“Regulatory Relief” for Banking: Selected
Legislation in the 114th Congress
Sean M. Hoskins, Coordinator
Analyst in Financial Economics
Marc Labonte
Specialist in Macroeconomic Policy
Edward V. Murphy
Specialist in Financial Economics
Gary Shorter
Specialist in Financial Economics
May 14, 2015
Congressional Research Service
7-5700
www.crs.gov
R44035
“Regulatory Relief” for Banking: Selected Legislation in the 114th Congress
Summary
The 114th Congress is considering legislation to provide “regulatory relief” for banks. The need
for this relief, some argue, results from new regulations introduced in response to vulnerabilities
that were identified during the financial crisis that began in 2007. Some have contended that the
increased regulatory burden is resulting in significant costs that restrain economic growth and
consumers’ access to credit. Regulatory burden is the cost associated with government regulation
and its implementation. Others, however, believe the current regulatory structure strengthens
financial stability and increases protections for consumers, and they are concerned that regulatory
relief for banks could negatively affect consumers and market stability. Regulatory relief
proposals, therefore, may involve a trade-off between reducing costs associated with regulatory
burden and reducing benefits of regulation.
The bills analyzed in this report propose to provide regulatory relief to banks in a number of
different ways. Title VIII of H.R. 37 would extend the phase-in period for a provision of the
Volcker Rule. Title III of H.R. 37 would expand exemptions on capital issuance to include thrifts.
Similarly, H.R. 650, H.R. 1259, and H.R. 1529 would expand exemptions from mortgage
regulations. H.R. 601 would limit the circumstances under which reporting requirements about
privacy notices are triggered. H.R. 685 would change the definition of points and fees associated
with a mortgage to exclude certain costs from a regulatory requirement. H.R. 1408 would delay
the implementation of new capital requirements until regulators conduct a study of their impact
on mortgage servicing assets (MSAs).
Banking regulation has various policy goals, and the bills under consideration span multiple
policy areas. H.R. 601, H.R. 650, H.R. 685, H.R. 1259, and H.R. 1529 are examples of bills that
address a trade-off between reducing the regulatory burden of banks and reducing consumer
protection. H.R. 1408 and Title VIII of H.R. 37 are examples of legislation that attempt to
reconcile a trade-off between safety and soundness and regulatory burden. Title III of H.R. 37 is
an example of legislation with a trade-off between investor protection and the regulatory burden
on thrifts. Some of these proposals modify new regulations, wheras others modify regulations that
predate the crisis.
Several of the bills mentioned above would modify regulations issued by the Consumer Financial
Protection Bureau (CFPB), a regulator created by the Dodd-Frank Act (P.L. 111-203) to provide
an increased regulatory emphasis on consumer protection. The Dodd-Frank Act gave the CFPB
new authority and transferred existing authorities to it from the banking regulators. These bills
could be viewed in light of a broader policy debate about whether the CFPB has struck the
appropriate balance between consumer protection and regulatory burden and whether
congressional action is needed to achieve a more desirable balance.
This report discusses regulatory relief legislation for banks in the 114th Congress that, at the time
this report was published, has seen floor action or has been ordered to be reported by a
committee. If Congress acts on additional legislation, the report will be updated to include it.
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“Regulatory Relief” for Banking: Selected Legislation in the 114th Congress
Contents
Introduction ...................................................................................................................................... 1
Types of Regulatory Relief Proposals ....................................................................................... 2
H.R. 37: Promoting Job Creation and Reducing Small Business Burdens Act ............................... 3
Title III: Holding Company Registration Threshold Equalization Act ...................................... 3
Title VIII: Restoring Proven Financing for American Employers Act ...................................... 5
H.R. 601: Eliminate Privacy Notice Confusion Act ........................................................................ 6
H.R. 650: Preserving Access to Manufactured Housing Act of 2015 .............................................. 7
H.R. 685: Mortgage Choice Act of 2015 ....................................................................................... 11
H.R. 1259: Helping Expand Lending Practices in Rural Communities Act .................................. 15
H.R. 1408: Mortgage Servicing Asset Capital Requirements Act of 2015 .................................... 17
H.R. 1529: Community Institution Mortgage Relief Act of 2015 ................................................. 19
Contacts
Author Contact Information........................................................................................................... 24
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“Regulatory Relief” for Banking: Selected Legislation in the 114th Congress
Introduction
The 114th Congress is considering legislation to provide “regulatory relief” for banks.1 The need
for such relief, some argue, results from the increased regulation that was applied in response to
vulnerabilities that became evident during the financial crisis that began in 2007. In the aftermath
of the crisis, the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act;
P.L. 111-203), a wide-ranging package of regulatory reform legislation, was enacted.2 As financial
regulators have implemented the Dodd-Frank Act and other reforms, some in Congress claim that
the pendulum has swung too far toward excessive regulation. They argue that the additional
regulation has resulted in significant costs that have stymied economic growth and restricted
consumers’ access to credit. Others, however, believe the current regulatory structure has
strengthened financial stability and increased protections for consumers. They are concerned that
regulatory relief for banks could negatively affect consumers and market stability.
In assessing whether regulatory relief is called for or whether a regulation has not gone far
enough, a central question is whether an appropriate trade-off has been struck between the
benefits and costs of regulation. The different objectives and potential benefits of financial
regulation include enhancing the safety and soundness of certain institutions; protecting
consumers and investors from fraud, manipulation, and discrimination; and promoting financial
stability while reducing systemic risk. The costs associated with government regulation are
referred to as regulatory burden.3 The presence of regulatory burden does not necessarily mean
that a regulation is undesirable or should be repealed. A regulation can have benefits that could
outweigh its costs, but the presence of costs means, tautologically, that there is regulatory burden.
Regulatory requirements often are imposed on the providers of financial services, so banks
frequently are the focus of discussions about regulatory burden. But some costs of regulation are
passed on to consumers, so consumers also may benefit from relief. Any benefits to banks or
consumers of regulatory relief, however, would need to be balanced against a potential reduction
to consumer protection and to the other benefits of regulation.
The concept of regulatory burden can be contrasted with the phrase unduly burdensome. Whereas
regulatory burden is about the costs associated with a regulation, unduly burdensome refers to the
balance between benefits and costs. For example, some would consider a regulation to be unduly
burdensome if costs were in excess of benefits or the same benefits could be achieved at a lower
cost. But the mere presence of regulatory burden does not mean that a regulation is unduly
burdensome. Policymakers advocating for regulatory relief argue that the regulatory burden
associated with certain regulations rises to the level of being unduly burdensome for banks,
whereas critics of those relief proposals typically believe the benefits of regulation outweigh the
regulatory burden.
1 For a summary of the regulatory relief debate, see CRS Report IF10162, Introduction to Financial Services:
“Regulatory Relief,” by Sean M. Hoskins and Marc Labonte.
2 For a summary, see CRS Report R41350, The Dodd-Frank Wall Street Reform and Consumer Protection Act:
Background and Summary, coordinated by Baird Webel.
3 For an analysis of the regulatory burden on small banks, see CRS Report R43999, An Analysis of the Regulatory
Burden on Small Banks, by Sean M. Hoskins and Marc Labonte.
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Types of Regulatory Relief Proposals
As relief proposals for banks are debated, a useful framework to categorize proposals includes
assessing to whom relief would be provided and how relief would be provided. Relief could be
provided either to all banks to which a regulation applies or to only a subset of banks based on
size, type, or the activities the banks perform. Policymakers also would need to consider whether
relief should be provided, for example, by repealing entire provisions, by providing exemptions
from specific requirements, or by tailoring a requirement so that it still applies to certain entities
but does so in a less burdensome way. Examples of different forms of tailoring are streamlining
the regulation, grandfathering existing firms or types of instruments from the regulation, and
phasing in a new regulation over time.
Some regulatory relief policies can be characterized as forward-looking—focusing on how to
modify the rulemaking process to reduce the burden associated with future rulemakings, such as
strengthening existing cost-benefit analysis requirements on financial regulators to bring them in
to line with executive agency standards. Alternatively, regulatory relief can be backward-
looking—modifying existing regulations. Modifications can be made to regulations stemming
from statutory requirements, regulatory or judicial interpretations of statute, or requirements
originating from regulators’ broad discretionary powers.
This report assesses backward-looking banking regulatory relief proposals that have been marked
up by committee or have seen floor action in the 114th Congress. Because banks are involved in
many different activities, this report does not address all regulatory relief proposals that would
affect each aspect of a bank’s business (e.g., it does not cover proposals affecting banks’
involvement in areas such as derivatives) but focuses on those proposals that address the
traditional areas of banking, such as taking deposits and offering loans.4 The proposals discussed
in this report vary with regard to the type of relief, including to whom relief would be provided
and the manner in which it would be provided. Although many of the proposals would modify
regulations issued after the crisis, some would adjust policies that predated the financial crisis and
some proposals are characterized as technical fixes. Further, the report does not cover banking
legislation that has seen legislative action but does not involve regulatory relief. For each
proposal, the report explains what the bill would do and the main arguments offered by its
supporters and opponents.
4 Some bills would modify a regulation that applies to banks and nonbanks engaged in a specific activity.
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H.R. 37: Promoting Job Creation and Reducing
Small Business Burdens Act
H.R. 37 passed the House on January 14, 2015. It contained 11 titles covering a variety of
financial services issues. This report reviews two titles that apply to banks.
Title III: Holding Company Registration Threshold
Equalization Act5
Title III of H.R. 37 would raise the exemption threshold on the Securities and Exchange
Commission’s (SEC’s) registration for thrift holding companies to match the current exemptions
for bank holding companies (BHCs).
