Monday, February 21, 2011
Tuesday, February 15, 2011
U.S. Department of Treasury: Obama Administration Plan Provides Path Forward for Reforming America’s Housing Finance Market, Winding down Fannie Mae and Freddie Mac
Reforms Will Shrink the Government’s Footprint in Housing Finance on a Responsible Timeline, Help Protect Taxpayers
Plan Includes Critical Measures to Help Fix the Fundamental Flaws in the Mortgage Market, Better Target Government’s Support for Affordable Housing
WASHINGTON – Today, the Obama Administration delivered a report to Congress that provides a path forward for reforming America’s housing finance market. The Administration’s plan will wind down Fannie Mae and Freddie Mac and shrink the government's current footprint in housing finance on a responsible timeline. The plan also lays out reforms to continue fixing the fundamental flaws in the mortgage market through stronger consumer protection, increased transparency for investors, improved underwriting standards, and other critical measures. Additionally, it will help provide targeted and transparent support to creditworthy but underserved families that want to own their own home, as well as affordable rental options.
“This is a plan for fundamental reform – to wind down the GSEs, strengthen consumer protection, and preserve access to affordable housing for people who need it,” said Treasury Secretary Tim Geithner. “We are going to start the process of reform now, but we are going to do it responsibly and carefully so that we support the recovery and the process of repair of the housing market.”
“This report provides a strong plan to fix the fundamental flaws in the mortgage market and better target the government’s support for affordable homeownership and rental housing,” said Housing and Urban Development Secretary Shaun Donovan. “We must continue to take the necessary steps to ensure that Americans have access to quality housing they can afford. This involves rebalancing our housing priorities to support a range of affordable options, from promoting much-needed financing for quality, affordable rental homes to ensuring the availability of safe, and sustainable mortgage products for current and future homeowners.”
The Obama Administration's reform plan will:
read more...
MORTGAGE NEWS: Housing Finance Reform: Reduced Loan Limits, Larger Down Payments, Higher FHA MIP Fees
by Adam Quinones
The long-awaited report on the future of housing finance has been released by the Obama Administration.
Below is the presser....
I highlighted some talking points. The first thing to take away from this paper is the Administration's intention to wind down Fannie and Freddie on a responsible timeline. That tells you this reform/winding down process will take many years and much debate. 5 to 7 years according to Treasury Secretary Tim Geithner. There's nothing wrong with that though. Slow and steady works as long as lenders have funding liquidity in the process. The main goal is to get housing finance reform done right....the first time, this market can only take so much more stress, rewriting regs repeatedly would be detrimental to the overall housing recovery process.
Next on the list of observations is a tightrope transition from government supported loan funding to private investor supported loan funding. It appears the Administration is taking an "if we don't do it, someone else will" approach. They will attempt to accomplish their objective of reducing the government's "footprint" in the secondary mortgage market by tightening underwriting guidelines and raising fees. They believe this will effectively "level the playing" field and lower the barriers to entry for private investors. We hope risk retention (skin in the game) regs don't "unlevel" that playing field. READ MORE: Proposed Risk Retention Reform Affects Banker and Broker Loan Pricing
There is a ton of discussion still to be had. For now, read on...
read more...
Monday, February 14, 2011
THE WASHINGTON POST: Administration proposals to overhaul federal housing role draw fire from left
By Zachary A. Goldfarb and Brady Dennis
Washington Post Staff Writers | Saturday, February 12, 2011; 1:25 AM
The Obama administration's plan to overhaul the U.S. housing market drew fire Friday from some of the president's traditional allies, who argued that proposals in the newly released report could make it too costly for many Americans to buy a home.
But while consumer and civil rights groups broke with President Obama over the long-awaited white paper, the plan met with little objection - and even praise - from Republicans, who have pilloried the administration over its housing policies.
Senior administration officials offered a series of suggestions for scaling back the federal role in the housing market, which has been on government life-support since the mortgage meltdown three years ago. In the near term, the administration wants to require larger down payments and higher fees for home loans and reduce the number of borrowers getting government-backed loans. Beyond that, the plan calls for eliminating Fannie Mae and Freddie Mac and putting private financial firms at the center of the mortgage market.
The future of Fannie and Freddie
The White House is going to propose a range of options to reform Fannie Mae, Freddie Mac and the mortgage market, which could cause changes to the face of American housing. (CBS News).
Watch Video...
Obama administration proposals to reduce federal role in housing market
By Dina ElBoghdady
Washington Post Staff Writer | Friday, February 11, 2011; 11:46 PM
The Obama administration is pressing to scale back the federal government's role in the mortgage market. On Friday, it presented Congress with several proposals that would raise the costs of federally backed loans, a move designed to help the private sector better compete with Fannie Mae, Freddie Mac and the Federal Housing Administration. Here are some highlights from the administration's report:
read more...
