WASHINGTON (10/4/13)--Rep. Bill Huizenga (R-Mich.) last week introduced a pared-down version of the Consumer Mortgage Choice Act (H.R. 3211), a bill which would address some credit union concerns regarding point and fee definitions in the Consumer Financial Protection Bureau's amended final "Ability to Repay" rule.
H.R. 3211 is a revised version of H.R. 1077, which Huzienga introduced earlier this year. The legislator simplified his earlier bill to increase its chances of final passage, CUNA Senior Vice President of Legislative Affairs Ryan Donovan said.
The CFPB's "Ability to Repay" rule, which will require lenders to determine a borrower's ability to repay before writing a mortgage loan, is slated to take effect on Jan. 10, 2014. CUNA remains concerned about the definition of points and fees in the rule, CUNA President/CEO Bill Cheney wrote. "Specifically, we are concerned that the inclusion of affiliated title charges remains as part of the points and fees definition," he said.
Huizenga's new bill, which was referred to the House Financial Services Committee late last week, would exclude from the definition compensation which is retained by a creditor or its affiliate as a result of its participation in an affiliated business arrangement as defined under the Real Estate Settlement Procedures Act.
"Defining points and fees in this way will maintain a competitive marketplace, prevent over-pricing or limiting choice in low-moderate income areas and allow consumers to enjoy the existing benefit of working through one entity for their new mortgage or refinance," Cheney wrote.
Cheney thanked Huizenga for introducing the bill, and said CUNA looks forward to helping him move the bill through Congress.