MBA Advocacy Update Oct. 3, 2022

October 3, 2022

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

On Wednesday, in a follow-up to last week’s White House meeting, MBA President and CEO Bob Broeksmit, CMB, sent a letter to key Biden administration officials, reiterating MBA’s recommendations on addressing housing supply and affordability challenges across the country. House and Senate lawmakers passed a Continuing Resolution ahead of the September 30 government funding deadline to avert a federal shutdown. And on Wednesday, the FHFA proposed to amend the Agency’s Duty to Serve Underserved Markets regulation to facilitate Fannie Mae and Freddie Mac’s (the Enterprises) activities related to serving colonias.

MBA Sends Letter to White House on Housing Sustainability and Affordability

Why it matters: In the letter, MBA focused on top single-family and multifamily advocacy priorities, including: supporting a reduction of Federal Housing Administration mortgage insurance premiums; enhancing and improving the low-income housing tax credit; reviewing and revising the risk-based capital requirement in Ginnie Mae’s recently finalized capital and liquidity standards; increasing the FHA multifamily large loan limit threshold; and supporting state programs that have successfully produced affordable rental housing.
What’s next: MBA remains committed to working with our members, the administration, Congress and other stakeholders on safe and responsible policies that increase homeownership and affordable rental housing options for all households.

For more information, please contact Bill Killmer at (202) 557-2736 or Mike Flood at (202) 557-2745.

Congress Passes Stopgap Funding Bill to Avert Government Shutdown

Last week, House and Senate lawmakers passed a Continuing Resolution ahead of the September 30 government funding deadline to avert a federal shutdown. The stopgap funding bill extends Fiscal Year 2022 funding until Friday, December 16. President Joe Biden signed the measure into law on Friday.

Why it matters: The stopgap measure keeps agencies – such as HUD – funded at their current levels and extends several expiring authorizations that were addressed in the FY 2022 omnibus appropriations bill, including the National Flood Insurance Program.
What’s next: Negotiations are underway in the House and Senate for a longer-term FY 2023 omnibus funding bill. MBA will provide members with any relevant updates as those discussions continue.

For more information, please contact Alden Knowlton at (202) 557-2741, Borden Hoskins at (202) 557-2712, Ethan Saxon at (202) 557 2913 or Tallman Johnson at (202) 557-2866.

FHFA Proposes Amendments to Enterprise Duty to Serve Underserved Markets Rule

Last week, the Federal Housing Finance Agency proposed to amend the Agency’s Duty to Serve Underserved Markets regulation to facilitate Fannie Mae and Freddie Mac’s activities related to serving colonias, which are generally defined as high-needs unincorporated communities along the U.S.-Mexico border. In the proposed rule, FHFA would revise its Enterprise DTS Underserved Markets regulation to add a definition of “colonia census tract,” which would serve as a census tract-based proxy for a “colonia,” and amend the definition of “high-needs rural region” in the regulation by substituting “colonia census tract” for “colonia.” The proposed rule would also update the definition of “rural area” in the regulation to include all colonia census tracts regardless of location. These changes would make Enterprise activities in all colonia census tracts eligible for Duty to Serve credit.

Why it matters: FHFA remains committed to promoting affordability, equity, and sustainability in the nation’s housing finance markets, especially in underserved communities. The proposed amendment will help eliminate barriers and allow the Enterprises to better serve people living in colonias.
What’s next: FHFA will be accepting written public comments on this proposed rule within 60 days of publication in the Federal Register. MBA will be further evaluating the proposed amendments in the coming weeks and will continue to engage with FHFA on this and other critical housing issues.

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

FHA Allows Consideration of Rental Payment History

On Tuesday, the Federal Housing Administration released Mortgagee Letter 2022-17, Consideration of Positive Rental Payment History for First Time Homebuyers in Forward Mortgage Purchase Transactions. FHA’s announcement allows mortgagees to submit a purchase transaction to TOTAL Mortgage Scorecard when borrowers have made all on-time payments in the previous 12 months and at least one borrower has a documented history of payments of $300 or more. The Mortgagee Letter is here.

