MBA Advocacy Update May 24 2021
Last week, MBA submitted comments supporting the CFPB’s proposed rule to delay the implementation of the Fair Debt Collection Practices Act final rules from November 30, 2021, to January 29, 2022. On Thursday, the Senate Banking Committee held a hearing on housing and infrastructure. And Wednesday, the House Ways and Means Committee held a hearing on tax code options for infrastructure investment.
1. MBA Submits Comments on CFPB’s Proposed Delay of FDCPA
On Wednesday, MBA submitted comments supporting the Consumer Financial Protection Bureau’s proposed rule to delay the implementation of the Fair Debt Collection Practices Act final rules by 60 days, from November 30, 2021, to January 29, 2022. While MBA supports the CFPB’s actions, the comment letter argues for a longer proposed delay period to provide sufficient time for servicers to interpret and implement the needed changes in order to comply.
- Why it matters: As the industry continues to deal with the ongoing effects of the COVID-19 pandemic, servicer resources have been focused on quickly implementing numerous complex policies to better assist borrowers; because of this, more time is needed to change internal policies and controls.
- What’s next: The CFPB will review the public comments to determine if and how long to delay implementation.
For more information, please contact Darnell Peterson at (202) 557-2922.
2. MBA’s Fratantoni in HousingWire: What Biden Tax Plans Mean for Housing Market
Last week, HousingWire published a guest column written by MBA SVP and Chief Economist Mike Fratantoni on what the Biden administration’s tax proposals mean for the real estate industry. Fratantoni analyzes the current state of the U.S. federal budget, and gives an overview of the 2017 Tax Cuts and Jobs Act as well as President Biden’s two 2021 tax proposals: The American Jobs Plan and The American Families Plan.
- Why it matters: The Biden administration has proposed the $2.3 trillion American Jobs Plan and the $1.8 trillion American Families Plan to rebuild infrastructure, as well as provide new spending for a host of educational, public health, and other initiatives. To pay for these expenditures – at least partially – the plans include a series of provisions that would largely reverse the TCJA’s tax rate cuts for corporations and higher-income individuals. Fratantoni’s analysis focuses on the tax elements of the two proposals that would directly affect real estate markets.
- What’s next: MBA will continue to advocate with the administration and on Capitol Hill against any threat to real estate finance markets as the congressional debate on tax and infrastructure advances.
3. Senate Banking Committee Hearing on ‘21st Century Communities: Expanding Opportunity Through Infrastructure Investments’
On Thursday, the Senate Banking Committee held a hearing to hear testimony from HUD Secretary Marcia Fudge and Transportation Secretary Pete Buttigieg on the Biden administration’s proposed American Jobs Plan. The hearing exposed partisan disagreement on how infrastructure should be paid for and the size of future federal transit and infrastructure investments.
Ranking Member Patrick Toomey (R-PA) opened the hearing with remarks emphasizing the need for Congress to focus on physical infrastructure spending, rather than housing, and outlined the preferred Republican approach of repurposing previously appropriated stimulus money to pay for infrastructure. He said, “[L]et’s be clear: Housing is housing. People certainly need housing, but housing is not infrastructure.”
Sens. Kyrsten Sinema (D-AZ), Steve Daines (R-MT) and Jon Tester (D-MT) each raised concerns regarding affordable housing in rural areas, and Fudge mentioned a variety of tax measures in her responses – such as the Low-Income Housing Tax Credit and the Neighborhood Homes Investment Act – in the context of the Biden proposal. Chairman Sherrod Brown (D-OH) asked how HUD can help communities address restrictive zoning and expand access to housing development. Fudge asked Congress to provide HUD with tools to assist localities as they address zoning challenges. Sen. Mark Warner (D-VA) briefly mentioned the need to further help homebuyers build equity, and credited much of the existing wealth gap to unequal access to homeownership.
- Why it matters: The hearing highlighted the deep division on the committee over how to pay for the approximately $85 billion in transit funding that the committee has jurisdiction over, as well as the $213 billion in additional housing funding proposed by the Biden administration.
- What’s next: The committee will seek to authorize multiyear transportation legislation as part of a larger transportation and infrastructure package that will be merged with the highway authorization.
4. House Ways and Means Committee Holds Hearing on Tax Code Options for Infrastructure Investment
On Wednesday, the House Ways and Means Committee held a hearing, “Leveraging the Tax Code for Infrastructure Investment.” Both Republicans and Democrats expressed an underlying agreement that Congress must act on infrastructure policy. Specifically, there was bipartisan agreement that funding mechanisms such as private activity bonds and public-private partnerships should be pursued, and there was agreement in favor of policy options that would renovate, revitalize, and expand access to affordable housing for low-income and rural communities.
- Why it matters: This hearing is part of a series that will set the stage for congressional action on the nature, size, and scope of revenue raisers and tax “pay-fors” to fund infrastructure priorities.
