The House of Representatives today passed H.R. 1210, the Portfolio Lending and Mortgage Access Act introduced by Congressman Andy Barr (KY-6) in a bipartisan vote of 255 to 174. The bill promotes affordable home financing and discourages the practice of securitizing and selling of mortgages that led to the 2008 financial crisis and the resulting taxpayer bailouts of Fannie Mae, Freddie Mac, and large systemically important financial institutions.
“The one-size-fits-all, top-down Qualified Mortgage rule is preventing creditworthy Americans from the dream of homeownership, holding our economy back, and contributing to consolidation and closures among community banks and credit unions,” said Congressman Barr. “My bill would expand access to credit as long as banks and credit unions do not sell the mortgages as securities. This reform would have the dual benefit of promoting responsible lending practices which will prevent future crises and bailouts, while encouraging economic growth through expanded homeownership.”
The legislation reforms the Qualified Mortgage rule imposed by the Consumer Financial Protection Bureau to allow banks and credit unions to hold mortgages in portfolio, therefore retaining 100 percent of the risk, to satisfy the requirements of the rule. The bill promotes affordable home financing and discourages the risky practices which led to the 2008 financial crisis and the resulting taxpayer bailouts of Fannie Mae, Freddie Mac, and large systemically important financial institutions.
The Independent Community Bankers Association reports that 73 percent of community bankers have decreased their mortgage business or completely stopped providing mortgage loans due to the expense of complying with the Qualified Mortgage regulation.