Riley quoted in RESPAnews.com
"HUD defines 'restrained' enforcement; Industry reacts", RESPAnews.com
Francis X. Riley, III, a partner and vice chair of the Litigation Department, comments on the announcement by the Department of Housing and Urban Development (HUD) that, for the first four months of 2010, the staff of the Mortgagee Review Board (MRB) will exercise restraint in enforcing new regulatory requirements under RESPA.
The new requirements, effective Jan. 1, 2010, are a standardized Good Faith Estimate and HUD-1 Settlement Statement, which HUD has mandated the industry begin using as part of its RESPA final rule issued on Nov. 17, 2008.
Riley said HUD’s decision to provide latitude in compliance is “laudable,” although its vagueness raises several issues, if not concerns. “HUD is talking about making a subjective determination, on a case-by-case basis, as to whether to enforce the new rule’s GFE and HUD-1 requirements and impose penalties for violations of those requirements,” Riley said. “Thus, it would appear that HUD will make a decision to enforce the new regulations or not, or in part, depending upon how it feels about the alleged violation and/or whether it resulted from a lack of good faith in attempting to comply. This apparent ad hoc approach is in need of better guidelines for the ‘restrained enforcement.’”