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Local edition Or ig i nat ion SECONDARY MARKET Sellers Get a New Set of Rules s e c on da r y m a r k e t a na ly t ic s se r v ic i ng As the industry prepares for the looming CFPB deadline, the rules are being doled out to all parties involved. a mortgage under the CFPB final rule is correct. These determinations of compliance with the CFPB final rule and other applicable laws are the seller's responsibility," Freddie Mac explained in its announcement. organizations. Its mission is to protect and promote sustainable homeownership for all segments of America, from existing homeowners to those aspiring to purchase a house. "In terms of public policy, America's homeowners have Industry Veterans Launch New Homeowner Alliance never had a collective voice of their own to promote their best interests. It's time to take America's homeowners off the menu and give them a seat at the table," said Phil Bracken, Alliance chairman and founder. Bracken is an industry veteran of more than 35 years and has received numerous awards, including the National Association of Real Estate Brokers' Eagle Award and the Mortgage Bankers Association's Andrew Woodward Distinguished Service Award—its highest honor. Also leading the group are Tino Diaz, former chairman of the National Association of Hispanic Real Estate Professionals; Armando Falcon, former director of the Office of Federal Housing Oversight; Washington D.C. // Fannie Mae and Freddie Mac have both updated their seller guides to incorporate the Consumer Financial Protection Bureau's "Ability to Repay" rule under the Truth in Lending Act. The rule will go into effect January 10, 2014. The Federal Housing Finance Agency (FHFA) worked with the GSEs to update their respective seller guides in alignment with one another. The basic goal of the Ability to Repay rule is to ensure lenders act in good faith that a borrower can repay his or her loan before offering the loan. After January 10, 2014, Fannie Mae and Freddie Mac will only purchase loans that are fully amortizing, have terms of 30 or fewer years, and have points and fees that equal no more than 3 percent of the total loan amount. The GSEs will not accept loans with prepayment penalties. Freddie Mac explains that it will continue to accept them until January 10, 2014, if they have settlement dates are on or before July 31, 2014. The GSEs are also revising their rules regarding relief refinances for "higher-priced mortgage loans." These loans must have a maximum debt-to-income ratio of 45 percent, and lenders must verify the borrower's income source and amount. The GSEs note that it will be the seller's responsibility to ensure compliance with the CFPB's rules before selling loans to the GSEs. "Freddie Mac will not make the determination of whether a mortgage is exempt from, or complies with, the CFPB final rule or whether a seller's designation of the status of 62 | The M Report Organization will focus on uniting American homeowners in terms of policy, providing a vehicle for advocacy. Missouri // The industry has a new national group dedicated to serving as the voice for homeowners, and membership is now officially open. Billing itself as the first group of its kind, America's Homeowner Alliance was launched by a team of industry veterans and an advisory board of housing industry professionals as well as prominent consumer groups and fair housing and Joe Murin, former Ginnie Mae president. Diaz serves as the alliance's president, while Falcon and Murin are among its advisory board members. "We will focus on examining the policies of both government and private entities so that we can serve as an ombudsman for homeowners, providing protection from abusive or bad practices in the marketplace," Diaz said. "And as an added bonus, Alliance members will have the opportunity to enjoy retail and rewards-based purchasing benefits providing discounts on everyday products that are important to homeowners." For $20 per year, member homeowners will receive access to a rewards purchasing program with more than 1,000 retail outlets, including Home Depot, Lowes, and Sears. On a larger scale, the alliance's first goals include defending the mortgage interest deduction, preserving low down payment mortgages, ensuring finance availability for responsible consumers, and encouraging more private capital in the industry, among others. "With the support, encouragement, and endorsement of individual homeowners, assistance from major consumer groups, diverse segment real estate groups, and many other organizations, America's Homeowner Alliance has launched today to serve as the profound voice for sustainable homeownership and will continue to do so for years to come," Bracken said. NAACP Swipes at Corker-Warner Bill Organization decries the legislation, which includes policies it contends would bar middle class, minorities from homeownership. MAryland // A statement issued from Hilary O. Shelton, SVP for advocacy for the National Association for the Advancement