GSE REFORM: Kicking the Can Down the Road

The mortgage industry has been forced to endure all sorts of "Cart Before the Horse" type regulatory reforms over the past two years. I would describe these onesy-twosy procedural reforms as poorly planned band-aids which do little to slow the bleeding of a hemorrhaging patient. The biggest problem with this patchwork reform approach is it has led to conflicting interpretations of regulatory policy and an over-tightening of loan underwriting guidelines. These protective measure have put banks on the defensive and all but cut off funding lines to "less than perfect" borrowers, deepening the hole that has become the housing market over the past two years. Not too many folks disagree with calls for much needed GSE Reform, but there is a disparity among the urgency of these outcries. Some say the...(read more)

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Source: http://www.mortgagenewsdaily.com/01242011_gse_reform_delay.asp

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