* WASHINGTON (1/2/09)—The National Association of Mortgage Bankers said it will seek an injunction against the U.S. Department of Housing and Urban Development’s (HUD) new rule on mortgage fees and disclosures. HUD’s rule overhauls how the Real Estate Settlement Procedures Act is enforced and most of its significant changes are scheduled to take effect in 2010. The broker trade group wants the court to overturn the new HUD rule because, the group claims, its provisions may be confusing to borrowers and also would create an uneven playing field for lenders (National Mortgage News
via American Banker
Dec. 29). Jeffrey Bloch, senior assistant general counsel for the Credit Union National Association said the lawsuit could provide an “interesting wrinkle” to HUD’s final plan. However, Bloch advises credit unions that at this point, the rule will still go into effect as written … * WASHINGTON (1/2/09)--Lawmakers will continue to push for credit card reform in the new year, according to observers (American Banker
Dec. 31). The Federal Reserve Board two weeks ago approved new restrictions on card practices effective July 2010. But some say the Fed rules are insufficient. Sen. Carl Levin (D-Mich.) has conducted several hearings on the topic. Rep. Carolyn Maloney (D-N.Y.) said she wants the Fed’s restrictions to be implemented faster. Maloney is working on a bill that would prevent card companies from marketing to minors, let consumers set their own credit limits and reject cards before they are activated. Her bill also would legislate the Fed ban on double-cycle billing and universal default. Sen. Dick Durbin (D-Ill.) and Rep. John Conyers (D-Mich.) also may introduce legislation regarding interchange fees again ... * WASHINGTON (1/2/09)--Observers say the Treasury has allocated more than is available in Troubled Asset Relief Program (TARP) funds after the agency announced Monday that it will support GMAC LLC with $6 billion. A Treasury official said Monday in a conference call that TARP funds are not in debt (American Banker
Dec. 31). The Treasury received $350 billion from Congress and has allocated $358.4 billion. Of the $350 billion, $217 billion has been disbursed. Speaker of the House Nancy Pelosi (D-Calif..) and House Financial Services Committee Chair Barney Frank (D-Mass.) have said they will not release TARP’s remaining $350 billion until the Treasury agrees to a foreclosure prevention plan ... * WASHINGTON (1/2/09)--Piggybacks on second mortgages could trip up loan modifications, Federal Reserve Board researchers said (Bloomberg News
Dec. 31). Piggyback mortgages are not usually owned by those who hold the main loans on homes, and piggyback owners must provide approval when a first mortgage is modified. For loan transactions where defaults occur, loss mitigation problems could be more difficult, according to Fed economists Robert Avery, Glenn Canner and Kenneth Brevoort ... * WASHINGTON (1/2/09)—The U.S. Treasury Department Wednesday released its responses to questions
posed in the Congressional Oversight Panel's first report on implementation of the Emergency Economic Stabilization Act. The Treasury document addressed 10 queries, including: What is Treasury’s strategy and what specific facts changed that led to your change in strategy? Is the strategy working to stabilize markets? What have financial institutions done with the taxpayers’ money received so far? And is the Treasury looking ahead? ...