Attainable and sustainable homeownership should be the goal for restructuring the secondary mortgage market, said National Association of Realtors (NAR) President Vicki Cox Golder on Monday at a regional conference on housing finance reform.
"Realtors support strengthening the soundness and financial safety of the mortgage market so there are safe, flexible and affordable options to meet borrowers’ needs," said Golder, owner of Vicki L. Cox & Assoc. in Tucson, Ariz. "While fixing the mortgage finance system is critical, it’s just half the challenge. We also need to continue to support policies that advance and sustain homeownership, which helps people build wealth over the long term."
Other industry and government officials at the conference included Federal Housing Administration (FHA) Commissioner Dave Stevens, Assistant Secretary for Financial Institutions Michael Barr, Under Secretary of Treasury for Domestic Finance Jeffrey Goldstein and Deputy Director of the National Economic Council Dianna Farrell.
At the conference, the NAR recommended reforming the FHA, which is bearing the brunt of the market share right now, according to a statement.
"While some reforms have taken place, more needs to be done to strengthen its soundness and financial safety and protect taxpayers," said Golder. "Congress is working on legislation that would help FHA operate more effectively and reduce risk, and that legislation needs to be passed this session."
The NAR also recommends restructuring Fannie Mae and Freddie Mac from their current private-profit and public-loss structure into government-chartered, non-shareholder owned authorities. This will make the entities subject to tighter regulations on product, profitability and minimal retained portfolio practices in a way that ensures they accomplish their mission and protect taxpayer monies, according to a statement.
"While we work to shore up this important aspect of the finance system, we also need to encourage the private market to step up and do their part to address current problem," said Golder. "Specifically, we need lenders to do a much better job of restructuring loans, approving reasonable short sales, helping people avoid foreclosure and ensuring that standards are not overly stringent."
