Top 3 Things to Know from Washington
1. MBA President and CEO Bob Broeksmit Testifies on Capitol Hill on Basel III Bank Capital Proposal
MBA President and CEO Bob Broeksmit, CMB, testified before the House Financial Services Committee’s (HFSC) Subcommittee on Financial Institutions and Monetary Policy on Thursday, September 14, to highlight real estate finance industry concerns with the banking agencies’ proposed changes to bank capital requirements. The so-called “end game” proposed rules complete U.S. regulators’ implementation of the Basel III standards and ostensibly make changes in response to the recent large bank failures. A summary of the hearing can be found here, and a video recording can be found here. Click here for MBA’s written testimony.
By appearing on MBA’s behalf, Bob was able to address (and answer questions from) a bipartisan House group to reinforce our industry’s opposition to certain provisions of the proposal that would undermine mortgage credit availability, highlighting for them how the proposed rule would affect both the single-family housing and commercial real estate finance markets.
The testimony also outlined how the proposal would undermine certain specific key policy objectives, including efforts to close the racial homeownership and wealth gaps, the provision of affordable housing (both ownership and rental), the promotion of competition over consolidation, and the upcoming unveiling of a final Community Reinvestment Act rule.
Comments on the Basel III proposal are due by November 30, 2023, with July 1, 2025, as the start of a three-year transition period provided for the final rule. MBA created a summary of the proposed rule and will work with members and other industry stakeholders to formulate our response, focusing on the numerous negative impacts these proposed rules would have on the housing finance ecosystem.
2. MBA-supported “Trigger Leads” Effort (H.R. 4198) Continues (Top RESBOG Priority)
MBA continues to seek additional House cosponsors for H.R. 4198, the Protecting Consumers from Abusive Mortgage Leads Act, our industry’s preferred approach to eliminate abusive mortgage credit “trigger leads” – while simultaneously continuing to push for the introduction of a bipartisan Senate companion bill. As previously reported, Rep. John Rose (R-TN) introduced this important legislation in June in an effort to curtail abusive trigger leads while preserving their use in appropriately limited circumstances – such as communicating with existing customers.
The Rose bill – a top MBA Residential Board of Governors (RESBOG) priority – is a separate and distinct proposal that differs from H.R. 2656, as introduced by Rep. Ritchie Torres (D-NY) in April, which would issue a blanket ban on trigger leads. H.R. 4198 would allow for prescreen reports (trigger leads) to be permissible under the Fair Credit Reporting Act in limited circumstances during a real estate transaction. A consumer reporting agency would not be allowed to furnish a trigger lead to a third party unless that third party certifies having a consumer’s consent or a current relationship with the consumer.
3. Senate Panel Hold Important Hearing on Insurance Challenges
On September 7, the Senate Banking, Housing, and Urban Affairs Committee held a hearing entitled, “Perspectives on Challenges in the Property Insurance Market and the Impact on Consumers.” A summary of the hearing can be found here. MBA submitted a letter/statement for the record ahead of the hearing on top industry priorities, including the need to reauthorize the NFIP (set to expire on September 30, 2023) and addressing the rising costs and declining availability of private property insurance coverage. We have continued to collaborate with members of Congress on both sides of the aisle to stress the critical need to develop workable state and local solutions to the current insurance crisis.
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