The simple, immediate answer is likely “not much”, at least not in the short term. All the consternation caused by Dodd Frank and the CFPB’s implementation of the law through mortgage related regulation has pretty much passed. Most lenders have adjusted to TRID disclosure requirements and closings happen on time. Fannie, Freddie and the FHA pretty much drive underwriting standards. While we all wish it was easier to get credit, where we are now is probably a good place to sustain the market and avoid foreclosures. Absent its sometimes rattling enforcement actions, doing business under the CFPB’s mortgage regulations is pretty much a non-issue at this stage in the game.
While Cordray’s appointment of a deputy director, on his way out the door, may provide a few days of entertaining nightly news from Washington, ultimately there will be a Trump nominee to head the bureau confirmed by the Senate. But the CFPB, led by a Trump nominee, really won’t mean much to the housing industry and the regulations already in place. Those regulations are not really determinative of where the market is or where it might go. Could it be easier to close a loan with some changes to regulation? Sure it could. But changes to the regulations won’t dramatically change agency UW standards making credit more readily available or impact affordability. There are plenty of qualified buyers for the inventory that is available. Demand for available inventory is the least of our concerns.
So while the drama in Washington plays out over the next few days, any expected housing market impact, which will likely be minimal, is not happening anytime soon. In other financial areas there will be a more immediate impact from the changing of the guard at the CFPB, but for the mortgage industry and housing as a whole we know what we need to do and how we need to do it. We will likely be doing it this way for a while longer.