Historically, under the Securities Act of 1933 (P.L. 73-22), banks and BHCs, similar to
nonfinancial firms, generally were required to register securities with the SEC if they had total
assets exceeding $10 million and the shares were held (as per shareholders of record) by 500
shareholders or more. Banks and BHCs also were allowed to stop registering securities with the
SEC, a process known as deregistration, if the number of their shareholders of record fell to 300
shareholders or fewer.
Title VI of the Jumpstart Our Business Startups Act (JOBS Act; P.L. 112-106) raised the SEC
shareholder registration threshold from 500 shareholders to 2,000 shareholders and increased the
upper limit for deregistration from 300 shareholders to 1,200 shareholders for those banks and
nonfinancial firms. In other words, the JOBS Act made it easier for banks and BHCs to increase
the number of their shareholders while remaining unregistered private banks and, if already
registered, to voluntarily deregister while also adding more shareholders.6 The provision went
into effect immediately upon the enactment of the JOBS Act on April 5, 2012.
These changes made by the JOBS Act did not apply to savings and loan holding companies
(SLHCs). Title III of H.R. 37 would amend the Securities Exchange Act of 1934 by extending the
higher registration and deregistration shareholder thresholds in the JOBS Act for banks and BHCs
to SLHCs.7 Savings and loans (also known as thrifts and savings banks) are similar to banks in
that they take deposits and make loans, but their regulation is somewhat different. Over time, the
differences between banks and savings and loans have narrowed.8 Under the provision, an SLHC
would be required to register with the SEC if its assets exceed $10 million and it has 2,000
shareholders of record, up from the current requirement of 500 shareholders of record. SLHCs
5 This section was authored by Gary Shorter, specialist in Financial Economics.
6 This section largely derives from: Katherine Koops, “The JOBS Act and SEC Deregistration: New Thresholds and
Special Considerations for Banks and Bank Holding Companies,” Bank Bryan Cave Law Firm, June 8, 2012, at
http://www.bankbryancave.com/2012/06/the-jobs-act-and-sec-deregistration-new-thresholds-and-special-
considerations-for-banks-and-bank-holding-companies/.
7 Similar language was included in H.R. 801 in the 113th Congress. H.R. 801 passed the House on January 14, 2014.
8 See CRS Report R42572, The Consumer Financial Protection Bureau (CFPB): A Legal Analysis, by David H.
Carpenter.
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that want to deregister from the SEC would have to have no more than 1,200 shareholders of
record, an increase over the current 300 or fewer shareholders.
Policy Discussion. Generally speaking, the central perceived benefit of SEC registration is to
enhance investor protection by ensuring that investors have access to significant financial and
nonfinancial data about firms and the securities they issue. The cost of SEC registration is the
regulatory burden on the firm issuing securities associated with complying with SEC
requirements, which potentially raises the cost of capital and reduces how much capital a firm can
raise. For small firms, the regulatory burden of registration is thought to be greater than for larger
firms.9
Policymakers attempt to reach the optimal trade-off between costs and benefits of SEC
registration by exempting firms below a certain size from registration requirements. The JOBS
Act raised this threshold for banks, modifying the balance between costs and benefits.
Reports indicate that after passage of the JOBS Act, a number of privately held banks and BHCs
took advantage of Title VI’s reduction in shareholder ownership registration triggers by raising
capital from additional shareholders without having to register with the SEC.10 Some banks also
have taken the opportunity to deregister from the SEC.11 One of the few studies on changes to the
financial health of banks that took advantage of the JOBS Act threshold changes to deregister
found that the act was generally, but not entirely, financially beneficial to banks. For example, it
found that, on average, the legislation resulted in $1.31 in higher net bank income and $3.28
lower pretax expenses for every $1.00 of bank assets and was responsible for $1.54 million in
increased assets per bank employee.12 The study did not attempt to estimate the costs to investors
of reduced disclosure under the changes made by the JOBS Act.
In potentially expanding the exemption threshold on SEC registration for thrift holding
companies, there are two main points to consider. First, should exemption levels from SEC
registration requirements be different for thrifts and savings and loans than for banks? Current
law makes it more difficult for small thrifts to raise capital than for small banks. Second, are the
costs and benefits of registration requirements for small banks better balanced at the higher
thresholds enacted for banks in the JOBS Act or the lower thresholds in current law for thrifts?
9 See Independent Community Bankers of America (ICBA), “ICBA Statement on Senate Passage of JOBS Act,” press
release, March 22, 2012, at http://www.icba.org/news/newsreleasedetail.cfm?ItemNumber=123582.
10 For example, see ICBA, “Key JOBS Act Provision Must Be Addressed to Benefit Thrifts,” press release, September
13, 2012, at http://www.icba.org/files/ICBASites/PDFs/test091312.pdf.
11 For example, see Jeff Blumenthal, “100-plus Banks Deregister Stock since JOBS Act,” Philadelphia Business
Journal, February 15, 2013, at http://www.bizjournals.com/philadelphia/print-edition/2013/02/15/100-plus-banks-
deregister-stock-since.html; Brian Yurcan, “Small Banks Deregister in Droves Due to JOBS Act,” Bank Tech, May 30,
2012, at http://www.banktech.com/compliance/small-banks-deregister-in-droves-due-to-jobs-act/d/d-id/1295425.
12 Joshua Mitts, Did the JOBS Act Benefit Community Banks? A Regression Discontinuity Study, April 25, 2013, at
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2233502.
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Title VIII: Restoring Proven Financing for American
Employers Act13
Title VIII of H.R. 37 would modify a provision of the final rule implementing Section 619 of the
Dodd-Frank Act, also known as the “Volcker Rule.” It would modify the Volcker Rule’s treatment
of certain collateralized loan obligations (CLOs) as impermissible covered fund investments.14 It
would allow banks with investments in certain CLOs issued before January 31, 2014, an
additional two years, until July 21, 2019, to be in compliance with the Volcker Rule.
A CLO is a form of securitization in which a pool of loans (typically, commercial loans) is funded
by issuing securities. CLOs provide nearly $300 billion in financing to U.S. companies.15 The
Volcker Rule has two main parts—it prohibits banks from proprietary trading of “risky” assets
and from “certain relationships” with “risky” investment funds.16 H.R. 37 involves the latter. In
December 2013, five financial regulators issued a final rule defining which funds are considered
risky and therefore prohibited under the Volcker Rule. Many of the trusts used to facilitate CLOs
were included in the definition of risky investment funds. As a result, banks would have to divest
themselves of certain CLO-related securities if the securities conveyed an impermissible interest
in the trust. The Volcker Rule does not ban CLOs or banking organizations from holding CLOs;
rather, it prohibits banking organizations from owning securities conferring ownership-like rights
in CLOs. Regulators already have exercised their discretion to extend the conformance period for
banks to divest themselves of these CLO-related assets to 2016 and could extend until 2017. An
extension beyond 2017 could require additional agency findings. H.R. 37 would extend the
conformance period to 2019 for all covered CLOs.17
H.R. 37 only applies to banks that hold securities issued by existing CLOs funded by commercial
loans. It would limit the extension period for conformance to those CLO securities issued prior to
January 31, 2014. Going forward, bank participation in newly issued CLOs would have to be
structured to comply with the Volcker Rule’s prohibition of bank interests in risky investment
firms.18
Policy Discussion. The potential economic impact of H.R. 37 depends on the characteristics of
CLO-related obligations already held in the banking system. If banks did not expect their CLO
holdings to be prohibited by the Volcker Rule, they may not have made any preparations to
comply with it. Thus, proponents of extending the conformance period argue that rapid divestiture
of CLO-related securities could force banks to sell these securities at a loss, perhaps in fire sales,
13 This section was authored by Edward V. Murphy, specialist in Financial Economics.
14 The language in Title VIII originally was passed by the House as H.R. 4167 (in the 113th Congress) by voice vote
under suspension on April 29, 2014.
15 U.S. Congress, House Committee on Financial Services, Subcommittee on Capital Markets and Government
Sponsored Enterprises, The Dodd-Frank Act’s Impact on Asset-Backed Securities, Testimony of Meredith Coffey, 113th
Cong., 2nd sess., February 26, 2014.
16 CRS Legal Sidebar, What Companies Must Comply with the Volcker Rule?, David H. Carpenter. “Certain
relationships,” as defined by P.L. 111-203, §619, includes acquiring or retaining “any equity, partnership, or other
ownership interest in or sponsor a hedge fund or a private equity fund.”
17 CRS Legal Sidebar, Congress Contemplates Extending Volcker Rule Conformance Period for CLO Investments,
David Carpenter.
18 CRS Legal Sidebar, What Companies Must Comply with the Volcker Rule?, David H. Carpenter.
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if an extension is not granted. They argue that such stress in the banking system may curtail credit
available to small- and medium-sized commercial businesses.19
Opponents of Title VIII of H.R. 37, including the White House, argue that extending the
conformance period would undermine the intent of the Volcker Rule and allow risky securities to
remain in the banking system. They contend that it could result in future destabilizing losses for
banks that hold risky securities.20 On the other hand, H.R. 37 merely changes the grandfathering
date of existing commercial loan-related CLO securities from 2017 to 2019. It would neither
prohibit conforming CLO securities from being created in the future to fund small and medium
businesses nor exempt newly issued CLOs from the Volcker Rule going forward.
