Department of Housing and Urban Development (HUD) Secretary Ben Carson made his first appearance before the Mortgage Bankers Association annual convention, taking the stage in Denver this week. His message: Protect dream makers by reviewing regulations and HUD’s process on defect taxonomy.
Carson began his speech by addressing home ownership as part of the American Dream.
“If this is so, then you, who help so many families achieve it, are the dream makers,” he said, in prepared remarks issued by HUD. “You play an indispensable part in making it a good one. And that’s where your interests intersect with HUD’s mission, and my passion.”
Carson said that HUD does not consider private business as a rival to the government.
“Instead, private business is the activity of the American people exercising their rights in a free economy. And our government exists to protect those rights,” he said. “Therefore, when pursuing HUD’s mission to ensure safe, affordable housing for our countrymen, we cannot expect to achieve it by hindering the ‘dream makers,’ from bankers to builders.”
How are dream makers being hindered? By burdensome regulations, Carson said, something which HUD is working to change under an executive order issued by President Donald Trump.
“In keeping with his executive order, we have established a Regulatory Reform Task Force charged with identifying agency regulations that should be repealed, replaced or modified,” Carson said. “We are also rolling out improvements of particular interest to your field. One of the most important principles in running HUD is to balance the fulfillment of our mission with protecting taxpayers. Fulfilling our mission requires us to ensure that creditworthy borrowers have robust access to mortgage credit.”
Without lenders willing to offer FHA-insured loans, or serve as Ginnie Mae issuers, affordable credit access becomes a challenge, he said.
“We have heard concerns on the part of some in the lender community about participating fully in our programs because of the undue risks they perceive from a lack of clarity in what we expect and exposure to outsized liability from immaterial errors,” Carson said. “Lenders have rightly pointed out that absolute perfection in the lending process cannot be achieved, and that borrowers bear the costs of compliance through higher mortgage rates.”
Carson said those concerns had been heard by HUD and, as he previously told the House Financial Services Committee, the agency is working with the Department of Justice to review and address them – particularly related to False Claims Act cases.
“Part of the process will entail a review by FHA of its lender certifications and the implementation of the defect taxonomy,” Carson said. “This review will benefit greatly from the extensive feedback received from lenders, and other stakeholders, in our request for input on regulatory reform conducted in response to the president’s executive orders on burdensome regulations. Your feedback and recommendations will be invaluable.”
The objective of HUD, he said, is simple.
“We want every good lender who makes responsible loans, and services them well, to feel confident that they can participate fully in HUD’s programs, serving borrowers and enabling housing to continue to spur our economy,” Carson said.