Idaho Senator Mike Crapo (R-ID), along with Senators Richard Shelby (R-AL), Bob Corker (R-TN) and Pat Toomey (R-PA), today introduced legislation, S. 3571, that requires the Consumer Financial Protection Bureau (CFPB) to conduct a small business panel on the Qualified Mortgage rule before it can go forward with a final rule.
Section 1100G of the Dodd-Frank Act requires the CFPB to conduct a small business review panel before it proposes a regulation. This panel would meet with representatives of directly regulated small entities and offers an opportunity to provide advice and recommendations on regulatory alternatives to minimize the burden on small businesses. In the case of the Qualified Mortgage rule, however, the CFPB is asserting a technicality to argue that it is not required to convene a small business panel before finalizing this rule.
"The CFPB is sending the wrong signal that it doesn't value the small business panel and its role in crafting rules that impact small businesses," Crapo said. "The Qualified Mortgage rule is one of the most important rules that the CFPB will write, as it will have a significant impact on the ability of every American to purchase a home. To help minimize unintended consequences, this legislation fulfills Congressional intent by requiring the CFPB to conduct a small business panel on the Qualified Mortgage rule before it can go forward with a final rule."
"Not surprisingly, the CFPB believes that it can play by its own rules," said Shelby, ranking member of the Banking Committee. "This legislation will ensure that the Bureau complies with the law."
"Requiring the CFPB to quantify the impact of their regulations on small businesses remains one of the few checks on the bureau's power and is an important component of congressional oversight," said Corker. "There is real danger that a QM regulation that ignores the impact on smaller lenders would adversely affect Americans' access to mortgages needed to purchase homes."