News Filter: Press Releases & Statements

Statement: CFPB’s Proposed Rules on The General QM Loan Definition and Extension of the GSE Patch

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WASHINGTON — U.S. Mortgage Insurers (USMI) President Lindsey Johnson issued the following statement on the Consumer Financial Protection Bureau’s (CFPB) Notices of Proposed Rulemaking (NPRM) on the general qualified mortgage (QM) definition under the Truth in Lending Act (Regulation Z) and the extension of the government sponsored enterprises (GSEs) Patch:

“USMI appreciates the CFPB assessing what has happened in the marketplace since the general QM loan definition and temporary QM category (“GSE Patch”) were first implemented in 2014. Since then, market participants have originated mortgage loans with far greater diligence to ensure consumers have a reasonable ability-to-repay (ATR) and with more robust underwriting standards that have resulted in a much stronger housing finance system. The GSE Patch has also played a critical role in maintaining credit availability in the conventional market. As takers of first-loss mortgage credit risk with more than six decades of expertise and experience underwriting and actively managing that risk, USMI members understand the need to balance prudent underwriting with a clear and transparent standard that maintains access to affordable and sustainable mortgage finance credit for home-ready borrowers. USMI looks forward to reviewing and submitting comments on both rules.”

In September 2019, USMI submitted comments on the CFPB’s advance NPRM on the QM definition, offering specific recommendations for replacing the current GSE Patch to establish a single transparent and consistent QM definition in a way that balances access to mortgage finance credit and proper underwriting guardrails to ensure consumers’ ATR.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org

Press Release: New Report Finds Low Down Payment Mortgage Lending Increased in 2019, Meanwhile Saving for a 20 Percent Down Payment Could Take 21 Years

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WASHINGTON — U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual state-by-state report on low down payment mortgage lending. The report finds the number of low down payment loans backed by private MI increased 22.9 percent in 2019; meanwhile saving for a 20 percent down payment may take potential homebuyers 21 years to save — three times the length of time it could take to save a 5 percent down payment. USMI also found that the top five states for low down payment home financing with private MI were Texas, California, Florida, Illinois, and Ohio.

“Last year, over 1.3 million homeowners purchased a home or refinanced an existing mortgage with less than a 20 percent down payment using private mortgage insurance,” said Lindsey Johnson, president of USMI. “Given the current economic environment and the desire of many people to keep more cash on-hand, low down payment loans are more important than ever. Loans backed by private MI are a great option as a time-tested means for accessing homeownership sooner while still providing credit risk protection and stability to the U.S. housing system.”

The report examines the number of borrowers helped, the percentage of borrowers who were first-time homebuyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save a 20 percent versus a 5 percent down payment for each state plus the District of Columbia.

Key findings from the report:

  • It could take 21 years on average for a household earning the national median income of $63,179 to save for a 20 percent down payment (plus closing costs), for a $274,600 single-family home, the national median sales price.
  • The wait time decreases to 7 years with a 5 percent down payment insured mortgage — a nearly 67 percent shorter wait time at the national level.
  • In 2019, the number of homeowners who qualified for a mortgage because of private MI reached over 1.3 million, nearly 60 percent of purchase mortgages went to first-time homebuyers, and more than 40 percent had annual incomes below $75,000. The average loan amount purchased or refinanced with MI was $269,072.
  • Over the last five years, the role of private MI in the low down payment sector increased from 34.8 percent of the insured market in 2015 to 44.7 percent in 2019.

The below table shows the top five states in which MI was used by borrowers to purchase or refinance homes in 2019.

State Number of Borrowers Helped with Private MI First-Time Homebuyers
Texas 105,158 56 percent
California 103,120 68 percent
Florida 88,360 55 percent
Illinois 58,654 64 percent
Ohio 51,167 59 percent

Private MI serves as a bridge for creditworthy homebuyers to qualify for home financing despite a low down payment. It provides protection against mortgage default credit risk and is structured to protect the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, in the conventional mortgage market.

