Massachusetts House Bill H1104

Massachusetts 2023-2024 Regular Session

• Introduced: 2/16/23
• Refer: 2/16/23
• Refer: 4/3/24

Caption

Relative to mortgage review boards and a small business loan review board within the Division of Banks

Impact

The bill's implementation is expected to create a more systematic approach to dealing with mortgage loan denials, providing an appeals process for applicants who believe their applications have been wrongfully denied. By requiring boards to meet regularly and review cases, it aims to ensure accountability among mortgage lenders and protect consumers' rights. Furthermore, the establishment of a small business loan review board will offer similar mechanisms for addressing denied small business loans, thereby promoting transparency and fairness in lending practices.

Summary

House Bill H1104 establishes two regional mortgage review boards and a small business loan review board within the Division of Banks in Massachusetts. The mortgage review boards will be located in the Boston metropolitan area and central/western Massachusetts, consisting of five appointees tasked with evaluating residential mortgage loan denials based on property location. This structure aims to enhance oversight and ensure a fair review process for applicants facing denial of mortgage loans, potentially addressing discrimination based on geographic factors.

Contention

While the establishment of these review boards could enhance consumer protections, there may be concerns regarding the adequacy of resources dedicated to these boards and their ability to effectively manage case loads. Additionally, potential conflicts may arise between traditional banking institutions and small businesses regarding lending practices, especially in terms of local economic needs versus broader financial policies. The bill seeks to balance these interests by mandating diverse representation on the boards, yet the effectiveness of this representation remains a key point of discussion.