An update to the VA home loan program, the CFPB trying to help mortgage originators and Jack in the Box marching into Georgia. From the wild and wooly world of real estate, here are our Hits and Misses for the week of June 10-14.
Hit: Score One for the VA. This week, the U.S. Department of Veterans Affairs (VA) issued a circular announcing a temporary policy change that will enable borrowers using the VA home loan program to pay certain real estate buyer-broker fees when purchasing a home. The circular comes in the wake of changes coming to the broker commission structure following the settlement of the Sitzer/Burnett case. Prior to this policy shift, the VA home loan program prevented buyer-broker fee compensation. While federal bureaucracy often gets in the way of immediate action, the VA deserves credit for quickly addressing this issue while ensuring its home loan program can remain as a viable tool for the nation’s heroes.
Hit: Score One for the CFPB. The Consumer Financial Protection Bureau (CFPB) deserves praise for its proposed rule to remove medical bills from most credit reports. Rohit Chopra, the agency’s director, said this will “end the senseless practice of weaponizing the credit reporting system to coerce patients into paying medical bills that they do not owe. Medical bills on credit reports too often are inaccurate and have little to no predictive value when it comes to repaying other loans.” The CFPB predicted the rule would result in the approval of approximately 22,000 mortgages every year – and having the CFPB doing something to help the mortgage industry is a welcome change of pace.
Hit: Score One for Amazon. The e-commerce giant Amazon announced this week it is adding $1.4 billion to its Amazon Housing Equity Fund, which sought to build and preserve 20,000 affordable homes over a five-year period. The fund was launched in January 2021 with $2 billion, but it has already exceeded its goal – so more funding is being added to build and preserve an additional 14,000 affordable homes. While the fund is limited to three markets in Tennessee, Virginia and Washington, Amazon CEO Andy Jassy said he hoped the company can “help make a meaningful difference for thousands more people and enable these regions to thrive.”
Hit: Score One for Jack in the Box. The fast-food chain Jack in the Box Inc. announced this week that it signed a development agreement to open 15 locations throughout Georgia. The agreement brings the fast-food chain into Georgia for the first time while expanding its presence in the southeast. The new sites have not been selected, although the company is looking into the state’s growing markets including Augusta, Macon and Savannah. At a time when many fast-food chains are either closing locations or laying off workers due to elevated operating costs, Jack in the Box’s expansion plan is encouraging news for the food service and commercial real estate sectors.
Miss: How Not to Invest Like Trump. The financial site Benzinga published a pair of articles this week falsely suggesting that its readers could “Invest Like Donald Trump” by focusing on two New York City-based real estate investment trusts. The articles didn’t specifically state that Trump was putting his money into the REITs being highlighted, but instead noted that Trump made his fortune in real estate and that potential investors should consider REITs. According to Forbes, most of Trump’s investments include bonds, Treasuries and money-market funds, while a minority of his portfolio consists of stock holdings in blue-chip companies including Procter & Gamble, JPMorgan Chase, Pfizer and Johnson & Johnson. REITs are not part of the Trump investment strategy – and anyone who want to invest like the former president should probably read Forbes instead of Benzinga. (Disclosure: This author was once a part of the Benzinga staff when its editorial standards were much stronger.)
Miss: Warren on the Warpath. Massachusetts Sen. Elizabeth Warren popped up in the news this week with her demand that the Federal Reserve cut rates. In a letter to Fed Chairman Jerome Powell, Warren claimed that “housing-related inflation is directly driven by high interest rates: reducing rates will reduce the costs of renting, buying, and building housing, lowering Americans’ single highest monthly expense.” The ignorance of Warren’s understanding of how the housing market works was exceeded only by her arrogance in trying to force Powell to enact a policy decision that he repeatedly stated was not going to occur.
Phil Hall is editor of Weekly Real Estate News. He can be reached at [email protected].
Photo courtesy Columbia Pictures
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MISS!!! The idea that it’s a HIT that Vets can pay a buyer broker is a BIG MISS. So much for nothing down benefits for Veterans. What baloney.