MBA Advocacy Update

Steve O'Connor; Bill Killmer 

May 13, 2019


FHA proposed new guidelines on Loan-Level and Annual Certifications, as well as a new Defect Taxonomy. The House Committees on Financial Services and Veterans' Affairs both passed the Protect Affordable Mortgages for Veterans Act of 2019, a technical correction to allow a specific cohort of VA "orphan" loans to be pooled into Ginnie Mae securities. And Oklahoma Gov. Kevin Stitt (R) signed SB 915 into law, which will enable the use of remote online notarization in the state.  

FHA Proposes New Lender Certification Requirements
FHA on Thursday FHA announced its long-awaited Proposed Revisions to the Certifications and Defect Taxonomy (  

These changes are the result of years of advocacy by MBA to reduce lender exposure to risk arising from overzealous use of the False Claims Act. They are being proposed in an effort to give additional clarity and to streamline FHA program requirements while continuing to fulfill FHA's duty to protect the Mutual Mortgage Insurance Fund. FHA is seeking public feedback on these proposed changes, specifically to its loan-level certifications, annual lender certifications and the Defect Taxonomy. Key highlights from the announcement include:  

--Loan-Level Certifications: FHA is completely revising the Addendum to Uniform Residential Loan Application;  

--Annual Lender Certifications: The proposal changes annual lender certifications to better align them with existing statute. Changes are intended to address industry concerns by streamlining the certification statements, while continuing to hold lenders accountable for compliance with all HUD eligibility and approval requirements; and  

--Defect Taxonomy: Updates will provide more clarity and transparency into FHA's existing loan-level quality assurance processes.  

MBA released a statement of support ( and will continue to work with HUD as we have been in constant communication throughout this process. For a side-by-side comparison of existing language and the proposed changes, click  

For more information, please contact Andrea Oh at (202) 557-2922; or Julienne Joseph at (202) 557-2782  

House Committees Pass Bill to Provide Certainty Regarding Mortgage Loans to Veterans
On Wednesday, the House Committees on Financial Services and Veterans' Affairs passed the Protect Affordable Mortgages for Veterans Act of 2019, H.R. 1988.  

The bipartisan bill, introduced by Reps. David Scott, D-Ga., and Lee Zeldin, R-N.Y., would correct a legislative drafting error that prevented VA-guaranteed "orphaned loans" from being eligible for Ginnie Mae pooling. The legislation would also provide a go-forward fix by changing the start date of the 210-day seasoning period from the date on which the first payment was made to the date on which the first payment was due, which would provide greater clarity for lenders. The legislative fix would promote liquidity and enable impacted VA lenders to provide more mortgage credit to veterans.  

The full text of MBA's letter to the Financial Services and Veterans' Affairs committees can be found at  

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

House Veterans Committee Advances Blue Water Navy Bill
On Wednesday, the House Veterans' Affairs Committee passed the Blue Water Navy Vietnam Veterans Act of 2019, H.R. 299, which advanced by voice vote.  

The bill, introduced by Rep. David P. Roe, R-Tenn., would extend certain health benefits to veterans who served in Southeast Asia and Korea, and were affected by diseases associated with Agent Orange. While MBA applauded the Committee's efforts to ensure adequate medical care for veterans who may have been exposed to dangerous chemicals in the course of their service, MBA raised concerns about a provision that would increase fees charged to veterans in connection with the Department of Veterans Affairs Home Loans program. MBA will continue to engage Congress and urge legislators to ensure that housing-related revenue is not used to pay for non-housing-related spending. The full text of the Veterans' Affairs Committee can be found at  

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

House Passes Bill to Extend National Flood Insurance Program Through Fiscal Year 2019
On Friday, the House passed H.R. 2157, the Supplemental Appropriations Act, 2019, sponsored by Rep. Nita Lowey, D-N.Y., Chair of the House Appropriations Committee.  

This supplemental appropriations bill includes a provision that would extend the National Flood Insurance Program, due to lapse at the end of May, through the end of this fiscal year on September 30. The bill, which passed by a 257-150 vote, also includes $17 billion in aid for certain disaster-stricken communities.  

In a joint coalition letter sent to Congress, MBA advocated for an extension of the NFIP in the absence of consensus agreement among legislators to reform the program. The legislation now heads to the Senate for its consideration.  

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

Senate Banking Committee Holds Hearing on Data Privacy
On Wednesday, the Senate Banking Committee held a hearing, Privacy Rights and Data Collection in a Digital Economy. Witnesses included Peter Chase, Senior Fellow with the German Marshall Fund of the United States; Jay Cline, Privacy and Consumer Protection Leader and Principal with PwC; and Maciej Ceglowski, Founder of Pinboard.  

Banking Committee Chairman Mike Crapo, R-Idaho, who is in the early stages of crafting a potential data privacy bill, used the hearing to examine the European Union's General Data Protection Regulation and other approaches to data privacy, such as the effect on the financial services industry and how companies collect and use information in marketing and decision-making related to credit, insurance, or employment. Crapo and Ranking Member Sherrod Brown, D-Ohio, indicated there was bipartisan support to address data privacy concerns. "There's enough agreement here," Brown said. "Unlike some issues that we've had greater differences on, this is something that we can really do."  

On February 13, in a rare bipartisan request, Crapo and Brown invited feedback from the public on the collection, use, and protection on sensitive information by financial regulators and private companies. MBA submitted its feedback and supports efforts to ensure that no consumer is unwittingly exposed to harm by unintentionally providing his or her personal data to unscrupulous actors. However, MBA suggested not to prevent the careful use of data to improve the efficiency of mortgage origination. The full text of MBA's letter to the Banking Committee can be found at  

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

Ginnie Mae Extends Deadline for Comments on VA Cash-Out Refinances
Last week, Ginnie Mae extended the deadline for responses to its recently issued Request for Input on Pooling Eligibility Changes ( from May 22 to May 31. As a reminder, this RFI addresses the prepayment behavior of VA-guaranteed cash-out refinances with higher loan-to-value ratios.  

