Susan Taylor
Most people assume mortgage rules exist to protect them. Some do. But a lot of them, I’ll be honest, protect the system, and they come with real costs that get quietly passed down to borrowers in the form of higher rates, stricter approvals, and fewer lenders willing to play ball. That’s exactly the tension sitting at the center of a genuinely unusual move the Consumer Financial Protection Bureau made on July 9, 2026: they published a formal Request for Information asking lenders, consumer advocates, and regular people to tell them which mortgage regulations are costing too much or blocking creditworthy buyers from getting loans. The agency is essentially asking the public to help rewrite the rulebook. That doesn’t happen often.
This RFI didn’t come out of nowhere. It’s a direct response to Executive Order 14393, “Promoting Access to Mortgage Credit,” which President Trump signed on March 13, 2026. The order specifically targets community banks under $30 billion in assets and smaller regional banks under $100 billion, based on the argument that compliance costs have pushed many of these institutions out of the mortgage market entirely. Fewer lenders means less competition, which generally means worse deals for borrowers. The CFPB’s RFI is the formal mechanism for figuring out which rules, specifically, are causing that problem.
What surprised me was the scope of it. The CFPB isn’t asking narrow technical questions aimed at industry lawyers. The RFI explicitly invites input on any provision that is “increasing costs, slowing mortgage origination, or otherwise making it harder for creditworthy borrowers to obtain mortgage loans,” according to the SBA Office of Advocacy’s summary published July 13, 2026. That’s a wide-open door. And based on the CFPB’s July 6 regulatory agenda, changes are expected to start materializing as early as November 2026.
- The CFPB's July 9, 2026 RFI asks the public which mortgage rules raise costs or block creditworthy buyers.
- Executive Order 14393 (March 13, 2026) targets compliance costs hurting banks under $100 billion in assets.
- The CFPB's own agenda flags mortgage rules as its top priority through November 2026.
- 30-year fixed rates hit 6.77% on July 22, 2026, a near 11-month high.
- A final rule overhauling loss mitigation under Regulation X is the most consequential item on the agenda.
Why Small Banks Leaving the Mortgage Market Actually Hurts You
Here’s something most borrowers don’t think about: the lender you choose affects the rate you get, the fees you pay, and sometimes whether you qualify at all. Community banks and credit unions often serve borrowers that big national lenders won’t touch, including self-employed buyers, people in rural areas, and buyers with non-traditional income. When compliance costs get high enough, those smaller institutions stop offering mortgages. That’s not theoretical. It’s been happening for years.
EO 14393 puts a number on the problem: banks under $30 billion in assets and under $100 billion in assets face compliance burdens disproportionate to their size. A small community bank doesn’t have a team of regulatory attorneys. Every new rule is hours of staff time and outside legal fees, and at some point the math stops working. The RFI is asking: which rules are the ones actually causing that damage?
| Bank Size Category | Target of EO 14393? | Compliance Burden Risk |
|---|---|---|
| Community banks (under $30B assets) | Yes, primary focus | High, limited compliance staff |
| Smaller regional banks (under $100B assets) | Yes, secondary focus | Moderate to high |
| Large national lenders (over $100B assets) | No | Lower relative to revenue |
The Regulation X Overhaul Is the Part That Affects You Most Right Now
Helpful resource: The Millionaire Real Estate Investor by Gary Keller is a top-rated option for this. (As an Amazon Associate this site earns from qualifying purchases.)
Of everything on the CFPB’s plate, the one that hits borrowers most directly is a planned final rule overhauling loss mitigation procedures under Regulation X. Loss mitigation is the process your loan servicer is supposed to follow if you fall behind on payments, things like loan modifications, repayment plans, and forbearance. Right now those procedures are complicated, inconsistent, and, depending on who services your loan, can feel like trying to get help from a wall.
