The Mortgage Bankers Association (MBA) was generally
encouraged by the Biden administration’s announcements regarding the housing
market, released just prior to the 2024 State of the Union Address. MBA
President and CEO Bob Broeksmit also noted the organization’s concerns about
certain indications from the Consumer Financial Protection Bureau (CFPB) about
closing costs and other expenses associated with mortgage transactions.
The Biden administration said it plans to increase support
for initiatives aimed at boosting housing availability and affordability. One
such measure would expand the number of allocations issued under the Low-Income
Housing Tax Credit (LIHTC) program.
“MBA welcomes the administration’s focus on legislative
reforms and regulatory fixes that increase single-family and multifamily
housing supply and help to make homeownership more affordable and attainable
for all qualified borrowers,” Broeksmit said in a statement. “This is even more
important in today’s high mortgage rate environment.”
He also noted MBA’s support for the Senate’s bipartisan bill
titled “Tax Relief for American Families and Workers Act of 2024” (H.R. 7024),
which could help produce an estimated 200,000 additional rental units over the
next two years.
“Housing markets across the country continue to suffer from
supply-demand imbalances, and we have urged the administration to take
meaningful action to remove regulatory barriers that impede development,”
Broeksmit added. “We also have offered recommendations that would make
government lending programs less costly and more effective for our members and
consumers.”
On a less encouraging note, Broeksmit expressed concern that
certain proposals on closing costs and title insurance could undermine consumer
protections, increase risk and reduce competition.
“In 2015, the industry implemented final rules from the
Consumer Financial Protection Bureau (CFPB) making comprehensive reforms to
mortgage disclosures to increase clarity and transparency and to help
facilitate consumer shopping,” he explained. “In 2020, the CFPB reviewed and
praised its own rules. Suggestions that another revamp of these rules is needed
depart from the legal regime created by Congress in the Dodd-Frank Act and will
only increase regulatory costs and make it untenable for smaller lenders to
compete.”
Broeksmit noted that MBA intends to analyze all Biden
administration initiatives, noting many of which require Congressional action.
“[A]s more information is released and will continue
to work with the administration, lawmakers on both sides of the aisle, and
industry stakeholders on effective solutions that bolster housing supply,
improve affordability for both renters and borrowers, and improve access to
sustainable homeownership,” Broeksmit said.
The Federal Housing Finance Agency (FHFA) also recently announced
the allocation of approximately $301 million from the U.S. Department of
Housing and Urban Development’s (HUD) Housing Trust Fund and U.S. Treasury’s Capital
Magnet Fund to support affordable housing initiatives administered by Fannie
Mae and Freddie Mac (the enterprises).
“Affordable housing is one of the greatest challenges facing
communities across the country today,” FHFA Director Sandra Thompson said in a
release. “A portion of every loan purchased by the enterprises is allocated to
the Housing Trust Fund and the Capital Magnet Fund, which provide resources
that increase affordable housing options in our communities.”
The Housing Trust Fund will receive $196 million as part of
its annual fund allocation to help states and state-designated entities produce
or preserve affordable housing through the acquisition, new construction,
reconstruction and/or rehabilitation of non-luxury housing, the release states.
The Capital Magnet Fund will receive $105 million, which it
will use to support affordable housing activities related to economic
development and community service facilities.