NAR MEETS WITH BIG BANKS TO DISCUSS FORECLOSURES PROBLEMS

With all the recent issues surfacing related to foreclosures, it is good to note that the National Association of Realtors (NAR) is taking a highly proactive stance to address the current market struggle with housing and mortgage. Recently, the NAR Leadership Team has held several meetings during the past two months with the heads of major national banks, i.e. Bank of America Home Loans, Wells Fargo Home Mortgage, Chase Home Mortgage, and CitiMortgage, to discuss problems with short sales and the availability of credit to potential buyers. NAR’s position has always been that “we want to help homeowners avoid foreclosure, whenever possible.”

These meetings give NAR an opportunity to discuss with the four largest lenders the problems Realtors face every day when working to get deals to the closing table. All the banks acknowledge the difficulties that realtors, lenders and homeowners are facing and have given their commitment to work with all concerned.

We are including below the key agreement points provided by NAR, as a result of this meeting. As an active member of the NAR, my group supports the initiatives and will closely monitor the progress that will enable us to provide you with the best service.


SUMMARY OF BANK MEETINGS

In each meeting, lenders and REALTORS® have agreed to work in the following areas:

Transparency
REALTORS® need to understand each lender’s policies for underwriting loans, valuing property, selecting brokers for REO listings, and deciding whether to approve a short sale.

Service
Having a single point of contact is extremely important to improve service to the borrower, short seller, and the real estate agent. NAR is urging all lenders to adopt this approach.

Balance
FHA and the government sponsored enterprises (GSEs: Fannie Mae and Freddie Mac) have become over-focused on safety at the expense of their mission. NAR urges lenders to advocate a return to a reasonable center, now that credit policies have over-corrected.

Speed
When a borrower applies for a loan and receives a conditional approval, the conditions are often impossible to meet. It would be better to decline the loan and allow all parties to move on. Short sale approvals often take months. HAFA and other short sales programs should be implemented quickly.

Accuracy
Lenders are aware that problems related to the application of new appraisal guidelines have skewed some appraisals. NAR continues to raise these issues with the lenders, regulators, FHA, and the GSEs and seek solutions.

Performance/Compensation
Real estate professionals work extremely hard and for many months on a successful short sale. NAR urges lenders to make commissions policies more transparent and to agree not to reduce commissions at or shortly before closing. At the same time, NAR acknowledges that lenders waste time processing short sales that are not real offers, and we urge our members not to participate in this practice.

Lenders also are monitoring performance of REO listing brokers and will take steps to resolve problems.