H.R. 601: Eliminate Privacy Notice Confusion Act21
H.R. 601 was passed by the House on April 13, 2015.22 It would reduce the number of
circumstances under which financial firms, including banks, were required to send customers
privacy notices. It is an example of a regulatory relief bill amending a law that predates the
financial crisis.
Under a provision of the Gramm-Leach-Bliley Act (15 U.S.C. §6803), financial firms are
required to send customers privacy notices when they establish a relationship with the customer
and annually thereafter. Firms also are required to send customers notices explaining how
customers may opt out of allowing the firm to share their personal information with third parties,
under certain circumstances.23
Under H.R. 601, financial firms would no longer be required to send annual privacy notices if
their privacy policy had not changed. Cases in which third-party information sharing triggers
notification and the opportunity to opt out under current law would remain unchanged.24
Policy Discussion. Financial firms argue that the privacy notice requirement is unduly
burdensome to them and of little value to customers because the notices are lengthy, confusing,
and thus likely to be ignored. Defenders of current law argue that it provides consumer protection
and safeguards privacy.25
19 Hamilton Place Strategies, Regulating Risk: Implementation of New Regulation, January 2015, at
http://hamiltonplacestrategies.com/sites/default/files/newsfiles/HPS%20White%20Paper%20-
%20Regulating%20Risk%20-%20Volcker%20and%20CLOs.pdf.
20 Executive Office of the President, Statement of Administrative Policy, January 12, 2015, at
http://www.whitehouse.gov/sites/default/files/omb/legislative/sap/114/saphr37r_20150112.pdf.
21 This section was authored by Marc Labonte, specialist in Macroeconomic Policy.
22 A similar bill in the 113th Congress, H.R. 749, was ordered to be reported by the House Financial Services
Committee.
23 For a summary of the requirement, see Federal Trade Commission, In Brief: The Financial Privacy Requirements of
the Gramm-Leach-Bliley Act, July 2002, at https://www.ftc.gov/tips-advice/business-center/guidance/brief-financial-
privacy-requirements-gramm-leach-bliley-act.
24 U.S. Congress, House Committee on Financial Services, Eliminate Privacy Notice Confusion Act, report to
accompany H.R. 601, 114th Cong., 1st sess., April 13, 2015, H.Rept. 114-59.
25 CFPB, 12 C.F.R. Part 1016, Docket No. CFPB–2014–0010, RIN 3170–AA39, p. 64059, at http://www.gpo.gov/
fdsys/pkg/FR-2014-10-28/pdf/2014-25299.pdf; http://fsroundtable.org/hr-601-eliminate-privacy-notice-confusion-act/.
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The Consumer Financial Protection Bureau (CFPB) contends that a rule it issued in 2014
modifying Regulation P (which implements 15 U.S.C. §6803) will reduce the regulatory burden
of compliance without undermining the policy’s benefits.26 The 2014 CFPB rule allows firms
under certain conditions to post privacy notices on the Internet rather than mail hard copies to
customers. The rule requires firms to continue sending printed notices when privacy policies are
changed or information is shared with third parties. Firms are required to provide annual
notification that privacy notices are available on the Internet and to provide printed notices upon
request. Proponents of H.R. 601 believe additional relief is needed beyond what was provided in
the 2014 CFPB rule.
The Congressional Budget Office (CBO) estimates that H.R. 601 as ordered reported would result
in an increase in direct spending that would not be significant.27 The bill would not affect
revenues or discretionary spending.
H.R. 650: Preserving Access to Manufactured
Housing Act of 201528
H.R. 650 was passed by the House on April 14, 2015.29 H.R. 650 as passed would affect the
market for manufactured housing by amending the definitions of mortgage originator and high-
cost mortgage in the Truth-in-Lending Act (TILA; 15 U.S.C. §§1601, et seq.).30 Manufactured
homes, which often are located in more rural areas, are a type of single-family housing that is
factory built and transported to a placement site rather than constructed on-site.31 When
purchasing a manufactured home, a consumer does not necessarily have to own the land on which
the manufactured home is placed. Instead, the consumer could lease the land, a practice that is
different from what is often done with a site-built home.32 Manufactured housing also differs
from site-built properties in other ways, such as which consumer protection laws apply to the
transaction and how state laws title manufactured housing.33
The Dodd-Frank Act changed the definitions for mortgage originator and high-cost mortgage to
provide additional consumer protections to borrowers for most types of housing transactions,
including manufactured housing. Some argue that these protections restrict credit for
manufactured housing. H.R. 650 would modify the definitions of mortgage originator and high-
26 Consumer Financial Protection Bureau (CFPB), 12 C.F.R. Part 1016, Docket No. CFPB–2014–0010, RIN 3170–
AA39, at http://www.gpo.gov/fdsys/pkg/FR-2014-10-28/pdf/2014-25299.pdf.
27 Congressional Budget Office (CBO), Cost Estimate of H.R. 601, April 7, 2015, at https://www.cbo.gov/sites/default/
files/cbofiles/attachments/hr601.pdf.
28 This section was authored by Sean Hoskins, analyst in Financial Economics.
29 A similar bill in the 113th Congress, H.R. 1779, was ordered to be reported by the House Financial Services
Committee.
30 15 U.S.C. §§1601 et seq.
31 CFPB, Manufactured-housing consumer finance in the United States, September 2014, p. 9, at
http://files.consumerfinance.gov/f/201409_cfpb_report_manufactured-housing.pdf.
32 According to the CFPB, about “three-fifths of manufactured-housing residents who own their home also own the
land it is sited on.” CFPB, Manufactured-housing consumer finance in the United States, September 2014, p. 6, at
http://files.consumerfinance.gov/f/201409_cfpb_report_manufactured-housing.pdf.
33 For more, see CFPB, Manufactured-housing consumer finance in the United States, September 2014, at
http://files.consumerfinance.gov/f/201409_cfpb_report_manufactured-housing.pdf.
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cost mortgage with the goal of increasing credit. Critics of the proposal are concerned about the
effect on consumers of reducing the consumer protections. The first part of H.R. 650 would not
affect banks but would affect manufactured-home retailers. It is discussed briefly to provide
context for the second part of H.R. 650, which would affect banks more directly.
Definition of Mortgage Originator. In response to problems in the mortgage market when the
housing bubble burst, the Secure and Fair Enforcement for Mortgage Licensing Act of 2008
(SAFE Act; P.L. 110-289) and the Dodd-Frank Act established new requirements for mortgage
originators’ licensing, registration, compensation, training, and other practices. A mortgage
originator is someone who, among other things, “(i) takes a residential mortgage loan application;
(ii) assists a consumer in obtaining or applying to obtain a residential mortgage loan; or (iii)
offers or negotiates terms of a residential mortgage loan.”34 The current definition in
implementing the regulation excludes employees of manufactured-home retailers under certain
circumstances, such as “if they do not take a consumer credit application, offer or negotiate credit
terms, or advise a consumer on credit terms.”35 H.R. 650 would expand the exception such that
retailers of manufactured homes or their employees would not be considered mortgage originators
unless they received more compensation for a sale that included a loan than for a sale that did not
include a loan.
Policy Discussion. Supporters of H.R. 650 argue that the current definition of mortgage
originator is too broad and negatively affects the manufactured-housing market. Manufactured-
home retailers “have been forced to stop providing technical assistance to consumers during the
process of home buying” because of concerns that providing this assistance will result in the
retailers being deemed loan originators, which in turn will lead to costs that the manufactured-
home retailers do not want to bear, according to supporters.36 Supporters of the bill argue that this
situation has unnecessarily complicated the purchase process for consumers. H.R. 650 would
allow manufactured-home retailers to provide minimal assistance to consumers for which they
would not be compensated.
Opponents of H.R. 650, however, note that the existing protections are intended to prevent
retailers from pressuring consumers into making their purchase through a particular creditor.
Expanding the exemption, they argue, “would perpetuate the conflicts of interest and steering that
plague this industry and allow lenders to pass additional costs on to consumers.”37
High-Cost Mortgage. H.R. 650 also would narrow the definition of high-cost mortgage for
manufactured housing. A high-cost mortgage often is referred to as a “HOEPA loan” because the
Home Ownership and Equity Protection Act (HOEPA; P.L. 103-325) provides additional
consumer protections to borrowers for certain high-cost transactions involving a borrower’s
home. The Dodd-Frank Act expanded the protections available to high-cost mortgages by having
more types of mortgage transactions be covered and by lowering the thresholds at which a
34 P.L. 111-203, §1401. The definition of mortgage originator has multiple exemptions, such as for those who perform
primarily clerical or administrative tasks in support of a mortgage originator or those who engage in certain forms of
seller financing.
35 CFPB, Manufactured-housing consumer finance in the United States, September 2014, p. 51, at
http://files.consumerfinance.gov/f/201409_cfpb_report_manufactured-housing.pdf.
36 Rep. Stephen Fincher, Congressional Record, vol. 161, part 53 (April 14, 2015), p. H2178.
37 Corporation for Enterprise Development, “Consumer Groups Sign On Letter Opposing H.R. 650,” at http://cfed.org/
assets/pdfs/policy/federal/consumer_groups_sign_on_letter_opposing_HR_650.pdf.
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mortgage would be deemed high cost. The CFPB issued a rule implementing those changes in
2013.38
Consumers receive additional protections on high-cost transactions, such as “special disclosure
requirements and restrictions on loan terms, and borrowers in high-cost mortgages have enhanced
remedies for violations of the law.”39 Prior to originating the mortgage, lenders are required to
receive “written certification that the consumer has obtained counseling on the advisability of the
mortgage from a counselor that is approved to provide such counseling.”40 Because of these
protections and the added legal liability associated with originating a high-cost mortgage,
originating a HOEPA loan is generally considered more costly for a lender (which could be either
a bank or a nonbank) than originating a non-HOEPA loan. This is an example of the trade-off
between consumer protection and credit availability—if a loan is deemed high-cost, the consumer
has added protections, but the lender may be less willing to originate it.
