CAN-SPAM Primer; Nevada’s HOA Ruling has Major Implications; USDA Map Update; Vendor Updates

I don’t know what you earn on your savings in
the bank, but I earn about 0%. I think plenty of others do as well, and
plenty of others are thinking that they may-as-well help someone out
with it. The National Association of Realtors reports in
2013 about 27% of people who purchased their first home received a cash
gift
from relatives or friends to help with the down payment vs. 24% in 2012. This is the highest percentage on record.

A
secondary marketing guy I know was lamenting over the fact that when he
signed up to see the rates for an online mortgage company (name being
withheld, by the way), that he was inundated with phone calls, then
emails for weeks afterwards. When I asked him if his bank had an
employee loan program, he said, “ya, but our rates stink.” Moving right
along….we all know about the “do not call” list which is federally
mandated and prohibits commercial sales calls from ruining our dinners,
however, there is no such “do not email” list with government oversight.
This does not mean that emails can be used to violate the CAN-SPAM Act
which must be adhered to when a commercial message or advertisement is
transmitted via email. It’s important to note while attempting to market
or advertise that the CAN-SPAM Act covers “all commercial messages
defined as “any electronic mail message the primary purpose of which is
the commercial advertisement or promotion of a commercial product or
service”.

Unlike many other advertisement regulations, the CAN-SPAM Act does not contain an exception for business to business emails. Here
are a few items to remember in order to be within compliance (the full
PDF file can be accessed via the FTC link I added above): Opt-Out/Unsubscribe Requirement:
The email must contain a clear and conspicuous explanation detailing a
mechanism for the recipient to opt out of all future emails. All opt-out
requests must be honored within 10 business days. The only information
recipients can be asked to provide, in order to opt out of future
emails, is their email addresses.  No ghost emails permitted: A valid physical address of the sender of the message and/or the advertiser must be set forth in the email [Section 5(a)(5)]. Be transparent:
(a) the email must clearly and conspicuously indicate it is an
advertisement; (b) the subject line must relate to the body of the email
and not be deceptive; and, (c) the “from” header must be accurate and
identify the sender on the email.

Here’s trouble. The
Nevada Supreme Court upheld a law that allows homeowners associations
(HOAs) to foreclose on homes ahead of first mortgage providers,
solidifying “super lien” priority for HOA claims in Nevada. The
decision is expected to reinforce similar laws in other states that have
super lien laws designed to protect HOAs at the expense of first lien
holders. So are first liens still secure when an HOA is involved?

The
court ruled that an HOA super-priority lien is a “true super-priority
lien,” and that a properly conducted foreclosure on the HOA lien
extinguishes first deeds of trust. The
case in question involved a $6,000 lien that was foreclosed upon by SFR
Investments, wiping out an $880,000 first lien held by U.S. Bank. Analysts quickly pointed out that super lien states
(about 20) pose a great risk to lenders, servicers and investors in
many parts of the country, with some estimates running as high as
350,000 HOAs covering over 25 million households.

Much
of this is new construction, and it has been a growing issue in many
retirement states like Florida. If, in theory only, one had a greedy
condo association, we could anticipate varying levels of mismanagement,
fraud or vindictiveness. The CFPB and FHFA have gone to great lengths to
inform the consumers about the mortgage indebtedness, but critics
believe this allows for an unregulated group to seize a property with
little effort.

The public sees what is spelled out in newspapers such as the Reno Gazette Journal,
business section. The case involved a condo HOA in Las Vegas filing
liens on property for non-payment of HOA dues. Some entity bought those
lien rights, and foreclosed. In the past the HOA could not actually
foreclose, as they were behind the deed of trust: they could file notice
but not actually foreclose.  Only
government agencies that are in front of deed of trust could actually
foreclose. The NSC ruled in favor of the HOA, meaning the HOA can
foreclose and is in front of the 1st deed of trust – in this case held
by US Bank.

In
general lenders believe that the court is “misguided.” The HOA is not a
government agency, and historically, that is the only entity than can
be in front of a 1st deed of trust. So will lenders stop lending
whenever an HOA is involved since the possibility has increased that
their loan will be wiped out?  Possibly
– evidently the ruling does not specify the type of HOA or any
limitation, so some subdivision that has an HOA to maintain a front
entrance brick wall and some flowers and collects $20.00 a month dues
has lien rights over a 1st deed of trust. Why would any lender make a
loan knowing this? This could be catastrophic for housing with HOAs in
Nevada and several other states.

