The Mortgage Bankers Association released a response late Thursday to a white paper submitted to Congress the previous day by the Federal Reserve. The white paper, accompanied by a letters to the respective chairs and ranking members of the House Financial Services and Senate Banking committees was delivered on Wednesday by Fed Chairman Ben S. Beranke.
The document, titled, "The U.S. Housing Market: Current Conditions and Policy Considerations." laid out what it described as a potential framework for policy discussions regarding housing policy in three areas.
- Moderating the inflow of properties into the large inventory of unsold homes;
- Removing some of the obstacles preventing creditworthy borrowers from accessing mortgage credit; and
- Limiting the number of homeowners who are pushed into an inefficient and overburdened foreclosure pipeline.
A detailed summary of the Federal Reserve's policy outline can be read here.
David H. Stevens, President and CEO of MBA, issued a statement on behalf of the Association which said, in part:
"The Fed's white paper is a thoughtful document that raises a number of very interesting issues that policymakers ought to consider as they seek to solve the ongoing ills of the housing market. The Fed staff's comments validate much of what we have been saying, as it relates to the balance between credit availability and consumer protection, as well as the role that Fannie Mae and Freddie Mac could play in stabilizing and revitalizing the mortgage market.
"FHFA is tasked with preserving the assets and minimizing the near-term losses of Fannie Mae and Freddie Mac. However, at the same time, Fannie and Freddie are the dominant players in the mortgage market and we agree with the Fed that, if allowed, could take steps that would benefit the markets by helping homeowners and making affordable credit more available for qualified borrowers. Among those could be initiatives that may increase short term losses, but have long-term benefits for the housing market.
