Homeownership is one of the cornerstones of the American Dream and the linchpin of economic stability and opportunity. Yesterday, NCLR's Janis Bowdler, Director of the Wealth-Building Policy Project, testified at a congressional hearing on the impact of new changes to the nation's mortgage laws. At the center of the hearing was H.R. 2446, known as the “Real Estate Settlement Procedures Act Home Warranty Clarification Act of 2011.” This bill would ensure that consumers throughout America have access to and are provided with clear information about the cost of mortgage settlement. H.R. 2446 would also serve to protect consumers from unnecessarily high settlement charges, which are generally the result of predatory financial practices. Bowdler made her case for the protections provided by the legislation, which would improve financial markets for Hispanics, immigrants and other consumers of color. Her testimony highlighted three aspects of the mortgage origination process that are currently under consideration by Congress, and she offered recommendations for creating a responsible and accessible mortgage market.
Below are Bowdler’s opening remarks. You can read the full text of her testimony here.
“For the last four decades, NCLR has been committed to improving opportunities for the nation s 50.5 million Latinos. To this end, NCLR conducts research, policy analysis, and advocacy on a variety of financial services issues that affect the ability of Latinos to build and maintain assets and wealth. I would like to thank Chairwoman Judy Biggert and Ranking Member Luis Gutierrez for inviting me to participate in today’s hearing.
For more than two decades, NCLR has engaged in public policy issues that focus on supporting strong fair housing and fair lending laws, increased access to financial services for low-income people, and promoting homeownership in the Latino community. And for more than ten years, the NCLR Homeownership Network (NHN)—a network of 50 community-based counseling providers—has been providing first-time homebuyers with the advice and guidance they need to navigate the mortgage process. NHN counselors have produced more than 25,000 first-time homebuyers over the last 13 years. NCLR's subsidiary, the Raza Development Fund (RDF), is the nation’s largest Hispanic Community Development Financial Institution (CDFI). Since 1999, RDF has provided $500 million in financing to community-based development projects throughout the country, building the capacity of local nonprofits and creating opportunities for Latino communities. Our research, programs, and market investments have increased NCLR’s institutional knowledge of how Latinos interact with the mortgage and financial markets and the impact on their communities.NCLR strongly supports the Dodd-Frank Wall Street Reform and Consumer Protection Act. This landmark legislation includes new protections that will improve financial markets for Hispanic and immigrant consumers, a number of which will be under the jurisdiction of the newly created Consumer Financial Protection Bureau (CFPB). In addition, regulators are drafting rules that will guide the implementation of new remittance protections, underwriting standards, and mortgage reform. Though the majority of rules have yet to be finalized, NCLR has high hopes that the new rules will further the goals of Dodd-Frank by protecting consumers while maintaining market access.
In my brief comments today, I will draw your attention to three critical aspects of the mortgage origination process that are currently under consideration by Congress and federal regulators: the new Truth in Lending Act (TILA) disclosure being developed by CFPB; the Department of Housing and Urban Development’s (HUD) Housing Counseling Program; and the Federal Reserve’s pending rule to prohibit unfair steering practices.