MBA Advocacy Update Mar. 22, 2021

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

On Monday, HUD finalized updated forms in the FHA Single-Family Condo approval process. On Tuesday, the Senate Banking, Housing, and Urban Affairs Committee held the first of what is expected to be a series of oversight hearings on housing policy this year. And on Thursday, MBA submitted feedback to FHA in response to ML 2021-05, which extends the foreclosure and eviction moratorium and expands the use of FHA’s COVID-19 Loss Mitigation options. 

1. HUD Finalizes Updated Forms in FHA Single-Family Condo Approval Process 

On Monday, HUD released Mortgagee Letter (ML) 2021-09, finalizing changes to the Federal Housing Administration Single-Unit and Project Approval Condominium Questionnaires, Forms HUD-9991 and HUD-9992. HUD requested feedback in two rounds, first incorporating feedback – including significant suggestions from MBA – received in March 2020.

• Why it matters: Since release of HUD’s Final Rule on FHA Condominium Project Approvals, concerns have been raised regarding the questionnaires used in the approval process. MBA’s comment letters outlined how difficulty with the questionnaires results in incomplete data and delayed, or failed, project and single-unit approvals. Our initial review indicates that several of MBA’s recommendations have been incorporated into the final forms. 
• What’s next: Mortgagees may begin using the new forms immediately, with mandatory use beginning for case numbers assigned on or after May 17.

For more information, please contact Hanna Pitz at (202) 557-2796.

2. Senate Banking Committee Holds Hearing on State of Housing in America 

On Tuesday, the Senate Banking Committee held the first of what is expected to be a series of oversight hearings on housing policy this year. Chairman Sherrod Brown (D-OH) called for new solutions for low-income borrowers to access small-dollar mortgages to purchase homes. There was widespread agreement by senators on the need to remove barriers to housing construction in order to address the lack of affordable housing. Several democratic senators focused on the impact of the pandemic and expressed concerns regarding foreclosures and evictions as relief measures expire.

Ranking Member Pat Toomey (R-PA) outlined his principles for housing finance reform legislation, and Sen. Mike Rounds (R-SD) expressed support of the FHFA’s enterprise capital framework, but questioned its treatment of credit risk transfers. Notably, Nikitra Bailey, EVP with the Center for Responsible Lending, testified that, “…servicers may be sorely tested when forbearance comes to an end as upwards of two million borrowers may need assistance in a limited time frame, and execution by large organizations is always a challenge, particularly with something as complicated, and important, as a mortgage.” She also recommended that “Congress should simply require private loans to adopt the foreclosure moratorium and forbearance policies offered by one of the GSEs or FHA, as well to mirror the federally-backed loans in providing a post-forbearance solution that does not increase borrowers’ monthly payments. In addition, Congress should provide servicers of private-label securities a safe harbor from investor lawsuits when they follow these provisions.” However, this testimony did not lead to a broader discussion about mortgage servicing.

• Why it matters: Several senators used the hearing to preview specific legislation they will continue to advocate for enactment. This includes Sen. Mark Warner’s (D-VA) draft legislation to provide first-generation homeowners with subsidized 20-year mortgages; Sen. Catherine Cortez Masto’s (D-NV) effort to expand HMDA data reporting requirements; and Sen. Elizabeth Warren’s (D-MA) re-introduction of the American Housing and Economic Mobility Act that provides a major expansion of the National Housing Trust Fund.
• What’s next: MBA will continue to work with senators who mentioned their specific housing legislative priorities as the committee starts work on considering a housing title that could be included in comprehensive infrastructure legislation.

For more information, please contact Tallman Johnson at (202) 557-2866 or Ethan Saxon at (202) 557-2913.

3. MBA Provides Feedback on House Financial Services Committee Legislation  

On March 10, the House Financial Services Committee held a hearing, with topics of discussion involving several bills related to housing. The list of legislation included two bills that have yet to be introduced, one that would create a significant new program to provide forgivable down payment assistance grants for “first generation homebuyers,” and a second bill that would require FHA to recalculate the manner in which student loan obligations are considered in debt-to-income ratios. MBA’s comments to the Committee can be found here.

