MBA Advocacy Update

Steve O'Connor; Bill Killmer  

June 03, 2019

Congress was out last week in observance of the Memorial Day recess and will return to Washington today. On Thursday, Congress passed an extension of the National Flood Insurance Program for two weeks. Also, FHA extended the comment period for public input regarding loan-level certifications.  

The NFIP was set to expire on May 31. Reauthorization appeared to be a done deal when it was included in a disaster relief package passed by the Senate last week in an 85-8 vote. That package would have extended the program's authorization through September 30.

The House was then expected to pass the package by unanimous consent, as most House members had already left town for the holiday weekend. Unfortunately, unanimous consent failed last week and again this past Tuesday when one member objected.  

After experiencing procedural hurdles, the House eventually passed a different Senate bill that would extend the NFIP for two weeks, buying legislators time to negotiate a longer-term extension. Considering a threat of an NFIP lapse, MBA sent a joint coalition letter to Congress urging congressional leaders to immediately extend the NFIP (  

For more information, please contact Ernie Jolly at (202) 557-2741; or Dan Grattan at (202) 557-2712  

FHA Grants Extension for Comments Regarding Loan-Level Certifications 
On Thursday, the Federal Housing Administration announced ( it will extend the public feedback period on its proposed revisions to the Addendum to Uniform Residential Loan Application posted on the Single Family Housing Drafting Table on until 11:59 p.m. ET on June 30. The original feedback end date was June 8.  

The proposed revisions to the Addendum to Uniform Residential Loan Application were previously announced in FHA INFO 19-18 on May 9, 2019 ( FHA is extending the feedback period to give interested parties additional time to review and submit feedback on the proposed changes.  

Please note that while the extension is granted for comments on the Loan-Level Certifications only, the feedback deadlines for the Annual Lender Certifications and the Defect Taxonomy--also posted on the Drafting Table--remain the same, and end on June 8.  

For more information, please contact Dan Fichtler at (202) 557-2780; or Fran Mordi at (202) 557-2860  

MBA Provides Comments to Ginnie Mae on VA Cash-Out Refinances
On Friday, MBA submitted comments to a Ginnie Mae Request for Input on Pooling Eligibility Changes for VA cash-out refinances with higher loan-to-value ratios (  

In its comments, MBA reiterated its long-running emphasis on the need to protect borrowers, lenders, and investors from the serial refinancing--or "churning"--of VA loans. MBA also provided specific feedback on three pooling restrictions considered by the RFI: creating single-Issuer custom pools for high-LTV VA cash-out refinances, creating a new category of multi-Issuer pools that include only these loans or imposing a de minimis standard to limit the concentration of these loans in any given pool. Further, MBA provided mechanisms for Ginnie Mae to better narrow the scope of loans affected by any policy changes, both by Issuer and by loan type.  

As a reminder, MBA recently submitted comments to VA detailing a series of recommendations on the parameters of cash-out refinances to deter loan churning, slow Ginnie Mae prepayment speeds and protect consumers. MBA drew upon this work in developing its response to the Ginnie Mae RFI.  

For more information, please contact Dan Fichtler at (202) 557-2780  

MBA Asks FHFA to Delay GSE Early Implementation of the Uniform Residential Loan Application
On Wednesday, MBA sent a letter ( to Federal Housing Finance Agency Director Mark Calabria requesting a delay to the July 1, optional adoption date for the Uniform Residential Loan Application. This request follows similar conversations that MBA President and CEO Bob Broeksmit, CMB, had with Calabria and the GSEs during MBA's 2019 Secondary Conference last week.  

MBA made this request due to concerns that the optional adoption period would create severe logistical challenges for the industry, requiring each lender to coordinate with every one of its business partners to develop a separate implementation plan. MBA also expressed concerns that some of the government housing agencies (FHA, VA, USDA) might not be ready to fully support the new URLA by the July 1 date. MBA requested that the February deadline for mandatory adoption also be reassessed should any the agencies be deemed unlikely to meet that date. MBA will continue to communicate with FHFA and the GSEs to address these concerns.  

For more information, please contact Rick Hill at (202) 557-2718; or Dan Fichtler at (202) 557-2780  

Agencies Publish Final Rules on Mortgage Servicing Assets For Non-Advanced Approaches Banks
On May 28, the OCC, FDIC and Federal Reserve Board released final rules on their September 2017 proposal to simplify certain aspects of the Basel III capital rules for non-advanced approach banking organizations (  

The original proposal increased the amount of MSAs that a bank can include in Tier 1 capital from 10% to 25%, and retained the risk weighting for MSAs not deducted from Tier 1 capital at 250%. The final rule made no substantive changes to the proposal.  

