Community Lenders Must be at Core of Housing Finance Reform

CUNA Chief Advocacy Officer Ryan Donovan continued CUNA’s direct advocacy to staff from all 535 Congressional offices Thursday with a message highlighting six credit union principles for housing finance reform. CUNA has gone on record numerous times since the start of this Congress with housing finance reform priorities, emphasizing that policymakers must keep credit unions’ role in supporting their communities in mind.

“Housing finance reforms must put community lenders at the core of the future secondary mortgage Market in order to help credit unions responsibly serve more Americans with the goal of homeownership,” Donovan said.

The principles are:

  • Equal access: the secondary market must be accessible to lenders of all sizes on an equitable basis;
  • Affordability: qualified consumers deserve access to predictable, affordable mortgage payments, keeping in mind that smaller lenders like credit unions provide greater flexibility for consumers that are often denied by banks;
  • Reasonable and orderly transition: any transition to a new housing finance system must be reasonable and orderly;
  • Strong oversight and supervision: secondary market entities must be subject to appropriate regulatory and supervisory oversight to ensure their safety and soundness;
  • Durability: the housing finance system should include an explicit federally-insured or guaranteed component to ensure that, even in troubled economic times, the secondary mortgage market continues to exist; and
  • Preservation of what works: the housing finance system should preserve the things that work, such as cost-effective and member-oriented credit union mortgage servicing options, emphasizing consumer education and home-purchase counseling, and applying reasonable conforming loan limits that adequately consider local real estate expenses in higher cost areas.