Republican leaders on the House Financial Services Committee are keeping an eye on federal regulators as they consider attaching national servicing standards to a risk retention rule.
In particular, GOP lawmakers appear wary of banking regulators — the Federal Deposit Insurance Corp. in particular, which has taken the lead on servicing issues — mandating new standards. (The risk retention rule is mandated by the Dodd-Frank bill passed last year.)
"To the extent the regulatory agencies seek to implement national mortgage servicing standards, the committee will review those standards to ensure that proper authority exists for such regulations and that deficient practices are adequately addressed without unduly increasing the cost of mortgage financing," according to a draft of the committee's oversight plan.
The House Financial Services Committee is slated to approve the plan this Thursday (Feb. 10), which will set the committee's oversight agenda for the year.
Committee chairman Spencer Bachus, R-Ala., also wants to stop the Obama administration from using more TARP funds for its HAMP loan modification programs. "Accordingly, the committee recommends rescinding unspent and unobligated balances currently committed to these programs," the oversight plan says.
The administration recently committed $8 billion for a new FHA program to refinance underwater borrowers. "Rather than funding another ineffective foreclosure mitigation program, the committee recommends that the $8 billion in TARP funds that has been set aside for this program be returned to the taxpayer," the plan says.
The Congressional Budget Office recently estimated the administration will spend only $12 billion of the $45.6 billion of TARP funds committed to HAMP and related foreclosure prevention programs.
