On March 13, 2026, President Donald Trump issued an Executive Order outlining a broad policy shift aimed at reducing regulatory burden in the U.S. mortgage market, with a particular emphasis on community banks and smaller financial institutions. The E.O. directs federal agencies to reassess existing mortgage-related regulations and supervisory practices to improve credit access, enhance market competition, and modernize operational frameworks, while maintaining core consumer protection principles.
Key takeaways from the Order include:
The CFPB is directed to review and amend Regulation Z to expand Qualified Mortgage safe harbors, reduce or modify points-and-fees caps for small-balance loans, streamline Ability-To-Repay (ATR) underwriting expectations to eliminate unnecessary compliance burdens, revisit TRID requirements, and modernize rescission requirements;
The Order calls for modernization of HMDA requirements, with a focus on reducing reporting burdens for smaller institutions;
Federal banking and housing agencies are directed to evaluate changes to capital and liquidity frameworks, focusing on risk weights for mortgage-related exposures, enhancing access to Federal Home Loan Bank (FHLB) funding, creating targeted liquidity programs for entry-level housing, and improving collateral valuation through digitizatio;
The Order promotes modernization of appraisal frameworks;
The Order emphasizes a shift to digital mortgage processes by eliminating unnecessary wet-signature requirements, standardizing e-signatures and remote online notarization, and promoting uniform standards across federal programs to enhance efficiency and reduce costs; and
The Order aims to simplify mortgage servicing by supporting community banks, streamlining loss mitigation, prioritizing resolution of servicing errors, and reducing emphasis on technical compliance, thereby promoting outcomes-based supervision.
Read the full Executive Order here.