Mortgage Brokers' Suit Gets Setback

The National Association of Mortgage Brokers has received a setback in its lawsuit against the Department of Housing and Urban Development over the proposed Real Estate Settlement Procedures Act rule. NAMB president Jim Pair told attendees at the California Association of Mortgage Brokers convention in San Diego that the judge hearing the case ruled that HUD followed the Administrative Procedures Act in creating the rule. However, he added, the ruling, "Does not hurt us because the judge did not make any comments regarding yield spread premiums." In NAMB's favor, Mr. Pair said, is pressure from two different sources on HUD to withdraw the RESPA rule, first from the Federal Reserve proposal and the proposed Consumer Financial Protection Agency legislation. NAMB is still looking at the ruling, Mr. Pair said, but it is quite likely it will wait and see before deciding how to proceed on this suit. Mr. Pair was asked about a moratorium on the Home Valuation Code of Conduct. He said there was a good chance a bill will pass Congress but it needs more sponsors. He also said NAMB has obtained an e-mail from an appraisal management company sent to an appraiser saying the appraisal came in too low and it needs to be raised. This goes to the heart of the HVCC issue, which was said to be originator pressure of appraisers over valuations.