CREF Policy Update: Supreme Court Rules in CFPB’s Favor; Prudential Regulators Testify on the Hill; MBA Shares Views Ahead of Markup
Supreme Court Upholds CFPB’s Funding
The U.S. Supreme Court last week ruled in a 7-2 opinion that the Consumer Financial Protection Bureau’s (CFPB) appropriations mechanism is constitutional, reversing a previous decision by the U.S. Court of Appeals for the 5th Circuit.
The Court’s decision in the case, Community Financial Services Association (CFSA) v. Consumer Financial Protection Bureau, rejects an argument by CFSA that the CFPB’s funding structure ran afoul of the Constitution’s Appropriations Clause.
What they’re saying: MBA’s Broeksmit in a press statement said, “MBA is relieved that the Supreme Court avoided a ruling that would have disrupted the housing and mortgage markets and harmed the economy and consumers.”
Go deeper: Last year, MBA filed a joint amicus brief, which took no position on whether the Bureau is constitutionally funded but instead focused the Court’s attention on how to avoid disrupting the housing and mortgage markets.
The brief suggested that if the Bureau’s funding structure is ruled unconstitutional, the Court should sever those funding provisions and preserve the Bureau’s past actions until Congress corrects the constitutional appropriations problems.
What’s next: There is no immediate impact on real estate finance rules from the decision. MBA’s summary can be read here.
For more information, please contact Justin Wiseman at (202) 557-2845, Alisha Sears at (202) 557-2930 or Stephanie Milner at (202) 557-2747.
Prudential Regulators Appear Before House and Senate Committees
Last week, Federal Reserve (Fed) Vice Chair Michael Barr, Federal Deposit Insurance Corporation (FDIC) Chair Marty Gruenberg, and Acting Office of the Comptroller of the Currency (OCC) Michael Hsu testified before both the House Financial Services (HFSC) and Senate Banking, Housing, and Urban Affairs (SBHUAC) Committees.
The hearings came on the heels of a long-anticipated report released by law firm Cleary Gottlieb Steen & Hamilton examining allegations concerning sexual harassment and interpersonal misconduct at the FDIC. As anticipated, both HFSC and SBHUAC Republicans reiterated their pleas for Gruenberg to resign.
See a full summary of both the House and Senate hearings here and here.
Why it matters: Several lawmakers’ questions also focused on the ongoing status of the regulators’ Basel III “Endgame” proposal. Similar to previous hearings, many Republicans criticized aspects of the proposal and urged regulators to withdraw it. Additionally, some Democrats reiterated concern with certain provisions, including its impact on mortgage credit availability and the treatment of tax equity investments.
Notably, Vice Chair Barr refrained from echoing Fed Chair Jerome Powell’s previous statement about a re-proposal being a “live option,” while signaling there would be “broad and material changes” to the rule. Vice Chair Barr also highlighted that the Fed’s Quantitative Impact Study (QIS) on the proposal will be released “relatively soon.”
Go deeper: Republicans and Democrats both questioned the regulators on the recently released Financial Stability Oversight Council (FSOC) report on nonbank mortgage servicers.
What’s next: Rep. Brad Sherman (D-CA) asked HFSC Chairman Patrick McHenry (R-NC) to schedule an additional hearing specifically focusing on the Cleary report and Chair Gruenberg’s oversight of the FDIC.
MBA will continue to advocate strongly for our industry’s preferred outcomes on the Basel III proposal – and in reaction to the recent FSOC report.
For more information, please contact Ethan Saxon at (202) 557-2913, George Rogers at (202) 557-2797, Rachel Kelley at (202) 557 2816 or Madisyn Rhone at (202) 557-2741.
MBA Shares Views on Pertinent Bills at Extensive House Financial Services Committee Markup
Last Thursday, the full HFSC considered and approved 11 bills during a full-day legislative “markup.” The broad slate of bills approved by the panel included proposals designed to ease regulations on banks, fence in the Securities and Exchange Commission, and potentially boost housing supply.
Why it matters: MBA shared a letter in advance of the markup with all HFSC member offices to reveal our specific industry views regarding: the Yes in My Back Yard (YIMBY) Act legislation designed to help eliminate discriminatory land use policies and remove barriers that depress affordable housing production; two titles within one bill that would limit the scope of the CFPB’s Section 1071 small business reporting rule requirements; another bill that would more clearly define the abusiveness standard under CFPB’s UDAAP authorities; a proposal to expand access to banking activities (including mortgage services) through the establishment of de novo financial institutions; and, a bill to compel the Treasury Department’s Director of the Community Development Financial Institutions (CDFI) Fund to testify annually before Congress.
