Also in this playlist...
This transcript is automatically generated
Washington but here in New York if you're looking for an FHA insured mortgage you might need to reach a little further in your pocket.
Congressman Scott Garrett introducing a bill to raise the federal housing administration's minimum down payment.
From three and a half percent to 5%.
And as we've been reporting that -- today is running very low on cash.
-- it's billed -- -- -- taxpayer protection act.
A 2009 might help with that joining me now in studio's content from Scott Garrett of new -- -- Huntsman ready to be here it's good to be within.
Why now and what took you so long because I thought we did talk about -- on this program the fact.
That that they today's reserves were running low and now below that 2% -- -- -- talking about it since the beginning of the year.
Then on -- I do appreciate -- all the dialogue panel discussion you've been having on in our office has been looking at this as well.
But you know what what the the fact of the matter is is that what we've been hearing from the FHA has don't worry about it -- worry about it we're doing behind that we're not gonna cost the taxpayer anything.
But you know even the OMB director's come out to say that's not true that the FAA is FHA has in the past and will in the future the future potentially cost American taxpayers something.
And what this bill tries to do is well stop the next bailout if you will.
Part of the bill though is to look at -- -- today more closely at but that begs the question.
Does congress really know the quality of the loans the types of loans at bank today has been making and what its books truly look like.
Congress doesn't mean that's part of the reason why we're doing this and actually happening right after we drop this bill and we got a phone call.
From the chairman and what -- actually gonna have a hearing now on the on the topic.
I don't think they're going to be specifically looking at our bill because we're -- Republican bill that the Democrat chairman I'd like them do it.
They're now going to be looking at it so we can delve into some of those issues that you've been talking about for some time.
Wouldn't it -- wouldn't it be more effective.
The size of the mortgage that -- days in shoring just like Fannie Mae and Freddie Mac right now at the high end it's close to 730000.
Wouldn't that be more effective than just raising the down payment what.
One and a half percentage points them.
Well I mean if there's a number of things you can look at look at the amount that the yeah.
They insure you look at the amount of a down payment and you know also look at the leverage ratio which is the other aspect they -- looking at as well all three really should be looked that.
You know what the political side of that the point that you're raising though of course is the thing while they're really not fair because if you live and -- high cost states like.
New York and New Jersey.
Compared to -- living over in I don't know Arkansas someplace like that.
You should have different numbers as as percentages are different -- -- an individual nominees to be close to -- that by now and on indicate that right up.
And now the question we raised not only on them but -- -- that same question when they looked -- years ago when they're doing that with the TSE's Fannie Mae and Freddie Mac.
We've looked at -- this all in the past and raises the very same arguments that you made it very political but we try to push back.
But what would -- on the other side play devil's advocate what would the housing market look like if not.
-- FHA stepping in and ensuring what one.
Fifth of all mortgages today out from there and one to 3% or so just a few years ago -- But then also with Fannie Mae and Freddie Mac -- all three of those together.
8590% of the mortgage market what it without the government.
What -- the housing market and that.
The -- question here and you went from 3% up to 20% just a really short period of time and that's what I sort of threw that question to chairman Bernard the other day you know what what would you do where she never gives you that really intensity and looking at.
But he raised the question that you and I are saying wolf it's.
It's a split do you want them up prop up the housing market may be up artificially.
And put the American taxpayer on the hook or you want to get an appropriate balance of what we're trying to do here is try to -- that appropriate balance of the taxpayer.
Isn't gonna have to bail out FHA just like that -- TSE's and Fannie and Freddie in the past and everything else.
Is still very little Murillo -- -- -- but.
Will it do anything to shore up that -- -- -- having an impact well why not 10%.
-- -- -- -- We we thought we picked a reasonable number to go from remember was below it's a 3.5 right now was below that before the tees in appropriate 3.5 -- that we're kicking up to 5%.
You can imagine we've already we -- the villain in the morning and by the afternoon we -- phone in the office is already getting phone calls from certain people.
And various industries saying how can you do this you're gonna decimate the marketplace what have you so to go up even further.
But probably even more problematic but it's that it's something that should be discussed all the should be realized as far as -- -- impacted housing how to impact the taxpayer will.
Quit your congressman you in favor of six extending or even expanding first time home buyer tax credit -- -- there's a bill in already to do that to do both of those things through extended also to raise it.
I think we should have a hearing on that as well just to see what gonna cost because.
What got us here in the first place was the government intervening in the marketplace to such an extent that you created the bubble that created a situation where some people couldn't buy houses -- -- -- to astronomically -- and other people understand the market.
We have to think long and hard before we do that all over again.
It's an intervention that started in the Great Depression -- good look at this out of congressman thank you so much congressman Scott Garrett.
Of New Jersey may well take care still to come.
Filter by section