|Reform legislation for FHA, Fannie Mae and Freddie Mac is forthcoming, according to the country’s mortgage bankers. But pending anti-predatory legislation could hurt the fragile real estate market.
Kurt Pfotenhauer, senior vice president for government affairs at the Mortgage Bankers Association, said he expects reform legislation for Fannie, Freddie and FHA as well as anti-predatory lending legislation to survive political scrutiny for enactment into law by the 110th Congress.
Congress will pick up on the “remarkable” progress toward government-sponsored enterprise reform it made last year, he said at an MBA press briefing Tuesday.
In written materials, MBA said it will work for the reintroduction and quick passage of legislation to create a strong, well-funded regulator who will assure that the GSEs’ activities focus on the mission in the secondary market, set affordable housing goals and ensure a strong secondary market through bank regulator-style oversight.
Explaining that 2006 also represented a significant progress toward FHA reform, Pfotenhauer reminded the audience that an FHA reform bill (HR5121) passed the House with a 415-7 vote and that the White House has indicated support for the bill. He said MBA will work to continue that momentum. “We expect that to come through Congress soon and successfully,” he said.
MBA also expects the passage of anti-predatory lending laws in the new year.
Pfotenhauer said widespread support for the issue will move the debate forward. MBA has long advocated the establishment of a uniform standard and that Rep. Barney Frank (D-Ma.), the chairman of the House Financial Services Committee, has made the issue a priority.
Pfotenhauer said MBA has gleaned from Frank’s comments that he is comfortable with industry arguments in favor of a uniform standard.
Suitability will be considered. Pfotenhauer said he expects suitability to be “vigorously” discussed as part of an anti-predatory lending legislative package. MBA is strongly opposed to the imposition of the standard, Pfotenhauer said, because it would turn the clock back from many of the advances made for consumers under the Fair Housing Act and the Community Reinvestment Act.
And, yes, long discussed and much ballyhooed RESPA reform is expected to make this year’s legislative and regulatory rounds.
Pfotenhauer said HUD indicates that it will move on the issue and that HUD’s discussions on improving the Good Faith Estimate and making it compatible with the HUD-1 form are positive. However, should HUD propose tolerances on lender and broker charges, Pfotenhauer said MBA will urge the agency to exercise its exemption authority to permit average cost pricing and to provide an exemption from RESPA’s Section 8b.
But “harsh regulatory adjustments” could curtail credit, jeopardize a fragile housing recovery and extend the housing slowdown, according to the trade group’s Chief Economist Doug Duncan.
John Robbins, chairman of MBA and CEO of Wachovia Securities-subsidiary American Mortgage Network Corp., said the association has set up a special taskforce to develop recommendations for voluntary disclosure forms — a major issue that brokers continue to tackle. The taskforce’s goal, he said, is to come up with an easy to understand tool that would explain the pros and cons of the type of mortgage loan the consumer chooses.
And in an effort to improve their base of operations and better execute their political agenda, MBA President and CEO Jonathan Kempner announced the trade association has purchased a building at 1331 L Street in Washington, D.C. The building, which is expected to be completed next year, will feature more than 170,000 square feet with approximately 65,000 feet being occupied by MBA.
In addition to serving as MBA headquarters, the building will have other office and retail space. MBA will seek certification for the building under the U.S. Green Building Council’s Leadership in Energy and Environmental Design program.
Kempner said the long-term space needs and financial interest of the organization are better served with the new building. He said the purchase will decrease MBA’s long-term occupancy expenses.
Lisa D. Burden is a legal analyst for MortgageDaily.com and holds a law degree from the University of Maryland. She is currently a freelance journalist who previously wrote for Institutional Investor publications and the Baltimore Daily Record.
e-mail Lisa at: firstname.lastname@example.org
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