Homebuyers Assistance Act

Floor Speech

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Mr. HILL. Mr. Speaker, I thank the chairman for yielding me some time on this important measure.

Mr. Speaker, I rise today in support of H.R. 3192, the Homebuyers Assistance Act, this commonsense, bipartisan bill which will provide certainty for the short transition period for the real estate industry, preventing costly market disruptions and delays for American homebuyers.

I thank Mr. Sherman for his help in design and leadership. I also thank my friends, Mr. Vargas and Mr. Pearce, who worked on this bill as well.

This straightforward measure will provide a temporary hold harmless period from enforcement action and litigation during the initial implementation of this new TILA-RESPA Integrated Disclosure form. This rule, by the way, became effective this past Saturday.

Companies out in the real world are trying to get this closing regime right and have spent billions of dollars in updating their systems and hundreds of man-hours training employees to comply with this 1,800-page rule.

Again, I remind my colleagues that, at the height of the Depression, in rewriting all of America's banking laws, the Banking Act of 1933 consumed only 37 pages.

There is no opportunity to test. This is a bright-line rule that just turns on. You have to have new forms and new, substantive changes, and these compliance challenges are many.

This temporary grace period will allow the industry to work with the CFPB to ensure a smooth transition. As previously noted, 300 bipartisan Members have urged this grace period, including the ranking member.

We are here today by the inadequate response of the CFPB to a lot of concerns across our Nation, from Realtors, mortgage lenders, title companies, people in the appraisal business.

Mr. Cordray could have provided this certainty, just like HUD did for the revised RESPA disclosures back in 2010. But statements from Mr. Cordray like the industry can ``read between the lines'' doesn't constitute certainty in the real world.

It might here in the Beltway. But as a Member of Congress who until the end of 2014 was CEO of a community bank, I can assure you that kind of ``read between the lines'' certainty doesn't work in the real world.

A recent survey by the American Bankers Association indicated over 40 percent of institutions have not yet received compliance software needed to implement TRID. It is very frustrating to Members on both sides of the aisle, particularly after the number of years that we have talked about a new TRID form. But, nonetheless, it is a fact. Ninety percent of institutions were still testing the incorporation into their lending platforms.

I can tell you this is more complicated than it looks to someone who is a bureaucrat in Washington. You have got a loan operating system and a loan doc prep system typically from two different vendors. Both require software changes.

Three-quarters of those surveyed in the mortgage banking industry said they needed an additional 3 weeks to 4 months for additional debugging and testing. So this commonsense bill will allow them to perform that task, not disrupt closings, and allow people to have a safe harbor from potential litigation or enforcement penalties.

One bank in Arkansas called me Monday, 2 days after TRID went live, to say they are still not expected to get the final fix from their software providers until Thanksgiving.

In addition to these kinds of operating implementation issues, many are still out there waiting for clarification from the CFPB on certain issues.

The chairman mentioned one-time close. One of the most popular products in banking today, particularly among community banks, is a construction-to-permanent mortgage closing, where one can build their home and go to a permanent loan closing all with one application and one set of forms and a single closing.

But because of confusion over how to properly disclose information under the new TRID form, I think this is a problem. Several banks, as noted, are going to cease one-time construction-to-permanent loan making, again, one of the most popular products in community banking.

I want to emphasize that this temporary protection only applies to those making a good faith effort to comply to this very complex rule. It in no way alters the underlying rule.

While I disagree with much of Dodd-Frank, I support the general purpose of this rule, which is to attempt to streamline and simplify mortgage disclosures for consumers, albeit, comparing the forms side by side, I don't know if that was accomplished or not. But it is absolutely a worthy objective.

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Mr. HILL. Our title companies, bankers, and others in the industry who are earnestly trying to comply with these new TRID rules need to have the confidence and certainty that they can go into this closing regime giving excellent customer service, and not be looking over their shoulder for an inadvertent penalty or civil litigation.

Mr. Speaker, we are pro-consumer. 400,000 consumers buy a home every month in this country, and over 230,000 consumers refinance a mortgage. All will be positively impacted by this temporary measure. I urge its consideration.

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