Our Housing Finance System and the GSEs provide essential services to families and lenders across the country. Rural borrowers, small lenders and lower wealth borrowers particularly benefit from these services because the GSEs provide access to a national market, making home loans more affordable overall. The GSEs, though, had critical flaws leading up to the crisis. Since then, fundamental reforms have been made to them, and these changes have addressed systemic risks.

Going forward that work needs to be continued and expanded through regulation like that of the utility industry, to ensure that the housing finance system fully carries out its public mission but does not expand beyond that role. Proposals to replace the housing finance system with a dramatically new model would unnecessarily undercut the system’s public mission and place our overall housing market in grave danger of harmful and costly disruption. Finally, there is a growing affordable housing crisis for potential homeowners and renters across the country. To provide decent housing opportunities for American families, the existing GSEs’ duty to serve the full market and their affordable housing programs and requirements must be preserved, and significant additional efforts must be undertaken to expand lending to more credit worthy families.

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