MBA has been advocating for years for an increase in the Tier 1 cap (above even the proposed 25%) and a reduction in the risk weighting. This action represents a partial win on the cap, but MBA is disappointed that the cap was not increased further and that the excessive risk weighting was left unchanged. We are still reviewing the entire document and will follow up with any other pertinent details in the final rules.    

The rules are effective April 1, 2020, but a banking organization is allowed to early adopt. As expected, these final rules supersede and, in effect, eliminate the 2017 transition rules.  

For more information, please contact Fran Mordi at (202) 557-2860  

Senate Banking Committee to Hold Hearing on Nominations
On Wednesday, June 5, the Senate Banking Committee will hold a hearing on the following Executive Branch nominations: Thomas Peter Feddo as Assistant Secretary of the Treasury for Investment Security; Nazak Nikakhtar as Under Secretary of Commerce for Industry and Security; Ian Paul Steff as Assistant Secretary of Commerce and Director General of the United States and Foreign Commercial Service; Michelle Bowman as a Member of the Board of Governors of the Federal Reserve System; Paul Shmotolokha as First Vice President of the Export-Import Bank of the United States; and Allison Herren Lee as a Member of the Securities and Exchange Commission.  

For more information, please contact Tallman Johnson at (202) 557-2866; or Erin Barry at (202) 557-2913  

New York Senate, Assembly Banking Committee Chairs Introduce Companion Bills to Clarify State's 2018 AMC Minimum Standards Law
Last week, the chairs of the New York State Senate and Assembly Committees on Banks introduced companion legislation (SB-6249 ( and AB-8024 (, respectively) to amend law enacted last year that established Dodd-Frank-required minimum standards for appraisal management companies.  

The new law went into effect on April 27 despite strongly expressed concerns from the industry about the N.Y. Department of State's extremely narrow legal interpretation of Section 160-jjjj(3) that runs counter to the legislative intent of the law. As a result, AMCs and lenders stopped using unlicensed individuals for non-appraiser services such as broker price opinions, property condition reports and more.  

The new bills would clarify that an AMC may hire or contract a person for property inspections or property evaluations if they are licensed as an appraiser, real estate broker, or home inspector, or a person for a broker price opinion if they are licensed as a real estate broker. The bills are the result of efforts by the NYMBA, Mortgage Action Alliance members and industry volunteers and partners. Given the bills' sponsorship, they are expected to move through their respective committees to a floor vote in the remaining days of the state's legislative session.  

For more information, please contact William Kooper at (202) 557-2737; or Kobie Pruitt at (202) 557-2870  

MBA Reconvenes NMLS Working Group
Recently, with numerous developments affecting state-licensed companies and the Nationwide Mortgage Licensing System, MBA reconvened its NMLS Working Group to discuss, among other issues, the proposed NMLS 2.0 changes and the MLO licensing process.  

The group will meet quarterly and is open to employees of MBA regular member companies or select- or premier-level associate member companies. During its inaugural meeting, the group asked MBA staff to organize emerging issues they are facing as they prepare to implement MLO Temporary Authority. The next meeting will be held the week of July 29.  

For more information or to participate, please contact Kobie Pruitt at (202) 557-2870   

MBA to Hold Webinar on MLO Temporary Authority; Conference of State Bank Supervisors to Participate
MBA Education announced it will hold a live Compliance Essentials webinar at 2:00 p.m. ET on July 11 to discuss implementation of the federal new Mortgage Loan Originator Temporary Authority law and what companies need to know to take advantage of this business opportunity.  

MBA Senior Vice President of Residential Policy and Member Engagement Pete Mills will lead a discussion that will include Bill Young, Vice President of NMLS Business Services at the Conference of State Bank Supervisors. Young's team at CSBS is in the process of redesigning the MLO licensing components of the NMLS to prepare for Temporary Authority's November 24 implementation, and this is a chance to hear directly from, and ask questions of, CSBS on the status of that effort. Also participating is Haydn Richards, Partner with Bradley, to walk through many new operational challenges and legal compliance requirements that member companies should be considering ahead of implementation.  

To register for the webinar, click  

For more information, please contact William Kooper at (202) 557-2737; or Lisa Volb at (202) 557-2919  

Compliance Essentials Webinar on Proposed Amendments to Reg F June 13
Join MBA Education on June 13 as subject matter experts examine proposed amendments to Reg F and the impact on the Fair Debt Collection Practices Act.  

Speakers will address changes including who is covered under the proposed amendments, updated disclosure requirements, conduct and communication requirements, and a few issues not addressed in the Proposed Rule and potential interplay with state debt collection laws.  

To register for this webinar, click  

For more information, please contact Lisa Volb at or 202/557-2919.

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