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2010 Legislation Recap 2010 certainly had its fill of newsworthy acronyms! RESPA, HAMP, HARP, FICO, NFIP, HAFA and a few hundred more; all with revisions and regulations that impacted how the real estate community does business. Below is a synopsis of significant legislation and the links to access additional information. • RESPA Changes Effective January 1, 2010 The Department of Housing and Urban Development (HUD) made significant changes to the Real Estate Settlement Procedures Act There are numerous provisions including a requirement that loan originators provide borrowers with a standard Good Faith Estimate that clearly discloses key loan terms and closing costs. http://www.hud.gov/offices/hsg/rmra/res/respa_hm.cfm • Homebuyer Tax Credit Extension The $8,000 tax credit for first-time home buyers and the $6,500 tax credit for repeat home buyers were extended; for home purchases where a binding sales contract was signed by April 30, 2010, qualified buyers had until September 30, 2010 to complete the purchase. Service members who were on official extended duty outside of the United States for at least 90 days between Jan.1, 2009 and May 1, 2010, may qualify for a one-year extension. http://money.cnn.com/2010/06/30/news/economy/homebuyer_tax_credit/index.htm • Home Affordable Foreclosure Alternatives Program (March 12, 2010) The Home Affordable Foreclosure Alternatives (HAFA) Program provides additional options to avoid costly foreclosures and offers incentives to borrowers, servicers and investors who utilize a short sale or deed-in-lieu (DIL) to avoid foreclosures. https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.jsp • Home Affordable Refinance Program (HARP) (March 1, 2010) Federal Housing Finance Agency announced the extension of the Home Affordable Refinance Program (HARP) to June 30, 2011. http://fhfa.gov/webfiles/15466/HARPEXTENDED3110%5B1%5D.pdf • FHA Accepting Electronic Signature (April 8, 2010) FHA will accept electronic signatures on third party documents. Third party documents are those that are originated and signed outside of the mortgagee’s control, such as a sales contract. The policy is effective immediately. http://portal.hud.gov/portal/page/portal/HUDMobile/pressreleases/2010/HUDNo.10-075 • Introduction of Home Affordable Foreclosure Alternatives Program (June 1, 2010) The Fannie Mae HAFA, introduced provider servicer guidance and direction for using the short sale or deed-in-lieu (DIL) process for borrowers who qualified for, but did not complete, a loan modification under the Home Affordable Modification Program (HAMP). https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2010/svc1007.pdf

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2010 Legislation Recap Continued • FHA Commissioner Addresses RESPA Home Warranty Guidance (June 30, 2010) Assistant Secretary for Housing/FHA Commissioner Dave Stevens laid out the guidance on the appropriate circumstances under which brokers and agents can be compensated on a per transaction basis for selling home warranties. http://portal. hud.gov/portal/page/portal/ver-3/HUD/federal_housing_administration/docs/From_The_Desk_Of_June_2010.pdf • FHA Mortgage Insurance Premium (August 12, 2010) President signed into law a bill which authorizes HUD to increase the annual mortgage insurance premium for FHA loans, effective October 4, 2010. http://www.nls.gov/offices/adm/hudclips/letters/mortgagee/files/10-28ml.pdf • USDA Given Authority to Resume Loan Program (August 2010) Authority to resume operating the Single Family Housing Guaranteed Loan Program (SFHGLP) at no cost to taxpayers. http://www.mortgagenewsdaily.com/08252010_usda_single_family_funds.asp • GSEs Release Appraiser Independence Rules to Replace HVCC Fannie Mae and Freddie Mac issued new Appraiser Independence Requirements to supplant the controversial Home Valuation Code of Conduct (HVCC). https://www.efanniemae.com/sf/guides/ssg/relatedsellinginfo/appcode/pdf/air.pdf • FHA Refinance of Borrowers in Negative Equity Positions (March 26, 2010) The Department of Housing and Urban Development (HUD) and the Department of the Treasury announced enhancements to the existing Making Home Affordable Program and Federal Housing Administration refinance program that will give a greater number of responsible borrowers an opportunity to remain in their homes. http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-23ml.pdf • Introducing Reverse Mortgage HECM Saver( October 4, 2010) FHA designed HECM Saver as a second initial mortgage insurance premium (MIP) option for the purpose of lowering upfront loan closing costs, for mortgagors who want to borrow a smaller amount than what would be available with a HECM Standard1. http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-34ml.pdf • Fannie Mae Announces Relief For Homeowners Affected by Gulf Oil Spill (June 16, 2010) Fannie Mae announced that servicers may immediately suspend or reduce mortgage payments for borrowers whose properties or income are negatively impacted by the Gulf oil spill. http://www.fanniemae.com/newsreleases/2010/5062.jhtml • National Flood Insurance Program extended until September 2011 While the one-year extension brings a level of certainty to the NFIP, the National Association of Realtors believes there needs to be comprehensive reform measures to place the NFIP on more sound financial footing for at least another 5 years. http://www.realtor.org/government_affairs/flood_update • Minimum credit scores and loan to value ratios (September 3, 2010) New requirements announced for FHA loans. http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-29ml.pdf • Underwriting Borrowers with a Prior Preforeclosure Sale or Deed-in-Lieu of Foreclosure (April 14, 2010) Fannie Mae updated several policies regarding the future eligibility of borrowers to obtain a new mortgage loan after experiencing a preforeclosure event (preforeclosure sale, short sale, or deed-in-lieu of foreclosure). https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2010/sel1005.pdf

First American Title Insurance Company makes no express or implied warranty respecting the information presented and assumes no responsibility for errors or omissions.


2010 Legislation Recap