The complete report is available here, along with fact sheets for all 50 states and the District of Columbia.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Statement: FHFA’s Re-Proposed Enterprise Capital Rule

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WASHINGTON — Lindsey Johnson, President of U.S. Mortgage Insurers (USMI), today issued the following statement on the Federal Housing Finance Agency’s (FHFA) Re-Proposed Rule on Enterprise Capital:

“USMI supports meaningful and appropriate capital requirements for Fannie Mae and Freddie Mac (the GSEs) and appreciates the FHFA re-proposing a rule to achieve that goal. The Rule on Enterprise Capital is one of the most significant rules that FHFA will issue. The rule will determine the future role of the GSEs, how private capital will be able to continue to support the conventional market to protect taxpayers, and importantly, the level of access and affordability of mortgage finance credit for consumers.

“It is critical for the FHFA to create a capital framework for the GSEs that strikes an appropriate balance between maintaining borrowers’ access to affordable mortgage credit and ensuring the GSEs and taxpayers are protected from mortgage credit risk. To better shield taxpayers from mortgage credit risk, it is critical that capital requirements be tailored to the GSEs’ business operations, be counter-cyclical to withstand future downturns, and fully recognize the risk reduction associated with private mortgage insurance and equivalent forms of loan-level credit enhancement.

“In our 2018 comment letter on the original proposed capital rule, we also detailed a post-conservatorship capital regime for the GSEs to supersede the 2017 Conservatorship Capital Framework (CCF) that was then in effect. USMI specifically addressed three overarching areas within the proposed rule: 1) the Process and Transparency of the Development of the Proposed Framework; 2) the Overall Appropriateness of the Proposed Capital Requirements; and 3) the Treatment of Counterparties.

“USMI looks forward in reviewing this new re-proposed Enterprise Capital Rule that is very significant for our members, other participants in the housing finance industry, and the American public.”

The FHFA originally introduced the Rule on Enterprise Capital in 2018. USMI submitted a comment letter stating that its members support the goal of developing and implementing appropriate capital requirements for the GSEs that are clear, deliberative, and analytically justified.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Statement: Bipartisan Senate Confirmation of Brian Montgomery as HUD Deputy Secretary

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WASHINGTON — Lindsey Johnson, President of U.S. Mortgage Insurers (USMI), today issued the following statement on the confirmation of Brian Montgomery by the United States Senate to serve as Deputy Secretary of the U.S. Department of Housing and Urban Development (HUD):

“USMI congratulates Deputy Secretary Brian Montgomery on his bipartisan Senate confirmation to help lead the U.S. Department of Housing and Urban Development (HUD). HUD serves as an important component of the more than $16 trillion U.S. outstanding mortgage debt market, and we know that Deputy Secretary Montgomery is deeply committed to HUD’s mission and to policies that support homeowners and renters.

“Deputy Secretary Montgomery is a respected, seasoned mortgage finance expert. His unique experience in both the private and public sectors, including his time as Assistant Secretary for Housing – Federal Housing Commissioner for HUD in the Donald Trump, George W. Bush, and Barack Obama administrations as well as his time as Acting HUD Secretary has been and will continue to be a major asset to the U.S. housing finance system. We are confident that Deputy Secretary Montgomery will help lead HUD and strengthen HUD’s programs and operations, and his leadership will be invaluable during these trying times in which his expertise and knowledge will be of great value.

“USMI and the private mortgage insurance industry look forward to working with Deputy Secretary Montgomery, Secretary Benjamin Carson, and other HUD leaders to establish a coordinated and robust housing finance system that prudently enables affordable homeownership for American families and also protects taxpayers from undue mortgage risk.”

