Trump Executive Order Targets TRID, ATR/QM, HMDA, and Other Rules for Revision in Regulatory Relief Effort for Banks in Mortgage Industry: What Your Company Needs to Know
President Trump issued two executive orders dealing with the mortgage and housing industries yesterday, March 13, 2026. One executive order, titled Promoting Access to Mortgage Credit, seeks regulatory relief for banks in the mortgage market. This order cites the regulatory burden on community banks and “smaller banks,” which it defines as banks with assets less than $100 billion. The order seeks amendments to several CFPB rules including the Ability-to-Repay/Qualified Mortgage (ATR-QM) rule, the Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA) Integrated Disclosure (TRID) rule, Home Mortgage Disclosure Act (HMDA) rule, servicing rules, and TILA rescission requirements. The other executive order, titled Removing Regulatory Barriers to Affordable Home Construction, seeks to amend federal regulatory requirements to remove barriers to and reduce the costs of residential housing development.
I will focus on the Promoting Access to Mortgage Credit Executive Order (“order”) in this post, because it touches upon many areas of consumer financial services regulation that may affect our clients’ businesses. In addition, it directs the CFPB to consider certain amendments to the TRID rule, which as you likely know, was the rule I led when I was a Senior Counsel and Special Advisor at the CFPB (I also led the design and consumer testing of the TRID forms).
Thisorder appears to be directed at the problem that is front and center for most voters in polls: housing affordability. What does it say? How will it affect your organization? Will it actually result in changes to the rules? Read below for more details on the order and some brief thoughts.
I. “Promoting Access to Mortgage Credit”
This order states that rulemaking, including rules under the Dodd-Frank Act, have increased the compliance costs in the mortgage market, which has “contributed to a significant decline in bank participation in mortgage lending.” The order then states that this has resulted in “reduced access to credit for some creditworthy borrowers, including rural households and low- and moderate-income households.” The order states that the administration’s policy is to, among other things, “tailor rules for community banks and ‘smaller banks’ (banks with assets fewer than $100 billion),” “modernize origination and closing standards to reduce lending costs,” “remove regulatory distortions to the structure of the mortgage market and to ensure capital and liquidity frameworks subject similar credit and liquidity risks to similar regulation across the system,” and to “promote competition among mortgage lenders of all charter types to drive down mortgage rates.”
The order has several sections in which it directs executive agencies to undertake specific regulatory reform initiatives in specific areas. Although the order’s preamble cites the regulatory burden on community and “smaller” banks, the order in many areas seeks generally applicable amendments to the rules or amendments targeting “banks” in general. Only some directives explicitly refer to community and smaller banks. I will discuss the order’s directives in more detail below.
A. CFPB’s Mortgage Rules
The order directs the CFPB to “consider, as appropriate and consistent with applicable law” many different amendments to its mortgage rules, which include:
Tailoring the requirements of TILA, RESPA, and the TRID rule to smaller banks
Several specific amendments to the ATR/QM rule:
Tailoring ATR and QM requirements to smaller banks, including potentially a broader QM safe harbor for portfolio loans
Exempting small-mortgage loans from caps on QM points and fees or, as appropriate, modifying such caps to support affordability
Updating regulations regarding banks’ reasonable compliance with ATR and QM underwriting requirements by removing unnecessarily burdensome elements
Replacing TRID timing rules with a materiality-based standard that preserves consumer clarity and reduces closing delays
Modernizing the right to rescission for mortgage lending, for example, by enabling increased secure electronic and digital forms and processes
Streamlining the requirements applicable to rate-and-term refinancing under Regulation X mortgage servicing rules
Exempting rate-and-term refinancing (including cash-out refinancing) from rescission rights
Amendments to Regulation C (which implements HMDA) to raise the asset threshold for exemption from HMDA for smaller banks, to exclude inquiries from the scope of HMDA, and to ensure that disclosures protect privacy and reduce burdens, including insufficiently tailored, expensive, and complex software and training needed for reporting financial institutions.
B. Directives for the Federal Reserve, CFPB, NCUA, FDIC, and OCC for Supervision, Enforcement, and Licensing Requirements
The order also directs the Federal Reserve, CFPB, NCUA, FDIC, and OCC to consider revising supervisory guidance to:
Ensure that examiners evaluate mortgage lending based on the effectiveness of the lender’s policies regarding a consumer’s ability to repay and prudent underwriting, rather than the existing focus on process and technical compliance
Ensure that good‑faith, technical compliance errors are subject to correction‑first supervisory treatment, with enforcement reserved for borrower harm or repeated misconduct
Exclude 1-4 family residential development and construction lending from commercial real estate concentration guidance and to ensure supervisory expectations support responsible construction lending by community banks.
The order also directs the Federal Reserve, CFPB, NCUA, FDIC, and OCC to consider a policy against enforcement actions for violations that:
Discourages imposing civil monetary penalties, except where the underlying violations are willful, knowing, or reckless
Considers good corporate conduct, including a bank’s correction of good-faith, technical compliance errors
Allows institutions a reasonable opportunity for self-identification and remediation of appropriate compliance matters.
Finally, the order directs the Federal Reserve, CFPB, NCUA, FDIC, and OCC to consider “eliminating duplicative or unnecessary requirements regarding licensing or registration for mortgage loan officers of any smaller bank.”
