To Boost the Housing Industry, Incentivize Responsible Behavior

What statement(s) related to housing—policy, or otherwise—would you want to hear in the presidential debates?

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Neither the President nor Governor Romney has done enough to explain how to fix the housing dilemmas we face today. I believe it is important for these leaders to point out that impeded access to credit for qualified candidates is handicapping the economy. This economy will not fully recover without a housing recovery. Housing is a manufacturing base that cannot be exported and can create millions of jobs. However, without moving forward on real GSE reform and housing finance policy, our recovery will continue to drag. We need leadership and there is a great opportunity for either candidate to demonstrate an understanding of such a common, critical issue with vital importance to our economy.

There is no doubt that credit was too loose in the recent years past, however the pendulum has swung too far. The average FICO score on conventional rate loans is over 750 and even on FHA loans the average is in the mid 750’s. We need solid underwriting standards, but our system for establishing credit is too opaque. Every homeowner disdains this reality, yet we are beholden to a system we don’t understand very well. We need to hear from each candidate regarding how they intend to incentivize responsible behavior by lenders and consumers so that the housing industry can once again be a key cog in economic growth.

Jimmy Kemp is President of the Jack Kemp Foundation.

Welcome to the BPC Housing Commission expert forum! This forum is intended to foster interactive and substantive discussion about pressing housing issues. Each month contributors from different parts of the housing sector will be invited to respond to a discussion topic. Guest posts will feature prominently on BPC’s website, as well as be shared regularly with Housing Commissioners to help inform their work.

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​ Expert bloggers are not members of the BPC Housing Commission. Any views expressed on this forum do not necessarily represent the views of the Housing Commission, its Co-Chairs, or the Bipartisan Policy Center.