On the Importance of Advocacy

QC Ally

By Jeff Flory, Chief Executive Officer of QC Ally

I am thankful that I was afforded the opportunity to participate in the MBA’s State and Local Workshop and National Advocacy Conference in Washington, DC. Having just gotten home after an exhilarating and tiring week, I have been able to reflect on the extremely important role that advocacy plays in the health of our lending industry and the promotion of homeownership for all.

First and foremost, there really aren’t enough superlatives to describe the efforts of the MBA in preparing for this week. It’s a Herculean task in both effort and coordination to bring over 350 mortgage professionals together, secure a slate of incredible guests to share their knowledge and insights (and a few political opinions), coordinate over 250 appointments with members of both the House and Senate in a hectic day on the hill, and make sure we are armed with the information we need to make articulate arguments to our elected officials and their staff on what we’d like to see happen and why.

In talking with one of my fellow California delegates, he made the comment that ‘just like voting, if you don’t take the time to participate, you essentially sacrifice the right to complain if things happen that you don’t like.’ I certainly understand how one can see their single solitary vote as not making a difference, but Advocacy hits differently — it’s real — it’s palpable – and you can see the direct connection people make between what you are saying and its impact on their constituents.

We had a full slate of issues to talk about during our time on the hill, but due to time limitations with each office, we chose to focus on those issues that were the most important:

Trigger Leads – While in some circumstances trigger leads can be a benefit to consumers and lenders (think servicing portfolio monitoring for indicators of financial stress), their usage has become synonymous with mortgage applications and the bombardment of consumers with calls after their credit report has been pulled. We were fortunate in talking about this with a couple of offices as two of the staffers we met with had recently purchased a home and experienced first-hand the seemingly endless texts, emails and phone calls.
VA Servicing Standards and Partial Claims – In the servicing world, partial claims options are both less costly to the VA than foreclosure claims and help keep more Veterans in their homes. While there was a partial claims process established through the CARES act pandemic relief, it expired in late 2022. Unfortunately, action by Congress is needed to re-establish this program. The USDA, FHA, and the GSE’s already have partial claims as part of their servicing default waterfall of options, so implementing this for Veterans is not a special program — it is simply putting them on equal footing to all other mortgage holders with financial distress.
BASEL III “Endgame” – While BASEL III is a bit more esoteric and encompasses much more than just mortgage lending, some of the parameters of BASEL III are seen as incredibly destructive in terms of the availability of mortgage credit to consumers. At issue are the risk weights applied to mortgages determined to be ‘higher risk’ (read higher LTV loans), capital requirements for Mortgage Servicing Rights, and the impact on warehouse lending.
Affordable Housing, Minority Homeownership, and Rural Housing – QC Ally has signed the MBA’s Home For All Pledge, and it’s imperative that Congress does what it can within its power to reduce barriers to homeownership. The path to building and achieving financial security is dramatically eased through homeownership, and we support a slate of Congressional initiatives to revitalize neighborhoods; increase the supply of affordable entry-level homes; remove barriers and cut red tape in the home building process; target transportation grants to increase mobility and access to affordable housing; provide down payment assistance for first-time homebuyers and first-generation homebuyers; and broaden USDA parameters to allow loans to be assumed or assigned and recognize rental income from ADU’s to USDA qualifying.
Remote Online Notarization – Last year, the House overwhelmingly signed a bipartisan bill, and now it’s the Senate’s turn to act. Even without the Senate bill, this is a great example of the MBA working with State organizations and leading industry supporters as we already have 45 States that have enacted RON legislation.
Regulatory Clarity – While this issue is a little ‘squishy’ in terms of having a specific ‘ask,’ what is important is that we articulate in very clear terms that the mortgage industry is ok with regulation and regulatory scrutiny. Our full support of the Trigger Leads initiative is supportive of the notion that we don’t want negatively disruptive players in our industry any more than regulators do. What is equally important is that we have a standard set of rules to work by and that proposed rules are promulgated through an established and predictable process. Policy through enforcement actions, blog posts, or other means do not allow for proper vetting via notice expectations, public input, etc.

What made the journey during the Conference most impactful was that while we were ostensibly engaged in political activity, there wasn’t a left or right spin to it. We were advocating for the mission of the MBA and that of our members, that homeownership is one of the best vehicles for wealth generation in our country. Anything that we can do to help promote the value of homeownership and reduce barriers for the greatest number of people, the better.

The work didn’t stop at National Advocacy, either. The State and Local workshop brought together State organizations from across the country to share best practices and talk about increasing engagement. Hopefully everyone left that session with some solid ideas to bring the principles of the National Advocacy Conference to their home states or enhance what they’re already doing.

I’m already signed up for the California MBA’s Legislative Day next month in Sacramento (April 23^rd), and I look forward to bringing that same spirit of advocacy in promoting homeownership in the Golden State. And for any of you who’ve made it this far in this article, I HIGHLY encourage you to get involved with your States. You know the adage, All Politics Are Local!