Senate GOP rebukes Biden rule that forces homebuyers with good credit to pay more
Senate Republicans are taking aim at a “shortsighted” Biden administrationthat will force homebuyers with good credit scores to pay higher mortgage rates and fees to subsidize people with riskier credit ratings who are also in the market to buy houses.
“This shortsighted and counterproductive policy demonstrates a profound misunderstanding of the necessity of accurately tailoring housing finance products to credit risk and establishes a perverse incentive that punishes hardworking Americans for their fiscal prudence,” he wrote in the letter. The fee changes will go into effect May 1 as part of the FHFA’s push for affordable housing, and they will affect mortgages originating at private banks across the country. Fannie Mae and Freddie Mac will enact the loan-level price adjustments, or LLPAs.
“We’ve got an economy where the rich keep getting richer,” she told The Washington Times. “And part of what the administration is looking for are ways that we can expand opportunity for everyone. Like anything, you’ve got to chew through the details to make sure you’re going to get the results you want.”“We still haven’t recovered from the crash in 2008 and more than 6 million homeowners being forced out of their homes because of Wall Street speculation bringing down our economy,” Ms.
“The GSEs implemented LLPAs as a risk-based pricing tool to encourage responsible lending and to protect taxpayers from undue risk,” they wrote. “However, the changes mandated by FHFA in January of this year will achieve the opposite result. These changes violate the fundamental principle of risk-based pricing, namely that lower-risk borrowers should pay lower prices for access to credit than higher-risk borrowers.
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Senate GOP rebukes Biden rule that forces homebuyers with good credit to pay moreSenate Republicans are taking aim at a “shortsighted” Biden rule that would force homebuyers with good credit scores to pay higher mortgage rates and fees to subsidize people with riskier credit ratings who are also in the market to buy houses.
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