C. Directives for Capital, Liquidity, Appraisal, and Electronic Mortgage Requirements
The order directs the Federal Reserve, NCUA, FDIC, OCC, and FHFA to undertake measures with respect to capital requirements and liquidity, including revising capital regulations and Federal Home Loan Bank programs.
In addition, these agencies and the CFPB are directed to consider certain changes to appraisal requirements, including “modernizing appraisal regulations,” “simplifying appraiser qualification requirements,” and “reducing appraisal requirements for low-risk transactions, including low loan-to-value refinancing and small‑balance loans.” The order also directs HUD and VA to consider certain changes to their appraisal requirements.
Further, the USDA, VA, and FHFA are directed to consider:
Eliminating unnecessary wet‑signature requirements
Standardizing acceptance of electronic documents and remote online notarization
Promoting digital mortgage standards.
D. Directives for Mortgage Servicing Rules and Supervision
The order also directs HUD, the Federal Reserve, CFPB, NCUA, FDIC, and OCC to consider:
Aligning supervisory expectations to support portfolio mortgage servicing support portfolio Mortgage servicing as a core community banking function
Extending cure‑first standards to good‑faith servicing errors
Simplifying loss mitigation requirements
Issuing a proposed rule providing exemptions from complex mortgage services for smaller banks
Ensuring that supervisory evaluations of performing, prudently underwritten portfolio loans do not focus on technical defects or rely on evolving supervisory interpretations.
II. Brief Thoughts on the Executive Order
I see some issues with respect to the order’s directives to the CFPB. First, the order directs the CFPB (and other agencies) to “consider” the amendments set forth in the order, rather than to actually make the amendments. This language is different from other executive orders that direct agencies to make certain amendments, such as President Trump’s Executive Order 14281 issued in April 2025, which directs agencies to eliminate disparate impact liability and requires reporting “steps for…amendment or repeal, as appropriate under applicable law.” This leaves some wiggle room for the CFPB to not actually propose or finalize these amendments. That being said, the CFPB’s leadership will likely follow the order and show some consideration of the amendments. We may see proposed rules, advanced notices of proposed rulemaking, or requests for information on some or all of these topics in the coming months. The CFPB could have a substantial number of proposed amendments to its mortgage rules in the coming year. But keep in mind, rulemakings, especially substantial changes to a marketplace, can take a long time. I do not anticipate that we will see major regulatory changes finalized and take effect very soon.
Also, recall that the CFPB already had two mortgage-specific proposed rules on its Spring 2025 regulatory agenda (a potential rescission of the Loan Originator Compensation rule and a rule amending the discretionary parts of its mortgage servicing rules, which I wrote about here). These rules have not been issued yet, although they were scheduled for last year. If these other rules are not complete, the CFPB may incorporate them into its response to this order, as these proposals would amend the rules under TILA and RESPA, which is the topic of the order.
Second, this order places many requirements on the CFPB, which could make it difficult for the CFPB to completely shut down now, which it appeared to many observers that Acting Director Vought was trying to do (this is currently being litigated, as I wrote about most recently here, here, and here). This order, because it directs the CFPB to consider many amendments to its rules and supervisory policies, may place pressure on the CFPB to at least keep some staff to work on the regulatory and supervisory parts of this order. This may not mean that the CFPB will substantially restart exams and investigations, however, and much of the order seeks more relaxed supervision and enforcement for these mortgage rules. In addition, in light of this regulatory reform agenda, the administration may want to consider a permanent director for the CFPB who has substantial consumer finance regulation experience (as Acting Director Vought’s term ends in August 2026).
Third, would these regulatory amendments make sense or achieve the objectives of the order? This blog would be way too long if I tried to address each topic and issue raised in the order, but I will address some issues regarding the potential TRID changes here. One issue is that consumer shopping could be negatively affected by having different disclosure requirements for different lenders. TRID is supposed to be a uniform disclosure standard across all lenders to enable consumer shopping across all lenders. Making changes that only apply to certain banks could hamper this important aspect of the rule.
In addition, while I do know of a few ways that the CFPB could improve the TRID timing requirements for all lenders, unwise changes to the timing requirements could result in consumers losing the opportunity to catch mistakes and ask questions along the way, and being surprised at the closing table, hindering the other goals of the TRID rule. For this reason, the CFPB should be very careful with any such timing changes.
Further, most “smaller” banks and community banks use vendors for their TRID documents and compliance (as well as for compliance with other rules). It could make it more burdensome and expensive if vendors had to accommodate different TRID or other regulatory requirements for different types of lenders. Compliance reviews by examiners, auditors, and due diligence firms could also be made more complicated and costly. Thus, any bank-specific amendments could actually increase costs to the entire industry, which would get passed onto consumers, and end up reducing access to credit.
Finally, any amendments to these rules could impose substantial implementation costs on the industry, as they will have to be programmed and tested in a variety of scenarios and across many different software integrations. As smarter folks than me told me when I worked at the CFPB, the mortgage industry’s software is like a spiderweb and any changes affect all the different interconnected players and software. The CFPB should consider these potential implementation and increased costs in a thorough cost-benefit analysis before promulgating any such final amendments.
Please email me at rich@garrishorn.com if you have any questions or if you would like to discuss any of the issues in this blog post. I would be happy to discuss further with you any of the specific amendments directed by this order.
