On the Hill is NAMB's bi-weekly read on what's happening in Washington and why it matters to mortgage brokers.
Each issue cuts through the noise to bring you the federal policy, legislation, and regulatory moves shaping your business, along with the context and action items you need to stay ahead.
Brought to you by the National Association of Mortgage Brokers, the voice of the broker community since 1973. |
Ten states are suing to save mortgage escrow interest, the FHFA is closing in on new pricing decisions, and the CFPB has a new acting director. Here's what brokers need to know. |
Lead Story: Ten States Sue Over Mortgage Escrow Interest |
A ten-state coalition is fighting to keep interest in borrowers' escrow accounts. On August 11, attorneys general led by Oregon and New York sued the Office of the Comptroller of the Currency to block two OCC rules that let national banks and federal savings associations decide whether to pay interest on mortgage escrow balances. The rules, issued May 15 and effective June 18, preempt interest-on-escrow laws in 14 states and territories. The suit, filed in the U.S. District Court for the District of Oregon, argues the OCC exceeded the preemption limits Congress set in Dodd-Frank. The plaintiff states are Oregon, New York, California, Connecticut, Maine, Maryland, Massachusetts, Minnesota, Rhode Island, and Vermont.
What brokers should know: about 80% of mortgage holders have escrow accounts, so this decides whether borrowers in those states keep earning interest on money held for taxes and insurance. Expect servicing practices to vary by state and by charter until the courts sort it out. The case also feeds the same National Bank Act preemption question the Supreme Court is weighing in Cantero.
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FHFA signals LLPA decisions are coming |
Loan pricing may be about to shift. On August 20, FHFA Director Bill Pulte posted that the agency is nearing the end of its review of certain loan-level price adjustments, with decisions coming soon. LLPAs feed directly into per-loan economics, so any change lands on your borrowers' rate sheets. Pulte's wording suggests the move will be targeted rather than a broad-based cut, and he previously tapped MBS Highway CEO and Fannie Mae board member Barry Habib to review and fix LLPAs.
For brokers: LLPA reduction is a standing NAMB priority. Watch for the specifics, since a narrow change could help some loan profiles and leave others untouched.
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Fannie Mae's AI governance rules are now in effect |
If your shop touches AI, this reaches you. Fannie Mae's Lender Letter LL-2026-04, effective August 6, sets governance expectations for lenders using artificial intelligence and machine learning in loans sold to Fannie Mae, and Freddie Mac has adopted similar requirements in its Seller/Servicer Guide. AI already sits inside loan origination systems, document recognition, fraud detection, pricing engines, and quality control tools, often without a lender realizing it.
For brokers: if you rely on automation anywhere in your process, confirm your partners can demonstrate responsible oversight, since that expectation now flows down through the loans you originate.
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The leadership handoff is done. Russell Vought's authority to serve as acting director under the Federal Vacancies Reform Act expired August 1, and Chief Legal Officer Mark Paoletta stepped in as acting director under the Bureau's succession provision. Reporting indicates Vought is staying on in a senior-adviser role. Nominee Brian Johnson, who told senators at his July 23 hearing that he does not intend to eliminate the Bureau, has not yet been confirmed.
Why it matters for brokers: Johnson's confirmation will determine whether the paused 2026 workforce reduction proceeds, and it sets the pace on LO compensation and RESPA servicing reform, both long-standing NAMB priorities.
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House Republicans float a CFPB overhaul. The House Financial Services Committee has circulated a discussion draft of a CFPB Reform Act of 2026 that would rewrite parts of the Bureau's structure and authority. It is early, but it signals the direction of the debate as a new director prepares to take over.
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- 30-year fixed: 6.65% (Freddie Mac PMMS, week ending August 20), down from 6.67% the prior week and above 6.58% a year ago, the second straight weekly decline.
- 15-year fixed: 5.95% (Freddie Mac, August 20), down from 5.96% the week before.
- Rates have mostly climbed this year on inflation expectations tied to the war with Iran and elevated Treasury yields. Pending home sales retreated in July, and MBA reported mortgage applications slipped 0.4% in its latest weekly survey.
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What your association has been doing these past two weeks:
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August 7: NAMB submitted its formal comment letter to the CFPB on TRID timing, the right of rescission, and reverse mortgage disclosures, supporting materiality-based flexibility while preserving the guaranteed consumer review periods, and urging parity for independent brokers with any relief given to small banks and credit unions.
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August 10: The CFPB's TRID comment period closed. NAMB thanks every member who submitted an example from their pipeline.
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Ongoing: The condo relief campaign continues, with the HOA reserve-funding increase to 15% set for January 4, 2027 as the next front. LO comp reform, LLPA reduction, credit report and credit scoring cost relief, flood insurance improvements, and expanded affordable housing access remain NAMB's 2026 priorities in Washington.
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- Now: H.R. 9237 and whether Section 104's VA home loan fee increases survive. Complete your Call to Action now.
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Soon: FHFA decisions on certain LLPAs, which Pulte says are coming soon.
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This fall: Senate confirmation action on CFPB nominee Brian Johnson, and the pace of LO comp and RESPA servicing reform under acting director Paoletta.
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In the courts: Oregon v. OCC on escrow interest, and whether the Supreme Court agrees to revisit Cantero.
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January 4, 2027: the condo HOA reserve-funding increase from 10% to 15% is set to take effect, the next front in NAMB's delay campaign.
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