U.S. Senators meet with Realtors® in D.C.

Sen. Pat Toomey

Pennsylvania Realtors® had a unique opportunity to talk with their senators yesterday at the U.S. Capitol in Washington, D.C. The 60 Realtors® in attendance were able to ask specific questions regarding issues related to the real estate industry and homeownership.

Sen. Pat Toomey told us that it’s helpful for our members to meet with members of Congress to educate them on real estate-related concerns.

Sen. Toomey said last year the Senate Banking Committee took a swing at reforming the government-sponsored entities (GSEs), to no avail. He said it’s not likely to see further reform efforts of GSE under the current administration. Sen. Toomey would prefer to see more private capital in lending and believes reform of these entities will be politically challenging.

Sen. Bob Casey

Sen. Bob Casey said he stands strongly with the National Association of Realtors® (NAR) on GSE reform and believes they are important to the real estate industry.

Realtors® strongly urged both senators to sign a letter circulating in the House to delay penalties on the new regulations under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA), which take effect August 1. The new regulations are far-reaching, particularly for lending institutions, and widely sweeping changes will hit at a peak time for the industry. NAR President Chris Polychron provided testimony before the Consumer Finance Protection Bureau to ask the bureau to take a time out from the enormous changes before hitting companies with large fines.

The Senate Banking Committee is expected to address some modest changes to the Dodd-Frank Act, according to Sen. Toomey. He said these changes will look at caps on fees, manufactured housing and qualified mortgages.

The senators were asked to extend Mortgage Debt Cancellation Relief. NAR supports two-year extension of tax relief for mortgage debt forgiveness. Several Realtors® gave examples of how this has helped their clients involved in short sales. In areas such as Monroe County, where a large majority of homes are distressed sales, many homeowners are still experiencing problems with these sales.

In addition, we urged the senators to support Patent Reform. Patent trolls purchase questionable, overly broad patents and use then to demand companies pay licensing fees, turning common business practices into potential lawsuits. Realtors® have been targeted by patent trolls for the use of such common technology as website drop-down menus and new listing search alerts, causing significant disruption in businesses.

Regarding the commercial real estate industry, Realtors® asked the senators to keep 1031 Like-Kind exchanges. This allows investment real estate to be exchanged for property of a like-kind on a tax-deferred basis. Exchanges are essential in investment and commercial real estate transactions; if repealed, fewer redevelopment projects will go forward, resulting in fewer new jobs. The like-kind exchange provision provides liquidity to an illiquid asset. Repealing the like-kind exchange provision would be counterproductive and result in the loss of jobs and economic growth with little gain in revenue.

We’re grateful to the senators for taking time out of their busy schedules to discuss real estate-related issues.