Wyoming Joins States Urging Biden To End New Mortgage Rule
Eighteen governors, including Mark Gordon of Wyoming, are asking President Biden to change a policy implemented by executive order regarding mortgage fees.
The Federal Housing Finance Agency altered pricing through Fannie Mae and Freddie Mac, government-sponsored companies that guarantee most mortgages.
Through the program the FHFA will be charging more to borrowers with good credit and less to those with bad credit.
“In short, the new LLPA framework will inevitably increase mortgage costs for lower-risk individuals and handicap those borrowers with larger down payments,” the governors wrote to President Biden and FHFA Director Sandra Thompson. “Further, the changes provide no incentive to borrowers to maintain good credit and will confuse borrowers at all credit levels.”
Republican Govs. Mike Parson of Missouri complain that the program is punishing those with good credit, and taking money from them, to give to those with bad credit.
"There is never a good time for bad policy, and this measure by the Biden Administration is certainly bad policy," Parson said in a statement. "This backward policy only serves to punish hard-working Americans who follow good financial practices, all while worsening overall housing market conditions. Only the Biden Administration would think it can solve a supply issue by subsidizing demand and bad credit."
The governors that are objecting believe that the Federal Reserve and record inflation are further reasons to end the policy.
The governors advocate for Congressional action to end the poicy if the president does not.
“Your actions are threatening the American housing system,” the governors wrote. “By upending the existing financing model that relies on individual financial responsibility, you are increasing uncertainty in the housing market and our nation’s economy.”
Governors signing the bill include Georgia, Alabama, Arkansas, Idaho, Indiana, Iowa, Mississippi, Montana, Nebraska, Nevada, New Hampshire, Ohio, South Dakota, Tennessee, Texas, Utah and Wyoming.