Housing industry groups call on HUD to withdraw disparate impact rule

Last week, several lenders and housing industry groups, including the National Association of REALTORS® (NAR) and Quicken Loans, called on HUD to withdraw its proposed rule to water down the disparate impact standard under the Fair Housing Act. In a letter to HUD Secretary Ben Carson, NAR President Vince Malta wrote, “While there is debate… as to whether additional clarity is needed with respect to disparate impact claims, there is broad consensus across the country that now is not the time to issue a regulation that could hinder further progress toward addressing ongoing systemic racism.” Politico reported on Tuesday that HUD is resisting these calls from lenders and industry groups, with Deputy HUD Secretary Brian Montgomery reaffirming the agency’s plans to issue a final rule on the disparate impact standard later this year in a letter to Bank of America Vice Chairman Anne Finucane.

House subcommittee holds hearing on protecting homeowners during the pandemic



On Thursday, the House Financial Services Subcommittee on Oversight and Investigations held a virtual oversight hearing on mortgage servicers’ implementation of the CARES Act. Among the witnesses who testified at the hearing were Donnell Williams, president of the National Association of Real Estate Brokers, and Ed DeMarco, president of the Housing Policy Council. In his opening remarks, Subcommittee Chairman Al Green (D-Texas) said that the largest 11 mortgage servicers approved over 2 million forbearance requests between March 27 and June 30, but that “often servicers fail to provide the borrowers with the 180-day forbearance that has been set in the CARES Act, and too often, borrowers were given but 90 days.” In his testimony, Williams said that the COVID-19 pandemic is disproportionately hurting Black homeowners, citing statistics showing that there is a 13% gap between Black and White homeowners receiving forbearance under the CARES Act. Williams called on Congress to take several steps, including allocating specific funds targeted to the preservation of Black homeownership and requiring the Federal Housing Administration (FHA) and mortgage servicers to notify borrowers of their rights to apply for forbearance.

HUD announces proposed streamlined single-family servicing policies



On Tuesday, the Department of Housing and Urban Development (HUD) announced that FHA published proposed revisions to its single-family servicing policies to reduce burdens on homeowners and mortgage servicers. The revisions include changing the standard servicing loss mitigation home retention waterfall, eliminating unnecessary and time-consuming borrower documentation requirements for Trial Payment Plans, and modifying servicing and operational policies like the allowable fee structures. “Our proposed policy changes will strengthen servicers’ ability to keep families experiencing financial challenges in their homes. They reduce the unnecessary barriers that often impede the delivery of timely borrower assistance,” said Acting Federal Housing Commissioner Len Wolfson in a statement.

FSOC announces review of secondary mortgage market

On Tuesday, the Financial Stability Oversight Council (FSOC) announced that it will begin an activities-based review of the secondary mortgage market. The review, which was announced at the FSOC’s Principals Meeting, will focus on the risk that various activities in the secondary mortgage market pose to the stability of the financial system as a whole and possible ways to mitigate that risk. The announcement comes after the FSOC said it would pivot to focus on activities rather than companies in December 2019. FHFA Director Mark Calabria issued a statement applauding the review, saying “As demonstrated by the 2008 financial crisis and again by COVID-19, Fannie Mae and Freddie Mac must be well capitalized in order to support the mortgage market during a stressed environment.”

House Appropriations Committee approves FY 2021 T-HUD funding bill



On Tuesday, the full House Appropriations Committee approved the FY 2021 funding bill for Transportation, Housing and Urban Development (T-HUD), following its approval by the House Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies last week. Overall, the bill allocates $50.6 billion for HUD, a $13.3 billion increase over President Trump’s FY 2021 budget request for the agency and a $1.5 billion increase over HUD’s FY 2020 enacted levels. Appropriations Committee Ranking Member Kay Grander (R-Texas) raised several objections to the T-HUD spending bill during the full committee markup, including the $75 billion in new emergency spending, which Granger argued reflected a lack of bipartisan input into the bill.

CFPB releases COVID-19 consumer complaint data

On Thursday, the CFPB issued an updated Complaint Bulletin with information about the over 8,000 consumer complaints it received from January through May 2020 that specifically mention COVID-19 or related terms. According to the CFPB’s analysis, mortgage, credit card and credit reporting complaints were the most common type of consumer complaints filed during this time period. In over half of the mortgage complaints identified by the CFPB, consumers identified struggling to pay the mortgage as the issue. The public can view the complaints by state and key word at the Consumer Complaint Database.