A mortgage is high cost if certain thresholds are breached related to the mortgage’s (1) annual
percentage rate (APR) or (2) points and fees.41
The APR is a measure of how much a loan costs expressed as an annualized rate. Computation of
the APR includes the interest rate as well as certain fees, such as compensation to the lender and
other expenses. Under the APR test, a loan is considered to be a high-cost mortgage if the APR
exceeds the average prime offer rate (APOR, an estimate of the market mortgage rate based on a
survey of rates) by more than 6.5 percentage points for most mortgages or by 8.5 percentage
points for certain loans under $50,000.42 H.R. 650 would increase the threshold for the latter
category to 10 percentage points above the APOR for certain transactions involving manufactured
housing below $75,000.
Points and fees, the second factor, refers to certain costs associated with originating the mortgage.
The term point refers to compensation paid up front to the lender by the borrower. A point is
expressed as a percentage of the loan amount, with one point equal to 1% of the loan amount.43
The fees included in the definition of points and fees include prepayment penalties, certain types
of insurance premiums, and other real estate-related fees. Under the points and fees test, the
mortgage is high cost if the points and fees exceed (1) 5% of the total amount borrowed for most
loans in excess of $20,000 or (2) the lesser of 8% of the total amount or $1,000 for loans of less
than $20,000.44
H.R. 650 would create a third category for the points and fees test for manufactured-housing
loans. Under the third category, certain types of manufactured-housing transactions would be
38 CFPB, “High-Cost Mortgage and Homeownership Counseling Amendments to the Truth in Lending Act (Regulation
Z) and Homeownership Counseling Amendments to the Real Estate Settlement Procedures Act (Regulation X),” 78
Federal Register 6855, January 31, 2013.
39 Ibid, 6856.
40 12 C.F.R. §1026.34.
41 In addition to the APR test and points and fees test, a mortgage can be high cost if there is a prepayment penalty that
meets certain criteria, although that issue is not addressed by H.R. 650. See Ibid.
42 15 U.S.C. §1602(bb). Other thresholds apply to junior liens.
43 In some cases, a point may be excluded from the definition of points and fees if the point results in a reduction in the
interest rate that is charged to the borrower. See P.L. 111-203, §1412.
44 15 U.S.C. §1602(bb).
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deemed high cost if the points and fees on loans less than $75,000 were greater than 5% of the
total loan amount or greater than $3,000. This higher threshold would make it less likely that a
manufactured-housing loan would be high cost under the points and fees test, all else equal.
Policy Discussion. Data from the CFPB’s September 2014 report on the manufactured-housing
market indicate that manufactured-housing loans are more likely to be HOEPA loans than loans
for traditional, site-built homes. The CFPB analyzed data for originations from 2012, which was
before the more expansive Dodd-Frank definition of high-cost mortgage took effect. The CFPB
estimated the share of the 2012 market that would have violated the APR test (which is just one of
the high-cost triggers) had the current thresholds been in effect and found that “0.2 percent of all
home-purchase loans in the U.S. have an interest rate that exceeds the HOEPA APR threshold.
This fraction is only 0.01 percent for site-built homes but nearly 17 percent for manufactured
homes.”45
As the CFPB notes, this estimate of the share of HOEPA loans may understate the true share
because it does not include the points and fees test, but it also may overstate the true share
because lenders may have adjusted the points, fees, interest rate, profitability of the loan, and
other factors so that fewer loans would have been high-cost had the new thresholds been in
effect.46 Either way, the CFPB’s data are illustrative of the fact that a larger share of
manufactured-housing loans than site-built loans is likely to be affected by the high-cost
mortgage requirements. The CFPB stated that the changes to HOEPA made by Dodd-Frank likely
would lead to a larger share of all loans being high cost, but “the resulting increase in the share of
high-cost mortgages was much larger for manufactured-housing loans than for loans on site-built
homes.”47
Manufactured-housing loans are more likely to be high cost for several reasons. Manufactured-
housing loans usually are smaller than loans for site-built properties. The CFPB’s report found
that the “median loan amount for site-built home purchase was $176,000, more than three times
the manufactured home purchase loan median of $55,000.”48 Because manufactured-housing
loans often are for a smaller amount, they are likely to have higher APR and points and fees
ratios; the APR and points and fees computations include some fixed costs that do not vary
proportionately to the size of the loan. All else equal, smaller loans would be more likely to
breach the thresholds. To account for this, the APR test and the points and fees test have
thresholds that vary based on the size of the loan, as explained above. Additionally, because of
how some states title manufactured homes and other unique aspects of the manufactured-housing
market, a manufactured-housing loan is likely to have a higher interest rate than a loan involving
a site-built home (all else equal), which makes it more likely that the loan will violate the APR
threshold.49
Supporters of H.R. 650 argue that the high-cost thresholds are poorly targeted for manufactured-
housing loans because the fixed costs and higher rates associated with smaller manufactured-
45 CFPB, Manufactured-housing consumer finance in the United States, September 2014, pp. 35-36, at
http://files.consumerfinance.gov/f/201409_cfpb_report_manufactured-housing.pdf.
46 Ibid, p. 48.
47 Ibid.
48 Ibid, p. 30.
49 Ibid, p. 6.
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housing loans make it more likely that the thresholds will be exceeded.50 The existing adjustments
for small-dollar loans are insufficient and allow too many manufactured-housing loans to be high
cost. As a result, critics of the current threshold argue, credit will be restricted as some lenders
will be less inclined to bear the expense and liability associated with originating high-cost
manufactured-housing loans. H.R. 650, they claim, is important for ensuring that credit is
available for borrowers who want to purchase a manufactured home.
Opponents of H.R. 650 argue that the APR and points and fees thresholds already are adjusted for
the size of the loan and do not need to be further modified. Doing so would weaken consumer
protections, they argue, for borrowers who are likely to have lower incomes and be more
“economically vulnerable consumers.”51 The Obama Administration has said that “if the
President were presented with H.R. 650, his senior advisors would recommend that he veto the
bill.”52
CBO estimates that H.R. 650 as ordered reported “would increase direct spending by less than
$500,000.”53 The bill would not affect revenues or discretionary spending.
H.R. 685: Mortgage Choice Act of 201554
H.R. 685 was passed by the House on April 14, 2015.55 H.R. 685 as passed would modify the
definition of points and fees to exclude from the definition (1) insurance held in escrow and (2)
certain fees paid to affiliates of the lender. As is elaborated upon below, points and fees refers to
certain costs that are paid by the borrower related to lender compensation and other expenses that
are associated with originating the mortgage. How points and fees are defined can have an effect
on credit availability (mortgage lenders argue that the current definition of points and fees makes
it harder for them to extend credit) and an effect on consumer protection (consumer groups argue
that expanding the definition could lead to borrowers being steered into more expensive
mortgages that they could be less able to repay).
The Ability-to-Repay Rule and Points and Fees. The definition of points and fees is a
component of multiple rules, but it is often discussed in the context of the Ability-to-Repay (ATR)
rule.56 Title XIV of the Dodd-Frank Act established the ATR requirement and instructed the CFPB
to establish the definition of a qualified mortgage (QM) as part of its implementation. The ATR
rule requires a lender to determine, based on documented and verified information, that at the
50 Manufactured Housing Institute, “The Preserving Access to Manufactured Housing Act (S. 682/H.R. 650),” at
http://www.manufacturedhousing.org/webdocs/S%20682%20HR%20650%20leave%20behind%20use.pdf.
51 Executive Office of the President, Office of Management and Budget, Statement of Administration Policy: H.R. 650 -
Preserving Access to Manufactured Housing Act of 2015, April 13, 2015, at https://www.whitehouse.gov/sites/default/
files/omb/legislative/sap/114/saphr650r_20150413.pdf.
52 Ibid.
53 CBO, Cost Estimate of H.R. 650, April 3, 2015, at http://www.cbo.gov/sites/default/files/cbofiles/attachments/
hr_650.pdf.
54 This section was authored by Sean Hoskins, analyst in Financial Economics.
55 A similar bill, H.R. 3211, passed the House in the 113th Congress.
56 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6407, January 30, 2013. For more on the rule, see CRS Report R43081, The Ability-to-Repay Rule: Possible Effects of
the Qualified Mortgage Definition on Credit Availability and Other Selected Issues, by Sean M. Hoskins.
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time a mortgage loan is made the borrower has the ability to repay the loan. Failure to make such
a determination could result in a lender having to pay damages to a borrower who brings a
lawsuit claiming that the lender did not follow the ATR rule. This legal risk gives lenders added
incentive to comply with the ATR rule.
One of the ways a lender can comply with the ATR rule is by originating a QM.57 A QM is a
mortgage that satisfies certain underwriting and product-feature requirements, such as having
payments below specified debt-to-income ratios and having a term no longer than 30 years. By
making a QM, a lender is presumed to have complied with the ATR rule and receives legal
protections that could reduce its potential legal liability. A lender can comply with the ATR rule
by making a mortgage that is not a QM, but the lender will not receive the additional legal
protections. The definition of a QM, therefore, is important to a lender seeking to minimize its
legal risk. Because of this legal risk, some are concerned that, at least in the short term, the vast
majority of mortgages that are originated will be mortgages meeting the QM standards due to the
legal protections that QMs afford lenders, even though there are other means of complying with
the ATR rule.58
As an additional requirement for a mortgage to be a QM, certain points and fees associated with
the mortgage must be below specified thresholds. Some argue that the more types of fees that are
included in the QM rule’s definition of points and fees, the more likely a mortgage is to breach
the points and fees threshold and no longer qualify as a QM.59 The definition of points and fees,
therefore, may be important for determining whether a mortgage receives QM status, which can
influence whether the lender will extend the loan.
