Failure to Recover: The State of Housing Markets, Mortgage Servicing Practices, and Foreclosures
Statement before the Committee on Oversight and Government Reform
Edward J. Pinto
March 19, 2012

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Here are four steps that could be taken today to help promote a housing recovery.  Failure to Recover: The State of Housing Markets, Mortgage Servicing Practices, and Foreclosures

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1.      End the needless delays in foreclosures that are slowing a recovery and driving up the cost of taxpayer bailouts of the GSEs.  

2.      Repeal the two biggest job killers – ObamaCare and Dodd-Frank – and act on dozens of other sound ideas have been suggested, but ignored.

3.      Promote the conversion to rental of properties resulting from short sales, REOs and foreclosures by expanding the GSEs’ individual investor loan limit.

4.      Help underwater borrowers who have done the right thing and made loan payments for the last 5-plus years get the benefit of a lower rate but have them keep the same monthly payment.  This way the loan would amortize much faster, helping the homeowner get himself out from underwater.  This would replace a reliance on refinances as an extremely weak for of stimulus.

 

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About the Author

 

Edward J.
Pinto
  • An executive vice president and chief credit officer for Fannie Mae until the late 1980s, Edward Pinto has done groundbreaking research on the role of government housing policies in the lead-up to the financial crisis. In particular, his data have revealed striking facts about the contributions of housing policy to the mortgage crisis. Two of his major research papers have been submitted to the Financial Crisis Inquiry Commission: "Government Housing Policies in the Lead-up to the Financial Crisis: A Forensic Study" and "Triggers of the Financial Crisis." At AEI Mr. Pinto is continuing his work on the role of housing policies in the financial crisis and researching policy considerations and options for rebuilding our housing-finance sector.
  • Phone: 240-423-2848
    Email: edward.pinto@aei.org

  • Assistant Info

    Name: Emily Rapp
    Phone: 202-419-5212
    Email: emily.rapp@aei.org
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