Office of the Assistant Secretary for Housing-Federal Housing Commissioner; Submission for OMB Review; Comment Request

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-3638-N-05]

Office of the Assistant Secretary for Housing-Federal Housing

Commissioner; Submission for OMB Review; Comment Request

AGENCY: Office of the Assistant Secretary for Housing-Federal Housing

Commissioner, HUD.

ACTION: Notice of proposed information collection.

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SUMMARY: The proposed information collection requirement described

below has been submitted to the Office of Management and Budget (OMB)

for emergency review, as required by the Paperwork Reduction Act. The

Department is soliciting public comments on the subject proposal. By

separate notice in today's Federal Register, the Department is also

soliciting comment for 60 days on a portion of the information

collection requirements covered by this emergency review notice.

DATES: The due date for comments is: August 19, 1996.

ADDRESSES: Interested persons are invited to submit comments regarding

this proposal. Comments must be

[[Page 41947]]

received within seven (7) days from the date of this Notice. Comments

should refer to the proposal by name and should be sent to: Joseph F.

Lackey, Jr., OMB Desk Officer, Office of Management and Budget, New

Executive Office Building, Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT:

Kay F. Weaver, Reports Management Officer, Department of Housing and

Urban Development, 451 Seventh Street, SE, Washington, DC 20410,

telephone (202) 708-0050 (this is not a toll-free number). For hearing-

and speech- impaired persons, this number may be accessed via TTY (text

telephone) by calling the Federal Information Relay Service at 1-800-

877-8339. Copies of the proposed forms and other available documents

submitted to OMB may be obtained from Ms. Weaver.

SUPPLEMENTARY INFORMATION: This Notice informs the public that the

Department of Housing and Urban Development (HUD) has submitted to OMB,

for emergency processing, an information collection package with

respect to a disclosure required for controlled business arrangements

between affiliated settlement service providers. HUD seeks to implement

this initiative as soon as possible. We are requesting that OMB approve

this Information Collection Package by August 12, 1996. By two separate

documents in today's Federal Register, the Department, simultaneously

with this notice: (1) is publishing a correction for a rule that was

published on June 7, 1996 (61 FR 29238) (``June 7 rule''), and

contained erroneous information about the approval status of these

information collections; and (2) is soliciting comment for the regular

60-day review period on a portion of the information collection

requirements (which were included in the June 7 rule) covered by this

notice. Regulatory provisions implementing the statutory requirement

for a disclosure under covered circumstances (see 12 U.S.C. 2607(c)(4))

are currently codified in 24 CFR 3500.15(b) and have been revised by

the June 7 rule (effective October 7, 1996). Although the revisions in

the June 7 rule will make small changes in the format provided for the

controlled business disclosure, these revisions are not expected to

affect the burden attributed to information collection requirements in

the current regulations. Therefore, this notice is for the purpose of

soliciting comment on the controlled business disclosure requirements

under both the current regulations and the regulations as they will be

amended on the effective date of the June 7 rule.

In order for borrowers who seek federally related mortgage loans

(including purchase money, refinances, assumptions, property

improvement, lines of credit, etc.) to be better-informed shoppers, a

settlement service provider, or employee thereof, is required to give

the borrower a certain disclosure when the borrower is being referred

to an affiliated settlement service provider. This controlled business

disclosure alerts the borrower that the referral may be based on a

business arrangement between the two providers, rather than on the best

rate or best service. Section 8(c)(4) of the Real Estate Settlement

Procedures Act (RESPA) (12 U.S.C. 2607(c)(4)), as well as the

implementing regulations at 24 CFR 3500.15, require that borrowers

receive this notice.

The Department has submitted the proposal for the collection of

information, as described below, to OMB for review, as required by the

Paperwork Reduction Act (44 U.S.C. Chapter 35): Notice of Submission of

Proposed Information Collection to OMB

Proposal: Controlled Business Arrangement Disclosure (CBA

disclosure) under 24 CFR 3500.15.

Office: Office of Housing-Federal Housing Commissioner.

Description of the Need for the Information and its Proposed Use: A

settlement service provider or an employee of a settlement service

provider is required to give the borrower a CBA disclosure prior to or

at the time the borrower is referred to an affiliated provider. The CBA

disclosure must be a separate piece of paper and the format must

contain the following information.

1. Specify the nature of the relationship (explaining the ownership

and financial interest) between the person performing the settlement

service and the person making the referral.

2. Describe the estimated charges or range of charges generally

made by the provider of settlement services.

3. State that the borrower is not required to use the referred

provider (except for certain circumstances).

Form Numbers: None.

Respondents: Respondents will be settlement service providers, or

employees thereof, who refer borrowers to other affiliated providers.

The estimated number of respondents is 10,000. The disclosure is

required to be given each time a settlement service provider refers the

borrower to an affiliated service provider. This specifically includes

each time an employee who does not perform settlement services refers

business to an affiliate.

Frequency of Submission: The third party disclosure is required

whenever a borrower is referred to an affiliated provider.

Reporting Burden: (Although the revisions in the June 7 rule will

make small changes in the format provided for the controlled business

disclosure, these revisions are not expected to affect the burden

attributed to information collection requirements in the current

regulations.)

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Number of Frequency of Hours per

respondents x response x response = Burden hours

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10,000....... 2.4 mill. 0.10 240,000

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Total Estimated Burden Hours: 240,000.

Status: New approval.

Authority: 44 U.S.C. 3507; 42 U.S.C. 3535(d).

Dated: August 1, 1996.

David S. Cristy,

Director, IRM Policy and Management Division.

[FR Doc. 96-20172 Filed 8-9-96; 8:45 am]

BILLING CODE 4210-27-M