The points and fees threshold varies based on the size of the loan. The threshold is higher for
smaller loans because some fees are fixed costs that do not depend on the size of the loan. All else
equal, smaller loans would be more likely to breach the thresholds unless their thresholds were
higher. The thresholds, which are indexed for inflation, are currently as follows:
• 3% of the total loan amount for a loan greater than or equal to $100,000;
• $3,000 for a loan less than $100,000 but greater than or equal to $60,000;
• 5% of the total amount for a loan less than $60,000 but greater than or equal to
$20,000;
• $1,000 for a loan less than $20,000 but greater than or equal to $12,500; and
• 8% of the total loan amount for a loan less than $12,500.60
A loan that is above the respective points and fees cap cannot be a QM.
57 For the definition of a QM, see 12 C.F.R. §1026.43.
58 CFPB, Prepared remarks of Richard Cordray at a meeting of the Credit Union National Association, February 27,
2013, at http://www.consumerfinance.gov/speeches/prepared-remarks-of-richard-cordray-at-a-meeting-of-the-credit-
union-national-association/. For a preliminary analysis of the effect of the QM rule on originations, see Bing Bai, Data
show surprisingly little impact of new mortgage rules, Urban Institute, August 21, 2014, at http://www.urban.org/
urban-wire/data-show-surprisingly-little-impact-new-mortgage-rules.
59 It is possible, however, that the market may adapt and have new fees so that the current definition may not affect
future outcomes.
60 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6587, January 30, 2013.
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The definition of points and fees includes certain costs associated with originating the mortgage.
The term point refers to compensation paid up front to the lender by the borrower. A point is
expressed as a percentage of the loan amount, with one point equal to 1% of the loan amount.61
The definition of fees has several different categories, but what is most pertinent with respect to
H.R. 685 is that certain fees are excluded from the definition of points and fees if “the charge is
paid to a third party unaffiliated with the creditor.”62 Certain fees paid to third parties affiliated63
with the lender are included in the definition. H.R. 685 would change the treatment of fees for
third parties affiliated with the lender by allowing (in some cases) those fees to also be excluded
from the definition of points and fees.
Policy Discussion. H.R. 685 would change the treatment of several types of fees. However, most
of the policy debate surrounding H.R. 685 has focused on title insurance because title insurance is
one of the larger fees associated with a mortgage that would be affected by the changes H.R. 685
proposes to the points and fees definition.64 Title insurance involves “searching the property’s
records to ensure that [a particular individual is] the rightful owner and to check for liens.”65 Title
insurance provides protection to the lender or borrower (depending on the type of policy) if there
turns out to be a defect in the title. Under the current definition for points and fees, fees for title
insurance provided by a title insurer that is independent of or unaffiliated with the lender may be
excluded from the points and fees definition, but the fees for an affiliated title insurer must be
included in the definition of points and fees. H.R. 685 would allow fees for affiliated title
insurance to be treated the same as independent title insurance, and both would be excluded from
the points and fees definition.
The cap on points and fees is intended to protect consumers from predatory loans by limiting fees
that can be placed on a QM and by aligning the incentives of the lender and the borrower.
Lenders can be compensated through points that are paid up front or through interest payments
over the life of the loan. The method by which the lender receives compensation may influence
the lender’s incentive to evaluate the borrower’s ability to repay the mortgage. As the CFPB notes
in its preamble to the ATR rule, the cap on points and fees may make lenders “take more care in
originating a loan when more of the return derives from performance over time (interest
payments) rather [than] from upfront payments (points and fees). As such, this provision [the cap
on points and fees] may offer lenders more incentive to underwrite these loans carefully.”66
Supporters of H.R. 685 argue that expanding the definition of points and fees is important to
ensuring that credit is available. The Mortgage Bankers Association, for example, stated that as a
61 In some cases, a point may be excluded from the definition of points and fees if the point results in a reduction in the
interest rate that is charged to the borrower. See P.L. 111-203, §1412.
62 15 U.S.C. §1602(bb).
63 An affiliated business arrangement is “an arrangement in which (A) a person who is in a position to refer business
incident to or a part of a real estate settlement service involving a federally related mortgage loan, or an associate of
such person, has either an affiliate relationship with or a direct or beneficial ownership interest of more than 1 percent
in a provider of settlement services; and (B) either of such persons directly or indirectly refers such business to that
provider or affirmatively influences the selection of that provider.” See 12 U.S.C. §2602(7).
64 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6439, January 30, 2013.
65 Federal Reserve Board, “A Consumer’s Guide to Mortgage Refinancings,” at http://www.federalreserve.gov/pubs/
refinancings/.
66 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6562, January 30, 2013.
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result of the current definition of points and fees, “many affiliated loans, particularly those made
to low-and moderate-income borrowers, would not qualify as QMs and would be unlikely to be
made or would only be available at higher rates due to heightened liability risks. Consumers
would lose the ability to choose to take advantage of the convenience and market efficiencies
offered by one-stop shopping.”67 Putting the fees of affiliated and independent title insurers on
equal footing in the points and fees definition, supporters argue, would enhance competition in
the title insurance industry.68
Supporters also contend that because title insurance is regulated predominantly by the states and
many states have policies in place to determine how title insurance is priced, there is less need to
be concerned that title insurance fees are excessive.69 They note that the Real Estate Settlement
Procedures Act (RESPA; 12 U.S.C. §§2601, et seq.) allows affiliated business arrangements and
already has protections in place for consumers, such as “a requirement to disclose affiliation to
consumers.”70
Opponents of H.R. 685 argue that, by narrowing the definition of points and fees to exclude
affiliated providers, the bill “would allow lenders to increase the cost of loans and still be eligible
for ‘Qualified Mortgage’ treatment. This revision risks eroding consumer protections and
returning the mortgage market to the days of careless lending focused on short-term profits.”71
For this reason, the Obama Administration has said that “if the President were presented with
H.R. 685, his senior advisors would recommend that he veto the bill.”72
Critics also contend that removing affiliated title insurers from the points and fees definition
would reduce the title insurance industry’s incentive to make the price of title insurance, which
some believe is already too high, “more reasonable.”73 They note that affiliated service providers
are likely to be able to receive business through references from their affiliate and, therefore,
“affiliates of a creditor may not have to compete in the market with other providers of a service
and thus may charge higher prices that get passed on to the consumer.”74
Escrow. Supporters of H.R. 685 state that the bill would clarify that insurance held in escrow75
should not be included in the definition of points and fees.76 They argue that the drafting of the
67 Letter from Mortgage Bankers Association, April 13, 2015, at http://mba.informz.net/MBA/data/images/
HR685Leadership4132015.pdf.
68 Ibid.
69 The Realty Alliance, “Congress Should Pass the Mortgage Choice Act,” at http://www.therealtyalliance.com/
getpublicfile.asp?ref=41.
70 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6438, January 30, 2013.
71 Executive Office of the President, Office of Management and Budget, Statement of Administration Policy: H.R. 685
– Mortgage Choice Act of 2015, April 13, 2015, at https://www.whitehouse.gov/sites/default/files/omb/legislative/sap/
114/saphr685r_20150413.pdf.
72 Ibid.
73 Center for Responsible Lending, “H.R. 685 Will Lead to Higher Fees for Homebuyers,” at
http://ourfinancialsecurity.org/blogs/wp-content/ourfinancialsecurity.org/uploads/2015/04/
hr685_will_lead_to_higher_fees_for_homebuyers-fact-sheet-3.18.15.pdf.
74 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6439, January 30, 2013.
75 An escrow account is an account that a “mortgage lender may set up to pay certain recurring property-related
expense ... such as property taxes and homeowner’s insurance.” Property taxes and homeowner’s insurance are often
lump-sum payments owed annually or semiannually. See CFPB, “What is an escrow or impound account?,” at
(continued...)
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Dodd-Frank Act left unclear how insurance payments held in escrow should be treated in the
definition. Opponents of the bill have not cited this provision as a rationale for their opposition.
CBO estimates that H.R. 685 as ordered reported “would affect direct spending” but that “those
effects would be insignificant.”77 The bill would not affect revenues or discretionary spending,
according to CBO.
H.R. 1259: Helping Expand Lending Practices in
Rural Communities Act78
H.R. 1259 was passed by the House on April 13, 2015.79 H.R. 1259 as passed would establish a
temporary, two-year program in which individuals could petition the CFPB for counties that were
not designated as rural by the CFPB to receive the rural designation. It also would establish
evaluation criteria and an evaluation process for the CFPB to follow in assessing these petitions.
H.R. 1259 as passed could increase the credit available to borrowers in rural areas but would
reduce some of the protections put in place for rural consumers.