Why it matters: MBA supports efforts to expand affordable homeownership. Evaluating rental history as part of the credit risk analysis potentially expands homeownership opportunities for QUALIFIED first-time homebuyers who would not otherwise have an approved credit score without the data.
What’s next: This guidance can be implemented for TOTAL scoring events on or after October 30, and for case numbers assigned on or after September 20, 2021. MBA will continue to engage with FHA and provide feedback on the Mortgagee Letter by October 27.

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

Upcoming Ginnie Mae Business Outage During Securitization Platform Migration

Last week, Ginnie Mae announced migration of its securitization platform to the cloud. This upgrade paves the way for more agile and flexible technological advances to support the Ginnie Mae mission. To support this transition, Ginnie Mae will begin closing business systems on Wednesday, October 19 and reopen them Tuesday, October 25. During this outage, nearly all Ginnie Mae business systems and applications will not be accessible. Ginnie Mae suggests planning ahead to reduce risks and avoid challenges to business processes.

Why it matters: This “Planned Business Outage” provides Ginnie Mae the time required to complete processing of transactions in the pipeline and to perform platform upgrades, without risk to business processes.
What’s next: Details on the planned outage can be found in the Modernization Bulletin as well as the Planned Business Outage Timeline. MBA will continue to engage with Ginnie Mae as they continue their modernization efforts.

For more information, please contact Rick Hill at (202) 557-2718 or Sasha Hewlett at (202) 557-2805.

Delaware Governor Signs Legislation to Permit Remote Online Notarization

Recently, Delaware Gov. John Carney signed legislation (SB 262), that will permanently allow use of remote online notarization in real estate financial transactions. SB 262 is generally consistent with the MBA-ALTA model bill.

Why it matters: Delaware becomes the 42nd state to enact RON legislation. In addition, as an attorney closing state, the debate in Delaware was similar to discussions held in other remaining states without remote notarization standards that require an attorney to be present for real estate closings. SB 262 could be used as a model for the remaining attorney states to pass their own respective RON laws.
What’s next: MBA will continue to work with ALTA and other coalition partners to encourage the eight remaining states to adopt RON laws.

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

D.C. Council Holds Hearing on Algorithm Bill that could Negatively Impact the Financial Services Industry

On Sept. 22, the Council of the District of Columbia held a hearing on legislation (B24-0558) that would place significant restrictions on the use of algorithms in financial services decisions. Limiting the use of these algorithms could create challenges for lenders to provide federally insured mortgages that are sold on the secondary market to Fannie Mae or Freddie Mac. Many of these products rely on automated processes, which financial institutions have no control over and thus no ability to audit or meet the bill’s transparency requirements. During the hearing, members of the financial services industry and the Commissioner of the Department of Insurance, Securities and Banking testified as to why the bill is not a workable fit for the financial services industry.

Why it matters: B24-0558 includes standards that are inconsistent with existing laws governing financial services companies, which could affect access to numerous federal programs for DC residents that are aimed at increasing credit affordability, including consumers with lower credit scores/incomes who are reliant on those programs.
What’s next: MBA is working with other financial services trade organizations to develop a comment letter expressing the industry’s specific concerns with the bill as drafted.

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

MBA Releases New DEI Playbook

Last week, MBA released a new resource designed to enhance or establish a workplace’s diversity, equity and inclusion framework. This playbook can be utilized to identify a clear strategy tailored to fit a company’s needs with checkpoints, guidelines, and detailed descriptions of each employee’s role to hold everyone accountable.

Why it matters: This new playbook is exclusively available and free to MBA members. Access the playbook here.

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

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:

Managing Liquidity and Operational Efficiency in a Fiercely Competitive Market – October 4
Prioritizing Compliance in Loan and Mortgage Digitization – October 12
Marijuana and Real Estate in 2022: What Every CRE Professional Should Know – October 19
Modern Day Redlining in Focus: Takeaways from Trident Mortgage and Beyond – October 20
Climate Risk in CREF – What we know and are learning – November 1

MBA members can register for any of the above events and view recent webinar recordings. For more information, please contact David Upbin at (202) 557-2931.

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