- The housing industry has been a pillar of the U.S. economy. MBA looks forward to working with members of Congress, HUD and
others in the administration to ensure that housing sustains its momentum. The legislative and regulatory goals listed here
are good for consumers and will further ensure the industry’s strength, thus allowing the industry to continue to support
and strengthen the economy.
- One of the most important policy and program efforts in any economic recovery is stimulus. How can we provide incentives for
corporations to create more jobs? How can we provide tax relief for consumers to further encourage consumer spending that
helps keep an economy going?
- To that end, MBA strongly supports the Administration’s effort to stimulate the economy through its $647 billion growth and
jobs plan. Our real estate wealth and the ability of our industry to put that wealth to work through refinancing were key
to sustaining the economy during last year’s downturn. However, overall economic health is vital in the longer term, and the
Administration is seeking to protect and enhance our economic strength.
- The Administration plan aims to create jobs. Robust employment is fundamentally important to the real estate finance industry.
MBA’s analysis of the economic effects of President Bush’s proposals shows that the Administration’s GDP growth estimates
are on target. The stimulus plan is expected to create 190,000 new jobs in 2003 and 900,000 jobs in 2004.
- In addition, the proposed elimination of taxes on dividend income could result in the issuance of more equity and less debt
by corporations. Any reduction in the corporate demand for debt could have a positive impact on real estate by lowering interest
rates below what they might otherwise be. If economic growth occurs, interest rates could ultimately rise moderately.
RESPA/TILA REFORM AND PREDATORY LENDING
- MBA shares the public’s concern about predatory lending. The acts of a few unscrupulous lenders have tarnished the reputation
of the entire mortgage industry. MBA wants to be part of the solution. Our goals for combating predatory lending in 2003 include:
- Simplification of the mortgage process: MBA supports comprehensive mortgage reform, including the Real Estate Settlement Procedures
Act (RESPA) reform and simplification of the Truth in Lending (TILA) disclosures. Moreover, MBA will promote national uniformity
in mortgage lending laws.
- Enforcement of existing laws: MBA seeks to work with Congress, regulators and industry groups to ensure that existing laws
are being adequately enforced, and to strengthen existing laws when necessary.
- Education of consumers: In the coming year, we seek to partner with industry groups to promote and expand the “Stop Mortgage
Fraud” education campaign.
- The goal is to eliminate predatory practices while leaving the mortgage market healthy and efficient. In the absence of action
at the national level, the growing, complex web of state laws is hampering mortgage lending and causing the migration of many
national lenders from certain markets, Georgia being the most prominent. MBA will work with Congress and others to develop
a national solution to mortgage lending laws.
- One important step in the effort to eliminate predatory lending is mortgage simplification. Through RESPA and TILA reform,
MBA believes this is possible.
- MBA applauds HUD Secretary Mel Martinez for his commitment to RESPA reform and for moving toward finalizing regulations. RESPA
reform will provide consumers with important and relevant information to navigate the complex mortgage origination process.
MBA will work to ensure the final rule strikes a balance between consumer protection and efficient operation of the mortgage
- MBA plans to work with the Federal Reserve Board to encourage it to simplify the Truth in Lending Act regulation. We will
continue to work with Congress to seek ways to improve both RESPA and TILA through the legislative process.
TERRORISM INSURANCE ACT
- The Terrorism Risk Insurance Act of 2002 guarantees that terrorism insurance will be made available for commercial real estate
properties, by nullifying terrorism exclusions in existing policies. As we work to ensure a smooth implementation process,
MBA has been and will continue to work closely with the U.S. Treasury Department in its implementation of the Terrorism Risk
Insurance Act to ensure that property and casualty insurance coverage for acts of terrorism is available and affordable, and
that the insurance notification process includes lenders and servicers.
HOMEOWNERSHIP & AFFORDABLE HOUSING
- The industry’s most important goals are to increase homeownership and access to affordable housing. To accomplish these, MBA
will focus on the following:
- Expand Minority Homeownership. MBA will support the Administration’s commitment to increasing minority homeownership by hosting
housing forums in four cities, developing a “tool kit” for partnership outreach to share with MBA member firms and creating
a Spanish version of MBA’s “Stop Mortgage Fraud” consumer education campaign.
- The American Dream Tax Credit. MBA supports the rehabilitation or new construction of 100,000 homes for purchase in low-income
neighborhoods, and we will work to enact the administration’s proposed American Dream Tax Credit.
- Mortgage Revenue Bonds. MBA wants to increase the availability of mortgage credit by repealing the rule that requires states
to use Mortgage Revenue Bonds (MRB) payments received after 10 years to retire the bonds. Also, MBA believes the states should
be allowed to use their own data to determine the average area home price when calculating the maximum price of a home that
may be purchased with MRB-financed mortgages.
- Low Income Housing Tax Credit. MBA is committed to increasing the supply of affordable rental housing by enhancing the effectiveness
of the Low Income Housing Tax Credit program through changes such as allowing the use of statewide (rather than area) median
income in rural areas, removing the barriers to combining tax credits with other assistance, facilitating the eligibility
of enlisted servicemen and women, and removing any bias in allocating tax credits to nonprofits over taxpaying sponsors, etc.