WASHINGTON, D.C. — President Donald J. Trump signed an executive order Friday directing federal agencies to review and reduce regulations that the administration says are slowing home construction, raising housing costs, and limiting access to mortgage credit for American homebuyers.
What This Means For You
- Federal agencies will review environmental, permitting, and housing rules that may increase the cost of building homes.
- Regulators are being directed to ease mortgage lending requirements, particularly for community banks and smaller lenders.
- The administration says the changes aim to increase housing supply and improve access to mortgage credit.
Federal Review of Housing Regulations
The order directs multiple federal agencies to examine regulations that affect housing development, including environmental permitting rules tied to wetlands, stormwater, and other water-related protections.
Under the directive, the Environmental Protection Agency and the Army Corps of Engineers must review federal permitting requirements under the Clean Water Act. Those rules govern activities such as construction runoff and projects that involve filling or dredging wetlands.
The administration said the review aims to streamline regulatory approvals and reduce development costs associated with housing construction.
Changes to Federal Housing Programs
Several agencies are also instructed to evaluate housing-related programs that could influence residential development.
The Department of Commerce, the Department of Housing and Urban Development, the Department of Transportation, and the Federal Housing Finance Agency must consider changes to programs that affect development density, transportation planning, and financing for housing projects.
Officials will also examine rules affecting manufactured housing and low-balance mortgages, which are often used to finance lower-cost homes.
Energy and Building Standards Review
Another section of the order directs agencies to review energy efficiency and water-use requirements tied to housing construction.
Federal officials are instructed to evaluate standards that apply to manufactured housing and federally financed housing projects, including energy efficiency codes and water conservation requirements.
The order states that agencies should consider eliminating requirements that impose significant costs on builders while remaining consistent with existing law.
Faster Federal Permitting
The order also directs the Council on Environmental Quality to provide guidance on how agencies implement the National Environmental Policy Act, a federal law requiring environmental reviews for many major projects.
The administration said the goal is to expand the use of “categorical exclusions,” which allow certain types of projects to bypass full environmental reviews when they are considered unlikely to have significant environmental impacts.
Historic preservation reviews may also be streamlined. The Advisory Council on Historic Preservation was directed to develop guidance aimed at reducing delays related to federal historic preservation requirements.
Encouraging State and Local Housing Development
Within 60 days, the Department of Housing and Urban Development must develop a set of “best practices” for state and local governments aimed at encouraging housing construction.
The guidance may include recommendations to shorten permitting timelines, limit building code changes that apply retroactively to projects already underway, and expand the use of manufactured or modular housing.
The administration also encouraged state and local governments to reconsider restrictions that limit housing construction outside urban areas.
Mortgage Credit Reforms
A second executive order issued Friday focuses on expanding access to mortgage credit.
Federal regulators were directed to review rules affecting mortgage origination, including Ability-to-Repay and Qualified Mortgage requirements. These rules, created after the 2008 financial crisis, require lenders to verify that borrowers can reasonably repay their loans.
The administration said regulators should consider tailoring those requirements for smaller banks and simplifying disclosure rules that govern mortgage closings.
Officials will also review data reporting requirements under the Home Mortgage Disclosure Act and examine capital rules affecting mortgage lending by banks.
Modernizing the Mortgage System
The order calls for expanded use of digital mortgage tools, including electronic signatures and remote online notarization for mortgage documents.
Federal agencies are also directed to evaluate appraisal standards, including the potential use of automated valuation models and other digital appraisal tools.
In addition, regulators are asked to review supervisory guidance that affects residential construction lending by community banks.
Next Steps
The executive orders direct multiple agencies to review existing regulations and develop potential revisions consistent with current law.
Several agencies must also submit reports or recommendations to the White House within specified timelines outlining possible regulatory or legislative changes aimed at increasing housing construction and expanding access to mortgage credit.
For the latest news on everything happening in Chester County and the surrounding area, be sure to follow MyChesCo on Google News and MSN.