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house Bill H.R. 3971

Giving Community Banks Relief From Mortgage Regulations Under Certain Circumstances

Argument in favor

This bill would ease the regulatory burden on small community financial institutions that offer mortgage loans, helping them better serve their clients officially.

Carey's Opinion
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12/13/2017
Just make sure the big banks don't get the same benefits.
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Fibonacci's Opinion
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12/07/2017
We need to leverage competition with the Big Banks by assisting credit unions in turn avoiding another Too Big to Fail scenario.
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Edder61's Opinion
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12/07/2017
Trash Dodd/Frank. It's bad for our country and small business.
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Argument opposed

This bill would ease requirements around risky, high-priced mortgage loans and make much larger banks eligible for this regulatory relief.

Julie's Opinion
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12/06/2017
I think we saw in 2008 what happens when you ease restrictions regarding housing loans. These people are predatory af.
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Leo's Opinion
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12/03/2017
Exemption from escrow requirements would create more risky and unsecured debt that would then be traded as high risk derivatives. This began our last economic downturn.
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RadicalModerate's Opinion
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12/04/2017
The 2018 United States elections will mostly be held on Tuesday, November 6, 2018. These midterm elections will take place in the middle of Republican President Donald Trump's term. All 435 seats in the United States House of Representatives and 33 of the 100 seats in the United States Senate will be contested.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
      senate Committees
      Committee on Banking, Housing, and Urban Affairs
  • The house Passed December 12th, 2017
    Roll Call Vote 293 Yea / 129 Nay
      house Committees
      Committee on Financial Services
      Consumer Protection and Financial Institutions
    IntroducedOctober 5th, 2017

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What is House Bill H.R. 3971?

This bill would exempt financial institutions from the requirement to establish escrow accounts to pay property taxes and insurance premiums for properties that secure “high-priced mortgages” with interest rates above certain thresholds if the lender has less than $25 billion in consolidated assets and holds the mortgage on its balance sheet for three years. It would also direct the Consumer Financial Protection Bureau (CFPB) to exempt mortgage servicers from requirements to administer escrow accounts if they service 30,000 or fewer mortgage loans each year.

Impact

Financial institutions with fewer than $25 billion in consolidated assets and their mortgage borrowers; and the CFPB.

Cost of House Bill H.R. 3971

$500.00 Thousand
The CBO estimates that enacting this bill would cost less than $500,000.

More Information

In-DepthSponsoring Rep. Claudia Tenney (R-NY) introduced this bill to reduce the regulatory burden on small financial institutions that offer mortgage loans. The Credit Union National Association wrote the following in support of the bill:

“We believe that the [CFPB] has the authority to make these exemptions under the existing authority which Congress conveyed to keep the regulatory burden on community financial institutions measured while the Bureau addressed its rulemaking on large banks and abusers of consumers. Unfortunately, the Bureau has not exercised this authority to the fullest extent possible, making this legislation necessary in order to ensure these rules are appropriately focused. The two changes made by this proposal would provide important regulatory relief to credit unions and help them to continue efficiently serving their members.”

Some Democrats have expressed their opposition to this bill, with some writing the following in its committee report:

“High-priced mortgage loans are essentially loans with higher interest rates that reflect riskier or subprime borrowers. H.R. 3971 would enable larger servicers, whose incentives are neither aligned with owners of the loans nor the borrowers, to potentially revive some of the abusive practices involved with predatory lending that contributed to the 2007-2009 financial crisis. Relatedly, escrow accounts are an important consumer consumer protection mechanism that ensure that homeowners have funds for recurring homeownership-related expenses, such as property taxes and insurance.”

This legislation passed the House Financial Services Committee on a 41-19 vote and has the support of four bipartisan cosponsors evenly divided between Republicans and Democrats.


Media:

Summary by Eric Revell

(Photo Credit: SARINYAPINNGAM / iStock)

AKA

Community Institution Mortgage Relief Act of 2017

Official Title

To amend the Truth in Lending Act and the Real Estate Settlement Procedures Act of 1974 to modify the requirements for community financial institutions with respect to certain rules relating to mortgage loans, and for other purposes.

    Just make sure the big banks don't get the same benefits.
    Like (10)
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    I think we saw in 2008 what happens when you ease restrictions regarding housing loans. These people are predatory af.
    Like (71)
    Follow
    Share
    Exemption from escrow requirements would create more risky and unsecured debt that would then be traded as high risk derivatives. This began our last economic downturn.
    Like (40)
    Follow
    Share
    The 2018 United States elections will mostly be held on Tuesday, November 6, 2018. These midterm elections will take place in the middle of Republican President Donald Trump's term. All 435 seats in the United States House of Representatives and 33 of the 100 seats in the United States Senate will be contested.
    Like (29)
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    What the hell!!! This administration knows no bounds. They find every way to screw the people. They want to stomp on us and flatten us until we are powerless. Keep bank regulations in place. Put all regulations back. Get rid of trump and his administration.
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    No. Don’t help big banks and don’t set us up for another financial meltdown.
    Like (12)
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    No more corporate relief. This is just to prevent the "corporate" damage incurred in the 2008 housing crash by the same industry bent on recreating it. Basically saying: Yep, we messed up and created a big mess and we want to do it again; only this time we want our immunity in advance. 📩 You are pushing the envelope. I realize you are delusional and believe that if you some how manage the 4th turning through a carefully planned class war that you will somehow escape unscathed. But you won’t! This is not Vietnam, and you will eventually be shown the door in the same manner as those politicians who used the Vietnam war to fatten their bank accounts were. That will be your destruction, your downfall, and your legacy! Will you be able to push either a internal of external war? It is likely that you will. But, you will not come out of this skirmish as the victor or victim. You will be the hunted as enemies of the state: guilty of treason.
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    2009 - here we go again?!!!
    Like (10)
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    This bill would ease requirements around risky, high-priced mortgage loans and make much larger banks eligible for this regulatory relief. Of course our heritage-bought-and-payed-for Putin/republicans would want this. More of a corporate takeover of America by the party of pedophiles, white supremest, KKK lovers... and they are a little worried about their brand today after endorsing Moore, hard to understand right?
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    We don’t need more leniency; we need accountability.
    Like (8)
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    We need to leverage competition with the Big Banks by assisting credit unions in turn avoiding another Too Big to Fail scenario.
    Like (6)
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    Are you kidding? The banking industry needs MORE oversight and regulation than it has now.
    Like (5)
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    Again, like with the Agents. This step is *blatant* banking *deregulation*, and undermines Dodd/Frank. Don't do it Congressman LaMalfa! Your Constituents in CA01, you know the ones who've promiaed NO #rubberstamp vote for you -- are watching you. Remember, #2018StartsNOW
    Like (4)
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    No we need those regulations to prevent fraud and companies taking advantage of and scamming customers. This bill will cost people their homes. Bad bad idea.
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    Do you have any memory of the world wide financial collapse of 2007-2008? Vote against this absurd proposal.
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    2008
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    It seems a little rushed for us to be loosening standards on mortgages when the memories of the last housing bubble and subsequent collapse are still so fresh in our political history. I don’t think this is the best way to try and make lending convenient for small banks if it happens at the expense of safe business practice.
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    Hell no! We have bailed the mortgage industry out enough. No more risky loans!
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    I’m missing how this would help the consumers. It seems as though it would benefit the banks.
    Like (4)
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    This creates unnecessary risk in a market that can be subject to recession in Markets that result in people losing homes and being devastated by financial crisis. I don’t agree with this bill. I oppose.
    Like (3)
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