On March 13, the White House issued an executive order titled “Promoting Access to Mortgage Credit.” The order states that statutory and regulatory changes adopted over the past two decades, specifically the Dodd-Frank Act, have increased compliance burdens related to originating and servicing mortgages — which have contributed to a decline in bank participation in mortgage lending, particularly among banks with fewer than $100 billion in assets. To improve access to mortgage credit, reduce regulatory burdens, and promote innovation and competition, the executive order directs the CFPB and the various federal financial regulators (including the Fed, FDIC, FHFA, NCUA and OCC) to consider a range of actions.

The order directs the CFPB to consider:

1. Updating Ability-to-Repay/Qualified Mortgage (ATR/QM) requirements by removing “unnecessarily burdensome” elements
2. Replacing TILA-RESPA Integrated Disclosure timing rules with a materiality-based standard
3. Modernizing the right to rescission by promoting digital processes or exempting refinance transactions entirely
4. Amending Regulation C to raise the exemption threshold for smaller banks and reduce compliance burdens
5. Revising guidance, in coordination with the Fed, FDIC, OCC and NCUA, to exclude one- to four-family residential development lending from commercial real estate concentration guidance

The executive order instructs the broader group of regulators to consider:

1. Revising supervisory guidance to evaluate mortgage lenders on the effectiveness of their ATR determinations rather than technical compliance
2. Revising capital regulations to tailor risk weights for portfolio mortgages, servicing rights and warehouse lines of credit
3. Modernizing appraisal regulations to expand the use of alternative valuation models and reduce appraisal requirements for low-risk transactions
4. Modernizing collateral valuation and transfer systems between the Fed and the FHLBanks
5. Expanding access to FHLB advances tied to mortgage assets
6. Refocusing the FHLBanks’ Affordable Housing Program on faster execution for small-scale housing projects
7. Promulgating enforcement policies that discourage monetary penalties except where violations are willful, knowing or reckless

Finally, the order tasks HUD and VA with aligning appraisal standards and clarifying the distinction between habitability concerns and cosmetic issues, and directs them, along with the FHFA and USDA, to consider actions promoting digital mortgages and standardizing acceptance of electronic processes.