The Dodd-Frank Rollback, the Economic Growth, Regulatory Relief and Consumer Protection Act, probably won't effect many future home buyers that are not Veterans. Check out the proposed changes awaiting Trumps anticipated signature.
The Economic Growth, Regulatory Relief and Consumer Protection Act,
a bill that will rollback some banking regulations created by the Dodd-Frank Wall Street Reform and Consumer Protection Act awaits The Presidents expected signature.
The rollback would allow some smaller and mid-sized banks to omit their cash balances held at the Federal Reserve and other central banks when calculating their supplementary leverage ratio, or what determines how much capital they need to hold," according to housingwire.com.
It also calls for the amendment of the Fair Credit Reporting Act, the federal statute that protects consumers and spells out how the credit bureaus and creditors can and must operate.
To keep it simple- here's what you can expect, how it may effect you and how it can effect your potential clients.
Here's the part that is causing confusion to my referral partners I have spoke with, the collection changes apply only to Veterans.
Debt Protections for Veterans -
These changes will take effect one year after the bill is signed:
Medical debt incurred by a veteran cannot be reported to the credit bureaus for at least one year from the date the medical services were performed. It is currently 180 days.
Medical debt incurred by a veteran that is in collections must be removed from their credit reports once the debt has been paid or settled. Currently, the standard 7 year rule for reporting collections applies.
Medical debt incurred by a veteran that is in collections must be removed from credit reports if the debt is or has been assumed by the Department of Veteran Affairs.
This will take 12-18 months to implement, a database will be created and will take at least a year.
Active duty military personnel will be able to sign up for free credit monitoring services from the credit reporting agencies.
Fraud alerts: Initial fraud alerts will last for one year, not 90 days, and anyone can add a fraud alert to their credit reports, even if they’ve never been the victim of fraud.
Free credit freezes: Security freezes will be free. Prior to the amendment, freezes were only free for victims of fraud.
Child credit protections: Children under the age of 16 are included in freezes.
Student Loans & Mortgages-
A debtor can request removal of any record of default if the lender offers loan rehabilitation programs and the debtor makes consecutive on-time payments to pay the loan on time.
The bill would also allow Fannie Mae and Freddie Mac to use newer-generation credit scores to underwrite residential mortgage loans if the newer score is determined to be reliable and accurate.
Today, Fannie Mae and Freddie Mac are required to use older FICO generations. This would allow for upgrade to newer credit-scoring models like FICO 8, FICO 9, VantageScore 3, or VantageScore 4.
In closing, use these changes to your advantage for yourself and or your clients purchasing homes, cars and all of life's other necessities!