Advocacy groups like that the N.A.A.C.P. and the National Council of La Raza, a Latino civil rights organization, on the one hand, and the American Bankers Association on the other, are joining together to fight rules they say could make home loans less affordable for minority and working-class Americans, according to an article in today's edition of The New York Times by Edward Wyatt and Ben Protess.
"The growing alliance between civil-rights organizations and banking lobbyists could extend beyond the current round of financial rule-making. If Congress turns its focus to restructuring Fannie Mae and Freddie Mac, for example, the same groups could voice similar concerns over anything that restricts the availability of credit for first-time home buyers," the article said.
David Stevens, chief executive of the Mortgage Bankers Association, told The Times that he thought "everyone agrees that the enthusiasm for promoting home ownership went way too far," but, he added, "now the risk is that we go too far the other way. We still need to be able to make affordable mortgages that don't just go to the wealth, who afford the biggest down payments and who have the most positive credit ratings."
"Republicans in Congress and the Obama administration have vowed to get the government out of the mortgage business, letting the private market take over Fannie and Freddie's functions of supporting the market for home loans. But lenders and consumer advocates say any privatizations could disrupt lending, making matters worse and outweighing the protections they were designed to offer," the article said.
Last year, the article noted, the National Association of Realtors reported that 96 percent of first-time home buyers made down payments below 20 percent.
Mortgages with down payments of 20 percent or more would be exempt from proposed legislation that would require the sellers of mortgage-back securities to retain part of the risk and "keep on their books at least 5 percent of the value of any baskets of loans they purchase from lenders and then resell to investors," the article said.
"The growing alliance between civil-rights organizations and banking lobbyists could extend beyond the current round of financial rule-making. If Congress turns its focus to restructuring Fannie Mae and Freddie Mac, for example, the same groups could voice similar concerns over anything that restricts the availability of credit for first-time home buyers," the article said.
David Stevens, chief executive of the Mortgage Bankers Association, told The Times that he thought "everyone agrees that the enthusiasm for promoting home ownership went way too far," but, he added, "now the risk is that we go too far the other way. We still need to be able to make affordable mortgages that don't just go to the wealth, who afford the biggest down payments and who have the most positive credit ratings."
"Republicans in Congress and the Obama administration have vowed to get the government out of the mortgage business, letting the private market take over Fannie and Freddie's functions of supporting the market for home loans. But lenders and consumer advocates say any privatizations could disrupt lending, making matters worse and outweighing the protections they were designed to offer," the article said.
Last year, the article noted, the National Association of Realtors reported that 96 percent of first-time home buyers made down payments below 20 percent.
Mortgages with down payments of 20 percent or more would be exempt from proposed legislation that would require the sellers of mortgage-back securities to retain part of the risk and "keep on their books at least 5 percent of the value of any baskets of loans they purchase from lenders and then resell to investors," the article said.
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
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