Definition of Rural. Statute allows for exemptions from certain consumer protection
requirements for companies operating in rural areas. In implementing the requirements, the CFPB
designates certain counties as rural. The exemptions and additional compliance options for
lenders in rural areas stem from concerns that borrowers in these areas may have a harder time
accessing credit than those in non-rural areas. For example, the ATR rule has an additional
compliance option that allows small lenders operating in rural or underserved areas to originate
balloon mortgages, subject to some restrictions.80
The Dodd-Frank Act specifies the additional compliance option for rural lenders, but it leaves the
definition of rural to the discretion of the CFPB. Balloon mortgages originated by lenders in areas
that are not designated as rural may be ineligible for the compliance option (although the CFPB
has established a two-year transition period to allow “small”81 lenders to originate balloon
mortgages until January 2016, subject to some restrictions). Lenders that benefit from exemptions
may offer products to their consumers that lenders in non-rural areas may be less likely to offer,
but consumers in rural areas may not receive the same protections as those in non-rural areas.
(...continued)
http://www.consumerfinance.gov/askcfpb/140/what-is-an-escrow-or-impound-account.html.
76 The Realty Alliance, “Congress Should Pass the Mortgage Choice Act,” at http://www.therealtyalliance.com/
getpublicfile.asp?ref=41.
77 CBO, Cost Estimate of H.R. 685, April 3, 2015, at https://www.cbo.gov/sites/default/files/cbofiles/attachments/
hr_685.pdf.
78 This section was authored by Sean Hoskins, analyst in Financial Economics.
79 A similar bill, H.R. 2672, passed the House in the 113th Congress.
80 See 12 C.F.R. §1026.43 and see CRS Report R43081, The Ability-to-Repay Rule: Possible Effects of the Qualified
Mortgage Definition on Credit Availability and Other Selected Issues, by Sean M. Hoskins.
81 The CFPB originally defined small for the purpose of the ATR rule as having less than or equal to $2 billion in assets
and originating 500 or fewer mortgages in the previous year. The January 2015 proposal would, among other things,
raise the threshold to 2,000 mortgage loans. See CFPB, “CFPB Issues Proposal To Facilitate Access To Credit In Rural
And Underserved Areas,” January 29, 2015, at http://www.consumerfinance.gov/newsroom/cfpb-issues-proposal-to-
facilitate-access-to-credit-in-rural-and-underserved-areas/.
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When publishing the ATR rule, the CFPB stated that it considers its method of designating
counties as rural, which is based on the U.S. Department of Agriculture’s Urban Influence
Codes,82 to be consistent with the intent of the exemptions contained in statute. The CFPB
estimated that its definition of rural results in 9.7% of the total U.S. population being in rural
areas.83 However, in light of various questions about its definition of rural raised during the
comment period, the CFPB said in 2013 that it intended “to study whether the [definition] of
‘rural’ ... should be adjusted.”84 As a result, the CFPB issued a proposed rule in January 2015 to
expand the definition of rural as a means of facilitating access to credit in rural areas. The new
definition would have two prongs: an area could be deemed rural under the existing methodology
involving the Urban Influence Codes or, if it is not designated as rural by that test, it could qualify
under an alternative method that involves the Census Bureau’s census block data.
To qualify for some of the exemptions, a lender not only must operate in a rural area but also
must meet the CFPB’s definition of small, which the CFPB also expanded in its January 2015
proposal.85 Based on 2013 data, the CFPB estimates “that the number of rural small creditors
would increase from about 2,400 to about 4,100 if the proposed provisions are adopted.”86
Policy Discussion. Although the proposed rule is intended to expand credit availability, the CFPB
notes that its analysis does not provide “direct evidence to estimate the degree to which the
proposed provisions would increase access to credit.”87 The CFPB explains that its inability to
estimate the change in credit availability from the proposal may be due to data limitations that
prevent it from testing certain hypotheses.88 Alternatively, the CFPB notes that the change in
credit availability may be difficult to estimate because borrowers in rural areas already may be
adequately served by lenders and therefore may not benefit from the CFPB’s expanded
definition.89
The CFPB maintains that the use of census blocks, as suggested in its proposed rule, allows for a
more granular approach, but critics have argued that the new approach “is still inadequate because
census tracts are only updated once every 10 years.”90 Supporters of H.R. 1259 believe the
CFPB’s method of designating counties as rural is inflexible and may not account for “atypical
population distributions or geographic boundaries.”91 H.R. 1259 is intended, supporters argue, to
82 For the definition of rural, see 12 C.F.R. §1026.35.
83 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” 78 Federal Register
6543, January 30, 2013.
84 CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act,” p. 6, at
http://files.consumerfinance.gov/f/201305_cfpb_final-rule_atr-concurrent-final-rule.pdf.
85 The CFPB originally defined small for the purpose of the ATR rule as having less than or equal to $2 billion in assets
and originating 500 or fewer mortgages in the previous year. The January 2015 proposal would, among other things,
raise the threshold to 2,000 mortgage loans. See CFPB, “CFPB Issues Proposal To Facilitate Access To Credit In Rural
And Underserved Areas,” January 29, 2015, at http://www.consumerfinance.gov/newsroom/cfpb-issues-proposal-to-
facilitate-access-to-credit-in-rural-and-underserved-areas/.
86 CFPB, Amendments Relating to Small Creditors and Rural or Underserved Areas Under the Truth in Lending Act
(Regulation Z), p. 69, at http://files.consumerfinance.gov/f/201501_cfpb_amendments-relating-to-small-creditors-and-
rural-or-underserved-areas.pdf.
87 Ibid, p. 72.
88 Ibid, p. 73.
89 Ibid.
90 Rep. Andy Barr, Congressional Record, vol. 161, part 52 (April 13, 2015), p. H2121.
91 Conference of State Bank Supervisors, “Letter of Support for H.R. 2672,” December 4, 2013, at http://www.csbs.org/
(continued...)
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provide a way to challenge a CFPB designation and invites individuals “to participate in their
government and provide input on matters of local knowledge. It is about making the Federal
Government more accessible, more accountable, and more responsive to the people who know
their local communities best.”92
CBO estimates that H.R. 1259 as ordered reported would increase direct spending by $1 million
over the next 10 years but would not affect revenues or discretionary spending.93
H.R. 1408: Mortgage Servicing Asset Capital
Requirements Act of 201594
H.R. 1408 was ordered to be reported by the House Committee on Financial Services on March
26, 2015.95 H.R. 1408 as ordered to be reported would require the federal banking regulators—the
Federal Reserve, Office of the Comptroller of the Currency, Federal Deposit Insurance
Corporation, and National Credit Union Administration—to “conduct a study of the appropriate
capital requirements for mortgage servicing assets for nonsystemic banking institutions”96 and
would delay the implementation of certain capital requirements until the report had been
completed. Nonsystemic banking institutions are defined as those banking institutions that have
not been identified by the Financial Stability Board (an intergovernmental body in which the
United States participates) as a global systemically important bank.97 Eight of the largest U.S.
banks currently have been identified as global systemically important banks.98
As discussed in more detail below, banks have identified the capital treatment for mortgage
servicing assets (MSAs) as one of the more costly aspects of the new capital requirements.
Supporters of H.R. 1408 want to delay implementation of the capital requirements until the
regulators further study MSAs. Opponents, by contrast, would like to see the capital rule
implemented without delay, although some acknowledge that there may be issues with the rule’s
treatment of MSAs.
Mortgage Servicing Assets and Basel III. Servicers collect payments from borrowers that are
current and forward them to the mortgage holder, work with borrowers that are delinquent to try
(...continued)
legislative/Documents/CSBSLetterofSupportforHR2672Dec42013.pdf.
92 Rep. Andy Barr, Congressional Record, vol. 161, part 52 (April 13, 2015), p. H2121.
93 CBO, Cost Estimate of H.R. 1259, April 6, 2015, at https://www.cbo.gov/sites/default/files/cbofiles/attachments/hr-
1259.pdf.
94 This section was authored by Sean Hoskins, analyst in Financial Economics.
95 A similar bill, H.R. 4042, was ordered to be reported by the Financial Services Committee in the 113th Congress.
96 H.R. 1408, §2.
97 For more on the Financial Stability Board, see CRS Report IF10129, Introduction to Financial Services:
International Supervision, by Martin A. Weiss.
98 Eight U.S. firms currently would be identified as global systemically important banks under the proposal: Bank of
America Corporation, the Bank of New York Mellon Corporation, Citigroup Inc., The Goldman Sachs Group, Inc.,
JPMorgan Chase & Co., Morgan Stanley, State Street Corporation, and Wells Fargo & Company. For more on global
systemically important banks, see Federal Reserve, press release, December 9, 2014, at http://www.federalreserve.gov/
newsevents/press/bcreg/20141209a.htm.
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to get them current, and extinguish the mortgage (such as through foreclosure) if a borrower is in
default. A mortgage servicer is compensated for its work. A mortgage holder can service the
mortgage itself or hire an agent to act on its behalf. Just as the holder of a mortgage can sell the
mortgage and the right to receive the stream of payments associated with a mortgage to a
different investor, a servicer can sell to a different servicer the right to service a mortgage and to
receive the compensation for doing so, which can make mortgage servicing a valuable asset. A
mortgage servicing asset, therefore, is an asset that results “from contracts to service loans
secured by real estate, where such loans are owned by third parties.”99 Some banks will originate
a mortgage and sell the mortgage to a different investor but retain the servicing of the mortgage
(so they keep the MSA) to maintain their relationship with the customer.