Go deeper: All of the MBA-supported bills were cleared by the panel (the YIMBY Act was approved unanimously). Find additional markup summary details here. Examine two additional joint industry letters signed by MBA and other trade groups in support of the YIMBY Act here and here.
What’s next: MBA will continue to weigh in on and seek to advance our industry’s priority policies in the few remaining HFSC markups expected to be held before the end of the 118th Congress.
For more information, please contact Madisyn Rhone at (202) 557-2741 or Rachel Kelley at (202) 557-2816.
FHFA Releases Request for Input on Mission of Federal Home Loan Banks
Last Thursday, the Federal Housing Finance Agency (FHFA) released a Request for Input (RFI) on the mission of the Federal Home Loan Banks’ (FHLBanks).
Specifically, FHFA is seeking input on three key areas: (1) updating the regulatory statement of the FHLBank System’s mission to better reflect its appropriate role in the housing finance system; (2) developing metrics and thresholds to evaluate mission achievement; and (3) identifying how the FHLBanks could incorporate incentives for members with a strong and demonstrable connection to the FHLBank System’s mission.
Why it matters: In November 2023, FHFA released its FHLBank System at 100: Focusing on the Future report, its comprehensive review of the FHLB System in anticipation of the System’s centennial in 2032.
Go deeper: MBA stressed the importance of expanding FHLB membership and maintaining the types of collateral that members can pledge under the current system in an October 2022 comment letter.
What’s next: MBA will review the RFI and work with members to provide a response by the July 15, 2024, deadline.
For more information, please contact Stephanie Milner at (202) 557-2747.
MBA Shares Views on Pertinent Bills at Extensive House Financial Services Committee Markup
Thursday, the full HFSC considered and approved 11 bills during a full-day legislative “markup.” The broad slate of bills approved by the panel included proposals designed to ease regulations on banks, fence in the Securities and Exchange Commission, and potentially boost housing supply.
Why it matters: MBA shared a letter in advance of the markup with all HFSC member offices to reveal our specific industry views regarding: the Yes in My Back Yard (YIMBY) Act legislation designed to help eliminate discriminatory land use policies and remove barriers that depress affordable housing production; two titles within one bill that would limit the scope of the CFPB’s Section 1071 small business reporting rule requirements; another bill that would more clearly define the abusiveness standard under CFPB’s UDAAP authorities; a proposal to expand access to banking activities (including mortgage services) through the establishment of de novo financial institutions; and, a bill to compel the Treasury Department’s Director of the Community Development Financial Institutions (CDFI) Fund to testify annually before Congress.
Go deeper: All of the MBA-supported bills were cleared by the panel (the YIMBY Act was approved unanimously). Find additional markup summary details here. Examine two additional joint industry letters signed by MBA and other trade groups in support of the YIMBY Act here and here.
What’s next: MBA will continue to weigh in on and seek to advance our industry’s priority policies in the few remaining HFSC markups expected to be held before the end of the 118th Congress.
For more information, please contact Madisyn Rhone at (202) 557-2741 or Rachel Kelley at (202) 557-2816.
[VIDEO] mPower Moments: Utilizing Personal Strengths with MISMO’s Jan Davis
mPower Founder Marcia M. Davies sits down with Jan Davis, MISMO’s VP of Operations, for an in-depth conversation on her career journey and how she joined the mortgage industry through her passion for data and technology.
Go deeper: Davis discusses her motivation behind being a woman professional in data and technology and how she has been able to enjoy her career by being willing to learn new things and being passionate about the industry’s mission. She also provides helpful advice on how the next generation of professionals can succeed by being a team player and bringing their authentic voice to the table.
What’s next: To watch more mPower Moments, click here.
For more information, please contact Marcia Davies at (202) 557-2707.
Upcoming MBA Education Webinars on Critical Industry Issues
MBA Education continues to deliver timely single-family and commercial/multifamily programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – which are complimentary to MBA members:
Introduction to Commercial Mortgage-Backed Securities – May 23
Culturally Competent Marketing and Messaging for Hispanic Homebuyers and Homeowners – May 30
Bank-Owned Mortgage Divisions: What Bankers Need to Know to Manage Mortgage Banking – June 11
Adding Reverse Mortgages to Your Business Line: The Value Proposition – June 20
Unpacking the Costs and Current State of Homeowners Insurance – June 20
MBA members can register for any of the above events and view recent webinar recordings by clicking here.
For any questions, please contact David Upbin at (202) 557-2931.
