What to do about U.S. mortgage finance?

By Guest Contributor
September 9, 2011

Americans should be outraged at the architecture of the nation's mortgage finance system.

U.S. housing has added problem: mortgage insurance

October 28, 2011

Many legislators want the government out of housing. Fair enough. But a look at the private business of mortgage insurance serves as a reminder that the private sector also needs an overhaul. Former highflier PMI’s takeover by regulators last week is a case in point.

Fan/Fred mortgage forgiveness would be weak potion

December 29, 2011

After resisting the idea for years, the regulator of the U.S. home loan giants is humoring a new policy effectively reducing principal on loans. The plan could slow the enterprises’ near-term losses, but would prolong their agony and do little to heal the housing market.

Renters need to flex muscle in U.S. housing debate

February 8, 2012

Though America’s mortgage system subsidizes homebuyers, its dysfunction has cost all taxpayers dearly. Few groups are pushing for change. But the nation’s 39 mln renters - often an afterthought in the discussion - ought to be up in arms. They might find unlikely allies, too.

U.S. payroll tax fight shows faux fiscal restraint

February 14, 2012

Using seized mortgage backers Fannie Mae and Freddie Mac to fund a short extension of the tax cut was bad enough, but Congress is about to do worse. It’s ready to pay for another 10 months’ worth by adding $100 bln to the deficit. Politics and dogma are foiling needed discipline.

Just let housing regulator DeMarco do his job

March 8, 2012

The knives are out for Frannie’s overseer for not cutting principal on underwater home loans backed by the agencies. Borrowers would hail him a hero if he changed his mind. But he has a broader duty to taxpayers. His stance as a clear-eyed regulator deserves praise, not punishment.

Frannie generosity could cost taxpayers $128 bln

April 18, 2012

Their regulator appears close to caving and may allow the agencies to reduce loans for underwater borrowers. That shouldn’t be a problem if aid is well targeted. But political pressure could turn such loan forgiveness into a moral hazard and almost double Frannie’s bailout tab.

BofA reject wins Fannie Mae booby prize

June 6, 2012

No good deed goes unpunished. Tim Mayopoulos, fired as the mega-bank hid Merrill losses in 2008, is the mortgage zombie’s new boss. That won’t improve the firms’ tense relationship. And he’s taking a pay cut. But his integrity and background make him a decent fit for the job.

Negative intellectual equity traps mortgage reform

February 26, 2013

The latest plan to shake up U.S. housing finance, from a bipartisan think tank, offers nothing new. It rests on the usual received wisdom that the market cannot exist without a government backstop. The idea’s prevalent among lawmakers, bankers and investors. It’s wrongheaded.

Cure for U.S. housing malaise may sustain disease

March 18, 2013

A Senate bill seeks to forbid Congress from raising Frannie’s fees to pay for federal spending. It sounds sensible. But in the alternate universe that is Washington, it may kill one of the few ways available to reduce taxpayer support for housing and bring back private capital.