• Why it matters: MBA has been working with Congress to provide insights and expertise to improve legislation designed to enhance housing affordability and accessibility.
• What’s next: The Committee is expected to schedule a markup in the coming months that will include these measures and others related to housing policy. 

For more information, please contact Borden Hoskins at (202) 557-2912, Tallman Johnson at (202) 557-2866, and Ethan Saxon at (202) 557-2913.

4. MBA Submits Feedback to FHA on ML 2021-05

On Thursday, MBA submitted feedback to FHA in response to ML 2021-05 which extends the foreclosure and eviction moratorium and expands the use of FHA’s COVID-19 Loss Mitigation options. The primary feedback requests that FHA align the incentive and expense reimbursement structure associated with its traditional loss mitigation program with the COVID-19 loss mitigation options, along with several clarification questions.

• Why it matters: Execution of the COVID-19 Standalone Partial Claim results in significant administrative burden for servicers. 
• What’s next: MBA will continue to monitor and evaluate COVID-19 policies for their impact on the industry.

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

5. Virginia Enacts Legislation Amending RON Law to Create Greater Consistency with the National Standard; New Mexico RON Legislation Passes Both Chambers

Last week, Virginia Gov. Ralph Northam (D) signed legislation (HB 2064) that amends Virginia’s current remote online notarization law to be more consistent with the national standard for RON adoption. HB 2064 includes provisions that establish standards for credential analysis and ID proofing, which were absent in the prior law and are necessary to protect consumer data and personal information. MBA worked with the Virginia MBA and bill drafters to ensure HB 2064 was consistent with the national standards for RON adoption present in the MBA-American Land Title Association state model bill and the non-partisan Uniform Law Commission’s Revised Uniform Law on Notarial Acts. In New Mexico, SB 12 unanimously passed both chambers of the legislature and is headed to Governor Michelle Grisham for her signature. MBA and the New Mexico Mortgage Lenders Association support this legislation, which would adopt RULONA.

• Why it matters: Virginia was one of the first states to enact legislation enabling the use of RON. However, since the enactment of the Virginia law, most states have coalesced around national models as the standard for RON implementation. With the passage of HB 2064 and the recent enactment of legislation in Montana, Vermont is now the only state with a RON law that is inconsistent with the national consensus for implementation. Moreover, if SB 12 is signed by Gov. Michelle Lujan Grisham (D), New Mexico would become the 31st state with RON.
• What’s next: MBA will continue to work with members and state and local partner associations to enact RON laws in the remaining states. Moreover, MBA will work with partners in Vermont to ensure all states are consistent with the national model for RON adoption. To learn more visit www.mba.org/ron.

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

6. SEC Welcomes Comments on Climate Change Disclosures

On Monday, Securities and Exchange Commission Acting Chair Allison Herren Lee asked for public input regarding whether current climate change disclosures “adequately inform investors.”

• Why it matters:  The SEC Chair has proposed 15 questions regarding the adequacy of corporate disclosures regarding climate change. While the request for input appears focused on corporations, the final question essentially asks “what else” should be considered for ESG disclosures.
• What’s next: MBA staff will analyze the request for information with its membership in order to understand the implications.

For more information, please contact Bruce Oliver at (202) 557-2840

7. RIHA Releases Special Report on Affordable and Subsidized Rental Housing 

MBA’s Research Institute for Housing America released a new study, The Location of Affordable and Subsidized Rental Housing Across and Within the Largest Cities in the United States. RIHA’s study provides evidence on changes in rent levels and the availability of subsidized rental housing for low- and moderate-income households over the last two decades in the nation’s 50 largest metropolitan statistical areas, and analyzes how the 2018 mandatory adoption of Small Area Fair Market Rents in 24 metropolitan areas affected the surrounding neighborhood poverty rates of Housing Choice Voucher recipients.

