During the Mortgage Bankers Association conference in Atlanta, GA, Federal Housing Administration Commissioner said the mortgage business should shine a light on bad participants in the industry and regain the public’s trust.
“There’s a reflection in the media that we aren’t holding ourselves accountable enough,” said David H. Stevens, commissioner of the FHA, noting that the recent news of flaws in some banks’ foreclosure processing methods is adding to the problem.
In the public’s eye, the mortgage industry bears a burden for lending practices that contributed to the housing crisis, he said. And the crisis now may end up creating a generation of people more apt to rent. If the children of baby boomers choose not to buy a home, it would have a large impact on markets to come he said.
Stevens cited a report by Harvard University’s Joint Center for Housing Studies that found the housing market’s rebound depends on that generation, who have watched the real-estate market crumble “with shock and awe” and now have reservations about whether they should buy a home.
As the industry deals with new rules and regulations aimed at improving consumer protections, Steven’s said it needs to ensure consumers have access to the credit they need. Even though FHA recently introduced a credit-score requirement for mortgages it insures, he cautioned bankers from making decisions based on solely on credit scores, which don’t always reflect a borrower’s complete financial picture.
“We won’t help communities to recover if we limit access to a very top tier,” he said.
Editors Note: Reverse Mortgage Daily is interviewing Stevens later this week, have a question we need to ask? Let us know.