During the 113th Congress, the National Association of REALTORS®’ (NAR’s) legislative and regulatory agenda continued to focus on creating a fundamentally sound and robust U.S. real estate market and protecting the consumers as well as the business interests of members.
Here are the highlights of NAR’s 2013 federal legislative and regulatory accomplishments:
Safe Harbor in Qualified Mortgage Rule
NAR achieved a significant victory in obtaining a safe harbor in the Consumer Financial Protection Bureau’s (CFPB) Qualified Mortgage (QM) rule, a law that ensures lenders only make loans to borrowers who have the ability to repay the loan. The creditor originating a QM is presumed to have complied with the general ability-to-repay standard and receives a safe harbor that reduces their litigation exposure. NAR and its industry partners fought to ensure that a less-safe rebuttable presumption was not adopted. NAR still has serious concerns with the QM rule, specifically the 3 percent cap on fees and points from affiliated lenders, and is working with Congress to fix these concerns before it is implemented in 2014.
Re-proposed Qualified Residential Mortgage Rule
After strong opposition from NAR, the CFPB re-proposed the Qualified Residential Mortgage (QRM) rule and aligned the definition of QRM with the same standards of QM. REALTORS® organized the broad-based Coalition for Sensible Housing Policy to draw attention to the regulation’s onerous 20 percent down payment requirement and other credit limiting features. The coalition successfully got an extension of the regulation comment period. NAR and the coalition then gathered the support of more than 50 U.S. Senators and 300 House members, who wrote to regulators expressing their original intent and opposing the sizable down payment requirement.
Extending Rural Housing Definition
NAR successfully worked to include language in both the House and Senate Appropriations bills to extend the rural housing definition for one year. Additionally, NAR championed language in the Senate farm bill to extend the definition through 2020. NAR continues to advocate for passage of these bills.
Preserving FHA and Ensuring Secondary Mortgage Market Finance
In strong opposition to the Protecting American Taxpayers and Homeowners (PATH) Act, NAR testified before Congress and sent several letters outlining its position. NAR supports a comprehensive approach to restructuring the secondary mortgage market, including winding down Fannie Mae and Freddie Mac, but believes any new secondary market entity replacing the firms must have an explicit government guarantee. Similarly, NAR believes the Federal Housing Administration (FHA) has made significant changes to address its financial problems.
Maintaining Current GSE Loan Limits
NAR led the effort to keep the Federal Housing Finance Agency (FHFA) from reducing conforming loan limits for Fannie Mae and Freddie Mac. Through a letter and meeting between President Gary Thomas and Acting Director Ed DeMarco, NAR rallied its industry partners to action. Concurrently, NAR helped secure bipartisan Congressional support by getting 13 Senators and 66 members of the House to send letters to FHFA asking them not to take action at this time.
Preserving Homeownership Tax Policies
Both the House and Senate are considering options to reform the federal tax system and broaden the tax base by eliminating undetermined tax deduction, exemption and credits, and using at least part of the savings to lower taxes. NAR believes that current real estate tax law is vital to the health of the economy and homeownership. NAR has submitted several letters to Congress outlining our tax reform position and will continue its ongoing dialogue to ensure our message is heard.
Bolstering Commercial Real Estate Lending
NAR has positioned itself to proactively foster legislation in 2014 by commenting on federal regulations pertaining to Basel III, Dodd-Frank Qualified Commercial Real Estate loan provisions and the Financial Accounting Standards Board rule regarding the value and importance of liquidity in commercial credit markets. These proactive steps to protect commercial interests will ensure that NAR has a voice in any upcoming reforms in the commercial sector.