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org

Statement: Nomination of Dana Wade for Federal Housing Commissioner

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WASHINGTON — Lindsey Johnson, President of the U.S. Mortgage Insurers (USMI), today issued the following statement on the nomination of Dana Wade to serve as Federal Housing Commissioner:

“USMI applauds the White House’s announcement of the President’s intent to nominate Dana Wade as the Federal Housing Commissioner to lead the Federal Housing Administration (FHA) and oversee the agency’s $1.3 trillion portfolio. Wade is a respected expert with broad experience in financial and housing policy issues. Her previous work, including her time as Acting Federal Housing Commissioner and Assistant Secretary for Housing, will allow her to swiftly start to address the important issues facing the housing finance system. We look forward to working closely with Dana Wade in seeking ways to establish a more complementary, collaborative, and consistent housing finance system that prudently enables homeownership for American families while also protecting taxpayers.”

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Statement: U.S. Congress Extending Mortgage Insurance Tax Deduction

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WASHINGTON — U.S. Mortgage Insurers (USMI) President Lindsey Johnson issued the following statement on the decision made by the U.S. Congress to extend the tax deduction for mortgage insurance (MI) premiums in the H.R.1865 – Further Consolidated Appropriations Act, 2020.

“We are pleased Congress extended the mortgage insurance tax deduction for years 2018 through the end of 2020. Private MI has helped more than 30 million middle-income Americans become homeowners over the last 60 years, and for over 10 years the deductibility of mortgage insurance has helped benefit millions of these hard-working borrowers—the majority of whom made annual incomes of less than $75,000.  

“This tax deduction was first available to taxpayers in 2007 and extended multiple times since then on a bipartisan basis. The last deduction expired at the end of 2016, and with this last extension for amounts paid or accrued after December 31, 2017, and before December 31, 2020, lawmakers demonstrate their commitment towards helping low-down payment and first-time homebuyers.

“Over the last six decades, private MI has bridged the gap between a 20 percent down payment and access to mortgage finance credit.  In the past year alone, MI helped more than 1.2 million homeowners purchase or refinance homes.”

According to the most recent IRS statistics of income, in 2017 alone more than 2.285 million taxpayers benefited from the MI premium tax deduction. The deduction is available to homeowners with MI who have an adjusted gross income under $100,000 and phases-out for adjusted gross incomes up to $110,000. USMI data show that nearly 60 percent of purchase loans with private MI go to first-time homebuyers and more than 40 percent of borrowers with private MI have incomes below $75,000.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Statement: U.S. Congress Extending Mortgage Insurance Tax Deduction

Posted on by dcadmin

WASHINGTON — U.S. Mortgage Insurers (USMI) President Lindsey Johnson issued the following statement on the decision made by the U.S. Congress to extend the tax deduction for mortgage insurance (MI) premiums in the H.R.1865 – Further Consolidated Appropriations Act, 2020.

“We are pleased Congress extended the mortgage insurance tax deduction for years 2018 through the end of 2020. Private MI has helped more than 30 million middle-income Americans become homeowners over the last 60 years, and for over 10 years the deductibility of mortgage insurance has helped benefit millions of these hard-working borrowers—the majority of whom made annual incomes of less than $75,000.  

“This tax deduction was first available to taxpayers in 2007 and extended multiple times since then on a bipartisan basis. The last deduction expired at the end of 2016, and with this last extension for amounts paid or accrued after December 31, 2017, and before December 31, 2020, lawmakers demonstrate their commitment towards helping low-down payment and first-time homebuyers.

“Over the last six decades, private MI has bridged the gap between a 20 percent down payment and access to mortgage finance credit.  In the past year alone, MI helped more than 1.2 million homeowners purchase or refinance homes.”

