By the Numbers: President Obama’s 2014 State of the Union Address
Posted by on January 30, 2014

6,778 total words.

40 words devoted to housing finance reform.

0 housing finance reform proposals from the Obama administration in 5 years

1 bill in Congress that protects taxpayers from ever again having to foot the bill for a housing crisis by ending the bailout of Fannie Mae and Freddie Mac and explicitly preserves the 30-year fixed rate mortgage. 

That bill – the Protecting American Taxpayers and Homeowners Act, the PATH Act.

“Instead of perpetual bailouts, Americans want meaningful reform of our housing finance system. That is why the House Financial Services Committee passed the PATH Act to give Americans the sustainable housing finance system we need – sustainable for homeowners so they buy homes they can actually afford to keep, sustainable to taxpayers so they will never again have to bail out Washington’s failed housing programs, and sustainable for our economy so we avoid future cycles of boom, bust and bailout. If the president truly believes in the need to address housing finance reform, as he said in tonight’s speech, he has come to the right place.”  -- Chairman Jeb Hensarling, 1/28/14

Specifically, the PATH Act:

  • Responsibly phases out Fannie Mae and Freddie Mac over five to seven years. These taxpayer-backed corporations played a central role in causing the 2008 financial crisis and taxpayers were forced to provide Fannie and Freddie with a nearly $200 billion bailout. The PATH Act permanently ends their bailout.
  • Strengthens and protects the FHA by giving it tools to tackle its solvency crisis and by giving it a specific mission to serve first-time homebuyers and those with low-to-moderate incomes.
  • Expressly preserves the 30-year fixed-rate mortgage. Section 213 of the PATH Act (.pdf) specifically states that the “FHA shall provide, among other mortgage insurance products, for the availability of a 30-year fixed-rate mortgage.” Under the PATH Act, the FHA would be required -- for the first time -- to offer a 30-year fixed-rate mortgage insurance product.
  • Reduces government control of the mortgage market by removing artificial barriers to private investment capital.
  • Repeals Dodd-Frank Act regulations that are harming community banks and credit unions and making it more difficult for middle income Americans to buy homes they can afford to keep.

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