Federal regulators should create a consistent and clear “safe harbor” for mortgages, ABA and several other trade groups said in a letter to Housing and Urban Development (HUD) Secretary Shaun Donovan and CFPB Director Richard Cordray.
In the letter, the groups asked for written guidance so that “mortgage lenders and servicers are able to meet their responsibilities under all mortgage lending standards.”
The groups pointed out that HUD’s recent fair housing rule provides for liability for mortgage lending or servicing with a disparate impact, even with facially neutral mortgages. Meanwhile, the CFPB’s ability-to-repay rule, the groups said, “will tighten credit standards through facially neutral requirements that may lead to disparate outcomes.”
“We urge you to set out written guidance for the industry that makes clear that a lender will not be subject to disparate impact liability based on specific actions undertaken to avoid liability under the Dodd-Frank rules,” the groups concluded.
Read the letter.