By 2014 NAR President Steve Brown
Because of NAR’s efforts and the REALTOR® Party‘s diligence, I am pleased to report that the United States House of Representatives passed the Mortgage Choice Act this past month. This bill would return many options to consumers as they shop for mortgages and other settlement services.
As a broker with affiliated companies, I know first hand how the current definition of points and fees for affiliated services in the qualified mortgage regulation has limited consumer options and healthy competition.
The opponents of the service fee cap reform say that the cap protects the consumer. This argument is based on assumptions that simply find no merit in practice. Rather the current cap can force consumers to use less than desirable title and insurance providers, at rates and/or services not as good as can be offered by an affiliate service provider.
The bill passed by the House would end the current 3% cap on fees and points paid to joint venture services and bring them under similar rules applicable to non affiliated services, such as title and insurance. Under the Mortgage Choice Act, affiliated and non affiliated service providers are treated the same, while still protecting borrows from risky loan products.
We applaud the House for listening to the concerns of consumers by passing this important piece of legislation. Now the Senate must take action.
Thank you to all — both our professional lobbying staff and our members who communicated with Congress about this legislation.
We will keep you posted on the progress of the bill.