The Mortgage Bankers Association (MBA) announced a series of policy initiatives it hopes to lobby Congress for in 2009, including strategies to stabilize the mortgage market, assist homeowners in danger of foreclosure, and prevent a repeat of the problems that led to the financial crisis from happening again.
MBA president and CEO John Courson said, “There’s no question that the environment we’ve seen over the past year that the mortgage lending industry has had its credibility questioned and its reputation somewhat tarnished. We’re aware of that, but we also recognize that we have an opportunity to look at how we’ve done business over the past few years and an opportunity to restructure.”
The MBA will encourage the Obama administration and Congress to include provisions in the pending $825 billion economic stimulus package that would ensure Federal Housing Administration (FHA) resources, guarantee the secondary mortgage market, and extend tax credits to homebuyers.

Steve O’Connor, MBA SVP for government affairs said, “We support the borrower tax credit, which we think should go to all home buyers, not just first-time home buyers, and should not have to be paid back. Longer term, it’s very important that FHA have the resources to handle the increase in business volume. We want to ensure that FHA receive the funding it was allocated last year.”
O’Connor added the MBA is advocating a Troubled Asset Relief Program (TARP)-funded refinancing program for borrowers who are underwater on their mortgages. One MBA proposal would allow the government to purchase the refinanced mortgage, which would then be sold, held, or repaid.
O’Connor said, “This will help borrowers who for some reason cannot get refinancing but have the ability to do so.”
The MBA is also calling for standardization for mortgage originators, including independent mortgage companies and brokers.
The MBA won’t just be pushing new programs in 2009, it will also be fighting to stop the creation of others, most notably, legislation that would allow bankruptcy judges to modify, or “cram down,” the terms of a primary mortgage.
MBA chairman David Kittle said, “Unilaterally allowing bankruptcy judges to cram down the terms of a mortgage is a bad idea and bad for the markets. Should such a bill pass, MBA wants the bill to go through the normal order, including hearings and robust debates. They must consider how this bill could damage the markets.”