Fact Sheet: President Donald J. Trump Promotes Access to Mortgage Credit

President Donald J. Trump has signed an Executive Order designed to increase mortgage competition and lower homeownership costs by reducing the regulatory burdens that have hindered community banks and smaller lenders. The administration characterizes the move as a necessary reversal of "market distortions" caused by the Dodd-Frank Act and subsequent federal rulemaking.Key components of the Executive Order include:Empowering Community Banks: The order directs the Consumer Financial Protection Bureau (CFPB) to tailor mortgage rules specifically for smaller banks, streamlining documentation requirements and promoting portfolio mortgage servicing as a core community banking function.Modernizing Appraisals and Underwriting: Regulators are instructed to shift from "process-oriented" approaches to "prudent underwriting" and to modernize appraisal regulations. This includes expanding the use of alternative valuation models and setting clearer timelines for appraisals.Capital and Liquidity Reforms: The order calls for reforms to risk-weighting and capital rules, specifically expanding access to Federal Home Loan Bank (FHLB) advances for residential mortgages and creating targeted liquidity programs for entry-level housing and small residential builders.Digital Mortgage Modernization: To reduce lending costs and timelines, the administration is expanding the use of electronic signatures, e-notes, and remote online notarization.Reporting and Privacy: The CFPB is directed to modernize Home Mortgage Disclosure Act (HMDA) requirements to reduce the compliance burden on lenders while enhancing borrower privacy.Broader Housing and Economic Strategy:The administration frames this order as part of a larger agenda to make the "American Dream" accessible again, building on previous actions such as:Prohibiting large institutional investors from purchasing single-family homes.Directing Fannie Mae and Freddie Mac to purchase $200 billion in mortgage-backed securities to lower rates.Implementing the Working Families Tax Cuts, which the administration claims has significantly increased household take-home pay.The administration asserts that by cutting "red tape" and restoring competition among local lenders, these reforms will lower mortgage rates and expand credit access for rural, low-income, and first-time homebuyers.