Jefferson City News

In a recent exchange between Congressman Blaine Luetkemeyer and U.S. Department of Housing and Urban Development (HUD) Secretary Marcia Fudge, concerns were raised about the present housing crisis in the United States and the Biden administration's efforts to address it. The discussion centered around the Federal Housing Finance Agency's (FHFA) decision to change credit-reporting requirements for mortgages backed by Fannie Mae and Freddie Mac.

Congressman Luetkemeyer inquired about this decision, asking Secretary Fudge if she was aware of the shift from a tri-merge credit report to two credit reports. Secretary Fudge acknowledged her awareness of the decision but mentioned her lack of knowledge regarding the background details.

The congressman expressed his concern that this change could lead to higher costs for borrowers, increased risk for lenders, and the exclusion of eligible borrowers from the mortgage markets. Secretary Fudge responded, stating that the risk assessment team at HUD has not raised any red flags regarding this change. She also clarified that the decision made by FHFA does not directly affect HUD.

When asked about the level of collaboration between HUD and FHFA, Secretary Fudge explained that she sits on the board that meets with FHFA to receive regular reports but does not work closely with them or provide advice.

The exchange sheds light on concerns raised by Congressman Luetkemeyer regarding the potential consequences of changing credit-reporting requirements. He had previously expressed his disapproval of these changes in a letter to FHFA Director Sandra Thompson in November 2023. He argued that tri-merge credit reports provide a more comprehensive understanding of a consumer's credit history and that shifting to a bi-merge requirement could lead to unmanageable debt for consumers and a significant increase in foreclosures, exacerbating the housing crisis and negatively impacting the economy.

As the housing crisis continues to be a pressing issue in the United States, the exchange between Congressman Luetkemeyer and Secretary Fudge highlights the need for careful consideration of policy decisions that may have far-reaching consequences. It remains to be seen how the Biden administration will address these concerns and work towards mitigating the housing crisis in the country.

[Watch the full exchange here.](link to video)

Click this link to access more information: https://luetkemeyer.house.gov/news/documentsingle.aspx?DocumentID=401028