Banks are required to fund their assets with a certain amount of capital to protect against the
possibility that their assets may drop in value. The riskier an asset, the more capital a bank is
required to hold to guard against losses. The Basel III framework is an international agreement
with U.S. participation that includes guidelines on how banks should be regulated, such as how
much capital they are required to hold against certain assets.100 The federal bank regulators have
issued rules generally implementing the Basel III framework and set capital requirements that
banks must follow.101
Policy Discussion. The new capital requirements mandate more capital for MSAs, making it
more costly for banks to hold MSAs. As a result, some banks have started selling their MSAs and
nonbanks (financial institutions that do not accept deposits and are not subject to the Basel III
capital requirements) have purchased MSAs.102 Although the CFPB regulates nonbank mortgage
servicers to ensure that they comply with consumer protections,103 some are worried that the
growth of nonbank servicers and the sale of MSAs may “trigger a race to the bottom that puts
homeowners at risk” as nonbank servicers cut costs to compete for business.104
Given the concerns about the effect the Basel III capital requirements are having on the mortgage
servicing market, some supporters of H.R. 1408 argue that the MSA capital requirements should
be delayed for all but the largest institutions. They contend that “there needs to be additional
review of whether or not additional capital is required simply for mortgage servicing.”105
Supporters do not believe the regulators performed sufficient analysis of the capital requirements’
99 H.R. 1408, §2.
100 For more on Basel, see CRS Report R42744, U.S. Implementation of the Basel Capital Regulatory Framework, by
Darryl E. Getter. The National Credit Union Administration (NCUA) has a similar capital rule for credit unions. See
NCUA, “Risk-Based Capital,” 80 Federal Register 17, January 27, 2015.
101 Although banks have begun implementing the Basel III capital rules already, including the new mortgage servicing
asset (MSA) treatment, the new treatment will not be fully phased in for several years. See Federal Reserve, Office of
the Comptroller of the Currency, “Regulatory Capital Rules,” 78 Federal Register 62079, October 11, 2013.
102 For more on the market shift to nonbank servicers, see Laurie Goodman and Pamela Lee, OASIS: A Securitization
Born from MSR Transfers, Urban Institute, at http://www.urban.org/sites/default/files/alfresco/publication-pdfs/
413086-OASIS-A-Securitization-Born-from-MSR-Transfers.PDF.
103 CRS Report R42572, The Consumer Financial Protection Bureau (CFPB): A Legal Analysis, by David H.
Carpenter.
104 Benjamin Lawsky, “Excerpts from Superintendent Lawsky’s Remarks on Non-Bank Mortgage Servicing in New
York City,” May 20, 2014, at http://www.dfs.ny.gov/about/press2014/pr1405201.htm.
105 Attributed to Rep. Ed Perlmutter by CQ Congressional Transcripts, “House Financial Services Committee Holds
Markup on Financial Regulatory Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-4653577?
9&search=M9QutUd4.
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implications prior to issuing these requirements and argue that they should do so before the rule
takes effect. Supporters also note that Basel III is an international agreement but that MSAs are a
product of the U.S. housing finance system, which is different than the housing finance system in
other countries. As a result, they contend that additional study needs to be given to this unique
topic.106
Some opponents of H.R. 1408 acknowledge that servicing has migrated to nonbanks and have
expressed concerns about the implications of that migration. They “fully support additional
research into the topics of the study which make up a large portion of” H.R. 1408.107 But these
opponents do not want implementation of the capital requirements to be delayed while the study
is ongoing because they believe Basel III is important to the safety and soundness of the banking
system.108
CBO estimates that H.R. 1408 as ordered to be reported would affect direct spending and
revenues but that “the net effect on the federal budget over the next 10 years would not be
significant.”109 CBO notes that by delaying the implementation of the capital requirements, H.R.
1408
would temporarily increase the regulatory capital of some banks by including additional
MSAs as capital. That increase could delay the corrective action or closure of a bank,
potentially increasing the cost of resolution if it was to ultimately fail. However, for a
number of reasons—the brief duration of the delay, the low ratio of MSAs to total assets, the
relatively low number of projected bank failures over the next year, and the phase-in of the
current rules—CBO expects that the probability and cost of future bank failures would not
increase significantly under the bill.110
H.R. 1529: Community Institution Mortgage Relief
Act of 2015111
H.R. 1529 was ordered reported by the House Committee on Financial Services on April 6,
2015.112 H.R. 1529 as ordered reported would make two modifications to CFPB mortgage rules.
It would (1) exempt from certain escrow requirements any mortgage held by a lender with assets
of $10 billion or less if the mortgage is held in the lender’s portfolio for three years and (2)
exempt from certain servicing requirements any servicer that annually services 20,000 mortgages
106 See American Bankers Association, “Letter to Representatives Luetkemeyer and Perlmutter,” May 12, 2014, at
http://www.aba.com/Advocacy/LetterstoCongress/Documents/ABALetteronMSAStop-StudyBill.pdf.
107 Attributed to Rep. Maxine Waters by CQ Congressional Transcripts, “House Financial Services Committee Holds
Markup on Financial Regulatory Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-4653577?
9&search=M9QutUd4.
108 CQ Congressional Transcripts, “House Financial Services Committee Holds Markup on Financial Regulatory
Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-4653577?9&search=M9QutUd4.
109 CBO, Cost Estimate of H.R. 1408, April 9, 2015, at https://www.cbo.gov/sites/default/files/cbofiles/attachments/
hr1408_1.pdf.
110 Regulatory capital ratios would increase because the computation used to determine capital levels would allow
banks to hold less capital. See Ibid.
111 This section was authored by Sean Hoskins, analyst in Financial Economics.
112 A similar bill, H.R. 4521, was ordered to be reported by the Financial Services Committee in the 113th Congress.
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or fewer. Supporters of H.R. 1529 argue that the bill would reduce the burden on small lenders
and servicers of complying with these regulations while giving added flexibility to consumers.
Opponents argue that the bill would roll back consumer protections that were put in place in
response to the housing and foreclosure crisis.
Escrow Accounts. An escrow account is an account that a “mortgage lender may set up to pay
certain recurring property-related expenses ... such as property taxes and homeowner’s
insurance.”113 Property taxes and homeowner’s insurance often are lump-sum payments owed
annually or semiannually. To ensure a borrower has enough money to make these payments, a
lender may divide up the amount owed and add it to a borrower’s monthly payment. The
additional amount paid each month is placed in the escrow account and then drawn on by the
mortgage servicer that administers the account to make the required annual or semiannual
payments. Maintaining escrow accounts for borrowers is an additional cost to banks and may be
especially costly for smaller firms.
An escrow account is not required for all types of mortgages but had been required for at least
one year for higher-priced mortgage loans even before the Dodd-Frank Act.114 A higher-priced
mortgage loan is a loan with an APR “that exceeds an ‘average prime offer rate’115 for a
comparable transaction by 1.5 or more percentage points for transactions secured by a first lien,
or by 3.5 or more percentage points for transactions secured by a subordinate lien.”116 If the first
lien is a jumbo mortgage (above the conforming loan limit117 for Fannie Mae and Freddie Mac),
then it is considered a higher-priced mortgage loan if its APR is 2.5 percentage points or more
above the average prime offer rate. The Dodd-Frank Act, among other things, extended the
amount of time an escrow account for a higher-priced mortgage loan must be maintained from
one year to five years, although the escrow account can be terminated after five years only if
certain conditions are met. It also provided additional disclosure requirements.118
The Dodd-Frank Act gave the CFPB the discretion to exempt from certain escrow requirements
lenders operating predominantly in rural areas if the lenders satisfied certain conditions.119 The
CFPB’s escrow rule included exemptions from escrow requirements for lenders that (1) operate
predominantly in rural or underserved areas; (2) extend 500 mortgages or fewer; (3) have less
than $2 billion in total assets; and (4) do not escrow for any mortgage they service (with some
exceptions).120 Additionally, a lender that satisfies the above criteria must intend to hold the loan
in its portfolio to be exempt from the escrow requirement for that loan. H.R. 1529 would expand
the exemption such that a lender also would be exempt from maintaining an escrow account for a
113 CFPB, “What is an escrow or impound account?,” at http://www.consumerfinance.gov/askcfpb/140/what-is-an-
escrow-or-impound-account.html.
114 A higher-priced mortgage loan is different from a high-cost mortgage described in H.R. 650. (See “H.R. 650:
Preserving Access to Manufactured Housing Act of 2015.”)
115 The average prime offer rate (APOR) is an estimate of the market mortgage rate based on a survey of rates. The
CFPB will publish the APOR weekly.
116 CFPB, “Escrow Requirements Under the Truth in Lending Act (Regulation Z),” 78 Federal Register 4726, January
22, 2013.
117 See CRS Report RS22172, The Conforming Loan Limit, by N. Eric Weiss and Sean M. Hoskins.
118 CFPB, Small Entity Compliance Guide: TILA Escrow Rule, April 18, 2013, p. 4, at http://files.consumerfinance.gov/
f/201307_cfpb_updated-sticker_escrows-implementation-guide.pdf.
119 P.L. 111-203, §1461.
120 See 12 C.F.R. §1026.35 and CFPB, “Escrow Requirements Under the Truth in Lending Act (Regulation Z),” 78
Federal Register 4726, January 22, 2013.
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mortgage as long as it satisfied two criteria: (1) the mortgage is held by the lender in its portfolio
for three or more years and (2) the lender has $10 billion or less in assets.
Policy Discussion. When the CFPB issued its escrow rule in January 2013, it estimated that
“there are 2,612 exempt creditors who originated ... first-lien higher-priced mortgage loans in
2011.”121 It also estimated that there would be 5,087 lenders with $10 billion or less in total assets
who, collectively, originated 91,142 first-lien higher-priced mortgage loans in 2011 that would
not be exempt from the escrow requirements.122 If H.R. 1529 had been in place in 2011, those
additional 5,087 lenders would have been exempt from the escrow requirements for the loans
held in portfolio for three or more years.
