WASHINGTON, D.C. – A group of national civil rights organizations sent a letter to U.S. Senate Banking Committee Chairman Mike Crapo (R-Idaho) and Ranking Member Sherrod Brown (D-Ohio) today urging them to fight against legislative efforts that would eliminate affordable housing goals in GSE reform. The letter is in response to a recent housing report released by the Bipartisan Policy Center. The report recommended policies that would make it extremely difficult for low-income families and communities of color to participate in the housing market today and in the future. The letter was signed by the Center for Responsible Lending; Leadership Conference on Civil and Human Rights; NAACP; National Coalition for Asian Pacific American Community Development; National Council of La Raza; National Fair Housing Alliance; National Urban League; and National Community Reinvestment Coalition.
The group stressed to the Senate Banking Committee leaders that any efforts for GSE reform must include policies to ensure that all secondary housing finance market entities comply with strong and effective affordable housing goals and statutorily-defined duty to serve obligations; expand access to quality, sustainable, affordable credit—particularly for underserved groups; employ risk-pooling measures; and protect taxpayers from bearing the cost of a housing downturn.
“Last week, calls were made to eliminate the GSE affordable housing goals as a means to move forward legislation to reform the secondary housing finance market. This misguided attempt is not new, and it would harm creditworthy borrowers who cannot access the mortgage credit they deserve, deny them their chance at the American Dream of homeownership, and weaken our nation’s economy,” the group wrote. “We believe that any legislative reform of our housing finance system must amount to true reform — and not retrogression. The goal of reform should be to create a secure housing finance system that is open and available to all creditworthy borrowers and lenders of all sizes, and that provides affordable mortgages to families with lesser incomes and wealth.”
The goal of housing finance reform is to create a safe housing finance system that provides affordable mortgages to all creditworthy borrowers, including people of color and families with modest incomes and lower wealth. Historically, the mortgage market has not adequately provided equal credit access to communities of color and low-income families. Subprime lenders targeted these same communities for predatory mortgage loans; the impact of the foreclosure crisis fell disproportionately on communities of color, stripping the vast majority of family wealth built up over the last decade. Today's mortgage market is worse, excluding families of color almost entirely.
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