According to the National Law Review’s analysis of the CFPB’s 2026 regulatory agenda, mortgage-related rulemakings are the bureau’s dominant priority for the rest of this year. The Regulation X changes are specifically aimed at servicers, the companies that collect your payments every month (which is often not the company that gave you the loan in the first place). If you’ve ever been through a financial hardship and tried to work with your servicer, you know how badly this process can go. A cleaner, more standardized loss mitigation rule could genuinely matter, especially if rates stay elevated and more borrowers hit rough patches.
Rates Are High and That Context Matters Here
None of this is happening in a calm market. As of July 22, 2026, the 30-year fixed mortgage rate sat at 6.77%, a near 11-month high, according to Mortgage News Daily. That’s being driven partly by oil price pressure tied to Iran-war-related disruptions and partly by inflation that came in at 3.5% in June. That combination is keeping the Fed cautious about cutting rates.
What does that have to do with a regulatory RFI? More than you’d think. When rates are this high, every fraction of a percentage point matters, and so does loan availability. If deregulation succeeds in bringing more small lenders back into the market, that’s more competition, which can push rates down at the margins. It also means more options for buyers who don’t fit the cookie-cutter approval profile. The timing of this regulatory push, right as affordability is being crushed by rates, is either very deliberate or very convenient, probably both.
What the Deregulation Critics Are Watching
I want to be fair here. The research on whether deregulation actually helps borrowers is genuinely mixed. The argument for loosening rules is straightforward: fewer compliance costs mean more lenders, more competition, lower costs for buyers. The argument against is equally real: some of these rules exist because of what happened in 2008, when lenders put people into loans they couldn’t afford and the whole system collapsed. The rules that feel annoying and expensive often have a reason behind them, even if that reason got buried under 200 pages of federal register text.
Consumer advocates will be watching the RFI responses closely. The Troutman Pepper Locke consumer financial services newsletter from July 14, 2026 flagged the CFPB’s agenda shift as one of the most significant regulatory pivots affecting mortgage lenders and servicers in years. The concern isn’t that the rules will be reviewed. It’s about which voices dominate the comment process. Lenders have lobbyists and legal teams who know how to write comments that move regulators. Individual borrowers mostly don’t.
If you want your experience to count, the RFI comment process is technically open to anyone. You don’t need a law degree. You need to be specific about what happened to you.
The honest takeaway here is that this moment is real and the stakes are real, but the outcome is genuinely uncertain. Deregulation could mean more options and lower costs for buyers, or it could mean weaker protections when things go wrong. Probably some of both. If you’re buying or refinancing in the next 12 months, keep an eye on what comes out of the CFPB between now and November 2026. And before making any mortgage decisions, talk to a HUD-approved housing counselor or a financial advisor who doesn’t have a commission riding on what you choose.
Sources
- SBA Office of Advocacy – CFPB Requests Information on Promoting Access to Mortgage Credit (July 13, 2026)
- Financial Services Perspectives – CFPB’s 2026 Regulatory Agenda: Changes Are Coming for Mortgage Lenders and Servicers (July 6, 2026)
- National Law Review – CFPB’s 2026 Regulatory Agenda: Changes Are Coming (July 2026)
- Mortgage News Daily – Mortgage Rates Inch Up to 11-Month High (July 22, 2026)
- Troutman Pepper Locke – Weekly Consumer Financial Services Newsletter (July 14, 2026)
Photo: Jakub Zerdzicki via Pexels
This article is for educational purposes only and does not constitute financial or mortgage advice. Mortgage rates change daily and vary by lender, loan type, credit profile, and property details. Consult a HUD-approved housing counselor (find one at hud.gov) or licensed mortgage professional for guidance specific to your financial situation.
Recommended Resources
Disclosure: As an Amazon Associate, we earn a small commission from qualifying purchases at no extra cost to you. We only recommend products that genuinely support the topics covered in this article.
- First-Time Home Buyer: The Complete Playbook (~$18), The #1 Amazon bestseller in homebuying, covers down payment strategies, mortgage pre-approval, and avoiding rookie mistakes.
- 100 Questions Every First-Time Home Buyer Should Ask (~$17), Nearly a million copies sold, covers every question to ask your lender, agent, and inspector before signing anything.
