The National Association of Mortgage Brokers Strongly Disagrees with the Community Development Financial Institutions Fund Recommendations for Proposed Modifications to CDFI Certification Application Processes

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For 50 years, NAMB has been voice of the mortgage industry representing the interests of mortgage professionals and home buyers

The National Association of Mortgage Brokers (NAMB), voice of the mortgage industry representing the interests of mortgage professionals and home buyers since 1973, strongly disagrees with recommendations from the Community Development Financial Institutions Fund (CDFI) regarding proposed modifications to the CDFI Certification Application process.

NAMB strongly believes many of the proposals extend beyond the CDFI Fund’s remit. Although several of the proposals are presented as supporting critical consumer protections, many of the new standards will force CDFIs to be less flexible and responsive to the needs of low- and moderate (LMI) communities.

“While NAMB members are not CDFIs, NAMB is very concerned by the precedent the CDFI Funds proposed rule would set as it relates to affordable mortgage products. The industry is already highly regulated and consumer protection is paramount amongst our membership. NAMB believes the limitations on CDFIs are unwarranted and if implemented as proposed could signal future crackdowns by regulators who actually have direct authority in the mortgage space,” said NAMB President Ernest Jones Jr.

Specifically, the CDFI Fund is proposing CDFIs be restricted from offering FHA streamline refinance loans to borrowers because the new loan does not require income verification. Recent studies have shown minority homeowners pay over $60,000 in additional interest on their mortgages over the life of their loans compared to other homeowners. The number one reason is minority homeowners are not generally offered the ability to refinance their homes when rates fall and are therefore stuck in higher-cost mortgages. The CDFI Fund proposal will exacerbate this problem in many LMI communities.

In addition to preventing the certification of CDFIs who offer FHA streamline refinances, the new proposed rule would disqualify from certification any CDFI that offers a VA IRRRL loan which allows veterans to refinance their homes at lower rates without high costs and fees associated with a full new underwriting. Minority veterans will be hit hardest by this new policy.

The damage the new proposal will do is not limited to refinance transactions. The CDFI Fund is threatening the certifications of CDFIs who use the industry standard bridge loan. A bridge loan can be very beneficial for LMI and low asset home buyers in illiquid markets and markets with sharply rising home prices, who need to cover expenses until an existing home is sold.

“Therefore, we have decided to lend our voice to the leading trade associations for the community banking industry, The National Bankers Association ( and The Community Development Bankers Association ( as they advocate for sensible changes to the proposed rule in Congress and within the Biden Administration. NAMB looks forward to this partnership as together we can ensure access and inclusion are offered in all communities across the country,” added Jones Jr.

About NAMB: The National Association of Mortgage Brokers has been the voice of the mortgage industry representing the interests of mortgage professionals and homebuyers since 1973. NAMB members include independent mortgage brokers, loan originators, and small businesses. NAMB provides mortgage professionals with advocacy, education, and rigorous certification programs to recognize members with the highest levels of professional knowledge and education. NAMB’s active lobbying and advocacy efforts focus on national and state issues, protecting the interests of its members and borrowers. As the leading national trade association for the mortgage industry, NAMB is affiliated with State Associations throughout the country and represents the interests of more than 910,000* licensed and registered Mortgage Loan Originators and 39,000* licensed mortgage broker and mortgage lender businesses. The Association hosts several meetings throughout the year. Engage the organization via social media:

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Joshua Steinfeld
Steinfeld Consulting
1 339-225-1581
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