Advocacy Update: MBA Chair-Elect Owen Lee Testifies on VA Program Improvements; USDA Launches MBA-Supported Pilot; Federal District Court Vacates FinCEN Rule; MBA Letter to CFPB on HMDA Reporting

March 27, 2026

MBA Chair-Elect Owen Lee Testifies Before House Committee on VA Program Improvements

On Thursday afternoon, Owen Lee, MBA’s 2026 Chair-Elect and CEO of Success Mortgage Partners, Inc., testified at a legislative hearing titled, “Kitchen Table Issues: Lowering Costs for Veteran Families Through the VA Home Loan Program,” before the House Committee on Veterans’ Affairs Economic Opportunity Subcommittee.

• Read Lee’s written and oral testimonies. Watch the replay here.

• A summary of the hearing can be found here.

Why it matters: Lee highlighted his decades of experience in mortgage lending and his company’s extensive work originating VA loans for veteran families nationwide. He commended Congress for passing the MBA-supported VA Home Loan Program Reform Act last year, which established a permanent partial claim program, and praised the VA’s collaborative implementation process. Lee also noted MBA’s key recommendations to refine and improve the rollout of partial claims authority, including prioritizing options that do not increase monthly payments and allowing for flexible forbearance before requiring veterans to make repayment decisions. Lee also urged broader program updates, including aligning property standards with other federal housing agencies, modernizing refinancing and fee structures, and improving documentation requirements to reflect current industry practices.

Lee also reiterated MBA’s position that VA funding fee revenue should be reinvested solely into strengthening the VA home loan program and emphasized the importance of continued reforms to reduce costs, improve efficiency, and better serve veteran homeowners.

Go deeper: MBA and its members played a leading role in advocating for the VA to have partial claims authority and have continuously supported changes that would provide veterans with the same loss mitigation options as other borrowers. The ability to offer a partial claim is a particularly important option for allowing borrowers to keep payments stable in a higher-interest-rate environment.

• Earlier this month, MBA sent a letter and detailed comments to the VA in response to its proposed policies implementing its Partial Claim program and changes to its loss mitigation waterfall.

What’s next: MBA will keep members informed about final guidelines on the VA’s proposed changes, which the agency has said will be announced in April. MBA will also closely monitor any VA Home Loan Program-related legislative proposals that may emerge in the House or Senate in the coming weeks.

For more information, please contact Rachel Kelley  at (202) 557-2816, Jeremy Green at (202) 557-2849 or Kaitlin Hildner at (202) 557-2933.

USDA Launches MBA-Supported Delegated Authority Pilot

The Department of Agriculture (USDA) Rural Housing Service (RHS) announced the Lender Interactive Test Environment (LITE) Delegated Authority Pilot Program for the Section 502 Single Family Housing Guaranteed Loan Program. This two-year pilot will run from September 1, 2026, through September 26, 2028, and is designed to test a delegated authority framework that allows approved lenders to underwrite and approve loans with reduced RHS involvement.

• To participate, lenders must demonstrate strong loan performance relative to the broader RHS loan portfolio over the past two years, originate at least 10 RHS-insured loans in the prior 12 months, maintain current certifications and obligations, and have a satisfactory compliance record with no failed reviews in the past 24 months.

Why it matters: This pilot marks a significant step toward modernizing USDA’s loan delivery process and has been a long-standing priority for which MBA has advocated. Delegated authority could improve processing times, reduce operational bottlenecks, and expand lender participation in rural housing programs.

What’s next: RHS will evaluate lender performance throughout the pilot to inform potential broader implementation. Interested lenders can apply by contacting USDA RHS at LITEPilot@usda.gov.

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

Federal District Court Vacates FinCEN Rule Nationwide

The federal district court for the Eastern District of Texas recently ruled to “vacate and set aside” the Financial Crimes and Enforcement Network’s (FinCEN’s) recent Residential Real Estate Anti-Money Laundering Rule (Rule). The Rule would have expanded reporting requirements for “non-financed transfers” of residential real property.

• In Flowers Title Companies, LLC v. Bessent, the Court found that the Rule exceeded statutory authority under the Bank Secrecy Act and violated the Administrative Procedure Act. Based on the ruling, the rule is vacated nationwide. Following the ruling, FinCEN posted a message on its website stating that real estate reports are not currently required and reporting persons are not subject to liability if they fail to report while the order is in force.

Why it matters: The Rule mandated substantial new information collection and reporting requirements and imposed significant operational challenges and potential legal liability for the nonjudicial foreclosure process. On January 13, MBA submitted a joint trades letter to the Treasury Department requesting an extension for the impending Rule beyond March 1, 2026, and an exemption for non-judicial foreclosure sales from this nationwide reporting obligation.

What’s next: MBA will continue to monitor the case. Neither the Department of Justice nor FinCEN has indicated whether they will appeal the decision.

For more information, please contact Kait Hildner at (202) 557-2933.

FSOC Issues Proposed Guidance on Nonbank Financial Company Designations

Last week the Financial Stability Oversight Council (FSOC) voted on and published the proposed interpretive guidance on nonbank financial company designations. The proposed guidance outlines the steps FSOC would take to determine whether to designate a nonbank financial company for Federal Reserve supervision.