Speaking of warning flags, Tom Davis from PMAC writes, “USDA Update–Implementation of New Rural Area Ineligible Area Maps Delayed!! The
USDA maps have been delayed once again. The Continuing Resolution had
language in it that would not allow federal funds to reclassify eligible
areas. The delay will last the length of the CR at that time the areas
could potentially be extended once again. If the Republicans gain
control of the Senate, more than likely another CR would be passed until
the end of March. If the Democrats remain in control then more than
likely an Omnibus bill will be passed and the changes to areas will be
implemented. On September, 19 “Continuing Appropriations Resolution,
2015,” (Public Law 113-164) was signed by the President. The continuing
resolution extends a current general provision regarding housing program
eligibility. This means that if a community is eligible today, they
will remain eligible under the continuing resolution. Barring further
Congressional action, RHS will delay implementation of the revised rural
area maps based on the changes to the rural area definition as revised
in the Agricultural Act of 2014 (Pub. L. 113-79). During the continuing
resolution and as provided in the FY 2014 Appropriations Act (P.L.
113-76), RHS will not reclassify any area eligible for rural housing
programs on September 30, 2013 as not eligible for such programs. The
‘Future Eligibility Maps’ are posted on the Eligibility Website.” (If anyone wants to become part of a group that is dedicated to Rural Housing, I highly recommend they join the LinkedIn group “USDA Guaranteed Rural Housing Loan Program Experts”.)

Let’s continue seeing what vendors have been up to lately!

FormFree Holdings Corporation,
a leading provider of automated asset verifications, announced that its
award-winning, patented solution, AccountChekTM, is now available
through Ellie Mae’s Encompass® mortgage management solution. FormFree
integration with Sallie Mae allows Encompass® users to verify an
applicant’s bank records in just minutes through FormFree’s
AccountChekTM.

Indecomm Global Services,
a leader in business process outsourcing, learning, and technology
solutions, announced that its eRecording services are now available in
more than 700 counties in the United States with the addition of Ramsey,
Minnesota, and others. These eRecording successes are accompanied with a
growth in companion paper filings. “Indecomm has been steadily
investing in eRecording across the country, moving from 600 to 700
counties in less than six months. Of the 3,600 recording jurisdictions
nationwide, only 1,184 counties offer eRecording and Indecomm serves 59
percent of these jurisdictions. In terms of population, Indecomm serves
55 percent. This clearly shows that Indecomm is committed to serving all
of the public and not just the largest counties. Indecomm’s footprint
is broad and deep, allowing Indecomm’s customers to reach the majority
of the counties and the majority of the population on one eRecording
platform.”

a la mode announced  it’s
reached a preliminary agreement with DataMaster, the leading provider
of MLS-sourced comparable data specifically structured for appraisers,
to integrate its data service with a la mode’s full range of appraisal
formfilling systems. DataMaster is currently integrated with a la mode’s
legacy WinTOTAL system, and with this agreement will also be available
in a la mode’s newer TOTAL 2013 formfilling platform.

An Arch MI press release
announced it has been approved as a mortgage insurance provider for the
FHLB Boston and its participating financial institutions for loans
purchased under the Mortgage Partnership Finance® (MPF) program.

Anyone
convinced that a selloff in the stock market leads to a big rally in
bonds was dealt another blow Thursday. Stocks dropped (the Dow was down
264 points, the SP -32) yet 10-yr T-note yields only went from
2.56% to 2.51%. And agency MBS prices rallied but not like Treasury
securities (“widening”) and not enough to cause much in the way of
intra-day price changes.

We do have some news out at 5:30AM PST: Q214
(Final) Real GDP is seen higher from the last decline of -2.1%, while
the GDP deflator is expected higher from prior as well (+1.3%). And at
6:55AM we’ll see the University of Michigan Sentiment number. In the early going rates are a shade better with the 10-yr at 2.50% and agency MBS prices better by a few “ticks”.

For
something totally un-mortgage related to finish off the work week…as
Derek Jeter fades into the sunset to await the Hall of Fame voting in
five years, it seems that a certain number of gals have signed memorabilia for doing “certain things”.

Article source: http://www.mortgagenewsdaily.com/channels/pipelinepress/09262014-can-spam-nevada-hoa-ruling.aspx

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