Washington, D.C. — After being sworn into office today, the administration of President Donald Trump moved to raise Federal Housing Administration, or FHA, premiums for new homebuyers by 25 basis points. This action, which reverses an Obama administration move to lower premiums by 25 basis points, will cost a new homebuyer an additional $500 on their housing payments in 2017. The lower premium rate, the FHA estimated, could have made homeownership affordable for an additional 250,000 first-time homebuyers in the next three years.
Sarah Edelman, Director of Housing Policy at the Center for American Progress, released the following statement:
President Trump campaigned as the candidate who would stand with the forgotten American worker, but of all of the actions he could have taken on his first day in office, it’s telling that his administration has moved to instead make it more expensive for Americans to buy a home this year and beyond. With mortgage interest rates already on the rise, reversing the FHA’s move to cut insurance premiums in fact puts the dream of homeownership farther out of reach for millions of hardworking Americans.
So-called reckless homeowners didn’t cause the housing crisis—but predatory lenders who tricked consumers into mortgages with exploding interest rates and other harmful features did. More than 7 million Americans lost their homes during the foreclosure crisis, largely because of predatory mortgages and incompetent servicing practices. As we were reminded yesterday at Steve Mnuchin’s Senate confirmation hearing, Trump’s own Treasury secretary nominee made millions from the crash, and today’s action is all the proof we need to know whose side the Trump administration is on.
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