Financial Officers From 27 States Sign Letter Objecting to Biden’s Mortgage ‘Equity’ Plan
“For decades, Americans have been told that they will be rewarded for saving their money and building a good credit score. This policy turns that time-tested principle upside down”
As we recently pointed out, the Biden administration wants people with good credit to carry the burden for high risk mortgages.
This progressive ‘equity’ policy is making its way into housing and finance, and it’s terrible.
Now, over two dozen financial officers from multiple states have signed a letter objecting to the idea.
BREAKING: 34 state financial officers from 27 states have signed-on to a letter to the Biden Administration demanding that they end their new mortgage equity program, which forces buyers with good credit to pay higher rates to subsidize loans for riskier borrowers. pic.twitter.com/P8RHbj0zzf
— Will Hild (@WillHild) May 1, 2023
The Daily Signal reports:
‘Disaster’: State Financial Officers Slam Biden Admin’s ‘Upside Down’ Mortgage Policy
A new Federal Housing Finance Agency policy that took effect Monday “will have the net effect of making it significantly more expensive for people with good credit to buy houses,” according to almost three dozen state financial officers.
Thirty-four state financial officers shared their “deep concern with the new Federal Housing Finance Agency policy” in a letter sent Monday to President Joe Biden and Sandra Thompson, director of the Federal Housing Finance Agency. The agency announced the policy in January.
“This new policy will force homebuyers with good credit to pay more on their mortgage every single month,” the letter says. “In other words, the policy will take money away from the people who played by the rules and did things right—including millions of hardworking, middle-class Americans who built a good credit score and saved enough to make a strong down payment.”
“For decades, Americans have been told that they will be rewarded for saving their money and building a good credit score. This policy turns that time-tested principle upside down,” the letter adds.
“It is already clear that this new policy will be a disaster,” the letter also said.
You can read the full letter here.
FOX Business has more:
The state finance officers blasted the plan for turning the normal system of home buying incentives “upside down” by hurting people who make sound financial decisions.
“[T]the policy will take money away from the people who played by the rules and did things right – including millions of hardworking, middle-class Americans who built a good credit score and saved enough to make a strong down payment,” they wrote. “Incredibly, those who make down payments of 20 percent or more on their homes will pay the highest fees – one of the most backward incentives imaginable.”
It noted that the forced extra payments will be used to hand out “better mortgage rates to people with lower credit ratings. Others have said the plan would make it easier for people with shaky credit histories to afford more expensive mortgages, a move that could put more people at financial risk.
The state officials said that while expanding homeownership is a worthy goal, the forced subsidization of risky loans isn’t the way to do it.
If the Biden administration wants to do something about housing, they should try to find ways to make it easier for builders to create it.
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Comments
This should be challenged as soon as the first “Victim” can be identified and harm done to them proven. On FNC this morning, they had a $1,700 per month mortgage payment going from that to $3,000 per month for people with good credit! That’s $1,000 per month tax! This will wipe out young people from ever buying their own homes. This administration is completely nuts!
I don’t know how what the cost is in any one situation but the insanely irrational social justice/equity premises underlying this garbage need to be challenged and stopped even if the cost where nominal. Because this is only the beginning.
The problem is you can’t just challenge it because it’s stupid. You have to be materially harmed to have standing.
Every person with good credit who is seeking a mortgage is materially harmed. Standing is not going to be a problem. The problem is finding a way this violates the Constitution or statute law, more than these have already been mangled.
This will wipe out young people from ever buying their own homes.
You act like that’s not the intention (of at least some).
Those numbers look off. Fox news published this a week ago: Experts have said under the rule, people with credit scores in the neighborhood of 680 might pay another $40 more per month on a $400,000 loan to subsidize higher-risk mortgages.
It’s still a moral hazard – rewarding irresponsible behavior.
Of course. My daughter recently said she worked 5 years to get her rating up from weak to 790. There are so many hard ball ads that the Republicans could run if they were a serious second party. Instead they spend a fortune attacking each other..
Did you expect Communism to be all fun and games?
So there won’t be mandatory train rides, outdoor camping and shooting sports? Cause, I was told many people have historically been participants in those activities under communism. /s
This is already what we do with health insurance, car insurance, etc.
Just another form of subsidy in a socialist dystopia.
And why is this not 50?
Yeah, I know why, too. /sigh/
You are missing the point completely. This has nothing to do with “equity” in the name of Marxism’s class struggle that gives the have-nots something at the expense of the haves. It’s all bout the elites cashing in on real estate.
Over the past few years, more and more real estate was purchased by corporations, governments and financial centers (Wall Street). The problem is that they hold so much real estate they can only sell to each other, which is pointless. They can’t sell to the upper classes because the lending rates are too high and people have much less disposable income.
So who can they sell to? The market comprised of poorer people and those with not-so-good credit. Can you see it now?
And might one reason for that might be the wave of foreclosures that began in late 2008 when the chickens came home to roost from an earlier government effort to make home mortgages easier to get whether the borrower could afford it or not?
That was two years after mortgage lenders tried to warn Congress that more than half of the mortgage borrowers under the Liar’s Loan (excuse me, Stated Income Loans https://en.m.wikipedia.org/wiki/Stated_income_loan ) had overstated their income in applying for their loans.
What’s stopping me from tanking my credit score to get a discount on a new home under this policy?
