CREF Policy Update Aug. 31: MBA Joins Coalition in Letter to CFPB Requesting Pause in Implementation of 1071 Small Business Reporting Rule for All Lenders

1. MBA Joins Coalition in Letter to CFPB Requesting a Pause in Implementation of 1071 Small Business Reporting Rule for All Lenders

MBA joined the American Financial Services Association (AFSA) and others in a letter to the Consumer Financial Protection Bureau (CFPB) requesting that the CFPB pause the 1071 Small Business Reporting Rule’s effective date and tiered implementation dates until all legal challenges against the CFPB are resolved. The request was made following the U.S. District Court for the Southern District of Texas’ recent order blocking enforcement of 1071 by the CFPB for only members of the American Bankers Association and/or Texas Bankers Association.

• Why it matters: The 1071 small business reporting rule requires some MBA members to collect and report data on commercial real estate loans. MBA’s comments in response to the CFPB’s proposed rule argued that the rule should only apply to small business lending and exempt most commercial and multifamily real estate loans. Lenders that originate at least 2,500 small business loans annually must collect data starting October 1, 2024. Lenders that originate at least 500 loans annually must collect data starting April 1, 2025. Lenders that originate at least 100 loans annually must collect data starting January 1, 2026. The latest filing instructions for 1071 reporting can be found here.

• What’s next: MBA will update members on any further developments related to this issue.

For more information, please contact Stephanie Milner at (202) 557-2757.

2. Ranking Member Waters, Committee Democrats Urge FHFA to Limit Rent Hikes at GSE-Backed Multifamily Properties

Eight House Democrats last Wednesday followed up on a prior Senate effort in urging Federal Housing Finance Agency (FHFA) Director Sandra Thompson to limit rent increases at multifamily apartment units with mortgages financed by Fannie Mae and Freddie Mac (the GSEs). Earlier this year, FHFA issued a request for input (RFI) on potential tenant protections for multifamily properties in its portfolio. The House letter can be found here , and the Senate letter can be found here.

• Why It matters: Governments at all levels are examining a series of policies designed to make rental housing more affordable. Like FHFA, some are considering rent control as a solution. MBA and other industry stakeholders have met with the Biden Administration numerous times this year on the topic of tenant protections and have stressed the importance of increasing affordable housing supply and avoiding unnecessary regulations such as rent control.
• What’s next: MBA will continue to advocate against rent control and for solutions to increase housing supply to address the nation’s affordable housing crisis. Earlier this month, MBA President and CEO Bob Broeksmit, CMB, wrote a blog post explaining how and why rent control policies will perpetuate the housing supply-demand disconnect.

For more information, please contact Alden Knowlton at (202) 557-2816.

3. Government Office of Financial Research Warns of Office Consolidation

Last Thursday, the Office of Financial Research (OFR), a division of the Treasury Department, released a report expressing concern that there may be significant contraction in the office market. The report warns that if trends continue, office properties could face the same type of consolidation faced by regional shopping malls in the 2000s, posing a risk to (1) financial institutions with exposure to the sector and (2) municipalities reliant on CRE tax revenue.

• Why it matters: Regulators continue to focus on office properties and loans as a source of potential weakness. The long-term nature of office leases, and still-changing dynamics of office usage, will likely keep the sector in the spotlight for coming quarters and years.
• What’s next: MBA will continue to educate key decision makers about current market dynamics. View MBA’s latest research here.

For more information, please contact Megan Booth at (202) 557-2740.

4. Get Involved – MBA Advocacy Month Kicks Off in September

Join MBA’s Legislative and Political Affairs (LPA) team in September for MBA Advocacy Month, an all-member campaign focused on raising awareness on the top single-family and commercial/multifamily issues that can help produce positive policy changes at the national level.

• Why it matters: Throughout September, MBA will work with members to engage with their employees and help run impactful Mortgage Action Alliance (MAA) and MORPAC campaigns. In addition, MBA staff will host (virtual) events, including legislative townhall(s) and webinars with a focus on how members can make their voices more effectively and better heard.
• What’s next: If interested in learning more and how to get involved, visit mba.org/advocacymonth.

For more information, please contact Jamey Lynch, AMP at (202) 557-2818.

5. 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, a list of upcoming webinars – which are complimentary to MBA members:

• Recent LO Comp Enforcement and Supervisory Activity – September 7
• Succeeding Today and Tomorrow: Tech Tools That Can Drive More Market Share – September 7
• Optimizing Technology in the Origination Process – September 12
• Budgeting and Financial Planning for Non-Believers – September 13
• Section 1071: A Practical Approach to Unpacking the CFPB’s Final Rule – September 13

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