MBA offers proposal for uniform national regulation of mortgage lending.
The MBA's proposed legislation is being called the Mortgage Improvement and Regulation Act. The new regulator--the Federal Mortgage Regulatory Agency (FMRA)--would be responsible for implementing and updating new mortgage lending and servicing standards as well as regulating independent mortgage bankers and brokers in partnership with state regulators.
MBA's proposal would include the following as part of the new national lending standards: 1) many of the components contained in new Home Ownership and Equity Protection Act (HOEPA) regulations (including a requirement for documentation of income/assets, limits on prepayment penalties and determining a borrower's ability to repay); 2) improvements to origination, servicing and appraisal practices (some of which were contained in H.R. 3915, which passed the House in 2007); 3) a new duty of care for mortgage bankers and mortgage brokers to ensure consumers get the key facts they need about available loan options and costs (including broker compensation); and 4) a requirement for borrowers to affirmatively opt-in, in writing, to acceptance of a non-traditional mortgage product.
Two days after MBA sent its letter to the two banking committee chairmen, a bill (H.R. 1728) was introduced in the House by Rep. Brad Miller (D-North Carolina); Rep. Mel Watt (D-North Carolina); and Rep. Barney Frank (D-Massachusetts), the House Banking Committee chairman. The legislation is called the Mortgage Reform and Anti-Predatory Lending Act of 2009. A press release announcing the legislation stated, "The bill is a tougher version of a measure that Rep. Miller sponsored in the previous Congress that would have overhauled mortgage regulations in an effort to prevent another subprime mortgage meltdown. Rep. Miller's previous bill passed the House in 2007 with bipartisan support, but was never considered in the Senate."
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|Title Annotation:||Briefing Book; Mortgage Bankers Association|
|Comment:||MBA offers proposal for uniform national regulation of mortgage lending.(Briefing Book)(Mortgage Bankers Association)|
|Date:||May 1, 2009|
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