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Republicans Seek to Block Housing Funds Payments

By
Mortgage and Lending with Right Trac Financial Group, Inc., NMLS# 2709 NMLS #1012303

As I wrote in my post dated December 14, 2014, entitled "Fannie / Freddie To Make Housing Fund Payments" Mel Watt, Director of the Federal Housing Finance Agency ordered FNMA and FHLMC to make their payments to the Housing Trust Fund and the Capital Magnet Fund as requiredhouse under the Housing and Economic Recovery Act of 2008.  The GSEs never made a payment to the housing funds since that legislation was passed.  Now House Republicans, led by representative Ed Royce (R-California) are about to introduce a bill entitled "Pay Back the Taxpayers Act of 2015".

The measure, which has not yet been introduced by Representative Royce, would prohibit the GSEs from making the payments to the federal housing funds as required under the 2008 legislation, past, present and future. The measure would also require that any payments made by the GSEs be turned over to the Department of the Treasury to be applied to the federal budget deficit.  This was announced on the heels of Royce's criticism of Mel Watt for putting the taxpayers at risk by allowing the GSEs to make 97% LTV loans.

The House Republicans have been a concern for several years and they do not appear to have things quite straight yet.  I hope these actions by Representative Royce are not an indication of things to come from House Republicans.

Posted by

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Randy Kirsch, NMLS #1012303

Right Trac Financial Group, Inc. NMLS #2709

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Manchester, Ct. 06042

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The blogs written and published by Randy Kirsch are not in any manner whatsoever to be considered as legal advice or as a legal opinions.  If you have legal questions or concerns regarding any area of real estate law or mortgage law you are advised to consult a licensed, competent real estate attorney in your local area to address your concerns and questions.

 

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Comments (4)

Winston Heverly
Coldwell Banker Access Realty - South Macon, GA
GRI, ABR, SFR, CDPE, CIAS, PA

I believe there are far more problems than what this bill would affect being passed or otherwise.

Jan 28, 2015 11:33 AM
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Good morning Randy. There are bills being introduced all the time, from both sides of the isle, but few get any traction. Not sure this one will get much traction, but time will tell.

Jan 28, 2015 06:30 PM
Conrad Allen
Re/Max Professional Associates - Webster, MA
Webster, Ma, Realtor

Hi Randy.  I am confused.  The GSE's never made their payments as required by law.  Is that correct?  Why would they now make them to the Treasury?  Also what is wrong with using this money to reduce the debt?

Jan 28, 2015 07:59 PM
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Randy I don't know enough about this to really comment intelligently about it.  But I will say this Royce is off base about the 97% LTV, and I hope he is not off base with his new proposal.

Jan 29, 2015 06:10 AM