Are you an oppressed minority? Are you a woman? Are you a trans person? Are you LGBTQI++?
If your answer to any of the above (and more) is, “No.” then you are not qualified to get a discount under this program.
I’m “g”, but have never seen a single loan or mortgage application ask me about that.
Cut the crap.
A federal judge on Wednesday temporarily blocked the Biden administration from making loan forgiveness payments to minority farmers as part of a $4 billion program intended to address a long history of racial injustice in American farming.
https://www.nytimes.com/2021/06/23/us/politics/biden-debt-relief-black-farmers.htmlI’ll cut the crap when the Biden regime stops attempting to give a certain racial minority favored status.
Homebuyers With Good Credit Could Pay To Boost Black Homeownership Under Biden Rule
https://freebeacon.com/biden-administration/homebuyers-with-good-credit-could-pay-to-boost-black-homeownership-under-biden-rule/If the Biden regime feels it necessary to do this for a certain racial minority then what’s stopping them from doing the same for LGBTQI++. It wouldn’t be that hard to include a ☑︎ and ask that question.
whoever writes the loan can charge a higher base rate because your credit is not seen as good according to a credit report
Just wrote my Senator and let him know it’s an easy thing to change an excellent credit score from one of excellence achieved thru responsible financial management to one more to the liking of the federal gov so that we are not further plundered by an out of control , marxist government.
This idiotic and inequitable policy would provide great ammunition to pummel dotard-marionette, Biden, in the Dumb-o-crat primary debates, if only he was participating in them.
I assume (perhaps naively) that the dotard will be forced by tradition to participate in general election debates, and, it will be fun to see his opponent fairly take him to task for indefensibly penalizing financially responsible Americans and would-be homeowners, while rewarding the financially irresponsible.
“penalizing financially responsible Americans and would-be homeowners, while rewarding the financially irresponsible” = taking from Republicans to subsidize Democrats, and today’s Democrats are too morally corrupted to object to that.
Comrades, many of you seem insufficiently committed to the goals of the party. Perhaps a stint in a reeducation facility would cure this lack? /s
This is clearly a tax and an illegal tax at that. Only Congress can tax.
Years ago it was possible to pay cash. Rare thing now.
More in common in less expensive areas than in insanely overpriced areas for sure. I bought this place cash v using OPM b/c I wanted to and intend to stay here. Rural areas are inexpensive which isn’t the same as cheap. Exclusive subdivision or apt bldg in LA, SF, NYC not so much.
I never bought a rental property for cash. I always financed those b/c I could use the same amount of capital to create an income stream and ride the rise in price from multiple properties simultaneously. Plus the many tax advantages.
You’ve got it!.
We can continue playing whack a mole or admit that certain people do not belong in a civilized society.
Great. Spent my life paying bills on time, not taking on debt and have an 830 score just to be told by Brandon I wasted my time. AHole…
I could have written your same comment except my rating recently plunged, I tell you,PLUNGED, to 822.
Wife and I scrimped and saved, no vacations, drove 20yr old cars and paid our mortgage off 18yrs early. How stupid we are
Not stupid at all. Prudent I would say, assuming you have your ‘forever home’ and it is located in a stable, common sense sort of place that doesn’t cater to weirdo leftist ideology of the week virtue signaling trends that destroy communities and the social fabric. No debt payment also means cash flow to fund hobby interests which may become more valuable in the future.
“From each according to his ability, to each according to his needs”. Any questions on what people are running the white House?
“From each according to his ability, to each according to his needs”.
Unless you are Hunter Biden vs. Navy Jones Roberts
They knew for months that this change was occurring on May 1, why wait until the very last minute to cover the story. I saw some stories going back as far as mid Jan. 2023. I was doing some research on the story and found this article.
https://www.mortgagenewsdaily.com/news/01192023-big-llpa-changes
What took so long for the mainstream media or the financial media so long to make it a story? I think we all know why, the crisis media and short attention span of the media nd the public.
Doesn’t the Congress have the right to challenge new regulations issued by federal agencies? Make the Democrats go on record as being in favor of punishing thrift and virtue. If I recall correctly, each house of Congress must vote to disapprove a regulation and then it goes to the President for signature. Make the congress critters go on record and then make Slow Joe veto the resolution.
Oh, that thinking is old-hat. Used to be, Congress held the power to declare war; then came the War Powers Act.
I am half-impressed:.27 is around half of 51.
Maybe I’m fully impressed: in office seems worth more than “former.”
I may be more impressednthan that, even: what’s the weight of the actual thing vs “has all the earmarks of,?”
Of course, as disinfo / psyop “active measures” the letter was far more effective of the two, as you’d expect. Those guys are the.pros, after.all.
Even Klingons use the phrase: “Only Nixon could go to China.”
Now there is a new one; “Only Biden could design a program that outrageously stupid.”.
Arguably, the student loan forgiveness program is even dumber, making poor people who had nothing to do with college involuntarily pay for cutting debt for people making vastly more.
“Design.”
Never attribute to malice what is adequately explained by stupidity. I’d add “opportunism.”
I understand that Biden also wants ordinary citizens to serve some of the sentences for those convicted of crimes, in the name of “Equity.”
Not “ordinary citizens”, but white people. That would work not only for “equity” but also for “reparations”.
Another tax on whitey, once again penalizing hard work and responsible behavior. These people are truly EVIL.