Housing Finance Reform

Housing Finance

Published Feb 27, 2025

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Resolved that National Association of Home Builders (NAHB) urge Congress and the Executive Branch to reaffirm support for housing as a national priority in fulfillment of the mandate of the Housing Act of 1949.

Further resolved that NAHB support maintaining a multifaceted housing finance system with both competing and complementary components, including private, federal, state and regional sources of capital liquidity as the best way to achieve the goals of the Housing Act of 1949. The system should support a reasonable menu of sound mortgage products for both single-family and multifamily housing, governed by prudent underwriting standards and adequate oversight and regulation.

Further resolved that NAHB urge Congress, the U.S. Department of the Treasury and the Federal Housing Finance Agency (FHFA) to work together to establish a path to move the housing finance system beyond the conservatorships of Fannie Mae and Freddie Mac (the Enterprises.)

Further resolved that NAHB support legislative and/or regulatory actions impacting the Enterprises and the Enterprises’ mortgage-backed securities (MBS) that are thoroughly vetted by market participants and considered to be safe from causing disruption to the primary and secondary mortgage market, which should include a federal government backstop of the Enterprises’ MBS obligations.

Further resolved that NAHB support the following comprehensive framework for a reliable, robust, safe and sound housing finance system that includes the following components:

A construct for the Enterprises and/or other congressionally chartered entities that allows them to have sufficient capital in order to support a liquid mortgage market, securitize mortgage loans and guarantee the timely payment of principal and interest to MBS investors;
Ending FHFA’s conservator supervision of the Enterprises while ensuring FHFA maintains effective regulatory oversight of the Enterprises. Consider a board structure for FHFA, instead of a single director, that is required to have members with extensive experience in and/or knowledge of housing capital market transactions and issues and housing finance needs;
Continued availability of financing for long-term (at least 30-year) fixed-rate mortgages at reasonable rates and terms as well as mortgage products with well-understood risk characteristics such as certain standard adjustable-rate mortgages and multifamily products;
Continued roles of the federal government housing agencies: Department of Housing and Urban Development (HUD), Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), the Department of Agriculture (USDA), and the Government National Mortgage Association (Ginnie Mae) and affirms existing NAHB policy that steps be taken to make the operations of these agencies more efficient and effective;
Enhanced role of state and local housing finance agencies (HFAs) as sources of housing funds;
Does not negatively impact the Federal Home Loan Banks’ (FHLBanks’) existing Acquired Member Asset programs, and options are provided for FHLBanks to expand their role in the housing finance system in furtherance of their mission;
Equitable availability and affordability of mortgage financing for credit-worthy home buyers using prudent underwriting guidelines that are fair, transparent and not overly restrictive;
A secondary mortgage market system with sound Enterprise MBS structures and full transparency to ensure a robust interest in the Enterprises’ MBS by investors;
Reforms undertaken in a balanced and flexible manner so creditworthy borrowers are not disadvantaged;
Preserving the important countercyclical role of Fannie Mae and Freddie Mac in providing access to mortgage credit;
Consideration of direct and indirect long-term consequences before implementation of solutions to mortgage and housing production credit issues.