No G-Fee Increase in Final Transportation Appropriations Bill

A House-Senate conference committee reached agreement last week on a multiyear transportation appropriations bill that omits a Mortgage Bankers Association-opposed provision on Fannie Mae/Freddie Mac credit guaranty fees.  

MBA and other industry trade groups had fiercely opposed a proposal to pay for a portion of new transportation spending through an increase in g-fees charged by Fannie Mae and Freddie Mac to guarantee loans.  

In letters to members of Congress, and through aggressive efforts by the MBA Mortgage Action Alliance, MBA asserted that g-fees should be used for their intended purpose: to protect against losses from faulty loans. MBA said increasing g-fees for non-related purposes amounted to a tax on potential homebuyers and consumers looking to refinance their mortgages.  

With respect to Federal Reserve dividends, the bill provides for banks with less than $10 billion in assets to continue to receive the current 6 percent dividend rate, while other banks will receive the lesser of the 10-year Treasury yield or 6 percent.  

MBA President and CEO David Stevens, CMB, issued a statement commending the conference committee’s decision to keep g-fees out of the appropriations process.  

“MBA commends the House and Senate conferees and leadership for reaching agreement on a multi-year transportation bill without taxing homeowners via an extension of higher Fannie Mae and Freddie Mac guarantee fees,” Stevens said. “MBA will continue to advocate vigorously on this issue and on behalf of policies that both ensure a healthy real estate market and empower consumers with affordable, sustainable housing choices.”     

The bill now goes back to the respective chambers for a final vote; upon approval, the bill would be sent to President Obama for his signature.  

The final bill can be viewed at http://transportation.house.gov/uploadedfiles/fastact_xml.pdf.