CREF Policy Update July 29, 2021

Commercial and multifamily developments and activities from MBA relevant to your business and our industry.

Last week , MBA senior staff spoke at FHFA’s listening session on a new radon testing standard that FHFA is considering. Last Tuesday, the OCC announced it would rescind its May 2020 rulemaking changes to its Community Reinvestment Act rules, and the banking agencies announced that they would do a joint rulemaking to amend CRA rules. And recently, MBA along with 12 trade organizations submitted a coalition letter to HUD Secretary Marcia Fudge urging her to take action to address the substantial delays for FHA-backed financing for multifamily projects.

Finally, don’t forget to participate in our DE&I survey, run by McLagan. See below for more information.

MBA and Members Speak at FHFA Radon Testing Listening Session

On Wednesday, MBA’s Mike Flood, SVP of Commercial and Multifamily, and Mike Fratantoni, SVP and Chief Economist, spoke at the Federal Housing Finance Agency’s (FHFA) listening session on a new radon testing standard that FHFA is considering. Many MBA members and industry also spoke during the five-hour session.

  • Why it matters: The new standard of 100% ground floor testing, with an additional 10% upper floor testing, is based on a biased study, is not risk-based, and would result in substantial delays in the GSEs’ multifamily pipelines, while also increasing the cost of closing loans.

  • What’s next: MBA and other stakeholders will submit letters following up on remarks at the listening session. FHFA will consider input before making a final determination of its multifamily Radon testing standards for the GSEs.

For more information, please contact Mike Flood at (202) 557-2745.

OCC to Rescind 2020 CRA Rule; Banking Agencies to Propose Joint Rule

On Tuesday, the Office of the Comptroller of the Currency (OCC) announced it would rescind its May 2020 rulemaking changes to the Community Reinvestment Act (CRA), and the OCC, Federal Reserve, and the Federal Deposit Insurance Corporation (FDIC) issued a joint statement that they are, committed to working together to jointly strengthen and modernize regulations implementing the CRA.”

  • Why it matters: MBA has submitted multiple comment letters suggesting ways to improve the CRA for commercial and multifamily lenders, including comments on the Federal Reserve’s Advance Notice of Proposed Rulemaking (ANPR).
  • What’s next: MBA will work with members to develop and submit comments in response to upcoming rulemakings regarding CRA.

For more information, please contact Grant Carlson at (202) 557-2765.

MBA-led Coalition Asks HUD Secretary Fudge to Address FHA Multifamily Processing Delays

On Thursday, MBA along with 12 trade organizations submitted a coalition letter to U.S. Department of Housing and Urban Development (HUD) Secretary Marcia Fudge urging her to take action to address the substantial delays now suffered by developers seeking Federal Housing Administration (FHA)-backed financing for multifamily projects. The recommended solutions include expediting the contracting process necessary for HUD to engage third-party resources to help with underwriting.

  • Why it matters: FHA multifamily financings are currently experiencing delays of greater than six months because of a shortage of available underwriters.

  • What’s next: MBA will continue to advocate for HUD to address this problem, and for Congress to provide sufficient HUD funding.

For more information, please contact Sharon Walker at (202) 557-2747.

HUD Secretary Fudge Appears Before House Financial Services Committee    

On Tuesday, HUD Secretary Fudge appeared before the House Financial Services Committee in a hearing entitled, “Building Back A Better, More Equitable Housing Infrastructure for America: Oversight of the Department of Housing and Urban Development (HUD).Democrats praised Fudge for her job thus far as HUD Secretary, especially her focus on the ongoing affordable housing crisis. Republicans raised a number of concerns, including the administration’s implementation of American Rescue Plan provisions and programs (such as emergency rental assistance (ERA)).  Rep. Roger Williams (R-TX) asked the Secretary about significant delays within the FHA multifamily program pipeline, including the six to twelve months “wait time” before an application is assigned to an underwriter.  A clip of this exchange can be found here.  

·        Why it Matters: Congressional questions can put more specific pressure on an agency like HUD to resolve issues garnering significant attention, including program delays and bottlenecks that impact the delivery of affordable housing.   

·        What’s Next: MBA will continue to work with both HUD and Congress to ensure additional oversight of the FHA multifamily pipeline delays, as well as a continued focus on the delivery of ERA funds. 