Go deeper: The updated policy reinstitutes many of the elements of FSOC’s 2019 interpretive guidance, including an activities-based approach and a cost-benefit analysis. The activities-based approach requires regulators to evaluate broader market/sector reforms before considering designation of individual companies. The guidance also provides a pre-designation “off-ramp,” which would allow companies to respond to identified steps to mitigate the potential threat to U.S. financial stability and avoid designation.

Why it matters: The updated guidance is responsive to the July 2023 comment letter MBA submitted regarding FSOC’s 2023 interpretive guidance. Through the proposed guidance FSOC published this week, FSOC sets the bar for entity designation higher, which would help ensure more judicious use of FSOC’s designation authority.

• As highlighted in the July 2023 comment letter, MBA does not believe it is appropriate for FSOC to designate IMBs – individually or as a sector – as a systemic risk to the entire U.S. financial system.

What’s next: The draft interpretive guidance includes questions for public comment. Following publication in the Federal Register, respondents will have 45 days to comment. MBA will work with members to draft a response.

For more information, please contact Kait Hildner at (202) 557-2933.

MBA Responds to CFPB Information Request on HMDA Reporting

Last Thursday, MBA sent a letter in response to a Request for Information (RFI) from the Consumer Financial Protection Bureau (CFPB or the Bureau) pertaining to the Home Mortgage Disclosure Act (HMDA) and its implementing regulations, Regulation C.

Why it matters: The CFPB requested comments on whether the collection of information is necessary for the proper performance of the functions of the CFPB, including whether the information has practical utility, and the accuracy of the CFPB’s estimate of the response burden of the data collection. Additionally, the Bureau asked for comments on the validity of the methods and the assumptions used, ways to enhance the quality, utility, and clarity of the information to be collected, and ways to minimize the compliance burden on respondents.

• In the letter, MBA applauded the CFPB’s decision to initiate the RFI and suggested several ways that the CFPB can minimize the burden of HMDA data collection.

Go deeper: Specifically, MBA recommended the following changes to Regulation C:

• Raising the loan reporting threshold to 100 loans from 25;

• Clearly defining what actions constitute a HMDA violation;

• Removing non-useful and burdensome data points from reporting requirements;

• Removing the requirement for quarterly HMDA reporting;

• Removing the requirement to report loan assumptions;

• Reconsidering guidance for peer comparison using publicly available HDMA data; and,

• Exempting multifamily/commercial loans from HMDA reporting requirements.

What’s next: MBA will keep members informed about next steps.

For more information, please contact Justin Wiseman at (202) 557- 2854 or Alisha Sears at (202) 557-2390.

Get Ready for NAC: Join Our Prep Webinars

MBA’s National Advocacy Conference is just around the corner, and now is the perfect time to secure your spot. Once you’re registered for the conference, take advantage of our two preparatory webinars designed to help you arrive informed, confident, and ready to advocate effectively on Capitol Hill.

• Issues Briefing Webinar Thursday, April 2 | 3:00–4:00 PM (ET) Hear the latest updates on key residential and commercial/multifamily policy priorities so you can deliver a strong, informed message during your Hill meetings.

Why it matters: Your voice carries weight. NAC is your opportunity to speak directly with lawmakers about the issues shaping the future of the real estate finance industry. These webinars can help ensure you will be fully prepared to make the most of those conversations—armed with the latest policy insights and the confidence to advocate effectively.

What’s next: After attending the prep webinars, you will receive final event details, meeting schedules, and on‑site guidance to help you navigate NAC with ease. The MBA team will make sure you are ready for a productive and impactful experience in Washington.

For more information, visit nac@mba.org or please contact Jamey Lynch at (202) 557-2818 or Erin Reilly at (202) 557-2751.

Get Ready for NAC: Join Our Prep Webinars

• First-Time Attendee Webinar Wednesday, April 1 | 3:00–4:00 PM (ET) Get a clear overview of what to expect at NAC—from the event schedule to foundational lobbying best practices—and bring your questions for our team of experts.
• Issues Briefing Webinar Thursday, April 2 | 3:00–4:00 PM (ET) Hear the latest updates on key residential and commercial/multifamily policy priorities so you can deliver a strong, informed message during your Hill meetings.

Why it matters: Your voice carries weight. NAC is your opportunity to speak directly with lawmakers about the issues shaping the real estate finance industry. These webinars ensure you’re fully prepared to make the most of those conversations—armed with the latest policy insights and the confidence to advocate effectively.

What’s next: After attending the prep webinars, you’ll receive final event details, meeting schedules, and on‑site guidance to help you navigate NAC with ease. We’ll make sure you’re ready for a productive and impactful experience in Washington.

For more information, visit nac@mba.org or please contact Jamey Lynch at (202) 557-2818 or Erin Reilly at (202) 557-2751.

Upcoming MBA Education Webinars on Critical Industry Issues

MBA Education continues to deliver timely single-family programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – all complimentary to MBA members:

• Fraud Detection and Prevention in Non-Agency Lending – March 31
• How Secondary Marketing Powers Mortgage Lending – April 1
• Data & System Privacy in an AI World – April 2
• Social Media Compliance, Risk Mitigation and Best Practices – April 9
• State of the Market: Tech Trends Shaping the Future of Mortgage Lending – May 14
• FHA Credit Watch Program: Revisiting Delinquency Trends and Remediation – May 14

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) 557-2931.

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