More specifically, the RFI considers the potential for Ginnie Mae to place restrictions on the pooling of VA cash-out refinances with LTV ratios above 90 percent. Options explicitly noted in the RFI include creating single-issuer custom pools for these loans, 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.  

In February, MBA 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 will draw upon this work in developing further recommendations in response to the Ginnie Mae RFI.  

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

MBA Submits Comments on CFPB PACE ANPR
On Tuesday, MBA submitted comments ( on the Consumer Financial Protection Bureau's Advance Notice of Proposed Rulemaking on residential Property Assessed Clean Energy (PACE) financing. The ANPR follows from Section 307 of the Economic Growth, Regulatory Relief, and Consumer Protection Act, which directs the Bureau to create regulations applying TILA's ability to repay requirements to PACE loans. The Bureau will use information gathered during the ANPR phase to inform later rule writing.  

MBA's comments highlight several issues with PACE finance including the lack of consumer protections and the "super-lien" status afforded PACE loans. MBA urges the Bureau to treat PACE loans like mortgage loans, given that both forms of real estate finance pose similar risks for consumers. Specifically, PACE lenders should be subject to TILA's ability to repay, disclosure, and licensing requirements. MBA also suggests offering Qualified Mortgage protections for subordinated PACE loans.  

For more information about MBA's comments or the Bureau's PACE rule writing process, please contact William Kooper at (202) 557-2737; or Justin Wiseman at (202) 557-2854  

CFPB Issues Proposed Rule on Fair Debt Collection Practices
On Wednesday, the Consumer Financial Protection Bureau released a notice of proposed rulemaking ( on amendments to Regulation F, 12 CFR Part 1006, which implements the Fair Debt Collection Practices Act. This rule is the first major FDCPA rulemaking since the statute's passage in 1977.  

The announcement included two supporting documents: a Fast Facts sheet on the rule (; and a flowchart outlining how to view electronic disclosures ( The Bureau seeks comment on proposed revised definitions, communication restrictions and regulations, and required disclosures applicable to debt collectors as defined in the Act.    

Of particular note is that the rule's definition of debt collector maintains the traditional understanding that those who collect on their own loans or acquire loans that are performing are not defined as debt collectors. MBA is currently reviewing the proposed rule and will provide a summary shortly.  

For more information, please contact Hanna Pitz at (202) 557-2796; or Sara Singhas at (202) 557-2826  

FHFA Adds Two New Officials to Leadership
The Federal Housing Finance Agency added two new officials to its leadership ranks last week, Christopher Bosland and Meghan Patenaude. Bosland is slated to serve as a Senior Adviser for Regulatory Affairs and Patenaude joins as a Senior Policy Advisor.  

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

Oklahoma Enacts New RON Statute; Tennessee Adopts Rules for RON Implementation
On Thursday, Oklahoma Gov. Kevin Stitt (R) signed SB 915 into law, which will enable use of remote online notarization in the state. The statutory language of SB 915 is consistent with the contours of the MBA-American Land Title Association model state RON bill ( Oklahoma becomes the ninth state in 2019 to enact RON legislation and the 19th state to establish RON as a permissible method of performing notarizations.  

Moreover, the Tennessee Secretary of State recently adopted emergency rules to provide consumers with the option of using RON for electronic documents. Tennessee's RON rules are consistent with the MISMO RON Working Group's model standards, which along with the MBA-ALTA state model RON bill continues to help establish a national consensus among state policy makers for RON rules and laws.  

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

MBA, State Partners Discuss AMC Licensing, Regulation in Washington, D.C.
On Tuesday, MBA, the Mortgage Bankers Association of Metropolitan Washington, the Maryland Mortgage Bankers and Brokers Association and the Real Estate Valuation Advocacy Association met with Commissioner Stephen Taylor of the Washington, D.C., Department of Insurance, Securities and Banking to discuss the importance of implementing regulations to establish Dodd-Frank-required minimum standards for appraisal management companies.  

Without legislation or clear, written guidance regarding enforcement of AMCs by the August deadline, these entities will be barred from participating in all federally related transactions in the District. In addition, AMCs and lenders would immediately have to stop using unlicensed individuals for non-appraiser services such as broker price opinions, property condition reports and more.  

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

Sign Up for Fourth Annual MAA Action Week
The Mortgage Action Alliance, MBA's free grassroots lobbying network, will hold its fourth annual Action Week May 13-17 (  

Action Week is a national, industry-wide campaign dedicated to helping real estate finance professionals learn how to become more engaged in political advocacy.   Last year, 49 companies ran company-wide enrollment campaigns; 20 state and local associations recruited new MAA members; and 12 individuals spread the word on social media to their professional networks.  

This year, our goal is to recruit 100 organizations (companies, state/local associations and individuals) to run concurrent enrollment campaigns in an effort to activate all MAA members during Action Week. Join the growing list of companies participating in MAA Action week.  

Sign up ( and MBA Staff will provide materials and resources to help support your efforts.  

For more information, please contact Alden Knowlton at (202) 557-2816  

MBA Compliance Essentials Webinar on ECOA Case Law May 15
Join MBA Education and the Compliance Essentials program on May 15 to examine the roots of ECOA regulations and how courts have interpreted them in shaping the current body of fair credit law. In particular, the webinar will discuss the courts', as well as the CFPB's, views of disparate impact under ECOA and the status of disparate impact under the current administration. The webinar will conclude with observations about complying with ECOA in a changing regulatory and legal environment.  

To register for this webinar, click  

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

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