FHA Chief Shoots Down Housing Bailout Bill
Here’s another great piece that was suggested to me. As you may have heard already, the U.S. House of Representatives passed a bill last week that would enable struggling mortgage holders to refinance into more affordable loans guaranteed by Uncle Sam. The legislation, spearheaded by House Financial Services Chairman Barney Frank, would require a significant expansion of the Federal Housing Administration (FHA). Well, according to Luke Mullins of U.S. News & World Report, FHA Commissioner Brian Montgomery is a bit leery of the proposal (understatement of the year). Mullins wrote yesterday in “FHA Chief Criticizes Rescue Plan”:
Montgomery expressed his opposition to the legislation recently passed by the House:
As one colleague described it, it is “on steroids” because it throws sound underwriting out the window. It moves us toward a federalization of the mortgage market, forces taxpayers to pay for bad loans, and doubles FHA’s portfolio, adding hundreds of thousands of risky loans in a Byzantine process that will take years to sort out and create a regulatory nightmare.
Besides risking the wrath of the powers-that-be in our nation’s capital, I must admit that I’m impressed that he said this within a room full of real estate agents at the National Association of Realtors Midyear Legislative Meetings and Trade Expo. I haven’t seen an obit for him, so besides a few claw marks, I’m assuming Montgomery survived the ordeal.
You can access Mullins’ piece here.
May 14th, 2008 at 11:41 pm
This is about the dippiest piece of legislation I’ve ever seen.
It takes flight from all common sense. It defies logic. If this passes the Senate, too, it must be vetoed.
May 15th, 2008 at 11:17 pm
Thanks for the comment Jack.
“This is about the dippiest piece of legislation I’ve ever seen.”
As Elvis Presley would say in an infamous 1977 concert, “plus tax.”