House Republicans are preparing legislation to block a proposed Biden administration regulation that, if enacted, would require lower-risk mortgage consumers to help pay lower rates for higher-risk borrowers.
On Wednesday., Rep. Stephanie Bice, R-Okla., chairwoman of the GOP Main Street Caucus, told Fox News Digital that Biden was creating a “culture of dependency” while avoiding Congress. As Bice noted, Biden and his executive agencies are trying to bypass Congress and fundamentally change how our country operates through the power of the pen, whether it is student loan forgiveness or the mortgage rule. According to Bice, the nation should not punish individuals who have made sound financial decisions, nor should the government incentivize lowering credit scores.
Bice introduced the Free Market Mortgage Act of 2023, which would reverse a new policy that the Federal Housing Finance Agency (FHFA) plans to implement next month.
According to experts, consumers with credit scores around 680 may have to pay an extra $40 per month on a $400,000 loan to support higher-risk mortgages under the law.
Because of reckless spending and high inflation, interest rates have risen significantly, and the last thing we need to do is impose additional fees on homebuyers. “We cannot continue a culture of dependency.” Her legislation prevents the Biden administration from enforcing this irrational rule.
At least six additional Republican lawmakers have signed on to her bill.
The new mortgage policy has been widely assailed by Republicans, even members of Biden’s party. Former FHA commissioner under President Obama, David Stevens, said that government could do better programs to help more minorities get into homeownership. It shouldn’t be done this way.
House Financial Services Committee Chair Patrick McHenry, R-North Carolina, and Housing and Insurance Subcommittee Chair Warren Davidson, R-Ohio, threatened action against FHFA Director Sandra Thompson on Tuesday, demanding that the policy be overturned.
According to the senators, lenders will pass on these new costs to borrowers without a doubt, resulting in higher mortgage rates and less credit availability. In addition to punishing responsible borrowers, this tax encourages homebuyers to reduce their down payments and incur additional debt.
Davidson called the new policy “socialist” in a Wednesday statement to Fox News Digital. The Biden administration’s new mortgage rule punishes fiscally responsible home buyers by requiring them to subsidize those who aren’t. It’s socialist wealth redistribution, he explained. Congress must reverse this rule if the FHFA does not.