MBA State Relations Committee Update Federal Highlights

Advocacy News and Information from the Latest Issue of the MBA State Relations Committee Update

FHFA Releases Annual Housing Report
FHFA has published its 2018 Annual Housing Report, which provides an overview of the affordable housing activities of Fannie Mae and Freddie Mac over the past year. This report includes preliminary determinations as to whether each enterprise met its required housing goals in 2017. In the single-family market, Fannie Mae met all five of its goals, while Freddie Mac met three of its goals-falling short of its low-income and very-low-income home purchase goals. In the multifamily market, both enterprises met all three of their goals.

The report also contains detailed information regarding the distribution of single-family loans by race/ethnicity, gender, and census tract median income, as well as single-family mortgage product types, payment types, loan-to-value ratios, and credit scores. MBA staff will continue to review the report and engage with FHFA and the enterprises on ways to strengthen the enterprises' affordable housing programs, including through continued implementation of the Duty to Serve program.

FHFA Issues Proposed Rule on FHLB Housing Goals
FHFA released a proposed rule to amend the affordable housing goals governing FHLB mortgage purchases through the Acquired Member Asset (AMA) programs. These programs-the Mortgage Purchase Program and the Mortgage Partnership Finance program-allow FHLBs to purchase 15- to 30-year conventional mortgages and loans insured or guaranteed by U.S. government agencies. In 2017, AMA purchases by the FHLBs totaled nearly $13 billion. The existing affordable housing goals cover various categories of purchases and only apply to FHLBs with purchases exceeding $2.5 billion per year. Measurement is based on retrospective evaluation of Home Mortgage Disclosure Act (HMDA) data. Under the proposed amendments, FHFA would remove the volume threshold and set a single, prospective affordable housing goal of 20 percent of each FHLB's total purchases. FHFA would also set a goal for participation by smaller institutions.

Comments will be due to FHFA on January 31, 2019.

MBA President and CEO Bob Broeksmit Blog Post on Supporting mPower
This week, MBA President and CEO Bob Broeksmit penned a blog post on the importance of MBA's mPower initiative. mPower, which stands for MBA Promoting Opportunities for Women to Extend their Reach, was founded by MBA COO Marcia M. Davies two years ago. It has grown into a platform for over 6,000 real estate professionals to strengthen their networks, conduct business, and achieve personal growth through an engaging online community, videos, webinars and live events.

FHFA Updates Progress on Fannie Mae and Freddie Mac Credit Risk Transfer Programs
Following its regular practice of reporting on the enterprises' efforts to reduce taxpayer exposure to mortgage credit risk, FHFA has published its latest Credit Risk Transfer Progress Report. The update notes that the enterprises combined to transfer risk on $367 billion of single-family UPB, with a total risk in force of $12 billion, in the first half of 2018. These figures put the enterprises on pace to exceed their previous annual records of risk transfer ($689 billion of single-family UPB) and risk in force ($21 billion), which were set in 2017. Debt issuances such as STACR and Connecticut Avenue Securities, which represent the most common form of credit risk transfer, accounted for 61 percent of single-family risk in force in the first half of 2018, while reinsurance transactions accounted for another 30 percent.

MBA has continued to advocate for increased volume and varying structures of credit risk transfer to be undertaken by the enterprises. These transactions better protect taxpayers while the enterprises are in conservatorship, provide opportunities for private capital to invest in mortgage finance, and should help facilitate the eventual transition to a fully reformed secondary market.

Federal Reserve Board Issues Proposed Revisions to Bank Regulatory Regime
The Federal Reserve Board (FRB) issued an interagency plan and a proposal revising its prudential capital and liquidity regulatory standards for banking organizations. The proposal is intended to tailor the rules based on size and supplementary metrics. It significantly reduces the burden of stress testing and liquidity requirements for regional banks. A separate announcement focusing only on the Basel MSR rules is expected soon from all three banking agencies.

MBA Comments on Rural Housing Service Proposed Rule on Loss Claims, Loss Mitigation
MBA submitted comments to the Rural Housing Service (RHS) related to the agency's proposed rule to amend the loss-claim and loss-mitigation processes. MBA supports RHS's proposal to eliminate paper-based claims submissions; revise the definition of settlement date for deeds-in-lieu to the date title is recorded; and clarify that lenders must adhere to other applicable federal, state, and local laws in addition to compliance with agency guidance. Concerns with the proposed loss-claim process arise from a lack of transparency regarding the valuation process and occupancy status at the time of title acquisition. MBA also voiced support for most of the proposed changes to loss-mitigation servicing, but raised concerns that providing increased flexibility to servicers when requiring Trial Payment Plans from borrowers may negatively impact a lender's ability to buy the loans out of Ginnie Mae pools. MBA suggests the Rural Housing Service consult with Ginnie Mae to clarify guidance on this issue and provide more transparency into the valuation model it intends to use prior to finalizing the rule.

MBA Urges FCC to Adopt Appropriate Definition of ATDS
MBA responded to the Federal Communication Commission's (FCC) request for further comment on the appropriate understanding of "automated telephone dialing system" (ATDS) under the Telephone Consumer Protection Act (TCPA) in light of the Ninth Circuit's recent decision in Marks v. Crunch San Diego, LLC. The FCC had sought comment earlier this year on TCPA issues after the D.C. Circuit set aside the FCC's 2015 Declaratory Ruling in ACA Int'l, et al. v. FCC, holding that FCC's ATDS definition was far too broad, as it captured nearly all possible phone systems. In Marks, the Ninth Circuit increased the confusion by effectively reclassifying any phone with the capacity to store numbers, such as a smartphone, as potential ATDS devices. MBA's letter spoke specifically to the statutory language, urging that the FCC adopt an appropriately limited definition of ATDS in light of the statute's unambiguous language. The comment letter follows MBA's previous comment letter on the broader regulatory issues surrounding the TCPA, as well as our petition for declaratory ruling seeking a clearer definition of ATDS.