Reforming America's Housing Finance Market, a Reasonable Perspective

Uncertainty in any aspect of the real estate transaction process causes a shift in an attitude of security for consumers, and all parties to the process.  Safety is always a prudent position.

Realtors prove their adaptability in tough times. We adjusted to the appraisal and underwriting changes to help our clients make it through until the process regained its footing.  We learned how to help people navigate the short sale process as a favorable option to the embarrassment of being forced from their homes in foreclosure. Today the distressed sale is better understood and people who were frozen by fear are now moving forward with confidence because or our determination to raise our level of expertise.

The next wave of uncertainty is starting in Washington D.C. and moving quickly inland. The President’s report to Reform America’s Housing Finance Market was released on Thursday and the media was roiling with reports of implications of doom for homeownership in America on Friday. The political and social consequences of doing away with Fannie Mae and Freddie Mac will be debated and politicized beyond our control.  Changes are needed. Drastic changes are required but to do no further harm, these changes  are best planned, designed, and implemented over time. 

I am confident the landscape of mortgage finance will be different and more effective in critical areas such as:

·         A mortgage system that allows future generations to enjoy the same advantages of predictable payments from a 30 year fixed mortgage

·         A continued government participation in ensuring a flow of mortgage capital in all economic conditions

·         Ensuring mortgage options for limited down payments for qualified, credit worthy buyers in all price ranges

·         Fair price premiums for lending fees and mortgage insurance

·         An improved mortgage servicing and foreclosure process

·         Further empowerment of consumers to avoid unfair practices

The National Association of Realtors has written their analysis of the President’s report.  My comments are just a summary of some of the points. The worst case scenarios will make headlines and may impact the attitude of the consumer this year.

We can not change the debate.  We can participate in the discussion with an attitude of acceptance of the need for change, trust in our ability to rise to the challenge, and confidence in the democratic system. My responsibility is to come up with smart solutions for my clients and be careful with my assessments of the situation. Patience is helpful.