A "lot for sale" sign stands along side a housing lot in Des Plaines, Ill. on March 21, 2021. | AP Photo/Nam Y. HuhWASHINGTON — President Joe Biden’s move to fire the top U.S. mortgage regulator is triggering calls from fellow Democrats to use the agency to expand access to loans for lower-income people, who have struggled to buy homes since the financial crisis.
“They knew this moment was coming,” said Jesse Van Tol, CEO of the National Community Reinvestment Coalition, a housing advocacy group. “Why don’t we already have a nominee?” Fannie and Freddie, which operate as government-sponsored entities, are critical to American homeownership because they buy mortgages from lenders and bundle them into securities for investors, underpinning mortgage market liquidity and ensuring affordability.
Senate Finance Committee member Sen. Pat Toomey questions Federal Internal Revenue Service Commissioner Charles Rettig during a hearing on Capitol Hill on April 10, 2019. | Chip Somodevilla/Getty Images Among their ideas: Giving Fannie and Freddie free rein to purchase mortgages with lower credit scores, allowing private lenders to make more of those loans; cutting fees; and expanding investment that supports the construction of multifamily rental properties.
“Their job is not risk elimination,” he said. “It’s risk management. Their mission is to add liquidity to the mortgage markets, not reduce it, and they need to get back in the liquidity business and add liquidity to underserved markets.” On her first day at the helm of FHFA, Thompson said she was committed to ensuring that the housing finance system operated "in a safe and sound manner" while keeping a “laser focus” on community investment. She said there was a “widespread lack of affordable housing and access to credit, especially in communities of color."
I'm sure like all prior 'dilemmas,' he'll handle this one with intelligence, care, and class
Subsidize the construction of new housing developments all across the country, and put restrictions on how homes built using the subsidies can be sold.
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