MBA Advocacy Update July 12, 2021

Bill Killmer bkillmer@mba.org; Pete Mills pmills@mba.org.

MBA submitted recommendations to FHFA last week with respect to the GSEs’ policies addressing eligibility of condominium projects that include short-term rentals. Also last week, Ginnie Mae announced it will continue current measures that allow for the electronic execution and transmission of form HUD 11711A (Release of Security Interest) and form HUD 11711B (Certification and Agreement). 

1. MBA Seeks Clarity on GSE Policies Regarding Condo Projects with Short-Term Rentals

Last week, MBA submitted recommendations to the Federal Housing Finance Agency with respect to Fannie Mae and Freddie Mac policies addressing eligibility of condominium projects that include short-term rentals. MBA recommended greater clarity in the GSE policies to ensure that lenders are able to more consistently understand which projects are eligible and avoid unnecessary repurchase risk.

• Why it matters: There currently is confusion in the industry regarding the existing GSE policies, particularly due to the “gray areas” that make it difficult for lenders to determine whether units in a particular condominium project are eligible for GSE-backed financing. This lack of clarity leads to different lenders coming to different conclusions about the same projects, with lending decisions based on varying interpretations of the selling guides rather than determinations about credit risk. MBA’s recommendations also seek to ensure greater access to GSE financing for owner-occupied units in projects located in markets that have significant vacation housing stock.
• What’s next: FHFA will review the public comments on its Request for Input and determine whether any changes to the GSEs’ selling guides are necessary.

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

2. Ginnie Mae to Continue Certain Usage of Digital Signatures 

Ginnie Mae announced it will continue current measures that allow for the electronic execution and transmission of form HUD 11711A (Release of Security Interest) and form HUD 11711B (Certification and Agreement). This temporary policy, originally announced last year (APM 20-01), was extended due to the ongoing impact of COVID-19. Issuers should note that continuation of this temporary measure does not negate portions of the Document Custody Manual Appendix that pertain to these forms. Ginnie Mae reserves the right to require wet signatures for affected loans, and will provide additional guidance on this issue at a future time or when the COVID-19 pandemic has been mitigated sufficiently.

• Why it matters: Continuation of this policy will minimize potential market disruptions caused by COVID-19.
• What’s next: MBA will continue to engage with Ginnie Mae in its efforts to support market participants and ensure smooth market functioning during the pandemic, as well as its efforts to enhance the digital capabilities of the program.

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

3. Connecticut Banking Department Issues Helpful Remote Work Order

The Connecticut Department of Banking recently issued an order indefinitely extending remote work guidance for licensed loan origination and servicing staff. The order follows the enactment of legislation (SB1202) that provides the Department of Banking with the legal authority to issue this guidance.

• Why it matters: Connecticut’s remote work guidance had been expected to sunset at the end of June, but the new authorization will supersede it.
• What’s next: MBA will also continue to work with state and local association partners to advocate for its model legislation and regulation for licensing flexibility. In addition, MBA is asking members to provide any information on legislative or regulatory efforts in their state that would allow remote work by contributing to a Google spreadsheet that will be used to update the information on MBA’s resource center. If you do not have access to a Google account, please contact Kobie Pruitt and he will provide you with a digital copy of the spreadsheet to fill out.

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

4. Colorado Enacts Comprehensive Overhaul of Data Privacy Law

On Thursday, Colorado Gov. Jared Polis signed legislation (SB21-190) that creates a comprehensive data privacy framework in Colorado. SB21-190 gives consumers the right to opt out of the processing of their personal data; access, correct, or delete the data; or obtain a portable copy of the data. The law includes an MBA-supported exemption for financial institutions and their affiliates that are subject to the Gramm-Leach-Bliley Act and activities regulated by the Fair Credit Reporting Act.

• Why it matters: Colorado becomes the third state to enact a comprehensive consumer data privacy law.
• What’s next: MBA will also continue to work with state and local association partners to advocate for data privacy legislation that is consistent with the MBA Data Privacy Principles and includes a full GLBA exemption for financial institutions.

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

5. Are You a Diversity Champion? Apply for MBA DEI Leadership Awards

MBA’s Diversity, Equity and Inclusion (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 of diversity, share how you are inspiring change and highlight your success by applying today.

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

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

6. 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:

• A Strategy for Executing a Successful LIBOR Transition (CREF) – July 12
• Do Commercial Servicer Ratings Matter? – July 14
• Planning for Community Reinvestment Act Modernization – July 15
• Preparing for the End of the Pandemic – What Should Servicers Do Now? – July 28
• Social Media and Digital Advertising 2021 Update – July 29
• C-PACE Financing 101: A Commercial/Multifamily Lender’s Overview – August 12

MBA members can register for any of the above events and view recent webinar recordings. For more information, please contact David Upbin at (202) 557-2890.