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The Mortgage Bankers Association (MBA) sent a 9-page
proposal today to the U.S. Senate Committee on Banking, Housing, and Urban
Affairs in response to a call for proposals aimed at promoting economic
development and consumer and lender participation in the economy.
Sen. Mike Crapo, R-Idaho, chair of the banking committee,
and Senator Sherrod Brown, D-Ohio, ranking member of the committee, put out the
call for proposals on March 20, seeking “three to five priority proposals” from
all interested stakeholders in the banking, housing and financial services
The MBA proposal contains seven major sections requesting
changes or modifications to existing rules and regulations. The first proposal
the MBA makes is a request for regulatory clarity and relief from the Consumer
Financial Protection Bureau, claiming the bureau’s “use of consent decrees and
administrative decisions to make changes in the rules, rather than formal
rulemaking or published guidance” creates uncertainty.
In addition, the MBA proposed changes to the
ability-to-repay (ATR) and Qualified Mortgage (QM) rules created by the
Dodd-Frank Act and the CFPB. Specifically, the proposal calls for expanding the
legal safe harbor on QM loans to include all loans that satisfy the QM
requirements, regardless of their annual percentage rate, and expanding the
range of loans that qualify for small-loan status under QM rules by increasing
the small-loan-size limit from $102,894 (for 2017) to $200,000.
The other five proposals in the MBA letter mostly deal with
Basel III capital-reserve rules and commercial mortgages. These proposals
request a review of servicing-market regulations and Basel III requirements; a
modification to the Federal Home Loan Bank membership rule; modifications to
the Basel III rules on High Volatility Commercial Real Estate; additional
improvements to the commercial mortgage-backed securities risk-retention rules;
and changes to the Low Income Housing Tax Credit program to foster competition
and reduce potential conflicts of interest.
Will McDermott is editor of Scotsman Guide Residential Edition. Reach him at (800) 297-6026 or email@example.com.
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