- What’s next: MBA staff will continue to engage with the administration and key congressional leaders and staff to advocate for the industry’s key tax priorities identified by RESBOG and the MBA Board-approved Tax Task Force.
5. House Passes Proposal Aiming to Increase Number of Qualified Appraisers for FHA Loans
On Tuesday, the House passed H.R. 3008, the Homebuyer Assistance Act of 2021, sponsored by Reps. Brad Sherman (D-CA) and Van Taylor (R-TX).This bipartisan legislation would allow more appraisers practicing in the field today to become eligible to conduct evaluations for mortgages insured by the Federal Housing Administration. Allowing lenders to expand their appraiser pools will address supply shortages and in turn reduce consumer costs and shorten delays that have occurred in many markets. Expediting valuations and lowering closing costs will create a more efficient residential mortgage market for lenders and consumers.
- Why it matters: MBA supports this legislation and sent a letter to the House in advance of its consideration. This bill passed with wide bipartisan support, indicating it could gain traction in the Senate in the coming months.
- What’s next: Senate Banking Committee Chairman Sherrod Brown has publicly stated his intention to focus on all aspects of housing, especially issues related to affordability.
6. Senate Banking Committee Discusses Flood Insurance Reauthorization
On Tuesday, the Senate Banking Committee held the first in a series of hearings on reauthorizing the National Flood Insurance Program prior to its expiration of authority on September 30. Lawmakers were divided on a list of proposed reforms to the program, with senators from flood-prone states resisting certain proposals, citing concerns about premium costs for homeowners. A summary of the hearing may be found here.
- Why it matters: The NFIP allows mortgage lenders, real estate agents, home builders and the rest of the housing industry to close deals on homes in floodplains. Long-term flood insurance reform has eluded Congress for years, resulting in lawmakers passing short-term reauthorizations of the program 16 times since 2017 to keep it operating.
- What’s next: Tuesday’s hearing was the first in four years that the Senate Banking Committee has held on the NFIP. The House Financial Services Committee unanimously passed a five-year reauthorization of the program in 2019 that required disclosure of property-specific risks for homeowners and homebuyers, and updated maps to create new flood zones. The Senate has been unable to reach an agreement yet on long-term changes.
7. HUD Deputy Secretary Nomination Advances to Senate Floor; MBA Submits Letter of Support
On Wednesday, the Senate Banking Committee approved by voice vote the nomination of Adrianne Todman to be Deputy Secretary of HUD. Her nomination now moves to the full Senate for consideration. MBA’s letter of support for Todman can be found here.
- Why it matters: Todman has an extensive background in housing, having served as CEO of the National Association of Housing and Redevelopment Officials (NAHRO) since 2017. Prior to joining NAHRO, she served as Executive Director of the District of Columbia Housing Authority (DCHA), where she focused on housing for homeless veterans, increased homeownership opportunities for low- and moderate-income families served by DCHA, and improved and expanded affordable housing units available to a range of household incomes.
- What’s next: Given her unanimous vote in committee, Todman’s nomination may move quickly and should not encounter strong resistance on the Senate floor. As the second most senior official at HUD, Todman will manage the day-to-day operations of the agency and will advise and assist the Secretary in leading the Department’s nearly 8,000 employees on issues such as affordable housing, government lending and fair housing.
8. House Financial Services Committee Holds Hearing with Prudential Regulators
On Wednesday, the House Financial Services Committee held a hearing, “Oversight of Prudential Regulators: Ensuring the Safety, Soundness, Diversity, and Accountability of Depository Institutions.” Witnesses included the heads of the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency and the National Credit Union Administration and the Vice Chair of Supervision of the Federal Reserve System. A broad range of topics were discussed including the Community Reinvestment Act, LIBOR transition, fintech partnerships, climate change and the implications of forbearance relief afforded to bank customers during the pandemic.
- Why it matters: The topics discussed during this hearing indicate regulatory adjustments Congress may pursue during the remainder of the 117th Congress, as well as priorities that may be pursued by the respective regulatory agencies themselves.
- What’s next: MBA will continue working with key lawmakers and regulators on all issues impacting our members.
9. Fannie Mae, Freddie Mac Release Proposed 2022-2024 Duty to Serve Plans
On Tuesday, the Federal Housing Finance Agency announced the GSEs’ proposed 2022-2024 Underserved Markets Plans under the Duty to Serve program. These plans provide an overview of the activities outlined by the GSEs to fulfill their Duty to Serve requirements over a three-year period.
- Why it matters: The Duty to Serve program holds the GSEs accountable for serving three important markets – rural housing, affordable housing preservation, and manufactured housing.
- What’s next: Comments on the proposed plans are due to FHFA no later than July 16. FHFA also will hold public listening sessions on each of the three targeted markets – rural housing (July 12), affordable housing preservation (July 13), and manufactured housing (July 14).