According to the most recent IRS statistics of income, in 2017 alone more than 2.285 million taxpayers benefited from the MI premium tax deduction. The deduction is available to homeowners with MI who have an adjusted gross income under $100,000 and phases-out for adjusted gross incomes up to $110,000. USMI data show that nearly 60 percent of purchase loans with private MI go to first-time homebuyers and more than 40 percent of borrowers with private MI have incomes below $75,000.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Statement: HUD’s 2019 Annual Report to Congress

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WASHINGTON— Lindsey Johnson, President of the U.S. Mortgage Insurers (USMI), released the following statement today on the U.S. Department of Housing and Urban Development (HUD) release of its 2019 Annual Report to Congress on the financial status of the Federal Housing Administration’s (FHA) Mutual Mortgage Insurance Fund (MMIF):

“USMI appreciates HUD’s thorough analysis of the MMIF’s economic condition and the release of valuable data on FHA borrower trends and mortgage performance. According to the report, the MMIF’s capital ratio stands at 4.84 percent, up from 2.76 percent last year, continuing the much-needed upward trend above the thin statutory requirement of only 2 percent. We applaud the FHA’s continued efforts to stabilize and further strengthen the fiscal health of the fund so that the FHA can continue its important role alongside the rest of us in serving the low-down payment market. We are encouraged by the longer-term focus of FHA as stated in their Annual Report, recognizing that ‘the MMI capital ratio is a result, not the target.’ Given the ‘extreme risk layering’ that FHA cites is on the rise, the cyclicality of the mortgage market, and the volatility of the Home Equity Conversion Mortgage (HECM) program, USMI agrees with the Administration’s actions to ensure that FHA can withstand another housing downturn and serve its important countercyclical role.

“In the Annual Report, Secretary Carson highlights that ‘[i]n our Housing Finance Reform Plan released in September of this year, we propose a number of solutions that would reduce risks to the MMI Fund, protect taxpayers from future bailouts, and ensure the FHA maintains its focus on providing access to mortgage financing to low- and moderate-income families that cannot be fulfilled through traditional underwriting.’The FHA is a very important part of the housing finance system, and USMI has long called for a more complementary, not competitive, role between FHA and the conventional market. Thankfully, today there is a vibrant low-down payment conventional market backed by private capital that continues to prudently facilitate the low-down payment credit needs of millions of Americans, giving consumers more options and shielding taxpayers from undue risk. In the past year alone, the private mortgage insurance (MI) industry helped more than 1.1 million people purchase or refinance their home—nearly 60 percent of purchasers were first time homebuyers and more than 40 percent of borrowers with private MI had annual incomes of $75,000 or less.

“Private MI continues to be well positioned to play a leading role in enabling borrowers to access affordable and sustainable low-down payment mortgage credit and serving as the first layer of protection against mortgage defaults to protect U.S. taxpayers and the federal government. In this sense, private MIs hold nearly double the capital assets that they held before the financial crisis, and just last week, USMI released details on the innovative growth of private MI credit risk transfer (MI CRT). Over the last four years, through new MI CRT structures, the industry transferred nearly $34 billion in risk on nearly $1.3 trillion of insurance-in-force, enhancing MI resiliency and the risk protection provided to the conventional mortgage market.

“Going forward, USMI and our member companies look forward to working with FHA and the Administration to promote complementary roles for the conventional market and FHA in the low-down payment lending space in order to best serve borrowers and protect taxpayers.”

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: Private Mortgage Insurers Transfer Nearly $34 Billion in Risk on Nearly $1.3 Trillion of Insurance-in-Force from 2015-2019

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USMI releases details on the developments and growth of private mortgage insurance credit risk transfer

WASHINGTON — U.S. Mortgage Insurers (USMI) today announced that private mortgage insurance (MI) companies transferred nearly $34 billion in risk on nearly $1.3 trillion of insurance-in-force from 2015 to 2019. USMI released details on the developments and growth of the MI credit risk transfer (MI CRT) market, which outlines the types of structures being used by the industry to transfer risk to reduce volatility and exposure of mortgage credit risk within the mortgage finance system, including to the government sponsored-enterprises (GSEs), and therefore taxpayers. It also finds that active adoption of CRT by private mortgage insurers has transformed the industry to help better insulate it from the cyclical mortgage market and enhanced their ability to be more stable, long-term managers and distributors of risk.

