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Tuesday, July 21, 2009
Law - Homeowners beset from many directions
Stories today:
- "New appraisal rules raise many concerns" by Nicole Blake of the Indianapolis Star. The story begins:
When Jake Stamper chose to refinance his four-bedroom home this year, he anticipated the Southside house would retain most of the value it had three years ago.
But instead, an appraiser determined Stamper's $259,000 house was worth $30,000 less. The culprit, Stamper says: new guidelines that allow lenders to hire appraisers who know little about a market.
Dubbed the Home Valuation Code of Conduct, rules that went into effect May 1 are meant to eliminate conflicts of interest that created pressure on real estate appraisers to inflate the value of a property.
Mortgage brokers and real estate agents say the rules also complicate and delay the loan process and open the door for inexperienced appraisers to determine home values.
- "Title-Insurer Fees Draw Scrutiny " by James R. Hagerty of the WSJ. The story begins:
The U.S. title-insurance industry faces increasing pressure from regulators to justify the fees charged to consumers for ensuring they have clear ownership of their homes.
For most people, title insurance is just another mysterious fee they must pay when they buy a home or refinance a mortgage. Unlike some of those fees, though, title charges aren’t negligible. They range from several hundred to several thousand dollars—and last year totaled more than $10 billion for the title industry. Lenders insist on the insurance to protect them against the possibility that a taxing authority, another creditor or a disgruntled heir may have a claim to the property, among other risks.
As falling home prices tempt more people back into the housing market in some parts of the country, politicians and regulators are raising questions about whether they may be paying too much for this protection. “There’s no transparency,” Delores Kelley , a state senator in Maryland, said in an interview. She introduced legislation that created a commission to study the title-insurance industry in Maryland. That panel is due to make recommendations about possible regulatory changes by December.
Posted by Marcia Oddi on July 21, 2009 10:01 AM
Posted to General Law Related