What will the new consumer protection bureau do for home buyers? Part of the financial reform bill signed into law by President Obama includes the creation of a Consumer Financial Protection Bureau, which plans to write new rules and monitor problems and abuses in areas such as residential real estate settlements, credit scores, “truth in lending,” and equal credit opportunity.
Is setting up yet another bureaucratic agency really going to provide any significant benefit to consumers? Well, it may be a way to finally get rid of the poorly thought out and implemented Home Valuation Code of Conduct (HVCC) rules imposed by Fannie Mae and Freddie Mac in 2009. HVCC is responsible for many of the late and undervalued appraisals we have been seeing since it’s implementation.
The new Bureau will include a hotline that will allow aggrieved mortgage borrowers and others to issue complaints and alert the Bureau to unfair and deceptive practices. Does that make you feel more protected?
It will also include rules requiring mortgage loan officers to verify mortgage applicants possess the ability to repay the loans they’re seeking. Is this different from making sure that a mortgage loan applicant is qualified to get the loan? Isn’t this already part and parcel of the mortgage application?
Does this new Consumer Financial Protection Bureau really offer any benefit beyond getting rid of HVCC or is it just another bureaucratic agency that will slow down transactions while providing more government jobs to staff the Bureau? Please share your thoughts by leaving a comment. For more on this story check out this article.
California Home Buyers Tax Break funds are low or gone. Did you know that California had to build a new computer system to handle the faxed applications for the home buyers’ tax credit? You may recall that the tax credit was available for first time home buyers or for new home buyers in two separate blocks of $100 million. If you missed it the first time, you can get the scoop here.
The Franchise Tax Board is allowing people to submit applications for the first time home buyer tax credit even though they reported having allocated all the available funds by the end of June. They claim they are continuing to accept applications because they want to make sure that they really use all the funds available and don’t have leftover funds as a result of duplicated, incorrect or incomplete applications.
I wonder how much the new computer system cost on top of the $200 million in tax credits we are giving these first time home buyers? You can read more about this here, but please share your thoughts below.
Home ownership rates are down. CNN reports that home ownership rates are lower in the second quarter of 2010 than they were a year ago. In fact the rate is the lowest it’s been since 2009. What do you think accounts for that? could it be all the foreclosures? Despite the fact that home ownership is down among individuals, it’s rising among investors.
What do you think is responsible for the decline? Are foreclosures the result of bad underwriting for loans, loss of jobs, a combination of both?
Agents for buyers rate higher. Home buyers rate real estate agents higher than home sellers this year as compared to last year, according to a national consumer satisfaction study released last week by a leading marketing information company. Moreover, home buyers were more satisfied with their real estate experience in 2010 than they were in 2009. On a 1000 point scale, home buyers on average ranked their experience at 803 points in 2010.
It doesn’t seem much of a surprise that home sellers were less satisfied. It is more difficult to be on the selling end lately when every buyer seems to be looking for a bargain.
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What are your thoughts? Comment on this story and let us know what you think.