MBA Urges House to Support FY2021 T-HUD Priorities
The Mortgage Bankers Association, in a July 14 letter to House leadership, urged the House to approve key industry-supported provisions for FHA in the federal government’s fiscal 2021 proposed budget.
The fiscal ’21 Transportation, Housing and Urban Development (T-HUD) appropriations bill is under consideration this week by the House Committee on Appropriations. The appropriations bill contains $130 million for FHA administrative contract expenses, which MBA supports.
In the letter to Committee leadership, MBA Senior Vice President of Legislative and Political Affairs Bill Killmer said MBA continues to staunchly support providing the FHA with the resources it requires, both in staffing and systems upgrades, to maintain its important, countercyclical role as a government-backed mortgage insurer.
“MBA has long been a proponent of adequate funding for staffing, project management and potential improvements that would allow the agency to better manage its operations and the risks associated with its Mutual Mortgage Insurance Fund,” Killmer wrote.
The letter outlines several provisions MBA supports in the appropriations bill:
–MBA appreciates and supports the enhanced level of resources within the bill allocated to HUD’s Cybersecurity and Information Technology Fund to help the agency better meet its acute information technology needs on a broad basis, including multifamily housing IT modernization.
–MBA strongly supports the specified $20 million from that Fund to be used in the ongoing upgrade of FHA’s decades-old single-family IT infrastructure. “These IT systems have long needed modernization, and the directed funds represent another crucial step forward to help FHA improve its quality assurance controls and the integrity of its systems,” Killmer said.
–With respect to FHA’s multifamily and healthcare finance programs, MBA commended appropriators for including $30 billion in commitment authority for the General and Special Risk Insurance (GI/SRI) Fund in its FY 2021 proposal, as well as adequate funding for rental assistance, particularly Section 8 Project Based Rental Assistance. “Together, these programs permit private sector lenders to continue to finance workforce and affordable apartments and residential healthcare facilities that serve millions of Americans,” MBA said.
–With respect to Ginnie Mae, MBA continues to support an increased level of funding for staffing, training and technology needs and the Committee for nearly doubling funds for Ginnie Mae’s administrative contract expenses to a total of $55.5 million. “Given Ginnie Mae’s critical role in providing liquidity targeted to low- and moderate-income families, first-time homebuyers, renters, veterans and rural households, particularly at this time, increased funding is necessary to prudently manage the increased loan volume in the single-family and multifamily mortgage markets,” MBA said.
The letter noted in recent years, market share for FHA, the Veterans Affairs Home Loan Program, and Rural Housing Service single-family lending has continued to shift towards a more diversified base of smaller lenders. “MBA believes this to be a positive trend for Ginnie Mae that reduces concentration risk in the program,” the letter said. “We commend you for providing this level of funding that will allow for increased oversight by the agency to support its ongoing counterparty risk management of the expanded issuer base.
–MBA also commended appropriators for maintaining a prohibition on federal funds being used to facilitate eminent domain seizures of performing mortgage loans. “By enacting this prohibition for the past several fiscal years, the Congress has been able to effectively defuse this threat,” Killmer wrote.
–Funding for housing and homeownership counseling is also a priority for MBA; the letter commended regulators for providing an increase to $75 million for this purpose. “These funds are critical to assisting homeowners facing foreclosure, helping first-time homebuyers navigate the challenges of the purchase process and counseling for reverse mortgages (a program requirement) for seniors, a traditionally high-risk group for financial fraud,” MBA said.
