Monday, August 10, 2015

Is government too involved in the mortgage industry?



If you have been involved with the housing industry for any period of time you are well aware of the many laws and regulations imposed upon it by the government. Some people feel that this level of involvement is good and helps to protect the home buyer but many people also have the opinion that there are simply too many rules to follow for the many professionals that work in this industry.

If you haven’t heard of Carly Fiorina, she is one of the many Republican presidential candidates running for office in the next election. She not only feels that the federal government is far too involved with the home mortgage business but actually blames government for the 2008 housing crash. It is her opinion that government should remove itself completely from the mortgage industry.

At a recent forum Ms. Fiorina stated that "The financial crisis was caused by Fannie Mae and Freddie Mac, government-sponsored entities that have been supported by both Republicans and Democrats alike". She also questions the government’s housing policies regarding mortgage loans after 2008 and further states that "We need to repeal Dodd-Frank just as we need to repeal Obamacare. But we also need to get about what we should have been doing years ago: Reforming Fannie Mae and Freddie Mac. The government should not be in the mortgage business, and have government agencies that are supposed to be regulating the financial system be competent at their job, not, as we know from reports, have federal government regulators—supposed to be minding the banking system—watching pornography all day long,"

This brings about an interesting question for all of us that are involved in the housing industry whether we are agents, appraisers, loan officers, etc. Over the years the government has become increasingly involved with the housing industry as well as many other types of business including education, banking and more, but has this actually helped the economy or hurt it? Do you think that government is helping the housing market by so much legislation or do you feel that the industry would do much better if left to “police” itself?

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