MBA Advocacy Update

Bill Killmer; Pete Mills

On Wednesday, the Federal Housing Finance Agency authorized Fannie Mae and Freddie Mac to impose an “Adverse Market Refinance Fee” – a 50-basis-point fee on most refinance mortgages, effective for loans delivered on or after September 1. Following the announcement, MBA CEO Bob Broeksmit, CMB, released a statement strongly urging FHFA to withdraw this directive.

And on Monday, MBA submitted comments responding to the CFPB’s proposed rule extending the GSE Patch. MBA’s comments recommend that the GSE Patch be extended to six months after the effective date of the new General QM rule. 

1. GSEs Announce New Adverse Market Refinance Fee

On Wednesday, Fannie Mae and Freddie Mac released lender letters announcing a 50-basis-point adverse market refinance fee to be imposed on refinances delivered on or after September 1. The fee applies to all refinances with the exception of single-closing construction-to-permanent loans that are processed and delivered as a refinance. MBA CEO Bob Broeksmit, CMB, released a statement strongly urging the Federal Housing Finance Agency to withdraw this directive.

  • Why it matters: This directive is contrary to recent Federal Reserve policy to keep rates low and the administration’s recently announced directives to support homeowners. Requiring Fannie Mae and Freddie Mac to charge a 0.5% fee on refinance mortgages they purchase will raise interest rates on families trying to make ends meet in these challenging times. In addition, the September 1 effective date will cost lenders millions on their locked pipelines, and means that borrowers who did not lock in their rates will face unanticipated cost increases just days from closing.
  • What’s next: Yesterday MBA and 19 other organizations representing the housing and financial services industries as well as public interest groups issued a joint statement on the adverse market refinance fee. Today, MBA hosted a webinar highlighting the TRID implications of GSE loan level price adjustment announcement. MBA will be working tirelessly in the days ahead with our colleagues and Congress to roll back this deeply misguided FHFA policy.

For more information, please contact Sasha Hewlett at (202) 557-2805.

2. MBA Suggests Modifications to the CFPB’s Proposed GSE Patch Extension

On Monday, MBA submitted comments responding to the Consumer Financial Protection Bureau’s proposed rule extending the GSE Patch. Rather than extending the GSE Patch until the effective date of the new General QM rule, as the CFPB has proposed, MBA’s comments recommend that the GSE Patch be extended to six months after the effective date of the new General QM rule. 

  • Why it matters: The changes recommended by MBA will better ensure the continued availability of affordable mortgage credit as the market transitions to the price-based General QM standard proposed by the CFPB.
  • What’s next: MBA will continue gathering member feedback as we prepare a response to the CFPB’s proposed rule for a price-based General QM definition to replace the GSE Patch.

For more information, please contact Justin Wiseman at (202) 557-2854, Dan Fichtler at (202) 557-2780, or Blake Chavis at (202) 557-2930.

3. MBA and Coalition Partners Seek Additional Time to Respond to CFPB’s Request for Information on Equal Credit Opportunity Act 

On Monday, MBA joined a coalition of trade associations and consumer advocacy groups to request an extension to the comment period for the CFPB’s recent Request for Information on ECOA and Regulation B. Specifically, the coalition letter requests “at least an additional 60 days” in which to respond to the ECOA RFI.  

  • Why it matters: The additional time requested will help ensure all stakeholders have adequate time to meaningfully address the important issues presented in the RFI, including ways to expand minority homeownership opportunities, reduce regulatory uncertainty, and develop viable solutions to compliance challenges under ECOA.
  • What’s next: MBA will continue gathering member feedback to respond to the RFI.

For more information, please contact Justin Wiseman at (202) 557-2854 or Blake Chavis at (202) 557-2930.

4. MBA Submits Comments to FHA on Mortgagee Letter 2020-22

Last Friday, MBA submitted comments to the Federal Housing Administration in response to Mortgagee Letter 2020-22, announcing FHA’s COVID-19 Loss Mitigation Options. In its comments, MBA continues to advocate for FHA to provide incentives for servicers executing COVID-19 home-retention options, highlighting that the operational costs incurred are the same as the standard FHA home-retention options. In addition to providing comments, MBA also requested additional clarification on how servicers should implement the loss mitigation options, specifically those surrounding borrower evaluation.