For more information, please contact Borden Hoskins at (202) 557-2712 or Alden Knowlton at (202) 557-2741.

Department of Labor’s Wage and Hour Division Offers Virtual Davis-Bacon Compliance Seminars

The Wage and Hour Division (WHD) at the Department of Labor (DOL) is offering their second annual virtual Prevailing Wage Seminars, which will be offered over various dates in August. The seminars will allow participants access to pre-recorded trainings on a variety of issues, including Davis-Bacon and Service Contract Act compliance.

  • Why it matters: FHA-financed new construction and substantial rehabilitation projects are subject to Davis-Bacon prevailing wage requirements.This training is part of WHD’s ongoing efforts to increase awareness and improve compliance with federal prevailing wage requirements.
  • What’s Next:  Participants can register here. Additional information, including links to videos training and virtual Q&As, will be provided to registrants at a later date.

For more information, please contact Sharon Walker at (202) 557-2747.

Climate/ESG Resources

For MBA’s Climate/ESG information, or how to get involved on climate and ESG issues, please visit MBA’s Climate and ESG webpage.

For more information, please contact Adrian Ballinger at (202) 557-2774.

State Trackers

  • State eviction moratorium and legislative activity tracker available here.

For more information, please contact William Kooper at (202) 557-2737 or Grant Carlson at (202) 557-2765.

Participate in the New Diversity, Equity and Inclusion (DEI) Study

Sign up today to participate in a new offering to MBA members, the Diversity, Equity and Inclusion (DEI) Study. The study is separately designed and compiled for both the residential and commercial/multifamily sides of the real estate finance industry, and is administered by world-class human resources advisory firm McLagan, a part of Aon plc. All participating companies are encouraged to complete as many sections of the study template as possible on the following topics: Policy and Initiatives; Headcount by Mortgage Job Function; Headcount by EEO-1 Categories; and Headcount by Movement.  

  • Why it matters: Over the past year, racial and gender inequalities have shaped our nation’s conversation, and MBA remains committed to supporting our member companies by forming solutions. We have been engaged with our staff and leaders in the real estate finance industry on how we can eliminate racial and gender inequalities within the mortgage industry, from the perspective of lending and servicing to borrowers, as well as staffing our own organizations. Participating will give our industry a baseline from which to improve, and to see how member companies compare to the industry as a whole.
  • What’s next: Registration and participation in the study is required in order to receive the results. Individual company data will be kept confidential in accordance with McLagan’s high standards. As a bonus, MBA members save $1,000 off the regular survey pricing. The general timeline is provided in the registration form, with data due back to McLagan in mid-September, and results released in October 2021.

For specific information about the DEI Study, please email Dave Rosenthal at McLagan or call (203) 326-4349. For general questions, please contact MBA Research members Marina Walsh at (202) 557-2817 or Jamie Woodwell at (202) 557-2936.

Are You a Diversity Champion? Apply for MBA’s DEI Leadership Awards

MBA’s DEI Leadership Awards are back! Now in its sixth year of recognizing MBA member companies, this awards program acknowledges the dedication and creativity that increase DEI efforts within a company’s leadership and employee base. If your organization is a champion for diversity, share how you are inspiring change and highlight your success by applying today.

  • What’s next: Applications are due August 13, 2021. Prior to getting started, please review these application tips to help you prepare your entry.

For more information, please contact MBA’s DEI Team.

Upcoming and Recent MBA Education Webinars on Critical Industry Issues

MBA Education continues to deliver timely 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:

  • Preparing for the End of the Pandemic – What Should Servicers Do Now? – July 28
  • Social Media and Digital Advertising 2021 Update – July 29
  • Compliance Considerations Before and After a Data Breach – August 10
  • C-PACE Financing 101: A Commercial/Multifamily Lender’s Overview – August 12
  • Commercial/Multifamily: Core and Non-Traditional Sector Outlooks and Mortgage Risk – August 17
  • Bank-Owned Mortgage Divisions: What Bankers Need to Know to Manage Mortgage Banking – August 26
  • Budgeting and Financial Planning for Non-Believers – September 9
  • Introduction and Walkthrough of MISMO’s Enhanced Logical Data Dictionary (LDD) – October 6

MBA members can register for any of the above events and view recent webinar recordings here.

For more information, please contact David Upbin at (202) 557-2890.