The New York Times published a story today that is flat out wrong in a number of respects. The story weaves a false narrative of political intrigue filled with half-truths claiming that MBA’s advocacy of policies supporting market-based housing finance reform somehow benefit a select few.
Let me set the record straight.
Anyone who says the MBA or I advocate primarily for the “big banks” hasn’t been paying attention over the last four years. Since the moment I arrived at MBA, my goal has been to unite the industry behind public policies that benefit all lenders – big and small, bank, non-bank or credit union. Nobody else represents the entire industry, like we do.
Our track record speaks for itself:
- MBA fought for and was successful pushing for GSE pricing parity for all lenders, bringing small lenders into meetings with FHFA on the very topic;
- MBA continues to advocate for more point of sale risk sharing transactions so all lenders can have access to the GSE credit risk transfer programs;
- MBA is leading efforts to change the SAFE Act to level the testing and licensing playing field for all mortgage originators, including getting legislation introduced this Congress to create transitional licensing of mortgage loan originators transitioning between federally insured depositories and non-depositories;
- MBA has led industry efforts to reform the GSEs’ reps and warrants framework so that all lenders have the clarity needed to rebut unfair repurchase requests and resolve intractable disputes through an independent arbiter;
- MBA’s state ambassadors represent small lenders through a variety of organizations and positions in the industry;
Specific to housing finance reform and the future of Freddie Mac and Fannie Mae, the central tenet of every move MBA has made has been to ensure equal access to the secondary market for lenders of all sizes, regardless of business model.
In fact, it was the ability of lightly supervised GSEs who were able to cut special deals for certain lenders based on volume that led to the rapid consolidation of the origination and servicing market that began in the 1990s and continued up until the housing crash in 2008. That is one of the very things MBA and others want to avoid. It’s why we advocate for retaining the cash window, preserving guarantee fee policies based on loan level risks not volume, and upfront risk share transactions through transparent mechanisms like deeper MI that help maintain G-fee discipline. And to that end, it is MBA that has consistently insisted that housing finance reform ensure that the “bright line” between the primary and secondary market is vital in any reform proposal.
MBA will not be deterred from its support of the essential role of all lenders in any housing finance reform policies – and that is for the benefit of not only lenders of every size, but is important for every American family and their ability to have access to affordable home mortgages.