Over the objections of consumer groups and liberal Democrats, legislation to provide regulatory relief to home lenders has made its way through the Senate.
By a vote of 67 to 31, S. 2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act, has been passed by the Senate.
The proposed law
would roll back or reduce some of the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
The bill, sponsored by Senate Banking Chairman Crapo (R-Idaho), was co-sponsored by four moderate Democrats.
Among the opponents of the bill was Dodd-Frank architect Sen. Elizabeth Warren (D-Massachusetts), who has said it puts consumers at greater risk because it also loosens rules on larger financial institutions.
The National Association for the Advancement of Colored People warned about the potential elimination of a Home Mortgage Disclosure Act anti-mortgage discrimination tool.
Others are concerned
about the prohibition of lawsuits against the nation’s three credit bureaus.
Sen. Sherrod Brown (D-Ohio) complained in a written statement that by its passage of the legislation, the Senate is siding
with special interests and Wall Street instead of borrowers.
“We missed an opportunity to pass meaningful bipartisan legislation that would help community banks and provide real protections for consumers,” Brown said in the statement. “Instead, we rolled back accountability measures for some of the biggest domestic and foreign banks at the expense of taxpayers.”
But there are plenty of parties who are happy with the vote.
Among them are former Obama administration official and Mortgage Bankers Association President and Chief Executive Officer David H. Stevens.
“This bill will further ensure consumer protections and adequate access to mortgage credit,” Stevens said.
He highlighted SAFE Act amendments that would provide loan originators with 120 days of transitional authority to originate while moving from a federal depository to a non-bank
or from one state to another.
Stevens also noted fixes to integrated disclosures required under the Truth in Lending Act and Real Estate Settlement Procedures Act.
He said another benefit to the bill is applying TILA requirements to Property Assessed Clean Lending — or PACE — loans.
“MBA now calls on the House to swiftly take up this bill for consideration,” Stevens said.
Other groups to praise passage of the bill were
the National Association of Home Builders and the National Association of Federally-Insured Credit Unions.
Even the Conference of of State Bank Supervisors issued a statement applauding the bill’s passage. The group says the legislation would
encourage community banks to lend more to prospective homebuyers and provide appraisal relief to rural borrowers.
“State regulators are charged with supporting local economic growth throughout their states, and the best way to do that is through a vibrant community banking sector,” CSBS CEO John Ryan said in a statement.
