assets, simplify capital calculations for community banks, provide relief from appraisal requirements for smaller
mortgages, institute longer exam cycles for community banks and provide charter flexibility for federal thrifts with
less than $15 billion in assets.
Nichols reiterated ABA’s longstanding opposition to arbitrary asset thresholds as a supervisory tool but said that
“the proposal to lift the threshold for designated systemically important institutions will at least spare more banks
from regulatory requirements that made little sense for institutions of their size. . . . ABA will continue to make the
case that tailoring regulation based on a bank’s risk profile and business model – as a growing number of
regulators support – is the best and most effective way to ensure banks are able to serve their communities while
protecting safety and soundness.” Read more. Read the bill.
HOUSE PASSES FIVE-YEAR FLOOD INSURANCE REAUTHORIZATION
In a bipartisan 237-189 vote on November 14, the House passed H.R. 2874, which would reauthorize the
National Flood Insurance Program for up to five years. In addition to extending the NFIP before it expires next
month – and thus providing greater certainty to lenders and borrowers – the legislation also includes updates to
interagency guidance and mandatory staffing that will facilitate compliance.
ABA's Rob Nichols applauded the vote. “We strongly support a long-term reauthorization of the NFIP, and
believe this bill makes appropriate and necessary reforms to address the program’s sustainability, affordability
and availability,” he said. “The five-year reauthorization included in the legislation will ensure that the program is
reliably available for borrowers seeking to purchase homes in special flood hazard areas where purchase of flood
insurance is mandatory.”
HOUSE COMMITTEE PASSES ABA-ADVOCATED BILLS
The House Financial Services Committee has approved several regulatory relief bills advocated by ABA. Almost
all were approved with bipartisan majorities. H.R. 3299 – a bill codifying the “valid-when-made” doctrine, which
ensures validly made loans remain valid when they are sold or assigned but which has come under question in
the courts – cleared on a 42-17 vote.
The committee approved a number of mortgage-related bills, including H.R. 1153, which would clarify the
Qualified Mortgage points and fees test (46-13 vote); H.R. 3978, which would allow the accurate disclosure of
title insurance premiums and potential discounts under the TILA-RESPA integrated disclosures (53-5 vote); and
H.R. 3221, which would eliminate appraisal requirements for certain portfolio loans (32-26 vote). Read ABA's
memo on the bills.
ABA SUPPORTS BILL TO FIX TRID
ABA on October 24 joined several financial and housing trade associations in a letter to House members urging
support for the TRID Improvement Act of 2017 (H.R. 3978), a bipartisan bill introduced by Rep. French Hill (
R-AR) and Rep. Ruben Kihuen (D-NV).
The bill would amend the Real Estate Settlement Procedures Act to require the CFPB to allow the accurate
disclosure of title insurance premiums and any potential available discounts to homebuyers. The associations
noted that the CFPB does not currently permit these disclosures, which creates inconsistencies in mortgage
documents and creates confusion for consumers. Read the letter.