  • Why it matters: Lack of servicer incentives for the execution of FHA COVID-19 Loss Mitigation Options leave servicers to cover the expenses sustained during the process. 
  • What’s next: MBA will continue to advocate for FHA to provide servicer incentives and further GSE alignment. 

For more information, please contact Sara Singhas at (202) 557-2826 or Darnell Peterson at (202) 557-2922.

5. MBA Provides Guidance to Industry on Oregon Forbearance Law, Urges Governor Not to Extend Emergency

On Wednesday, MBA convened a member meeting to discuss issues related to Oregon’s recently enacted law (HB 4204/HB 4213) that attempts to address financial hardships caused by the COVID-19 pandemic. The call, led by MBA State Legislative and Regulatory Committee Chair Lisa Klika, featured a panel of experts that included Matt Markee, Lobbyist for the Oregon MBA; David Shirk, Managing Director of Shirk Law PLLC; and Jesse Calm, Partner at McEwen Gisvold LLP. 

MBA also led a joint trades letter that was shared with Oregon Governor Kate Brown urging her not to extend the “emergency period” of the law beyond the current sunset date of September 30, 2020. In the letter, MBA and other national industry groups argue that the current law undermines the ongoing efforts by our industry to assist homeowners and renters because it creates duplicative – and sometimes contradictory – requirements to those already mandated by the federal CARES Act and the policies of the federal government’s affordable housing programs.

Moreover, the Oregon Division of Financial Regulation released a model lender disclosure on Thursday that indicates DFR’s expectations for compliance with the law and creates a resource for lenders to inform borrowers about their rights under the new law. Fannie Mae also released its Notice of Accommodations form, which it requires for properties secured in Oregon.

  • Why it matters: Many of the forbearance and eviction provisions of the new law are either divergent or duplicative of federal CARES Act requirements in addition to many recent policies by the GSEs and FHA.
  • What’s next: MBA will continue to work with the Oregon MBA to urge lawmakers to align their requirements with the federal standards.

For more information, please contact Kobie Pruitt at (202) 557-2870 or Grant Carlson at (202) 557-2765.

6. MBA, California MBA Convene a Webinar on California Ballot Initiatives

On Monday, MBA, along with the California MBA, convened a webinar to discuss concerns with Propositions 15 and 21, which will be on the California Election Day ballot in November.

  • Why it matters: If approved, Proposition 15 would increase property taxes on commercial real estate by more than $12.5 billion annually and would increase the cost of living in some of the most expensive cities in America at exactly the wrong time, when the economy in the state and the rest of the country are struggling. By amending the state’s 42-year-old property tax limits – known as “Prop 13” – the initiative could open the door to future tax increases on single-family homes.

    Proposition 21 would likely create a patchwork of state and local rent control laws that would make lending in the state more costly and affect the availability of affordable real estate financing in the state. Both ballot initiatives are strongly opposed by both the MBA and the California MBA, and represent a clear threat to the entire real estate finance industry.
  • What’s next: MBA will continue to work with the California MBA and advocate against these harmful propositions. If you would like to know more, MBA and the California MBA have created issue briefs for both Proposition 15 and Proposition 21.

For more information, please contact Kobie Pruitt at (202) 557-2870 or William Kooper at (202) 557-2737.

7. [VIDEO]: mPower Moments: mPower Moments: On Managing a Team and a Toddler During a Pandemic, with MBA’s Teressa Lurk

In this latest episode of mPower Moments, mPower Founder Marcia M. Davies sits down with MBA’s Teressa Lurk, Vice President of Marketing and Design, to discuss managing a team and keeping them engaged while working from home with a toddler.

  • Why it matters: The ongoing COVID-19 pandemic continues to present challenges for the men and women professionals wearing many hats these days while they work remotely and keep their families safe. In the video, Lurk also gives advice on how we can all make progress toward true equality in the workplace.
  • What’s next: To watch more mPower Moments, click here.

For more information, please contact Marcia Davies at (202) 557-2707.

8. Upcoming and Recent MBA Education Webinars on COVID-19-Related Topics

MBA Education continues to deliver timely single-family and commercial/multifamily programming that covers the spectrum of challenges, obstacles, and solutions pertaining to the ongoing COVID-19 pandemic. Below, please see a list of upcoming and recent webinars – which are complimentary to MBA members:

MBA members can access the full list of COVID-19 webinar recordings by clicking here. For more information, please contact David Upbin at (202) 557-2890.