A new research report by the Center for Responsible Lending (CRL) and National Urban League critiques a legislative discussion draft by U.S. Senators Bob Corker (R-Tenn.) and Mark Warner (D-Va.) to restructure the nation’s housing finance system, and it criticizes recently published papers supporting it.
CRL and the National Urban League’s report finds that the proposed legislation repeals the important public interest mandates within the current system and replaces them with weak incentives that will greatly harm the overall housing market. The report also finds that cost assumptions in the paper supporting the legislation are incorrect and once corrected will drive up costs for lower-wealth borrowers.
The new report, Senate GSE Reform Proposal: A Blow to Affordable Housing and Harmful to the Overall Housing Market, is jointly authored by CRL President Mike Calhoun, National Urban League President and CEO Marc H. Morial and senior financial economist Michael F. Molesky. Together they call for a system that supports opportunity for current and future generations to achieve homeownership as opposed to it only being reserved for those who are financially well off.
The report offers that administrative reform must continue to build upon the significant reforms begun in the bipartisan Housing and Economic Recovery Act of 2008. Moreover, a central purpose of government backing is that the housing finance system serves all markets across the country, all lenders, and all credit-worthy borrowers.
Download attached document to read full report.