NAR Gets Ready For The Main Event;Will Banks Get The Green Light To Enter Real Estate?

Michael Oxley (R-OH) and Barney Frank (D-MA) have introduced a bill that would allow certain financial firms to engage in real estate brokerage activities. The bill would amend the Bank Holding Company Act to clarify that real estate brokerage and real estate management activities are authorized financial activities for financial holding companies and financial subsidiaries of national banks. The legislation would allow those firms to act as agents for buyers and sellers of property and to list property for sale.

This bill runs counter to the National Assn. of REALTORS®' perennial favorite “Community Choice in Real Estate Act,” which would permanently bar banks from the real estate business.

Federally chartered mega banks that are allowed to conduct real estate will be exempt from state regulation. Their agents and employees would not need real estate licenses to buy or sell property. They would not have to pass licensing exams or pay licensing fees. They could ignore state laws or regulations governing the business of real estate such as consumer disclosure, environmental protection, and dual agency. Nor would these banks have to comply with state banking regulations, including those covering predatory lending.

We confess to some confusion about Barney Frank's involvement here considering that this bill seems to fly in the face of another bill that he  is sponsoring, very consumer-friendly legislation that will stem predatory lending.

We predict that the Oxley/Frank effort will fail but we think that NAR would have a more plausible argument if the group was not also engaged in strong lobbying efforts that will strip states' authority in health care benefits and delivery, and predatory lending,

Comments

[John]

Late payments can and do affect your credit, but nothing hurts your credit worse than "mortgage lates". If you possibly can you want to pay your mortgage payments on time and in full. If this becomes impossible for you to do it's time to do something serious in order to preserve your credit. At some point saving your home may not be the primary concern. Remember, it's just a house and you can always get another house, but if you damage your credit you may not be able to do that. So make sure you have your priorities in order.
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