The recent decision by the U.S. Department of Housing and Urban Development to withdraw its proposed changes to the federal Real Estate Settlement Procedures Act relieved real estate groups, but they’re not ready to say RESPA reform is dead.
“I think that most people don’t believe anything will be surfacing before the election and obviously what happens after the election depends on the results of the election,” said Sue Johnson, executive director of Real Estate Services Providers Council (RESPRO), which had opposed the changes. “I think probably the issue of mortgage simplification and lowering costs are going to be issues that are perennial, really.”
Acting HUD secretary Alphonso Jackson announced on Monday that HUD would review public, industry and congressional comments before resubmitting the rule to the White House Office of Management and Budget. The proposed changes drew thousands of comments in opposition from industry groups.
Steve O’Connor, VP of government affairs for the Mortgage Bankers Association, said Jackson gave every indication he intends to move forward with the changes. Like Johnson, O’Connor said he’s doubtful HUD will put forth more on the topic any time soon. But, he said, in the longer term, “it’s still very much a possibility.”
The MBA had opposed the proposed changes, but O’Connor said his group looks forward to working with HUD on revising RESPA. He said he’s hopeful HUD will actively seek out the opinions of his group and others before coming up with a new proposed rule.
“This is such a complex issue and the stakes are so high that it’s important we get it right,” O’Connor said.
Johnson said if HUD does work together with industry and consumer groups and Congress, proposed changes would have a much better chance of going through. But revising RESPA has been an idea kicking around for many years, Johnson said, and whether any new changes actually become rule still remains to be seen.
“I think that’s the million-dollar question,” Johnson said.
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