MBA CREF Policy Update Oct. 13, 2022
Bill Killmer bkillmer@mba.org; Mike Flood mflood@mba.org
The federal District Court for the District of Columbia recently ruled the Home Mortgage Disclosure Act (HMDA) reporting threshold should be decreased from 100 closed-end loans to 25 closed-end loans. Last Monday MBA sent a letter to the OCC, NCUA and FDIC in response to the proposed interagency policy statement on commercial real estate loan accommodations and workouts.
MBA is now accepting applications for its Commercial/Multifamily Diversity, Equity, & Inclusion Leadership Awards. For more information and to apply, click here.
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Federal District Court Ruling Lowers HMDA Loan Reporting Threshold
Earlier this month, the federal District Court for the District of Columbia ruled that the Home Mortgage Disclosure Act (HMDA) reporting threshold should be decreased from 100 closed-end loans to 25 closed-end loans. The Consumer Financial Protection Bureau, under previous Director Kathy Kraninger, had engaged in notice and comment rulemaking that resulted in a final rule in 2020 that increased the reporting threshold to 100 closed-end loans.
- Why it matters: As a result of the court’s ruling, only institutions originating fewer than 25 closed-end mortgage loans in each of the two preceding calendar years are exempt from HMDA reporting. Effective immediately, institutions that were previously exempt from reporting with loan volume in a range of 25 loans to 99 loans in each of the preceding two calendar years are now subject to HMDA reporting. MBA expects the CFPB to review the ruling and provide compliance guidance for institutions that are now subject to HMDA reporting. Banks, credit unions, and savings institutions with less than $50,000,000 in total assets remain exempt from HMDA reporting regardless of loan origination volume.
- What’s next: A detailed summary of the court ruling can be found here. MBA will keep members informed on all relevant updates.
For more information, please contact Justin Wiseman at (202) 557-2854 or Stephanie Milner at (202) 557-2747.
MBA Submits Letter to the OCC, NCUA, and FDIC in Response to Commercial Loan Workout Rulemaking
Last Wednesday, MBA submitted a letter to the Office of the Comptroller of the Currency (OCC), the National Credit Union Administration (NCUA), and the Federal Deposit Insurance Corporation (FDIC) in response to a proposed policy statement for prudent commercial real estate loan accommodations and workouts.
- Why it matters: The proposal is meant to update the Policy Statement on Prudent Commercial Real Estate Loan Workouts, which was issued by the Federal Financial Institutions Examination Council (2009 Statement). The regulatory update is expected to take “lessons learned” from previous downturns and allow banks to work with borrowers facing short-term issues.
- What’s next: MBA is reviewing a similar proposal released by the Federal Reserve Board on September 15, 2022. Comments are due by November 11, 2022.
For more information, please contact Stephanie Milner at (202) 557-2747.
Commercial/Multifamily Lending Expected to Fall in 2022 Due to Ongoing Economic Uncertainty
Total commercial and multifamily mortgage borrowing and lending is expected to fall to $766 billion this year, down 14 percent from 2021 totals ($891 billion). This is according to an updated MBA baseline forecast released Monday.
- MBA’s Vice President of Commercial Real Estate Research Jamie Woodwell said, “We continue to see significant changes, volatility, and uncertainty in the space, equity, and debt markets that drive commercial real estate values and transaction volumes. There was a record level of borrowing and lending during the first half of this year. Given market changes, we forecast a significant slowdown in the second half of the year – driven by rising interest rates and capitalization rates and uncertainty among buyers, sellers, and other stakeholders about where market values may lie. As we have noted before, most commercial real estate market fundamentals remain strong, with significant increases in the incomes and values of many properties in recent years. These factors are why MBA expects loan demand to begin to bounce back in 2023 and 2024.”
- What’s next: MBA’s updated CREF Forecast can be found here.
For more information, please contact Jamie Woodwell at (202) 557-2936.
L.A. City Council Votes to End Eviction Moratorium
Last Tuesday, the Los Angeles City Council unanimously voted to end the city’s nearly three-year eviction moratorium.
- Why it matters: While landlords have been allowed to file evictions, court proceedings have been on hold since the onset of the COVID-19 pandemic in March 2020.
- What’s next: Court proceedings will resume on February 1, 2023.
For more information, please contact William Kooper at (202) 557-2737 or Grant Carlson at (202)-557-2765.
Dr. Frank Nothaft Memorial Fellowship Fund
The real estate finance industry was saddened this summer to learn of the sudden passing of CoreLogic Chief Economist Dr. Frank Nothaft, an industry icon who previously spent 29 years at Freddie Mac, the last 14 as the organization’s Chief Economist. Frank’s research and insight were best-in-class, which is why he was an ever-present sight on stage at industry conferences and events, and a highly sought-after source by news outlets around the country.
- Why it matters: MBA is proud to partner with CoreLogic to establish the Dr. Frank Nothaft Memorial Fellowship Fund at Columbia University, where Frank earned his Ph.D., taught, and conducted research. The goal is to raise $250,000 to create an endowed fund that will provide a fellowship to a graduate student in Economics each year in perpetuity. MBA and CoreLogic, with help from a handful of other companies and industry leaders, have already raised almost $100,000, but we need your help to reach our goal of continuing Frank’s legacy.
- What’s next: Donate online at https://giving.columbia.edu/nothaft. Alternatively, you can mail a check, payable to Columbia University with a note in the memo line noting that it is for the Dr. Frank Nothaft Memorial Fellowship Fund, to: Columbia Alumni Center, Attention: Gift Systems, 622 West 113th Street, MC 4524, New York, NY 10025
For more information, please contact please contact Columbia University representative, Julia Morton, at 347-880-1737.
State Trackers
For more information, contact William Kooper at (202) 557-2737 or Grant Carlson at (202) 557-2765.
Upcoming 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 webinars, which are complimentary to MBA members:
- Marijuana and Real Estate in 2022: What Every CRE Professional Should Know – October 19
- Modern Day Redlining in Focus: Takeaways from Trident Mortgage and Beyond – October 20
- Climate Risk in CREF – What we know and are learning – November 1
- Prioritizing Compliance in Loan and Mortgage Digitization – October 12
- Marijuana and Real Estate in 2022: What Every CRE Professional Should Know – October 19
- Modern Day Redlining in Focus: Takeaways from Trident Mortgage and Beyond – October 20
- Climate Risk in CREF – What we know and are learning – November 1
- Inflation, Interest Rate, Cap Rates & Values: What Do We Really Know? – November 30
MBA members can register for any of the above events and view recent webinar recordings.
For more information, contact David Upbin at (202) 557-2931.
