Senate Housing Bill Criticized By Mortgage, Business Organizations

Washington, D.C.–Mortgage industry officials and business organizations are encouraging lawmakers to remove portions of a housing bill they feel would hurt lenders, BusinessWeek said Wednesday.Six groups–the American Financial Services Association, the Consumer Bankers Association, the Consumer Mortgage Coalition, Mortgage Bankers Association, U.S. Chamber of Commerce and the Financial Services Roundtable–sent a letter Tuesday to lawmakers that questioned the bill’s provision to make lenders select the best loan for each borrower.The groups feel that the requirement could result in lawsuits and cause lenders to “reduce the number and type of products to consumers.”The letter–sent to the two senior members of the Senate Banking Committee, Sens. Christopher Dodd (D-Conn.) and Richard Shelby (R-Ala.)–also expressed concern about another part of the bill, which would establish a national licensing system for loan officers and mortgage brokers.The groups want federal regulators to monitor lending–not the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators. Both organizations have been working on a licensing system for four years.The housing bill–which was passed last month by the Senate banking committee–could be voted on by the full Senate as early as this week.