Mortgage Bankers to Congress: Housing Finance Reform Must be Next Priority

BOSTON, Jan. 23, 2018 /PRNewswire-USNewswire/ -- Now that a tax reform bill has been signed into law, leading Massachusetts mortgage bankers are urging their Congressional Delegation to prioritize overhauling the housing finance system and ensuring America has a stable and robust secondary mortgage market.

"Housing finance reform has been pushed aside for too long," said Phil DeFronzo, President of Norcom Mortgage. "It is time for Congress to end the conservatorship of Fannie Mae and Freddie Mac, and create a housing finance system that encourages stability and competition, so all Americans have the opportunity to enter the housing market."  

During the Financial Crisis of 2008, Fannie Mae and Freddie Mac were placed under government conservatorship – or legal guardianship – because their financial conditions were deteriorating. To keep the two afloat and to prevent the U.S. housing market from collapsing, taxpayers were forced to pay $187 billion. Fannie and Freddie's conservatorship was only intended to be a temporary solution. Yet, nearly a decade later, these government-sponsored enterprises remain under the government's control.

"Massachusetts's housing market is one of the most expensive in the nation," said DeFronzo, "And to make matters worse, we're producing fewer housing units than we have in the last 50 years. This is driving people out of the commonwealth, and much of it is directly related to the current structure of our housing finance system."  

The Mortgage Bankers Association (MBA), the nation's leading advocate for the real estate finance industry, released a comprehensive proposal that would reform the current housing finance system. The plan aims to lessen the government's involvement in the secondary mortgage market, expand access to credit with more competition, promote affordable housing, and support underserved market segments.

"MBA's proposal includes the exact reforms necessary to achieve a robust and stable housing market –  one that will provide all Bay Staters the chance to find affordable housing options," said DeFronzo.

SOURCE Mortgage Bankers Association