House Committee Passes PATH Act
Last week the House Financial Services Committee passed H.R 2767, the Protecting American Taxpayers and Homeowners (PATH) Act, introduced by Rep Garrett (R-NJ). The vote of 30-27 was strongly along party lines with only two Republicans (Fitzpatrick (R-PA) and Miller (R-CA)) voting against the bill.
NAR opposes this legislation which includes reforms to FHA, the GSEs, and the financial regulatory law known as the Dodd-Frank Act. NAR opposes the bill based on two major concerns: 1) We strongly oppose the end of federal guarantee for a secondary mortgage market; and 2) we strongly oppose the dramatic restructuring and targeting of FHA.
The bill winds down Freddie Mac and Fannie Mae over a five-year period. It would create a new Utility to promote the securitization of mortgages. However, the bill does not provide for a federal guarantee for the Utility. The bill also contains significant changes to the FHA program that include income targeting, downpayment increases, and loan limit decreases. We cannot support this draft without a federal guarantee and a removal of the FHA Title.
NAR sent a letter to the Full Committee opposing the bill and asking for a no vote. The bill is not expected to come to the House floor until the fall. NAR will continue to work with Congress and explain our opposition to the legislation.