Affordable Housing Advocate Groups Call for Opposition to Mortgage Choice Act

Affordable Housing Advocate Groups Call for Opposition to Mortgage Choice Act

Boston – Massachusetts Affordable Housing Alliance (MAHA), Citizens’ Housing & Planning Association (CHAPA) and the Allston-Brighton CDC joined together to ask Congress not to strip protections for homebuyers created in the Dodd-Frank reforms. MAHA Executive Director Tom Callahan, CHAPA Executive Director Brenda Clement and Allston-Brighton CDC Director of Home Ownership Michelle Meiser spoke of the dangers of this bill which they say is yet another attempt by the big banks to do an end run around the tough Wall Street reform bill that passed Congress in the wake of the financial crisis and the ensuing Wall Street bailouts.

“At the Massachusetts Affordable Housing Alliance, we work with first time homebuyers trying to afford a home in Massachusetts.” Tom Callahan of MAHA said. “The Mortgage Choice Act will make that difficult.”

“These regulations in Dodd-Frank try to put into place some reasonable restrictions and some oversight over lending partners.” said Brenda Clement of CHAPA. “Let’s give them a shot. The protections were put in place for some very good reasons.”

“I can attest to the challenges that come with more expensive loans. People are unable to get housing.” added Michelle Meiser of Allston-Brighton CDC. “We need to support benefits of communities, not just individuals, to access home ownership safely and responsibility.”

Wall Street reforms now limit the fees lenders and their business partners – known as “affiliates” – may charge, protecting borrowers from loans that are full of tricks and traps and the risky features that harmed the economy in the recent mortgage crisis. Because of these reforms, lenders now must actually assess a mortgage borrower’s ability to repay before making the loan. And they have to limit the fees they can charge to a reasonable, and affordable, three percent. The Mortgage Choice Act will allow many more risky, high-cost loans by creating exceptions to the three percent points and fees threshold. Weakening the consumer protections will just create new incentives to trap consumers in overpriced mortgages.

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