MBA Advocacy Update

Bill Killmer; Pete Mills

On December 23, MBA sent a letter to Ginnie Mae offering recommendations on how the agency can improve its upcoming Digital Collateral Guide. Last week, the U.S. Department of Homeland Security and the New York Department of Financial Services both issued warnings alerting companies to potential cybersecurity risks. And on December 20, the Georgia Department of Banking and Finance finalized rules regarding mortgage loan originator temporary authority.

1. MBA Submits Recommendations to Ginnie Mae on Digital Collateral Guide

On December 23, MBA submitted a comment letter to Ginnie Mae in response to its request for information on its Digital Collateral Guide.

  • Why it matters: The eGuide describes the requirements that would apply to securitization of pools and loan packages containing digital mortgages and is the first step to fully incorporating digital mortgages into the Ginnie Mae business model.
  • MBA solicited feedback from members and provided a comprehensive list of recommendations and specific items that need additional clarification. 
  • MBA was pleased to see a digital collateral strategy highlighted in the Ginnie Mae 2020 plan and will continue to support Ginnie Mae as it modernizes its MBS program and platform.
  • Ginnie Mae’s moves to accept digital collateral not only reduce risk by improving data integrity and reducing loan defects, but also could provide the added benefit of increasing access to credit for Americans across the country.

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

2. DHS, New York DFS Issue Warnings on Potential Cybersecurity Risks

Last week, the Department of Homeland Security (DHS) and New York Department of Financial Services (NY DFS) both issued warnings alerting companies to cybersecurity risks associated with the Iranian government. 

  • Why it matters: Given the recent confrontation between the United States and Iran, all regulated entities should be on high alert for possible cyberattacks and be prepared to respond quickly to any suspected cyber incidents. Currently there are no specific, credible reports of new Iranian-sponsored cyberattacks.
  • Iranian-sponsored hackers have historically relied primarily on common hacking tactics such as email phishing, credential stuffing, password spraying and targeting unpatched devices. 
  • MBA recently issued a white paper titled,The Basic Components of an Information Security Program” to highlight best practices for protecting your organization. MBA encourages our members to use this resource when evaluating security risks.

For more information, please contact Rick Hill at (202) 557-2718. 

3. Georgia Department of Banking and Finance Issues Final Rules for Temporary Authority

On December 20, the Georgia Department of Banking and Finance finalized rules regarding mortgage loan originator (MLO) temporary authority in the state. MBA had submitted a comment letter to the DBF critical of the Department’s proposal.

  • Why it matters: The new rule, which is very similar to the Department’s proposal and includes provisions related to advertising and origination documentation, implements requirements for Georgia licensed MLOs and companies originating mortgages under temporary authority, became effective January 9, 2020.
  • Additionally, DBF is requiring a new consumer disclosure for all loans originated by MLOs operating with temporary authority in the state, which is effective April 1, 2020.

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

4. HUD Nominees, Including Brian Montgomery, Remain on Senate Floor Calendar for 2020

Just prior to the December recess, Senate leadership reached a unanimous consent agreement to hold some of the pending Executive Branch nominees in status quo on the Senate Executive Calendar. The three pending HUD nominees who were voted out of Committee on December 10– Brian Montgomery (Deputy Secretary), David Woll (Assistant Secretary for Community Planning & Development) and John Bobbitt (Assistant Secretary for Administration), were included on that list.

  • Why it matters: Barring this agreement, the Senate would have had to send the HUD nominees back to the White House for resubmission. As a result, the Banking Committee will not have to reprocess them at the Committee level this year.
  • With an impeachment trial looming and the Senate’s focus on judicial branch nominees, Senate leadership and the administration must negotiate as to when Montgomery would receive a floor vote in 2020. MBA submitted a letter to the Banking Committee encouraging members to vote YES on his nomination.

For more information, please contact Tallman Johnson at (202) 557-2866.

5. New York Regulator Requests LIBOR Transition Plans

On December 23, the New York Department of Financial Services published a notice requiring its regulated institutions to submit plans for their expected transition away from the use of the London Interbank Offered Rate. The NY DFS is requesting information on risk management, assessment of alternative rates, processes for communication with consumers and counterparties, operational readiness and governance frameworks.

  • Why it matters: The LIBOR index is likely to be discontinued at the end of 2021, which will have wide-ranging effects on the mortgage industry – particularly both legacy and new adjustable-rate products. Market participants should actively be preparing for the transition away from LIBOR.
  • Many resources exist to assist market participants with this transition:
  • Transition plans are due to the NY DFS by February 7.

For more information, please contact Dan Fichtler at (202) 557-2780.

6. mPower Moments: FIFA Women’s World Cup Champion Carli Lloyd on Overcoming Adversity and Pay Inequality

In the first episode of 2020, mPower Founder Marcia M. Davies sits down with fellow New Jersey native Carli Lloyd for an inspiring interview.

  • Why it matters: Carli Lloyd was one of the key members of the United States Women’s National Soccer Team (USWNT) that captivated the nation last summer and took home the championship at the 2019 FIFA Women’s World Cup in France. Carli is a two-time Olympic gold medalist, FIFA Women’s World Cup champion and FIFA Player of the Year in both 2015 and 2016.
  • Carli discusses with Marcia how she overcame difficult moments in her career by accepting the setbacks and using them as opportunities to work harder and come back stronger. Carli also shares some of the important work the USWNT is doing to push for pay equality.

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

7. MBA Education Webinar on 10 Things Your Company Must Do in 2020

On January 14, join MBA Education for its popular annual webinar (now complimentary!) on steps every mortgage lender should be taking in 2020 to increase revenue, control costs and manage risk. To register, please click here.

  • Why It Matters: 2019 was a profitable year for most lenders due to a boom in refinances as a result of low interest rates. This webinar will discuss what companies should be doing now that refinances are expected to slow down.

For more information, please contact Laura Vanegas at (202) 557-2785.