Congress quietly weakens mortgage protections—lenders get 5% cost-estimate leeway
H.R. 9459 — Home Affordability Through Mortgage Simplification Act · Filed by Scott Fitzgerald (R-WI) · Introduced Jun 25, 2026 · Referred to committee
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What it does
This bill relaxes mortgage lending regulations by allowing lenders to miss closing cost estimates by up to $500 or 5% without penalty, permits consumers to waive the 3-day closing disclosure waiting period, and shields lenders from liability for errors made by settlement agents if they exercised 'reasonable diligence.' It also expands APR tolerance to 0.125 percentage points and gives lenders a 60-day cure period after first notice of violations before penalties apply.
Why we flagged it
The bill's core function is to systematically weaken Truth in Lending Act enforcement and consumer protections in mortgage origination. Despite the title's invocation of 'affordability' and 'simplification,' the substantive provisions reduce lender accountability, expand tolerance for cost misstatements, and shield lenders from liability—benefiting the mortgage industry at the expense of borrower transparency.
What the text implies
- The $500 or 5% aggregate variance allowance effectively permits systematic underestimation of closing costs, particularly harmful to first-time homebuyers and lower-income borrowers who cannot absorb surprise costs at closing.
- Waiving the 3-day disclosure waiting period removes the only mandatory cooling-off period before loan consummation, eliminating a critical safeguard for borrowers to detect errors or shop alternatives.
The full analysis lists 5 implications of this text.
Who stands to gain
mortgage lenders and originators; mortgage servicers; settlement agents and title companies