MBA President Calls for Transparency, Collaboration in Washington

""Mortgage Bankers Association"":http://mba.org/default.htm (MBA) president and CEO David Stevens took the stage at the group's ""100th Annual Convention and Expo"":http://events.mortgagebankers.org/100th_Annual/sessions/default.aspx#INFO Monday morning, reflecting on the last century in housing and shining a spotlight on today's challenges.

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In his speech, Stevens said one of the biggest ongoing issues is the market's balance, which has tilted in the last half-decade from too loose to overly cautious.

""In correcting for the loose standards of yesterday we have stifled access to the credit needed to drive this market, this economy. In our effort to be diligent in the face of a collapse in the housing market, policymakers all over town have been making hundreds of policy decisions to clamp down on risk, decisions that may make sense in isolation but in the aggregate are choking off credit,"" he said in prepared remarks.

While he notes that the government's response to the economic crisis has seen its share of successes, he also says Washington needs to recognize and take responsibility for the shortcomings of its policies--a step he believes [COLUMN_BREAK]

policymakers have been reluctant to take as they ""continue to clamp down on risk, run up pricing on government lending, and pursue enforcement actions that may have made sense in 2009 and 2010, but today are impeding our economic health rather than supporting it.""

Among other examples, Stevens offered up the case of the GSEs, which he said ""have all but eliminated the ability for any borrower with a low down payment and average credit score from having access to a home loan at a reasonable price"" by implementing loan-level price adjusters for those with less than pristine credit or higher loan-to-value ratios--all in the name of eliminating risk.

""To be clear, after the GSEs were put into conservatorship, no one would argue the g-fees did not need to rise and sustainable lending had to be implemented,"" he remarked. ""But, today, the GSEs are virtually printing money and the excess profits are going to the Treasury--all at a cost to home ownership and the broad recovery of the housing market.""

Adding to the complications is the risk of class action suits, settlements, Justice Department actions, and complaints from state attorneys, all of which discourage lenders from considering a borrower ""on the bubble.""

Finally, Stevens said conflicts in rulemaking are hurting efforts to return private capital to the secondary market--a problem that could be avoided if policymakers would take more time to listen to the industry's concerns and make their work as transparent as possible.

""We can help the economy find its footing at a time when it could really use a boost. As rates start to rise, the recovery will need every ounce of help from all sectors of the economy. The real estate finance business can be an ally to growth if the policymakers partner with us--rather than holding us back,"" he said.