Changes to Dodd-Frank are one step closer to being realized this week with modifications passing the Senate with a vote of 67-31. The bill, sponsored by Senate Banking Committee Chairman Mike Crapo (R-Idaho), is being presented as a way to diminish the negative impact the law has had on small banks and credit unions, according to The Hill. Those in opposition of the changes such as Sen. Sherrod Brown (Ohio) believe the bill favors "special interests and Wall Street."
The most talked about changes to Dodd-Frank would include a higher threshold for banks subject to a Federal Reserve stress test and higher capital requirements. The threshold would be increased from $50 billion to $250 billion, freeing many large regional banks from tighter regulation.
Additional changes detailed in S. 2155 include a HMDA exemption for banks that originate fewer than 500 mortgages, looser and clearer TRID rules, and appraisal waivers for rural properties valued under $400,000. In addition, portfolio lenders with total assets up to $10 billion would enjoy an exemption from the ability to repay requirements for their portfolios.
Organizations such as the Mortgage Bankers Association (MBA) are showing their support for the passage of this bill, urging the House to act “swiftly”. “This bill will further ensure consumer protections and adequate access to mortgage credit,” said David H Stevens, President and CEO of the MBA.
Next stop for the bill is the House where its future is still uncertain. The House originally sought to roll back more of Dodd-Frank so there is a fear additional changes will be made. If that happens, the window may close for a major legislative revision to the rule.