Monday Market Update: MBA Releases Roadmap To Increase Affordability

Happy Monday! Welcome back to the Bobbi Decker Real Estate Blog! This week we are touching on one of the most challenging aspects of the real estate industry and what the Mortgage Bankers Association (MBA) is proposing to help: housing affordability. 

While we believe that home ownership continues to be the American Dream, we are also realistic that it is nearly harder than ever to achieve. Just last week, at the MBA's annual convention in Chicago, the trade group proposed 5 critical reforms designed to help make home ownership more attainable. The publication titled “Affordability in Action: A Policy Roadmap To Lower The Cost Of Owning And Renting A Home” can be found in full here. 

The 5 key focus areas are: 

#1: Lower the Upfront and Monthly Cost of a Home Mortgage.

Key aspects of this piece are allowing a single file vs. tri-merge (triple cost) credit report, reducing loan level price adjustments based on credit & loan characteristics, modernizing and utilizing responsible & cost-effective AI-assisted underwriting and streamlining the cost of title insurance. 

#2: Responsibly Open the Door to Credit for More Qualified Borrowers.

Affordability features of this suggestion revolve around removing structural barriers without lowering borrower standards. Items include reducing the complexity of TILA/RESPA/TRID disclosures, modernizing loan originator compensation rules, allowing streamlined refinance options and finalizing the flexible VA refinance framework. 

#3: Lower the Cost of Financing and Building Rental Housing.

Another cornerstone of the policy roadmap is to keep rental housing affordable to construct & maintain. Ideas here address both government-sponsored enterprises (GSEs) and private capital sources to finance construction, as well as advocating for regulations that encourage investment into rental unit building and maintenance. 

#4: Expand the Supply of Affordable Housing.

Helpful guidelines in this category refer to ways to expand condominium and new construction financing, thus improving entry level supply. There are also some creative ideas to modernize the 203(k) rehab program and address worker wage-requirements. 

#5: Strengthen the Housing Finance System for the Long Run.

Reforms in this range encourage re-calibrating capital lending rules to better align with real-world risk. Another concept promotes reviving the private-label securities market as a complement to the government-backed system. 

WOW! We know that these ideas are big, the implications are bigger and the implementation has a long way to go. To see more articles about this policy roadmap, see our resource list below! 

All my best,

Bobbi 

Resource List 

Mortgage Bankers Release Plan To Lower Borrowing Costs for Homebuyers

MBA Releases “Affordability in Action” Policy Roadmap to Lower the Cost of Buying and Renting a Home

MBA outlines the policy changes to lower housing costs

Bobbi Decker
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Broker Associate, Bobbi Decker & Associates
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