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Builders Get Reprieve on Incentives
1/12/2009
HUD will postpone for 90 days a new rule that would prevent home builders from offering incentives to customers who use the services of affiliated mortgage and title insurance providers.
The change was slated to take effect on Jan. 16 as part of reforms of the Real Estate Settlement Procedures Act (RESPA) that are being phased in this year but was challenged by the National Association of Home Builders, which considers it "arbitrary and capricious."
While HUD worries that home buyers who choose not to use a builder's affiliated service are being penalized, NAHB members argue that their incentive programs boost competition, reduce costs, and give consumers "a full range of options to explore the best possible deal to purchase a home."
Source: Inman News, Matt Carter (01/12/09)
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