Wednesday, November 18, 2009

More on HUD's Decision to Exercise "Restraint" in Enforcing New RESPA Rules

Last Friday HUD announced that it would exercise "restraint" in enforcing the new RESPA provisions set to go into effect on January 1, 2010 that deal with the Good Faith Estimate (GFE) and the HUD-1 Settlement Statement. We passed this story along here.

What we have questioned is the effect of this decision: Does delay of enforcement mean a delay in implementation, or are lenders still going to go live with the new forms on January 1st?

We have received strong indication from industry resources such as First American and the American Land Title Association (ALTA) that this decision is not a delay in implementation, but merely a delay in enforcement. There are still some practical considerations in some jurisdictions which make full compliance with the new rules impractical or impossible, and HUD does not want to be imposing financial obligations against companies who cannot possibly follow the new regulations.

We will continue to monitor this closely so agents and brokers know what to expect as of the first of the year. Stay tuned...