May 15, 2009
 
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NAHB Discusses AD&C Financing Issues with Bank Groups
NAHB Chairman Joe Robson, First Vice Chair Bob Jones, President Jerry Howard, Chief Economist David Crowe and senior Housing Finance staff held meetings this week with the leadership of the Independent Community Bankers of America and American Bankers Association to discuss how the two groups could work with NAHB to address AD&C financing problems.

The talks generated areas for possible mutual efforts. NAHB staff will follow-up with each of the two organizations to develop case studies and strategies to present to federal regulators and members of Congress. Initial efforts will focus on a joint letter to banking regulators, the Federal Housing Finance Agency and HUD regarding appraisal issues, emphasizing the need for regulators to issue proper procedures on the use of distressed sales as comparables.

To help restore the flow of credit that is needed for the production of housing, NAHB has compiled more than 100 case studies from its members who have run into problems with their lenders. The lead story in this week's issue of NBN Online focused on a sampling of these case studies. They illustrate the severity of the AD&C lending crisis and detail how lenders are making unreasonable demands that are turning many good loans into non-performing loans. NAHB is providing these stories to regulators, legislators and others who are in a position to help resolve the current situation. NAHB members are encouraged to share their financing experiences by filling out the online template located at www.nahb.org/adccasestudy. For more information, contact John Dimitri at 1-800-368-5242, x8529.
NOL Bill Introduced in House
Rep. Richard Neal (D-Mass.), chairman of the Select Revenue Measures Subcommittee of the House Ways and Means Committee, along with  Rep. Pat Tiberi (R-Ohio), the subcommittee's ranking member, this week introduced legislation to expand the net operating loss (NOL) carryback provision included in the economic stimulus package that was enacted into law in February.  Under the provisions of the law passed earlier this year, businesses with gross receipts of no more than $15 million over the prior three years and with a net operating loss in 2008 can elect to offset this loss against income earned in up to the five prior years. Typically, an NOL can only be carried back for two years.

NAHB strongly supported the NOL provision in the recent stimulus law and continues to advocate for broader policy that would cover losses from 2008 and 2009 and with no income limits so that all businesses could be covered.

The Neal-Tiberi bill, which does not yet have a bill number, mirrors S. 823, legislation introduced in the Senate by Finance Committee Chairman Max  Baucus (D-Mont.) and committee member Olympia Snowe (R-Maine). Reps. Paul Hodes (D-N.H.), Artur Davis (D-Ala.), Melissa Bean (D-Ill.) and Bill Pascrell (D-N.J.) have signed on as original cosponsors of the Neal-Tiberi legislation. NAHB is urging all members of the House and Senate to cosponsor the Neal-Tiberi and Baucus-Snowe bills, respectively. For more information, contact Greg Brown at x.8421. [return to top]

Tax Credit Monetization Receives a Boost
NAHB’s efforts to allow consumers to apply the $8,000 first-time home buyer tax credit to their downpayment and/or closing costs received a huge boost this week when HUD Secretary Shaun Donovan announced that HUD will allow government agencies and other authorized parties to monetize the tax credit through the use of either short- or long-term loans in conjunction with FHA-insured mortgage loans. HUD’s action would provide guidance on FHA mortgage insurance procedures for second lien programs that a number of state housing finance agencies have tied to the tax credit and open the door for other parties to provide tax credit bridge loans for first-time home buyer downpayments.

NAHB issued a press release noting that this will “help to stimulate home sales, stabilize housing and get the economy back on track.” NAHB leaders discussed this matter and other housing-related issues with HUD Secretary Shaun Donovan on May 5. In a related development, NAHB staff members David Ledford, Rob Dietz and Bill Renner conducted an interview with nationally syndicated real estate columnist Ken Harney on HUD’s first-time home buyer tax credit monetization announcement. For more information, contact David Ledford at x8265. [return to top]

HUD Secretary Donovan to Address NAHB Board
NAHB Board members will have the opportunity to meet HUD Secretary Shaun Donovan and learn more about his priorities in office during our upcoming Board of Directors meeting at the end of the month. Donovan accepted the invitation to appear before our Board that was extended by Chairman Joe Robson at last week’s meeting between the HUD Secretary and the NAHB leadership. The special session of the Board will take place in the Thurgood Marshall room of the Marriott Wardman Park hotel at 3:30 p.m. on Friday, May 29. [return to top]
HUD Withdraws Proposed RESPA Rule
In response to a lawsuit and comments filed by NAHB and its allies, HUD this week withdrew a proposed rule governing affiliated businesses that would have dampened enthusiasm for new home purchases. NAHB and a coalition of its members had filed suit against HUD in federal district court in Virginia to challenge the rule, which was intended to implement some changes to Real Estate Settlement and Procedures Act (RESPA) regulations.

The rule would have prohibited home builders from offering bona fide discounts and packaging of real estate settlement services, which have saved home buyers thousands of dollars over the years in closing costs, title searches and other fees. NAHB submitted detailed comments to HUD, saying that this rule would have been bad for consumers, bad for the housing industry and bad for the economy. One important note: HUD did say that it may still come back in the future and conduct a new rulemaking on the “required use” definition that was at the heart of this issue. For more information, contact Duane Desiderio at x8146 or Bill Renner at x8597. [return to top]

For more information or to contact us directly, please visit www.NAHB.org l ©2009, National Association of Home Builders

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