Washington Post Staff Writers | Saturday, February 12, 2011; 1:25 AM
The Obama administration's plan to overhaul the U.S. housing market drew fire Friday from some of the president's traditional allies, who argued that proposals in the newly released report could make it too costly for many Americans to buy a home.
But while consumer and civil rights groups broke with President Obama over the long-awaited white paper, the plan met with little objection - and even praise - from Republicans, who have pilloried the administration over its housing policies.
Senior administration officials offered a series of suggestions for scaling back the federal role in the housing market, which has been on government life-support since the mortgage meltdown three years ago. In the near term, the administration wants to require larger down payments and higher fees for home loans and reduce the number of borrowers getting government-backed loans. Beyond that, the plan calls for eliminating Fannie Mae and Freddie Mac and putting private financial firms at the center of the mortgage market.
The future of Fannie and Freddie
The White House is going to propose a range of options to reform Fannie Mae, Freddie Mac and the mortgage market, which could cause changes to the face of American housing. (CBS News).
Watch Video...
Obama administration proposals to reduce federal role in housing market
By Dina ElBoghdady
Washington Post Staff Writer | Friday, February 11, 2011; 11:46 PM
The Obama administration is pressing to scale back the federal government's role in the mortgage market. On Friday, it presented Congress with several proposals that would raise the costs of federally backed loans, a move designed to help the private sector better compete with Fannie Mae, Freddie Mac and the Federal Housing Administration. Here are some highlights from the administration's report:
read more...
THE WASHINGTON POST: Washington area is beginning to bounce back from recession, economists say
No, there aren't huge signing bonuses, or personal concierge services, or the jaw-dropping luxury perks that companies threw at top talent back in the boom days of the '90s. But with the pall of the Great Recession finally lifting, some Washington area companies are handing out iPads at interviews and rewarding employees with $5,000 referral bonuses and trips to France.
As other parts of the United States continue to stagger under nearly double-digit unemployment, large swaths of the Washington region's economy are beginning to bounce back, even if fitfully, economists say.
After 17 straight months of job losses, the District and its suburbs had nine consecutive months of employment growth through the end of last year, totaling more than 23,000 new positions, according to the Center for Regional Analysis at George Mason University. The last four months of 2010 were particularly strong, although economic forecasters said it could be years before the recovery is fully realized. Some sectors, including construction and manufacturing, continue to face significant slides.
With a relatively low unemployment rate of less than 6 percent, the Washington region has long been buoyed by the economic engine that is the federal government. Although the government is helping the recovery, the area's increasingly diversified economy is paying off: Businesses from a variety of sectors - including tech start-ups, hotels and retailers - have begun to open their wallets and hire, a positive sign, given sharp cuts expected in defense spending, officials said.
"The Washington area economy is leading the way, or at least recovered the fastest and is generating jobs at a much greater rate than any other metro area," said Stephen Fuller, director of the George Mason center. "The private sector is beginning to pull away from its dependence" on the federal government.
read more...
As other parts of the United States continue to stagger under nearly double-digit unemployment, large swaths of the Washington region's economy are beginning to bounce back, even if fitfully, economists say.
After 17 straight months of job losses, the District and its suburbs had nine consecutive months of employment growth through the end of last year, totaling more than 23,000 new positions, according to the Center for Regional Analysis at George Mason University. The last four months of 2010 were particularly strong, although economic forecasters said it could be years before the recovery is fully realized. Some sectors, including construction and manufacturing, continue to face significant slides.
With a relatively low unemployment rate of less than 6 percent, the Washington region has long been buoyed by the economic engine that is the federal government. Although the government is helping the recovery, the area's increasingly diversified economy is paying off: Businesses from a variety of sectors - including tech start-ups, hotels and retailers - have begun to open their wallets and hire, a positive sign, given sharp cuts expected in defense spending, officials said.
"The Washington area economy is leading the way, or at least recovered the fastest and is generating jobs at a much greater rate than any other metro area," said Stephen Fuller, director of the George Mason center. "The private sector is beginning to pull away from its dependence" on the federal government.
read more...
Friday, February 11, 2011
The Wall Street Journal: Fannie, Freddie Phaseout Proposed
By NICK TIMIRAOS And ALAN ZIBEL
WASHINGTON—The Obama administration unveiled a proposal Friday for winding down mortgage giants Fannie Mae and Freddie Mac, spelling out three options for what could take their place and setting the stage for a debate over the nation's $10.6 trillion mortgage market.
View Document
WASHINGTON—The Obama administration unveiled a proposal Friday for winding down mortgage giants Fannie Mae and Freddie Mac, spelling out three options for what could take their place and setting the stage for a debate over the nation's $10.6 trillion mortgage market.
