W. Alan Huffman, Wichita, KS
Committee Executive: Chere LaRose Sene, Chicago, IL, Tom Heinemann, Washington, DCPurpose:To serve the specialized needs of those members with an interest in real estate appraisal by: 1) monitoring, reviewing, examining, and analyzing appraisal-related issues for NAR; 2) referring appraisal-related issues to appropriate NAR committees for their consideration; and 3) providing recommendations on appraisal- related issues to the Board of Directors.I. Call to Order and Introductions
II. Approval of Minutes from Last Meeting
III. New Business
A. Legislative/Regulatory
1. H.R. 2061 “Predatory Mortgage Lending Practices Reduction Act”
H.R. 2061 was introduced by Rep. Jones (D-OH) on April 26, 2007. H.R. 2061 is currently in the House Committee on Financial Services with 16 cosponsors.
H.R. 2061 would amend RESPA requirements and prohibit mortgage lenders and brokers from providing subprime mortgage loans unless they are certified by HUD as having been adequately trained regarding subprime loans. It would alsorequire them to setup plans of practice to ensure RESPA compliance for high cost mortgages.Additionally, it declares as unenforceable any consumer contract/transaction that requires binding arbitration (not including post-controversy arbitration agreements). H.R. 2061 would also create grants to nonprofit community development programs to help educate buyers on predatory lending practices.
2. H.R. 3012 “Fair Mortgage Practices Act of 2007”
H.R.3012 was introduced by Rep. Bachus (R-AL) on July 12, 2007. H.R. 3012 is currently in the House Committee on Financial Services with 15 cosponsors, including Rep. Gary Miller of California. H.R. 3012 wouldcreate a national licensing/registry for loan originators and mortgage brokers. You would be required to get a federal license if your state does not currently have a license for loan originators or mortgage brokers.Additionally, H.R. 3012 would also attempt to simplify disclosure documents, require consumer counseling for homebuyers through HUD-certified programs, require escrow accounts for subprime mortgages, and would not allow a pre-payment penalty on loans that resetfrom a fixed rate to an ARM.
3. S. 1222 “STOP FRAUD Act”
S. 1222 was introduced by Sen. Obama (D-IL) on April 25, 2007. S. 1222 is currently in the Senate Committee on Banking, Housing, & Urban Affairs with one (1) cosponsor.
S. 1222 makes it a federal offense for a mortgage professional to defraud a homebuyer or to falsely obtain financing for property. It would also create a federal registryof loan originators and mortgage brokers and allow access to see if a broker or originator has committed fraud in other states.Additionally, S. 1222 would provide for further HUD counseling to homebuyers and would provide grants for states to strengthen their regulations of appraisers in order to make sure they are ethical and acting independent from the real estate agent or broker.4. S. 1299 “Borrower's Protection Act of 2007”
S. 1299 was introduced by Sen. Schumer (D-NY) on May 3, 2007. S. 1299 is currently in the Senate Committee on Banking, Housing, & Urban Affairs with four (4) cosponsors.
S. 1299 states that in the case of a home mortgage loan, a mortgage broker has a fiduciary duty to the consumer and is subject to all federal and state requirements for fiduciaries. S. 1299 would also require that a mortgage originator be able to verify that the buyer would be able to afford the loan,taxes, and insurance premiums currently and if the loan resets. The lender would be liable for acts, omissions, and representations of a broker in connection with Yield Spread Premium.Additionally, a mortgage originator cannot steer a consumer into a loan with a rate, charges, principal, or prepayment terms that are not reasonably advantageous to the consumer.S. 1299 prohibits a mortgage originator to enter into a home mortgage if there is reason to believe the appraiser did not act in good faith. S. 1299 also prohibits an originator from trying to influence an appraiser and a copy of the appraisal must be provided to the applicant, whether or not the loan is granted or denied.5. Kanjorski Bill
H.R. 3837 was introduced by Rep. Kanjorski (D-PA) on October 16, 2007. H.R. 3838, known as the “Escrow, Appraisal, and Mortgage Servicing Improvements Act”, is currently in the House Committee on Financial Services with six (6) cosponsors.
H.R. 3837 would have mortgage originators create an impound account for homebuyers. Additionally, it states that an appraiser would have to physically visit the property, interior included, before an appraisal can be accepted. The appraisal must be by a certified appraiser and the report must be provided to the consumer whether the loan is granted or denied. H.R. 3837 defines what it means to be an independent appraiser and that the originator can in no way influence the position of the appraiser. IV. Reports
A. NAR Appraisal Designations
B. NAR/Appraisal Institute Re-affiliation Work Group
C. Appraisal Foundation Trustee Report
D. MBA Mortgage Fraud Workgroup
E. The Appraisal Foundation Advisory Council (TAFAC)
F. Guest Presentation on 2007 National Appraiser Survey
Tim Forsythe, on behalf of October Research
V. Other Business
A. Issue Discussion: Seller’s Concessions*
B. Issue Discussion: Appraisal Management Companies*
C. Next Meeting: Wednesday, May 14, 2008
Omni Shoreham, Washington, DC
VI. Final Comments and Adjournment