10. GSEs Delay UCD Critical Error Implementation Date
On Wednesday, Fannie Mae and Freddie Mac announced an extension of the implementation date for Phase 1 critical edits from May 31 to July 31, for certain edits in the GSEs’ Uniform Closing Dataset collection systems to convert from “warning” to “critical.” This delay provides an additional two months for lenders to prepare for this change.
- Why it matters: The GSEs delayed the implementation date based on an assessment of industry readiness for the change.
- What’s next: MBA will continue to monitor industry readiness for this change and future Phase 2 edits. The scope and dates for Phase 2 have not yet been announced by the GSEs.
For more information, please contact Rick Hill at (202) 557-2718.
11. OCC Reverses Course on Community Reinvestment Act Final Rule
On May 8, the OCC issued OCC Bulletin 2021-24 announcing the agency is reconsidering its Community Reinvestment Act final rule that was issued in June 2020. In the bulletin, the OCC said that during this period of “reconsideration,” banks are allowed to suspend all efforts (including developing systems or other implementation activities) to comply with the provisions of the CRA Final Rule that will be effective in January 2023 and January 2024, but they must continue to comply with provisions or requirements that took effect in October 2020.
- Why it matters: Although the OCC did not indicate how long the “reconsideration” would be for, the agency indicated that while the reconsideration is ongoing, it will not implement or use the evaluation criteria in the CRA Final Rule to analyze examiner review of CRA activity quantification, assessment areas, general performance standards, data collection, recordkeeping, or reporting. Further, the agency indicated it is discontinuing plans to (i) finalize its December 2020 proposed rule on approaches to determine evaluation measure benchmarks, retail lending distribution test thresholds, and community development minimums under the CRA Final Rule; and (ii) collect bank CRA information as indicated in a December 2020 Federal Register publication.
- What’s next: With this action, the OCC has the opportunity to consider additional stakeholder input, evaluate issues and questions that have been raised, and forge a path to join efforts with the other two banking agencies on a uniform CRA rewrite.
MBA joined with several other financial trade associations to advocate for this result, and looks forward to engaging constructively with all the banking regulators to develop an updated CRA framework that benefits communities, banks, and regulators alike.
For more information, please contact Fran Mordi at (202) 557-2860.
12. MAA Action Weeks Campaign Recap
The Mortgage Action Alliance just wrapped up MAA Action Weeks, a national, industrywide campaign aimed at growing MAA and activating real estate finance professionals in key states and congressional districts. This year 80 companies participated, and through concurrent company campaigns, this effort generated 5,900 new MAA sign-ups and 13,400 MAA renewals, expanding the nationwide active MAA member total to more than 75,000.
- Why it matters: MAA empowers members to contact their state and federal elected officials supporting the Calls to Action to protect and secure our industry. This is the most critical time for our industry to unite and play an active role in shaping legislation and regulations that impact our companies, our customers, and the broader economy.
- What’s next: Click here to request a report of your company’s or state’s involvement, or to receive additional information about how to run a company campaign.
For more information, please contact Rosie Sheehan at (202) 557-2933.
13. House Financial Services Committee Announces New Leadership Posts
On Tuesday, the House Financial Services Committee Republicans and Democrats announced new posts to leadership positions within their respective caucuses. Rep. Jake Auchincloss (D-MA) will assume Vice Chairman of the full Committee, the No. 2 position under Chairwoman Maxine Waters (D-CA). Rep. French Hill (R-AR) will replace former Rep. Steve Stivers (R-OH) as the lead Republican on the Housing, Community Development and Insurance Subcommittee.
- Why it matters: Leadership positions on the Committee are integral in crafting policies and guiding bills through the legislative process.
- What’s next: MBA congratulates Reps. Auchincloss and Hill on their new assignments, and looks forward to working with both members in their new roles.
14. MBA Single-Family Research Showcase: June 23-24
On June 23-24, join MBA’s Research and Economics Team for its first-ever, two-day MBA Single-Family Research and Economics Showcase. Led by MBA SVP and Chief Economist Mike Fratantoni, analysts will detail the most current results and insights from their residential surveys, forecasts and reports.
- Why it matters: Session topics include: A Keynote on the Economy and the Mortgage Market; Latest Performance Benchmarking Data for Production and Servicing; Industry Volume and Demand; Demographics, Market Profiles and Players; Forbearance and Delinquency; Technology and Innovation; Staffing Issues; and Views on the Future of the Mortgage Industry. CPE credit is available.
- What’s next: To register, click here.
For more information, please contact Marina Walsh at (202) 557-2817.
15. 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:
- CONVERGENCE: The Future Is Female: How Women Are Shaping the Future of Housing – May 26
- Retail 3.0: Re-envisioning Retail – May 26
- Fair Lending: Things You Might Not Be Thinking Of – June 22
- Benchmarking for Performance and the Performance Ratios Every Mortgage Banker Must Know – June 29
- Transformation Impact of Blockchain in Mortgage Industry and Realized Economic Benefits – June 29
- Do Commercial Servicer Ratings Matter? – July 14