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“Lenders are running scared”


September 17, 2014 5:19 PM

White House, lenders discuss middle-class borrowers’ mortgage availability

http://m1.marketwatch.com/articles/BL-MWEB-7266?mobile=y&mobile=y

Obama administration officials met Wednesday with lenders and mortgage insurers to talk about strict credit standards that are preventing some middle-class families from obtaining home loans, a major headwind that economists say is holding back the housing market’s recovery.
The dialogue was “productive,” said David Stevens, president of the Mortgage Bankers Association, noting that covered topics included the oversight and policies of federally controlled mortgage-finance giants Fannie Mae and Freddie Mac , rules for safe mortgages, and government-insured low-down-payment loans, among others topics.
Wednesday’s meeting followed a two-day housing summit in Washington, hosted by the Bipartisan Policy Center, which brought together a wide range of policy experts, and officials from the government and industry. There’s too much uncertainty and disorganization when it comes to federal housing policies, economists agreed at BPC’s summit.

Uncertainty about legal and financial responsibilities is holding back lenders from making loans, experts agreed. “Lenders are running scared,” one mortgage banker said at the summit. And as hard as it’s been for would-be borrowers to get a loan this year, 2015 also looks like it’s going to be rough, housing-industry executives said .
Wednesday’s meeting at the White House was part of a broader administration effort to focus on the middle class, and invitees included industry representatives and administration officials from the White House, the U.S. Treasury Department, the U.S. Department of Housing and Urban Development, Fannie Mae, Freddie Mac, the regulator of Fannie and Freddie, and the Consumer Financial Protection Bureau.
–Ruth Mantell

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