The steps, outlined in a "white paper," are likely to mean higher borrowing costs and more-limited access to home loans for consumers. Treasury Secretary Timothy Geithner said establishing a new system could take five to seven years.
"This is a plan for fundamental reform of the housing market," Mr. Geithner said, cautioning that "we're going to proceed on this path of reform very carefully."
All of the administration's proposals envision a scaled-back role for the government, and officials emphasized the goal of restoring the market for mortgage-backed securities issued without the government's guarantee.
The initial reaction on Capitol Hill was positive. Rep. Scott Garrett, (R., N.J.), a frequent critic of the administration, said, "I'm encouraged to see the administration included a number of reform ideas that track closely with my own."
One option proposed by the administration includes a new government backstop of certain mortgages under a federal 'reinsurance' model, while another would proposes a more limited backstop that would scale up primarily during times of economic crisis. The third option proposes no such government backstop beyond existing federal agencies such as the Federal Housing
CNN Money: Obama wants big changes in mortgages
The highly anticipated "white paper" outlines steps the administration says will help draw private capital back into the mortgage market, curb unfair lending practices and make federal support for borrowers more targeted.
The plan would phase in changes over a period of years and push back the most dramatic restructuring, which would require congressional approval, until as late as 2018. (Colin Barr: The long goodbye). read more...
CNBC: Mortgage Costs to Rise As Government Lessens Role
Published: Friday, 11 Feb 2011 | 12:21 PM ET
The Obama administration laid out three broad options Friday for reducing the government's role in the mortgage market. All three would almost certainly lead to higher interest rates and costs for borrowers.
by CNBC.com
--------------------------------------------------------------------------------
But rather than making a single recommendation, the administration offered Congress three scenarios and will let lawmakers shape the final policy.
The options are:
The Obama administration laid out three broad options Friday for reducing the government's role in the mortgage market. All three would almost certainly lead to higher interest rates and costs for borrowers.
by CNBC.com
--------------------------------------------------------------------------------
The administration said in a report that the government should withdraw its support for the mortgage market slowly, over five years or more. The report describes a path for winding down the troubled mortgage giants Fannie Mae and Freddie Mac.
But rather than making a single recommendation, the administration offered Congress three scenarios and will let lawmakers shape the final policy.
The options are:
United Staes Treasury: Housing Finance Reform
On February 11, 2011, the Obama Administration delivered a report to Congress that provides a path forward for reforming America’s housing finance market. The Administration’s plan will wind down Fannie Mae and Freddie Mac and shrink the government's current footprint in housing finance on a responsible timeline. The plan also lays out reforms to continue fixing the fundamental flaws in the mortgage market through stronger consumer protection, increased transparency for investors, improved underwriting standards, and other critical measures. Additionally, it will help provide targeted and transparent support to creditworthy but underserved families that want to own their own home, as well as affordable rental options.this photo is courtesy of http://www.treasury.gov/Read the Report on Reforming America’s Housing Finance Market.
Read the press release.
Press Center
8/17/2010Page Content
August 17, 2010
Conference on the Future of Housing Finance
On August 17, Treasury and HUD hosted the Obama Administration's Conference on the Future of Housing Finance at Treasury. Secretary Geithner was joined by HUD Secretary Shaun Donovan and senior White House, HUD, and Treasury officials, as well as a wide cross-section of stakeholders, including citizen and consumer advocacy groups, economists, investors, lenders, market researchers, mortgage servicers, and many others. The conference provided an additional opportunity for the Administration to hear a diverse set of perspectives on the key issues surrounding housing finance reform and to make certain that all of the best ideas are on the table as it continues to develop a comprehensive housing finance reform proposal for delivery to Congress by January 2011. click here to read more...
Obama Administration Plan Provides Path Forward for Reforming America’s Housing Finance Market, Winding down Fannie Mae and Freddie Mac
2/11/2011
Page Content
Reforms Will Shrink the Government’s Footprint in Housing Finance on a Responsible Timeline, Help Protect Taxpayers
Plan Includes Critical Measures to Help Fix the Fundamental Flaws in the Mortgage Market, Better Target Government’s Support for Affordable Housing
WASHINGTON – Today, the Obama Administration delivered a report to Congress that provides a path forward for reforming America’s housing finance market. The Administration’s plan will wind down Fannie Mae and Freddie Mac and shrink the government's current footprint in housing finance on a responsible timeline. The plan also lays out reforms to continue fixing the fundamental flaws in the mortgage market through stronger consumer protection, increased transparency for investors, improved underwriting standards, and other critical measures. Additionally, it will help provide targeted and transparent support to creditworthy but underserved families that want to own their own home, as well as affordable rental options. click here to read more ...
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