• Among the several key findings, nearly all of the 50 largest MSAs since 2001 have become less affordable for renters and prospective first-time homebuyers, with annual median rent growth rising at 2.0% above inflation, compared to an 0.8% real increase in annual median income. This disparity has led to a typical household in 2020 – compared to 2001 – needing to devote an additional 7.6% of its income to rent a median-priced housing unit.
• Edward Seiler, RIHA Executive Director and MBA Associate Vice President, Housing Economics, said, “RIHA’s study underscores the importance of focusing on local-level solutions to address housing supply shortages and rental housing subsidy policies for low-income households.”

For more information, please contact Eddie Seiler at (202) 557-2739.

8. New HUD Cityscape Publication Features Guest Research Article on Housing Regulation and Affordability from MBA’s Fratantoni, Woodwell and Seiler  

This week, HUD published its latest issue of Cityscape. Published by the Office of Policy Development and Research (PD&R), the new issue features a joint guest article, Trends in Regulation and Affordability in Select U.S. Metropolitan Areas and Communities, written by Mike Fratantoni, MBA Senior Vice President and Chief Economist; Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research; and Eddie Seiler, MBA Associate Vice President of Housing Economics.

• Why it matters: The article links land-use restrictions in the last decade and a half to the evolution in housing supply and affordability within a diverse set of U.S. metro areas. Fratantoni, Woodwell and Seiler conclude that while comparing metropolitan areas across the country can be informative, within-metropolitan area analysis – although more difficult to obtain – may be more useful in informing local policymakers on the impacts of their potential regulatory actions on housing affordability.
• Read the article here.  

For more information, please contact Mike Fratantoni at (202) 557-2935, Jamie Woodwell at (202) 557-2936, or Eddie Seiler at (202) 557-2739.

9. Register Today: MBA’s Spring Conference & Expo 2021 – April 20-22 

MBA’s Spring Conference & Expo 2021, taking place via MBA Live, will feature several must-see sessions, including remarks from FHFA Director Mark Calabria and other prominent Washington policymakers and stakeholders. 

• Why it matters: Calabria will discuss the various policy issues at FHFA, while MBA leadership and others will examine the latest updates on Capitol Hill and within the Biden administration. 
• What’s next: To register for the conference, click here. 

For more information, please contact Dawn Williams at (202) 557-2877.

10. Register Today: MBA’s National Advocacy Conference – May 11-12

Registration is now open for MBA’s National Advocacy Conference, May 11-12. NAC allows you to connect directly with elected officials online from your home or office. Your story matters—share it with key policymakers as they consider and pass legislation that affects all of us. 

• Why it matters: Our industry has helped provide unprecedented aid and assistance to millions of American families and businesses—especially the most vulnerable—that continue to struggle. Last week, President Joe Biden signed into law The American Rescue Plan Act of 2021, which included key provisions to help support homeowners and renters as the economy recovers from the pandemic. NAC will provide a great opportunity for our industry to call on Congress to strengthen the nation’s economy in the wake of the pandemic, increase access to homeownership, and bolster affordable rental housing and community development.
•  What’s next: Share your experiences, your voice, and your passion for our industry May 11-12! Register today at mba.org/nac and take advantage of the $99 early bird rate.

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

11. [VIDEO]: mPower Moments: On Being An Advocate for Yourself and the Industry with FormFree’s Christy Moss

In this episode of mPower Moments, mPower Founder Marcia M. Davies sits down with Christy Moss, CMB, Head of Sales and Marketing at FormFree. Moss shares the interesting path she’s taken in her successful career, and explains how mPower has helped her become a stronger advocate for herself and the industry.

• Why it matters: As a member of MBA’s MAA Steering Committee and the mPower representative on that committee, Moss also explains why it’s important for women to get involved in advocacy.
• What’s next: To watch more mPower Moments, click here.

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

12. 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 and recent webinars – which are complimentary to MBA members:

• CCPA Review and What Lies Ahead – March 23
• Receivership 101 and Exploring Financing Opportunities – March 24
• The QM Delay and What To Do Now – March 30
• Renter Counseling to Mitigate Evictions and Reduce Operational Costs – March 31
• The Location of Affordable & Subsidized Rental Housing Across and Within the Largest Cities in the United States – April 8
• Key TCPA Compliance Issues – April 15

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