House Financial Services Committee Holds Mark-Up on PATH Act

Statement

This week, the House Financial Services Committee held a mark-up of the Protecting American Taxpayers and Homeowners (PATH) Act. As a part of the committee's leadership and role as Whip, I participated in the mark-up of the bill.

During the discussion of the PATH Act, House Republicans re-iterated the preservation of the 30-year mortgage in this housing reform bill. Since government-sponsored enterprises (GSEs) are not lenders, the 30-year mortgage will continue to exist without a government guarantee.

The PATH Act also winds down the GSEs that contributed to the 2008 housing disaster, Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac are the nation's largest bailout in history, costing the taxpayers nearly $200 billion. Today, taxpayers remain on the hook for 5.1 trillion in mortgage guarantees -- that's roughly one-third of our entire economy. The PATH Act eliminates these GSE's over a five year period, with the possibility of a two year extension.

As long as the government continues to dominate our housing finance market, our economy is at risk of another 2008-like crash. And unlike Dodd-Frank, this bill addresses the fundamental problems that caused the crisis -- incentives of affordable housing mandates. We saw the affects of people being able to buy homes they couldn't afford because of these affordable housing mandates, and the PATH Act repeals the mandates and corrects the problem. The bill also reforms FHA so it focuses on first time home borrowers and moderate-income home buyers. The PATH Act is just that, it's a path for consumers to get on the road for affordable, sensible home ownership and for community banks to compete in the mortgage market again.

It's been five years since the housing crisis, and the PATH Act finally addresses the reforms our housing finance needs by creating sustainable, affording solutions to our broken and bailed out system. I hope Speaker Boehner and Majority Leader Cantor quickly bring this bill to the House floor for a vote so that we can give consumers, community banks, and taxpayers some much needed peace of mind.

Source