“Through innovative new MI CRT structures, the industry is taking additional steps to enhance MI resiliency and the risk protection provided to the conventional mortgage market. MI CRT demonstrates that MI companies are sophisticated experts in pricing and actively managing mortgage credit risk,” said Lindsey Johnson, President of USMI. “Private MI plays a critical function in the housing finance system by serving as the first layer of protection against mortgage defaults. MI is also one of the only sources of private capital that has been available through all market cycles. After the financial crisis, the MI industry improved its safety and soundness through enhanced capital and operational standards, which in turn made us more resilient to withstand severe economic stress.”

USMI examined the two main MI CRT structures: Reinsurance and Capital Markets. It found that mortgage insurers have executed 18 reinsurance deals since 2015, transferring over $25 billion of risk on over $530 billion of insurance-in-force. As for the Capital Markets structure, the industry introduced MI Insurance Linked Note (ILN) programs beginning in 2015. Since then, mortgage insurers have issued 19 ILN deals, transferring $7.8 billion of risk on over $730 billion ofinsurance-in-force.

“While the MI industry has distributed credit risk for decades, these innovative CRT structures adopted by the industry in 2015 have transformed it from a ‘buy-and-hold’ into an ‘aggregate-manage-and-distribute’ model,” said Johnson. “The financial risk management approach of private MI companies has become much more countercyclical and significantly benefits the housing finance system.”

Because private mortgage insurers typically hold a portion of the first loss there is an alignment of incentives that ensures quality underwriting continues to be done by the industry, which reduces investors’ risk exposure, and ensures quality control on risk for investors and within the broader financial system. The investor base in these transactions continues to grow exponentially as the frequency of transactions increases, and the MI CRT investors to date represent trillions of dollars of private capital under management that provides a stable, deep pool of liquidity for the market.

“The MI CRT structures underscore the resilient nature and benefits of MI and the private capital it supplies to the housing market, safeguarding taxpayers against mortgage defaults, and ensuring that the private MI industry will continue to play a vital role in the mortgage finance system,” added Johnson.

More information on MI CRT is available here.


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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership.

Statement: Nomination of Brian Montgomery as Deputy Secretary of the HUD

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WASHINGTON — Lindsey Johnson, President of U.S. Mortgage Insurers (USMI), today issued the following statement on the President’s intent to nominate Federal Housing Administration (FHA) Commissioner Brian Montgomery as Deputy Secretary of the U.S. Department of Housing and Urban Development (HUD):

“USMI applauds the White House’s intent to nominate Brian Montgomery to serve as the Deputy Secretary of HUD. Commissioner Montgomery is a respected, seasoned mortgage finance expert, and his unique experience and past public service have been major assets to the FHA. His extensive background will allow him to immediately begin work on the most important issues facing the housing finance system. USMI and the private mortgage insurance industry look forward to working with Commissioner Montgomery going forward to establish a coordinated and robust housing finance system that prudently enables homeownership for American families.”

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: USMI Submits Comments to CFPB’s Advance Notice of Proposed Rulemaking on the Qualified Mortgage Definition

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WASHINGTON — Lindsey Johnson, President of U.S. Mortgage Insurers (USMI), today released the following statement on the organization’s comment letter submitted in response to the Consumer Financial Protection Bureau’s (“the Bureau”) Advance Notice of Proposed Rulemaking on the “Qualified Mortgage (QM) Definition under the Truth in Lending Act (Regulation Z).”

“As takers of first-loss mortgage credit risk with more than six decades of expertise and experience underwriting and actively managing that risk, USMI members understand the need to balance prudent underwriting with a clear and transparent standard that maintains access to affordable and sustainable mortgage finance credit for home-ready borrowers. The upcoming expiration of the temporary QM category, often referred to as the ‘GSE Patch,’ provides an important opportunity for the Bureau to assess what has developed within the marketplace since the enactment of the QM Rule. Notably, mortgage lending has been done with far greater diligence by market participants to ensure consumers have a reasonable ability-to-repay (ATR) and has resulted in a much stronger housing finance system. Further, the GSE Patch has played a critical role in maintaining credit availability. In our comments to the Bureau, we offer specific recommendations for replacing the current GSE Patch to establish a single transparent and consistent QM definition in a way to balance access to mortgage finance credit and proper underwriting guardrails to ensure consumers’ ATR. USMI’s recommendations include:

