Congress Grants Regulatory Relief to Retail Manufactured Home Sellers

On May 24, 2018, the Economic Growth, Regulatory Relief, and Consumer Protection Act (“Act”), S. 2155, which was passed by Congress on May 22, 2018, was signed into law. The Act represents the first major rewrite of the financial regulations legislated under the Dodd–Frank Wall Street Reform and Consumer Protection Act. The Act grants relief to manufactured home sellers from the mortgage originator requirement under the federal Truth In Lending Act (“TILA”).

The Act amends TILA by revising the exception from the definition of mortgage originator to include a retailer of a manufactured home, or it employee, if it: (i) does not receive compensation for engaging in mortgage originator activities in excess of compensation received in a comparable cash transaction, (ii) discloses to consumer in writing any corporate affiliation with any creditor, which if it has such affiliation, discloses at least one unaffiliated creditor, and (iii) does not directly negotiate with the consumer or lender loan terms (including rates, fees, and other costs).

By this amendment, the Act exempts manufactured home sellers (that meet the definition) from compliance with TILA’s mortgagor originator’s compensation requirements and related provisions.

However, it should be noted that since the Act only amends TILA, it does not exempt manufactured home sellers from NMLS registration and state licensing requirement the SAFE Act if they meet the SAFE Act definition of loan originator.

If you have any question regarding this Act, please reach out to Solomon Maman.

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