A key House subcommittee examined the CFPB's "Know Before You Owe" effort to combine RESPA and TILA disclosures, with MBA's Bill Cosgrove, CMB, testifying on behalf of the association. The Senate meanwhile completed work on the Farm Bill, adopting an MBA-backed amendment to grandfather in rural communities benefiting from USDA's housing programs and will now turn its attention to a five-year reauthorization of the National Flood Insurance Program.

In this Issue:

Bill Cosgrove, CMB, Testifies Before the House Subcommittee on Behalf of MBA

On Wednesday, June 20, 2012, MBA board member Bill Cosgrove, CMB, President and CEO of Union National Mortgage Company, testified before the House Financial Services Subcommittee on Insurance, Housing, and Community Opportunity in a hearing entitled "Mortgage Disclosures: How Do We Cut Red Tape for Consumers and Small Businesses?" Cosgrove articulated support for the Consumer Financial Protection Bureau's "Know Before You Owe" initiative but included these constructive considerations:

• First and foremost, MBA believes this effort must be done right and not in haste. 
• Second, while these forms have benefited from multiple rounds of feedback from the public, more work needs to be done to ensure they are as useful as possible to consumers.
• Third, the forms and rules resulting from this effort should not be finalized until the other Dodd-Frank rules impacting these forms are finalized and taken into account.
• Fourth, the rules accompanying the forms should be developed carefully so that they protect consumers without unwittingly harming the market and the borrowers they are intended to serve.
• And finally, when the forms and rules are finished, they should be implemented in an orderly manner that is respectful of the considerable commitment of resources small businesses like mine will need to ensure compliance.

For more information, please contact Ken Markison, (202)557-2930 or Len Wolfson, (202) 557-2712.

MBA Meets with FHFA and OCC on the Straw-Man Proposal

On Tuesday, June 19, 2012, MBA hosted a mortgage servicers and foreclosure law firms fly-in. Staff joined members to meet with the Federal Housing Finance Agency (FHFA) and the Office of the Comptroller of the Currency. The MBA working group presented a straw-man proposal that outlined a Third-Party Law Firm Review Program. The meeting was the result of the discussion last fall about developing a Single Uniform Audit Program to replace the individual servicer reviews of foreclosure law firms as required by the Consent Orders and regulatory directives.  The regulators, having reacted positively, will consider the straw-man proposal as they create the requirements for a third-party audit review. For more information, please contact Vicki Vidal, (202) 557-2861 or Sandra Troutman, (202) 557-2858.

MBA Meets With CFPB on Loan Officer Compensation Rule

On Thursday, June 21, 2012, MBA, along with other trade associations, met with the Bureau of Consumer Financial Protection (CFPB) staff to discuss the outline the CFPB provided of issues under consideration by the Bureau regarding the forthcoming Loan Originator (LO) compensation and qualification rule.   The rule is expected as soon as next month.  The ideas under consideration include a possible exemption to Dodd-Frank's restriction against compensation to a LO and the consumer also paying discount points and origination fees to the company. The exemption suggested would allow consumers to pay: (1) "bona fide" discount points that actually lower the rate; and (2) origination fees that are flat and do not vary with loan amount. MBA objected to the flat fee proposal as unfair to lower wealth borrowers and indicated that the forthcoming RESPA-TILA integration effort was the best place to address the CFPB's concern that borrowers may be confusing discount points and origination charges. For more information, please contact Ken Markison, (202)557-2930.

MBA Meets with OMB on Disparate Impact

On Tuesday, June 19, 2012, MBA and other trade associations met with staff of the Office of Management and Budget's regulatory review office (OIRA) to express serious reservations with HUD's pending Fair Housing Rule amendments, which include disparate impact provisions.  Staff expressed the view that the rule's legal foundation was questionable, the proposed burden of proof contrary to Supreme Court precedent, and that the potential impact of this rule would be harmful given pending government requirements such as the coming QM or QRM rules.  For further questions, please contact Ken Markison, (202) 557-2930 or Justin Wiseman,(202) 557-2854.

MBA Holds Educational Webinar on Filing SARs for Nonbanks 

On Tuesday, June 19, 2012, MBA held a successful webinar through CampusMBA to educate nonbank single-family mortgage lenders on Suspicious Activity Reports (SARs), a new requirement from the Financial Crimes Enforcement Network (FinCEN) under the Bank Secrecy Act (BSA).  Legal experts from Buckley Sandler LLP presented on the rule, helping participants prepare for the upcoming August 13, 2012, compliance deadline. For more information, please contact Andrew Szalay, AMP, (202) 557-2941.

Industry Developments:

House Appropriations Committee Marks Up HUD Budget

On Tuesday, June 19, 2012, the House Appropriations Committee marked up the fiscal year 2013 budget for the Department of Housing and Urban Development (HUD). Prior to the mark-up, MBA submitted a letter to the committee supporting funding for FHA and Ginnie Mae staffing and technology, an increase in funding for housing and homeownership counseling, and support for FHA's multifamily programs. MBA also noted its concerns about the proposed increase in mortgage insurance premiums for multifamily programs. For more information, please contact Len Wolfson , (202) 557-2712.

Congressional Hearings:

June:

        26 

Senate Banking Committee: Empowering and Protecting Service members, Veterans and their Families in the Consumer Financial Marketplace: A Status Update

28

House Committee on Financial Services: Appraisal Oversight: The Regulatory Impact on Consumers and Businesses

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