State Sen. Paul Feeney and Rep. James Murphy co-chair the Financial Services Committee's introductory hearing Tuesday, April 4, 2023. Screenshot | State House News Service

With 188 bills on the group’s radar and 24 of them before the committee that he co-chairs, Sen. Paul Feeney joked Tuesday that the Massachusetts Mortgage Bankers Association and Executive Director Deborah Sousa have season tickets to hearings of the Joint Committee on Financial Services.

Based on the two-hour parade of lobbyists, advocates and others who went before the committee at its informal introductory hearing Tuesday morning, season ticket holders could be in for quite a session.

Committee members got previews on issues they’ll hear more about as they begin to hold hearings on the roughly 375 bills already assigned to them, covering everything from debt collection, the various segments of the insurance industry, and senior citizen scams to roadway safety, auto body repair and athletic trainer licensure. And though there was little discussion of it Tuesday, the committee is also responsible for vetting legislation related to banks and the banking system – a topic of critical importance as reverberations from last month’s collapse of Silicon Valley Bank pulse through the economy.

Kathleen Murphy, president and CEO of the Massachusetts Bankers Association, said she expects to be before the committee frequently during the session and highlighted how her organization’s members displayed “industry leadership” when Silicon Valley Bank collapsed and had to be rescued by the Federal Deposit Insurance Corporation.

“Our members stepped forward, they were communicating very early with their clients and explaining that they were here to help. They opened accounts for Silicon Valley Bank customers. That was a very unique situation, that bank was not a member of our association,” Murphy said. “Our members are FDIC-insured institutions. They range from the smallest institutions to the largest … and they have really served in a really important role of settling the concern that had arisen when the FDIC stepped in to close that bank here on March the 10th.”

Though it was not a big topic of discussion Tuesday, the banking system is sure to remain on the committee’s radar this session. Last week, Housing and Economic Development Secretary Yvonne Hao told lawmakers that she expects “longer-term impacts here in Massachusetts” from the bank’s failure.

“We are not out of the woods. There is just a lot of volatility and uncertainty in the broader financial services area,” Hao said.

Sousa, the head of the Massachusetts Mortgage Bankers Association, and Darryl Caffee from Webster Five, the co-chair of the group’s legislative committee and a Shrewsbury resident, wanted to call lawmakers’ attention Tuesday to issues facing first-time homebuyers.

“Shrewsbury currently has an average listing price of $577,000 and the average sales price is about $509,000. While that data may lead one to believe that homeownership is becoming more accessible from a pure listing to sale price perspective, the reality is the challenges are more significant now than probably ever. I fear this next purchase season is going to be one of the most challenging for first-time homebuyers,” Caffee said. “To give you a brief example, I recently worked with a client looking to purchase a first-time home for about $375,000. They ended up offering over $50,000 above asking, only to find themselves competing with 41 homebuyers and losing out on that purchase to an all-cash offer.”

Sousa also flagged for the committee “a problem with adjustable rate mortgages hitting a subprime threshold in Massachusetts” about six months ago and her organization’s desire to address it with legislation.

“We worked with the Division of Banks, they quickly revised their regulatory bulletin, but there’s a piece of legislation that we need as a fix to correct the problem,” Sousa said. “So, brand-new issue, and so we’ll be contacting you. And in the meantime, thank you so much for this hearing.”

Bankers Trek to Beacon Hill to Highlight ARMs, Homeownership Concerns.

by State House News Service time to read: 2 min