American Banker: Calabria to Congress: If you don’t like crisis fee, then fund GSEs

American Banker, September 16 2020, Calabria to Congress: If you don’t like crisis fee, then fund GSEs

The adverse market fee is meant to aid Fannie and Freddie with losses associated with the COVID-19 pandemic. However, the fee could raise costs by about $1400 for the average customer rather than helping homeowners take advantage of the historically low mortgage rates.

Calabria testified before the House Financial Services Committee, where members of both parties questioned the fee imposed on refinancings. The added charge is meant to help Fannie and Freddie shoulder losses associated with the COVID-19 pandemic, but the fee could raise costs by an estimated $1,400 for the average consumer.

“Rather than allowing homeowners to take advantage of historically low mortgage rates, Director Calabria announced a new refinance fee that would take some of the savings that would have otherwise gone into the pockets of families and instead redirect that money into the pockets of Fannie and Freddie,” said House Financial Services Committee Chairwoman Maxine Waters, D-Calif.

 

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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