WASHINGTON: The mortgage-lending subsidiaries of national banks are immune from state regulation, the Supreme Court has ruled in a decision that upheld a controversial regulation issued six years ago by the Office of the Comptroller of the Currency, the chief federal bank regulator.
The attorneys general and bank regulators of all 50 states had urged the justices to find the regulation out of bounds, either as a misinterpretation of the National Bank Act or as a matter of constitutional federalism.
The story in the International Herald Tribune continues here.
While this doesn’t mean that Wells Fargo (or Wachovia which filed the lawsuit) will be putting signs up in your neighbor’s yards tomorrow, it does open up that possibility. The ruling in the bank’s favor today would allow them to conduct their real estate activities outside of state control.
Real estate is currently state controlled (the Oregon Real Estate Agency). This will blur that line. Obviously the National Association of Realtors was one of the most outspoken opponents. If big banks enter real estate a lot of the marginal (previously referred to as stupid) Realtors are going to have an even harder time competing in an already tightening market. While I can’t say that it thrills me either on a personal or professional level we’ve been positioning ourselves with our tools and service to be able to compete in any market. Since they would enter the game way back on the learning curve, I expect that they will have to pay their way into markets by buying out existing brokerages.
Not everything is price driven. It’s why Target and Nordstrom both do equally well serving their target market.