News Release

UnidosUS: Trump Housing Scheme Would Hurt Affordable Mortgage Market

September 5, 2019

WASHINGTON, DC—Today, the Trump administration announced its plans to make significant changes to the nation’s home mortgage market, including Fannie Mae and Freddie Mac—the Government Sponsored Entities (GSEs)—which have been in conservatorship since the Great Recession in September of 2008. The proposal threatens to shrink the federal government’s role in monitoring fairness and equity and weaken the affordable housing mission of the GSEs. If enacted, this plan would place borrowers of color—especially Latinos—in additional danger of not being able to access safe, affordable loans.

“Unfortunately, the administration’s proposal falls well short of this goal—which isn’t surprising coming on top of its recent attempts to undercut the fair housing enforcement system—make it more difficult for victims of discrimination to prove their claims and unleash predatory lenders from reasonable regulation. We call on Congress to enact reasonable, commonsense mortgage market reforms that would expand affordable homeownership for all Americans,” said UnidosUS President and CEO Janet Murguía.

Homeownership has long been a cornerstone of the American Dream for countless Latinos who are more likely than other groups to have the majority of their assets invested in their homes. Housing is a top electoral issue for Latino voters, in fact, more than nine out of 10 Latino voters in recent UnidosUS polling said it was critical for lawmakers to create more homeownership opportunities.

Despite recent gains, continued low Latino homeownership rates and persistent homeownership disparities have the potential to dampen the prospects of the nation’s housing market and economy. But instead of explicitly expanding affordable homeownership opportunities, the administration’s proposal privatizes the profits earned by investors and socializes the risks—repeating the same “too big to fail” scenario that required taxpayer bailouts a decade ago. Even worse, it does so without explicitly requiring home lenders to increase lending to credit-eligible low- and moderate-income homebuyers.

“Lenders often rely on the GSEs to provide the only source of mortgage credit to underserved areas in diverse communities. In fact, in 2018, the GSEs helped more than three million families buy or refinance their homes and made it possible for another 1.5 million to find an apartment, including nearly 900,000 low-and very-low income renters. When GSEs fulfill their mandates to serve all segments of the market, American families are more likely to find stable affordable homeownership opportunities,” Murguía concluded.

UnidosUS, previously known as NCLR (National Council of La Raza), is the nation’s largest Hispanic civil rights and advocacy organization. Through its unique combination of expert research, advocacy, programs, and an Affiliate Network of nearly 300 community-based organizations across the United States and Puerto Rico, UnidosUS simultaneously challenges the social, economic, and political barriers that affect Latinos at the national and local levels. For more than 50 years, UnidosUS has united communities and different groups seeking common ground through collaboration, and that share a desire to make our country stronger. For more information on UnidosUS, visit www.unidosus.org or follow us on Facebook, Twitter, and Instagram.

Contact:
Camila Gallardo
news@unidosus.org
(305) 215-4259