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Today on Real Estate Backstage, the fight between NAR and the Phoenix Association of REALTORS® heats up, with NAR threatening to revoke Phoenix’s charter … The injunction against the Corporate Transparency Act was removed, but then put back in place … the CFPB has filed a lawsuit against Rocket Homes for alleged RESPA violations … And finally, we take a close look at one really important economic indicator that almost no one is talking about.
The Battle Between NAR and Phoenix REALTORS®
Last week, on Episode 10, we covered the cease and desist letter that NAR sent to the Phoenix Association of REALTORS® over their “MLS Choice” membership option, which provides real estate agents who choose not to affiliate with the state or national REALTOR® associations with access to the local MLS, legal forms, and other benefits. Phoenix REALTORS® responded to NAR’s letter by refusing to stop offering “MLS Choice,” and now according to Real Estate News:
“The National Association of Realtors has ‘made the difficult but necessary decision to initiate the charter revocation process’ against Phoenix Realtors, according to an email sent to leaders … Muchow laid out the charter revocation process in her email: NAR president Kevin Sears will ask Phoenix Realtors to ‘review its reasons for non-compliance’ before a panel of 3-5 members of NAR’s Executive Committee, appointed by Sears. If PAR fails to convince the panel, it will be given another deadline to shut down MLS Choice. If it does not comply by the deadline, PAR will face a ‘show cause’ hearing before 7-9 different members of the Executive Committee. If that panel decides to revoke the charter, that recommendation will go before the full Executive Committee, which will make the final call. PAR’s territory ‘would become unassigned and available’ if its charter is revoked. NAR said that as this process unfolds, it will reach out to local members and make sure they know what’s going on ‘and the options available to them, including choosing another local association,’ Muchow said in her email.”
(Source: RealEstateNews.com)
The Corporate Transparency Act
A few weeks ago, on Episode 8, we covered an injunction placed on enforcement of the Corporate Transparency Act by a District Court in Texas, that temporarily froze the requirement that anyone with an ownership interest in a private company file a Beneficial Ownership Information Report with the Treasury Department. Well, on Monday, December 23rd, the law was reinstated on appeal. According to s-corp.org:
“An appellate court today ruled in favor of the federal government in reversing a nationwide injunction against the Corporate Transparency Act. The decision means that the CTA’s reporting requirements are now back in full effect, giving the approximately 20 million entities who have not yet submitted their filings just a few days to do so. The injunction that’s currently in place was ordered by a Texas court which found that the CTA is “likely unconstitutional” and that Congress went beyond its authority in enacting the statute. The government quickly requested that the injunction be stayed pending a final ruling.”
(Source: s-corp.org)
The deadline for BOI reports to be filed, which was originally set for the end of the year, was pushed back to January 13, 2025 … However, in a surprising turn of events, on Friday, December 27th the injunction was put back in place by the U.S Court of Appeals for the Fifth Circuit. According to the National Federation of Independent Business:
“The court’s latest decision reinstates the nationwide injunction, blocking the burdensome beneficial ownership information (BOI) reporting requirements for small businesses while the court fully considers the government’s appeal. It also nullifies a previous Fifth Circuit order that allowed the government to begin enforcing the CTA and BOI reporting requirements again. ‘The court’s reinstatement of the nationwide injunction is a welcome sigh of relief for small businesses,’ said Rob Smith, Senior Attorney of NFIB’s Small Business Legal Center. ‘Since being told earlier this week that they must urgently submit their BOI reports, our nation’s small businesses have experienced enormous chaos and confusion. Thankfully, the court’s latest decision recognizes that the CTA and BOI reporting requirements pose serious constitutional questions. It also provides Main Streets across the country with a reprieve from this harmful mandate while our lawsuit proceeds.’ ”
(Source: nfib.com)
The CFPB Sues Rocket Homes
According to HousingWire:
“The Consumer Financial Protection Bureau (CFPB) filed a lawsuit Monday accusing Rocket Homes of orchestrating a kickback scheme to funnel business to its sister companies, Rocket Mortgage and Amrock. The Jason Mitchell Group is also implicated in the alleged violations of the Real Estate Settlement Procedures Act (RESPA). According to the CFPB, between 2019 and 2024, real-estate brokerage firm Rocket Homes purportedly incentivized real estate brokers and agents with referrals and priority for future referrals in exchange for steering clients toward mortgage lender Rocket Mortgage and settlement firm Amrock, which are also under the umbrella of Detroit-based Rocket Companies. The Jason Mitchell Group and its founder, Jason Mitchell, allegedly participated by referring thousands of clients to Rocket’s companies … Rocket allegedly restricted brokers and agents from sharing competing lenders’ information, including details about down-payment assistance programs. At The Jason Mitchell Group, agents were supposedly trained to suggest transactions could fail if clients shopped around for other mortgage options … ‘Rocket engaged in a kickback scheme that discouraged homebuyers from comparison shopping and getting the best deal,’ CFPB Director Rohit Chopra said in a statement. ‘At a time when homeownership feels out of reach for so many, companies should not illegally block competition in ways that drive up the cost of housing.’ ”
(Source: HousingWire.com)
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Initial Jobless Claims
According to Reuters:
“The number of Americans filing new applications for jobless benefits dipped to the lowest in a month last week, consistent with a cooling but still-healthy U.S. labor market that is likely to keep Federal Reserve officials from cutting interest rates any further in the near term. Initial claims for state unemployment benefits fell by 1,000 to a seasonally adjusted 219,000 for the week ended Dec. 21, the Labor Department said on Thursday. Economists polled by Reuters had forecast 224,000 claims for the latest week.”
(Source: reuters.com)
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