MBA Mortgage Action Alliance Issues Call to Action on TRID Safe Harbor Legislation

Congress returns to Capitol Hill today; the Mortgage Bankers Association’s grassroots advocacy arm, the Mortgage Action Alliance, wants to make sure key housing finance issues are on the House and Senate’s front-burner.  

Ahead of consideration, the Mortgage Action Alliance issued a Call to Action, urging its members to contact their members of Congress in support of legislation that would provide a temporary enforcement grace period and legal safe harbor to ensure smooth implementation of the new TILA-RESPA Integrated Disclosures rules for lenders that make a good-faith effort to comply.  

In the House, H.R. 3192, the Homebuyers Assistance Act (http://financialservices.house.gov/uploadedfiles/bills-114hr3192pih.pdf), introduced by Rep. French Hill, R-Ark., would provide a legal safe harbor for lenders through February 1, 2016. The bill was approved by the House Financial Services Committee in late July.  

In the Senate, S. 1711 (https://www.congress.gov/bill/114th-congress/senate-bill/1711), introduced by Sen. Tim Scott, R-S.C., would provide a similar legal safe harbor through January 1, 2016. The bill was included in the regulatory relief package that was reported from the Senate Banking Committee earlier this year.

“A temporary legal safe harbor for lenders will ensure the new requirements are implemented in an orderly manner and that consumers are not confused or, worse yet, impaired in their ability to purchase a home or refinance a loan,” MBA said.  

In July, MBA and a number of industry trade groups sent a letter to House members urging support of H.R. 3192, emphasizing the importance of the safe harbor for lenders, the Consumer Financial Protection Bureau and consumers.  

“While the industry has been granted time to prepare for this new disclosure regime, there is no transition period for the regulation,” the letter said. “A hold-harmless period allows the Bureau to work with industry to gather data about implementation and provide written guidance to address common industry implementation hurdles that emerge after these new disclosures are put into use.”  

The letter emphasized that the real estate finance industry needs more certainty that their good- faith efforts to comply while still meeting consumers’ expectations does not expose lenders and settlement service providers to litigation during the initial period after the regulation becomes effective.

“This certainty will reduce the likelihood that consumers will experience delays or disruptions in the months following the October 3 implementation date.”  

For more information about the Mortgage Action Alliance, click https://www.mba.org/get-involved/take-action-with-maa.