December 4, 2019

In This Issue:

  • As Experienced Texas Congressmen Retire, Will the State's Sway in Congress Decline?
  • HUD Looks to Eliminate Regulatory Barriers to Affordable Housing
  • FHA Increases Rehab Loan Limits for Opportunity Zones
  • CFPB Fall 2019 Agenda Released: Loan Originator Compensation Rule Changes, GSE Patch, PACE, and More
  • Meet the Man Loosening Bank Regulation, One Detail at a Time
  • ALTA Registry Grows to More than 8,000 Listings; Get Your Free Listing Today

As Experienced Texas Congressmen Retire, Will the State's Sway in Congress Decline?

Texas Tribune | Nov. 27, 2019
U.S. Rep. Kay Granger, R-Fort Worth, was in Congress for over a decade before she narrowly won a bid to become the top Republican on the powerful House Appropriations Committee last year.

That's about how long it takes to achieve a position like that, especially on the committee that decides government spending. Her placement there was a big win for Texas Republicans in the House, giving one of their own a considerable amount of clout.

But the number of Texans in Congress with Granger's experience has been shrinking dramatically in recent years. This year, six of Granger's GOP colleagues from Texas, including five who would have had at least a decade of experience if they'd remained in their seats past the next election, announced retirement plans — a run for the exits that Democrats termed the "Texodus."

House members often come and go, leaving room for new leaders to represent the interests of millions of Texans. In recent years, however, the turnover has been high. That, combined with Democrats taking control of the House, has diminished the overall influence Texans carry in Congress.

“Regardless of who in the party is in control, the fact that these members are leaving, obviously that weakens the influence of the delegation,” said Richard Cohen, chief author of The Almanac of American Politics, adding that the delegation "has been known to carry its weight."
 
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HUD Looks to Eliminate Regulatory Barriers to Affordable Housing

HousingWire | Nov. 27, 2019
The Department of Housing and Urban Development published a request for information to dig into how regulations could be creating barriers to affordable housing.

The RFI is seeking public comment on federal, state, local and tribal laws, regulations, land use requirements and administrative practices that raise the cost of affordable housing and contribute to housing shortages.

“Owning a home is an essential component of the American Dream,” HUD Secretary Ben Carson said. “It is imperative that we remove regulatory barriers that prevent that dream from becoming a reality.”

“Through this request, communities across the country will have the opportunity to identify roadblocks to affordable housing and work with state, federal, and local leaders to remove them,” Carson continued.

Earlier this year, President Donald Trump signed Executive Order 13878, “Establishing a White House Council on Eliminating Regulatory Barriers to Affordable Housing,” saying that, for many Americans, the supply of available housing has not kept pace with the demand for housing by prospective renters and homebuyers, driving up housing costs.
 
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FHA Increases Rehab Loan Limits for Opportunity Zones

Realtor Magazine | Nov. 26, 2019
The Department of Housing and Urban Development is increasing the amount of money that borrowers can roll into a Federal Housing Administration loan when paying for rehabbing homes located in opportunity zones.

The FHA is allowing the extra funds through its Limited 203(k) Rehabilitation Mortgage Insurance Program for homes located in opportunity zones starting on Dec. 16.

Buyers who purchase a home in a qualified opportunity zone can use the Limited 203(k) program to finance rehabilitation costs up to $50,000 into the total mortgage amount. That is an increase of $15,000 over the maximum amount of $35,000 allowed through the program on single-family homes that are not located in opportunity zones.
 
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CFPB Fall 2019 Agenda Released: Loan Originator Compensation Rule Changes, GSE Patch, PACE, and More

ALTA | Dec. 2, 2019
Just before the holiday, the Consumer Financial Protection Bureau released its Fall 2019 Agenda. Under the Regulatory Flexibility Act, agencies are required to publish an agenda of rulemaking actions that the agency expects to take in the upcoming six months, including pre-rule, proposed rule, final rule, long-term and completed actions.

This is the second rulemaking agenda under CFPB Director Kathy Kraninger. The agenda identifies the matters that the Bureau "reasonably anticipates having under consideration during the period from Oct. 1, 2019, to Sept. 30, 2020."

One of the newest items on its long-term rulemaking list is the review of the loan originator compensation rule. The CFPB plans to examine whether it should (1) permit adjustments to a loan originator's compensation in connection with originating state housing finance authority loans to facilitate the origination of such loans, and (2) permit creditors to decrease an originator's compensation due to the originator's error.

The CFPB also will tackle the so-called GSE patch. This is a provision in the ability to repay/qualified mortgage rule that provides QM status to any loan eligible for sale to Fannie Mae and Freddie Mac. The provision heavily relies on lenders because the GSEs' rules are built into basic underwriting software and systems. 

The GSE patch provision is set to expire in January 2021. In July 2019, the CFPB issued an Advance Notice of Proposed Rulemaking to gather ideas for rule amendments to address the scheduled expiration of the GSE patch.

Another item of interest on the agenda is rulemaking on Property Assessed Clean Energy (PACE) financing. Section 307 of the Economic Growth, Regulatory Relief and Consumer Protection Act (EGRRCPA) required the CFPB to draft rules to apply the Truth in Lending Act (TILA) to PACE financing. The agenda estimates that pre-rule activity will occur in December 2019 to address.
 
If you have any questions, please contact Steve Gottheim at [email protected].

Meet the Man Loosening Bank Regulation, One Detail at a Time

New York Times | Nov. 29, 2019
In his first 21 months on the job, Randal K. Quarles, the Federal Reserve’s vice chairman for supervision and regulation, met at least 22 times with partners at his former law firm, Davis Polk & Wardwell, which represents many of the nation’s largest banks.

Those meetings, disclosed in public schedules and other releases, suggest a closeness between America’s most important bank regulator and the industry he watches over. Mr. Quarles was a bank lawyer at Davis Polk in the 1980s and ’90s. At the Fed, he has conferred with former colleagues there, including Randall Guynn, a close friend. They at least occasionally came alongside officials of banks they represent, including Goldman Sachs, and trade groups including the Securities Industry and Financial Markets Association.
 
But the gatherings also suggest Mr. Quarles is meticulously completing the job President Trump nominated him to do. He is perhaps the most central player as regulators reassess bank rules put into place quickly, and often bluntly, in response to the 2008 financial crisis. Lawyers at Davis Polk, which has built a reputation as a top financial services practice, know how the rules are working and what the banks find problematic.

That tension underlines a key challenge of financial regulation in 2019. Most current and former regulators agree that post-crisis rules could be improved. Banks’ input can help policymakers determine which adjustments will enable more lending without encouraging excessive risk-taking. But catering to their interests too intently risks reigniting vulnerabilities in a financial system with a record of sinking the entire United States economy.
 
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ALTA Registry Grows to More than 8,000 Listings; Get Your Free Listing Today

ALTA | Dec. 3, 2019
The national ALTA Title & Settlement Agent Registry is a searchable, online database containing title insurance underwriter-confirmed information about title agents, underwriter direct offices and real estate attorneys. It assigns a unique identification number—the ALTA ID—to each one for precise credentials. This allows lenders to know they are working with the correct company.
 

 
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Joining ALTA's Registry is simple: [email protected] or call us 855.618.2582

 

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