  • Maintaining the ATR and product restrictions as part of any updates to the QM definition to ensure discipline in the lending community and to protect consumers;
  • Retaining specific underwriting guardrails such as the current debt-to-income (DTI) component of the QM definition, but modifying the specific threshold to better serve consumers; and
  • Developing a single set of transparent compensating factors for loans with DTIs above 45 and up to 50 percent for defining QM across all markets, similar to how the GSEs, FHA, and VA use compensating factors in their respective markets today.

“Retaining specific thresholds in measuring a consumer’s income, assets, and financial obligations better serves consumers and ensures that the statutory and regulatory intent of measuring a consumer’s ATR is met. Further, adjusting the current DTI limit from 43 percent to 45 percent for all loans, and up to 50 percent for loans with accompanying compensating factors creates a more transparent and level playing field that provides greater certainty for borrowers and lenders and reduces the impact of the expiration of the GSE Patch. USMI believes that the development of a single transparent industry standard will facilitate greater consistency across all lending channels and ensure there is not market arbitrage to achieve QM status.

“USMI applauds the Bureau for undertaking the necessary process for updating this critical rule that is aimed at enhancing lending standards and consumer protection. We look forward to working with the Bureau as it seeks to implement any changes to this important rule.”

Following the release of the Bureau’s ANPR in July, USMI published a blog with observations and recommendations for replacing the GSE Patch.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Statement: The Administration’s Housing Finance Reform Reports

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WASHINGTON — Lindsey Johnson, President of U.S. Mortgage Insurers (USMI), today issued the following statement on the Administration’s Housing Finance Reform reports to address the nation’s housing finance system, including the government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac.
 
“USMI applauds the U.S. Treasury Department (Treasury) and the Department of Housing and Urban Development (HUD) for releasing their comprehensive Housing Reform Plan and Housing Finance Reform Plan (“Plans”) that together outline needed reforms to the housing finance system.  While USMI looks forward to reviewing the Plans in greater detail, we particularly appreciate Treasury and HUD identifying specific areas where the Administration can focus its efforts to put the housing finance system on a more sustainable path ahead of comprehensive legislative reform.
 
“While Congress ultimately needs to address the underlying structural challenges of the GSEs, the Administration’s proposal to reduce taxpayer risk exposure and address the areas of misaligned incentives of the GSEs while increasing transparency and market discipline could be the catalyst to break the legislative logjam and enable policymakers to enact comprehensive reforms.  Many of the actions proposed by the Administration’s Plans align with USMI’s principles for Administrative Reform, including our position that these actions could further reduce taxpayer risk by increasing private capital within the financial system, level the playing field between the GSEs and private market participants, provide greater transparency regarding GSE pricing and practices, and ensure that consumers have access to affordable and sustainable mortgage finance credit.
 
“Further, the Plans call for the Federal Housing Finance Agency (FHFA) and HUD to develop and implement a specific understanding as to the appropriate roles and overlap between the GSEs and the Federal Housing Administration (FHA).  USMI has long called for a consistent housing policy across different agencies and for greater coordination between the government-backed FHA market and the conventional market, and we look forward to working with the Administration as it seeks to define these important roles. 
 
“USMI is encouraged by the thoughtful and comprehensive Plans released today by the Administration and looks forward to working with the Administration to promote private capital ahead of taxpayer risk, instill greater transparency and market discipline within the housing finance system, and ensure Americans continue to have access to safe and affordable mortgage finance options.”
 
Last fall, USMI released a white paper on administrative reform (available for download here) that outlined 11 key recommendations for policymakers to consider when contemplating the future of housing finance. A PDF of these recommendations can be downloaded here.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.