Provisions of Reg Reform Bill

The Dodd-Frank Wall Street Reform Bill was awaiting a vote in the Senate as Mortgage Servicing News went to press this month. The bill contains the following provisions that impact the mortgage industry. These provisions would:

* Require MBS issuers to retain up to 5% of the credit risk on conventional mortgages that don't a meet a "qualified" mortgage test.

* Create a Consumer Financial Protection Bureau with rule-making authority over all mortgage lenders and explicated enforcement authority over nonbank or independent mortgage bankers, mortgage brokers and servicers.

* Establish a national consumer hotline so consumers can report problems with financial products and services.

* Instruct federal regulators to establish minimum mortgage underwriting standards along with loan officer and mortgage broker compensation standards.

* Require lenders to disclose the borrower's credit score when they reject a mortgage application.

* Lower the interest rate and points/fee trigger for HOEPA loans.

* Abolish the Office of Thrift Supervision and transfer supervision of federally chartered thrifts into the Office of the Comptroller of the Currency.

* Mandate federal or state regulation of appraisal management companies and require AMCs to pay appraisers their "customary" fee.

* Direct the Federal Reserve Board to examine the mortgage banking subsidiaries of the bank holding companies.

* Provide $1 billion for a program to help unemployed homeowners pay their mortgages and $1 billion to help cities and municipalities renovate foreclosed and abandoned houses.

* Raise the $100,000 deposit insurance limit to $250,000 and lower FDIC insurance premiums for community banks.

* Strengthen the Securities and Exchange Commission's oversight of the credit rating agencies.

* Preserve the Federal Trade Commission's existing consumer protection mandate and direct the FTC to work with the Consumer Financial Protection Bureau to avoid duplicative regulation of the same businesses.

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