RESPA Lawyer BlogOctober Research has selected Charles C. Cain to be a speaker at the 2009 National Compliance Summit on February 19-20, 2009 at The Westin Casuarina Las Vegas Hotel, Casino & Spa. Charles Cain is Of Counsel to the Sterbcow Law Group LLC in New Orleans, Louisiana and is President of Alliance Solutions LLC based in Cincinnati, Ohio.
Articles Posted in RESPA
REAL ESTATE SETTLEMENT PROCEDURES ACT (RESPA) LITIGATION UPDATE
A recent RESPA litigation ruling by the United States Sixth Circuit Court of Appeals in Cincinnati, Ohio sparked headlines this week when they overturned a district court ruling denying class certification in the Erik C. Carter, et. al., United States of America v. Welles Bowen Realty, Inc. et al lawsuit. No. 07-3965.
The issue at dispute is whether a Section 8 claim of the Real Estate Settlement Procedures Act violation gives consumers “standing even if the consumer does not allege an above-market race charge for services, i.e. an ‘overcharge.'” The district court previously held that because the defendants did not over charge the consumers they didn’t suffer an injury but the appellate court has overturned the district courts decision.
Welles-Bowen Title Agency is a joint venture affiliated business arrangement, owned by Welles-Bowen Realty, Inc. and Chicago Title Insurance Company–a Fidelity subsidiary. The alleged problem with the relationship however appears to be that Welles-Bowen Title Agency did not really perform any settlement work, review title, or even conduct the closings. However, Chicago Title gave Welles-Bowen Realty, Inc. seventy percent (70%) of the fees and title policy money generated. If the allegations are true then this relationship would appear to be an illegal sham affiliated business arrangement under federal RESPA guidelines. There are other issues at play as well, such as the State of Ohio’s affiliated business arrangement ownership and profit requirements but those were not addressed in this appellate decision.
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NEW RESPA GUIDELINES WENT INTO EFFECT ON JANUARY 16, 2009
The new Real Estate Settlement Procedures Act (RESPA) guidelines are now officially enacted as of Friday, Jan. 16, 2009. However the Required Use Section 9 changes have been put on hold for 90 days pending a review by HUD which was prompted by the National Association of Homebuilders lawsuit.
The new Good Faith Estimate (GFE) and Housing & Urban Development Settlement Statement (HUD-1) can now be used but won’t be required until next year. However if a lending institution does use the new Good Faith Estimate form then the new HUD-1 and HUD-1A must be used as well in order to be compliant with the new rules.
If you are a lender or title agent please make sure you and your staff are educated on these changes because the new rules will create a substantial risk for litigation for companies who are unaware of the new rules.
HUD DELAYS IMPLEMENTATION OF RESPA GUIDELINES 90 DAYS
We are hearing from multiple sources that the United States Department of Housing and Urban Development (HUD) will be formally announcing delaying the implementation of the new RESPA Reform rule which is scheduled to go into effect on January 16, 2009, The delay is in response to the National Association of Home Builder’s (NAHB) lawsuit against HUD that was filed on December 23, 2008. We will provide an update on NAHB lawsuit later.
The RESPA implementation delay is rumored to be 90 days from Jan. 16, 2009, meaning the new RESPA guidelines rule regarding Required Use and Section 9 of RESPA at this point will go info effect on April 16, 2009. The 90 days will give HUD 90 days to study the NAHB lawsuit.
NATIONALLY ACCLAIMED RESPA ATTORNEY, CHARLES “CHUCK” CAIN, JOINS THE STERBCOW LAW GROUP
The Sterbcow Law Group is pleased to announce that Charles C. Cain will join the law firm effective January 1, 2009. Charles will be “Of Counsel” and will work out of his Cincinnati, Ohio office. Charles is highly regarded as one of the country’s top RESPA compliance and regulatory attorneys by many in the legal and real estate industry. He will add tremendous depth to the firm in our rapidly expanding RESPA litigation and compliance practice.
Charles joins The Sterbcow Law Group from LandAmerica Financial Group, Inc. where he was the Vice President of LandAmerica’s Senior Alliance Business Partner division where he focused on management and creation of over 400 RESPA compliant affiliated business relationships in over 28 states. He also provided employee and independent agent RESPA training. Charles is also President of Alliance Solutions LLC in Cincinnati, Oho.
Charles has been a featured speaker at various events such as The Real Estate Settlement Providers Organization, October Research’s programs such as Title Radio and the National Settlement Services Summit, Ohio Bar Association, Kentucky Bar Association, Ohio Land Title Association, Indiana Land Title Association, Missouri Land Title Association, and Michigan Land Title Association. His reputation and knowledge are one of the many reasons that numerous state regulators throughout the United States consult with him for RESPA guidance.
The United States Department of Housing and Urban Development awarded him the “Special Citation” for Fair Housing Best Practices. He is the Past Chairman of the Real Property Section of the Cincinnati Bar Association, former Trustee of the Cincinnati Mortgage Bankers Association, Member of the Mayor of Cincinnati’s Blue Ribbon Committee of the Cincinnati Housing Partnership, and a Member of the Cincinnati Area Fair Mortgage Credit Project through the Federal Reserve Bank of Cleveland.
Charles is admitted to practice law in Ohio, Kentucky, various Federal Courts, and the U.S. 6th Circuit Court of Appeal.
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HUD: PRESIDENT ELECT OBAMA SELECTS SHAUN DONOVAN TO BE NEW SECRETARY
President Elect Barak Obama has selected Shaun Donovan to be the next United States’ Secretary of Housing and Urban Development. Donovan, who was the head of the New York Department of Housing Preservation and Development, is viewed by many in the industry as someone who possesses a significant amount of experience in the housing field.
Donovan was Managing Director for Prudential Mortgage Capital Co’s Lending and Affordable Housing Investments Division prior to his position with New York City. Real Estate Industry groups (the National Association of Realtors Mortgage Bankers Association, and others) have lauded Donovan’s selection once his name became public.
Donovan will inherit a lot of controversial regulations including RESPA Reform and will have to address other areas including the Federal Housing Administration’s (FHA) lending issues.
If the Senate confirms Donovan he will replace Steve Preston.
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