Supporters of H.R. 1529 argue that expanding the escrow exemption is important for reducing the
regulatory burden on small banks. Small banks already would have the incentive, the argument
goes, to make sure the borrower will pay taxes and insurance even without the escrow account
because the lender is exposed to some of the risk by keeping the mortgage in its portfolio.123
Because of this “skin in the game,” supporters believe the escrow requirement is unduly
burdensome for small banks. They also believe the requirement can be an unnecessary burden to
consumers who would rather manage their taxes and insurance payments on their own, especially
if those consumers have a history of making their required payments on previous loans.124
Opponents of H.R. 1529 argue that the escrow requirement is an important consumer protection.
The escrow account is required for higher-priced mortgage loans, and critics contend that the
higher interest rate on those loans reflects the fact that borrowers with these loans often are riskier
subprime borrowers.125 Because these borrowers already face a higher risk of default, opponents
of H.R. 1529 believe the escrow requirement is important for ensuring these borrowers are not
“being blindsided by additional costs at the end of each year.”126 They argue that the exemption
the CFPB gave for certain smaller entities already strikes the appropriate balance between
reducing the regulatory burden for some banks and protecting consumers.
Mortgage Servicers. The second part of H.R. 1529 addresses mortgage servicers. Servicers
received added attention from Congress after the surge in foreclosures following the bursting of
the housing bubble. The Dodd-Frank Act imposed additional requirements on servicers to protect
borrowers through amendments to TILA and RESPA.127 The new servicing protections128 include,
among other things, additional disclosure requirements about the timing of rate changes,
requirements for how payments would be credited, obligations to address errors in a timely
121 CFPB, “Escrow Requirements Under the Truth in Lending Act (Regulation Z),” 78 Federal Register 4747, January
22, 2013.The data the CFPB uses do not include non-depository institutions, so the CFPB estimates are a lower bound.
122 Ibid, 4748..
123 CQ Congressional Transcripts, “House Financial Services Committee Holds Markup on Financial Regulatory
Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-4653577?9&search=M9QutUd4.
124 Ibid.
125 Ibid.
126 Ibid.
127 12 U.S.C. §§2601 et seq.
128 Some of the servicing requirements are specific mandates in the Dodd-Frank Act, and some are issued at the
discretion of the CFPB pursuant to its authority under RESPA and TILA.
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fashion, and guidance on when foreclosure could be initiated and how servicers must have
continuity of contact with borrowers. The CFPB issued rules implementing those changes.129
Servicers that service 5,000 mortgages or fewer and only service mortgages that they or an
affiliate owns or originated are considered small servicers and are exempted from some but not
all TILA and RESPA servicing requirements.130 H.R. 1529 would modify the exemption for the
rules implemented under RESPA by directing the CFPB to provide exemptions to or adjustments
from the RESPA servicing provisions for servicers that service 20,000 mortgages or fewer “in
order to reduce regulatory burdens while appropriately balancing consumer protections.”131 The
RESPA servicing provisions that could be affected by H.R. 1529 include, among other things,
how escrow accounts (if they are required) would be administered, disclosure to an applicant
about whether his or her servicing can be sold or transferred, notice to the borrower if the loan is
transferred, prohibitions on the servicer relating to fees and imposing certain types of insurance,
and other consumer protections.132
Policy Discussion. In its discussion of its servicing rule, the CFPB notes that “servicers that
service relatively few loans, all of which they either originated or hold on portfolio, generally
have incentives to service well.”133 The incentive to service the loans well comes from the fact
that “foregoing the returns to scale of a large servicing portfolio indicates that the servicer
chooses not to profit from volume, and owning or having originated all of the loans serviced
indicates a stake in either the performance of the loan or in an ongoing relationship with the
borrower.”134 The CFPB, therefore, found that an “exemption may be appropriate only for
servicers that service a relatively small number of loans and either own or originated the loans
they service.”135
The CFPB set the loan threshold at 5,000 loans because it concluded that this category “identifies
the group of servicers that make loans only or largely in their local communities or more
generally have incentives to provide high levels of customer contact and information.”136 The
CFPB’s data analysis of the threshold concluded that
With the threshold set at 5,000 loans, the Bureau estimates that over 98% of insured
depositories and credit unions with under $2 billion in assets fall beneath the threshold. In
contrast, only 29% of such institutions with over $2 billion in assets fall beneath the
threshold and only 11% of such institutions with over $10 billion in assets do so. Further,
129 CFPB, “Mortgage Servicing Rules Under the Real Estate Settlement Procedures Act (Regulation X),” 78 Federal
Register 10695, February 14, 2013, and CFPB, “Mortgage Servicing Rules Under the Truth in Lending Act (Regulation
Z),” 78 Federal Register 10901, February 14, 2013.
130 See, for example, 12 C.F.R. 1026.41. The CFPB provided exemptions to small servicers from certain TILA
requirements using its authority under TILA. The CFPB elected not to extend certain RESPA requirements to small
servicers. See CFPB, “Mortgage Servicing Rules Under the Real Estate Settlement Procedures Act (Regulation X),” 78
Federal Register 10699, February 14, 2013.
131 H.R. 4521, §3.
132 For a full list, see 12 U.S.C. §2605 and CFPB, “Mortgage Servicing Rules Under the Real Estate Settlement
Procedures Act (Regulation X),” 78 Federal Register 10699, February 14, 2013.
133 CFPB, “Mortgage Servicing Rules Under the Truth in Lending Act (Regulation Z),” 78 Federal Register 10980,
February 14, 2013.
134 Ibid.
135 Ibid, 10975.
136 Ibid, 10981.
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over 99.5% of insured depositories and credit unions that meet the traditional threshold for a
community bank—$1 billion in assets—fall beneath the threshold. The Bureau estimates
there are about 60 million closed-end mortgage loans overall, with about 5.7 million serviced
by insured depositories and credit unions that qualify for the exemption.137
The CFPB’s 2013 rulemaking did not discuss the effect of setting the threshold at 20,000 loans, as
H.R. 1529 would, but it noted that if “the loan count threshold were set at 10,000 mortgage loans,
for example, over 99.5% of insured depositories and credit unions with under $2 billion in assets
would fall beneath the threshold. However, 50% of insured depositories with over $2 billion in
assets and 20% of those with over $10 billion in assets would fall beneath the threshold.”138
Those entities that service more than 5,000 loans, the CFPB contends, may be more likely to use
a different servicing model that would not have the same “incentives to provide high levels of
customer contact and information.”139 The CFPB, therefore, set the threshold at 5,000 loans.
Supporters of H.R. 1529 argue that the bill is intended to give the CFPB the discretion to either
provide “exemptions or adjustments to the requirements of the existing codes section and should
do so appropriately balancing consumer protections. So the near-small institutions will either get
the relief currently granted to the small institutions or a bit less relief, and that will be determined
by the CFPB.”140 Raising the threshold from 5,000 loans to 20,000 loans, supporters argue, “will
better delineate small servicers from the large servicers, and give credit union and community
banks greater flexibility to ensure that more of their customers can stay in their homes.”141
Opponents of H.R. 1529 have contended that the exemptions in the CFPB’s regulations are
sufficient to protect small lenders and that expanding the exemptions would weaken the
protections available to consumers. They note that by not only raising the threshold but also
removing the requirement that servicers own the mortgage, the servicers would have “less skin in
that game if bad servicing practices were to result in default and foreclosure.”142 Critics point to
mortgage servicers in particular as actors that performed poorly during the foreclosure crisis and
should not receive additional exemptions from CFPB regulations.143
CBO estimates that H.R. 1529 as ordered reported would “increase direct spending by less than
$500,000 for expenses of the CFPB to prepare and enforce new rules” but would not affect
revenues or discretionary spending.144
137 Ibid.
138 Ibid.
139 Ibid. The CFPB notes that its estimates are only for depository institutions and do not include non-depositories due
to data limitations.
140 Attributed to Rep. Brad Sherman by CQ Congressional Transcripts, “House Financial Services Committee Holds
Markup on Financial Regulatory Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-4653577?
0&search=4xqeO9ST.
141 Attributed to Rep. Blaine Luetkemeyer by CQ Congressional Transcripts, “House Financial Services Committee
Holds Markup on Financial Regulatory Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-
4653577?0&search=4xqeO9ST.
142 Attributed to Rep. Maxine Waters by CQ Congressional Transcripts, “House Financial Services Committee Holds
Markup on Financial Regulatory Legislation, March 25, 2015, at http://www.cq.com/doc/financialtranscripts-4653577?
0&search=4xqeO9ST.
143 Ibid. See also CRS Report R41491, “Robo-Signing” and Other Alleged Documentation Problems in Judicial and
Nonjudicial Foreclosure Processes, by David H. Carpenter.
144 CBO, Cost Estimate of H.R. 1529, April 3, 2015, at https://www.cbo.gov/sites/default/files/cbofiles/attachments/
(continued...)
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Author Contact Information
Sean M. Hoskins, Coordinator
Edward V. Murphy
Analyst in Financial Economics
Specialist in Financial Economics
shoskins@crs.loc.gov, 7-8958
tmurphy@crs.loc.gov, 7-6201
Marc Labonte
Gary Shorter
Specialist in Macroeconomic Policy
Specialist in Financial Economics
mlabonte@crs.loc.gov, 7-0640
gshorter@crs.loc.gov, 7-7772
(...continued)
hr_1529.pdf.
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