NAR Sends Letter to FHFA on Loan Limits
On Tuesday, September 17, 2013, NAR President Gary Thomas sent a letter to Federal Housing Finance Agency (FHFA) Acting Director Ed Demarco raising concerns about the continued attempts to increase cost and reduce access to conventional mortgages. As conservator of Fannie Mae and Freddie Mac (the government sponsored enterprises, or GSEs) FHFA has increasingly raised the fees to guarantee mortgages without studying whether doing so actually produces more participation by the private market. Additionally, FHFA recently suggested that it may reduce the GSE loan limits for 2014.
In the letter, NAR expresses concern that lowering loan limits and raising guarantee fees in an effort to reduce access to conventional lending, risks stunting the ongoing recovery in the housing market. In addition, NAR notes that there may be many other factors keeping purely private sector lending at low levels, meaning that consumers are simply being charged higher prices for a policy goal that has no ongoing performance measures.
NAR is also working with Congress on the loan limit issue. Representatives Maloney (D-NY), Miller (R-CA) and Sherman (D-CA) are circulating a letter to FHFA urging them not to lower the limits. The sponsors are asking their House colleagues to join with them in that letter. NAR sent a letter to the Full House this week, asking Members of Congress to sign onto that letter to FHFA.