It was intended to restore confidence in Fannie Mae and Freddie Macby strengthening re… [citation needed][citation needed], Upon registration, MLOs are provided with a Unique Identifier number. One such step is to file a report to the Consumer Financial Protection Bureau or with the U.S. Department of Housing and Urban Development (HUD). "Secure and Fair Enforcement for Mortgage Licensing Act" (12 United States Code, Section 5100, et seq. The action is "one of the most sweeping government interventions in private financial markets in decades".[2][3][4]. It also mandated a 3.5% down payment for any FHA loan and placed a 12-month moratorium on the U.S. Department of Housing and Urban Development implementation of risk-based premiums. Bush in 2008, required all states to implement a Mortgage Loan Originator (hereafter: "MLO") licensing and registration system by August 1, 2009 (August 1, 2010 for legislatures that meet biennially). Especially, it will aid them in identifying and avoiding bad actors. [citation needed]. 1101) Amends the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 to replace the Office of Federal Housing Enterprise Oversight of the Department of Housing … This part of the act required all states to implement a mortgage loan originator (MLO) licensing and registration system by August 1, 2009 (or August 1, 2010, for legislatures that meet biennially). The act allowed the FHA to guarantee up to $300 billion in new 30-year fixed-rate mortgages for subprime borrowers. Mortgage lending discrimination is illegal. A conforming loan is a mortgage whose underlying terms and conditions meet the funding criteria of Fannie Mae and Freddie Mac—mainly, an annual dollar limit. Mortgage commitments made on or before January 1, 2008, were covered under the act. ), passed by Congress and signed by President G.W. It allowed states to refinance subprime loans with mortgage revenue bonds and created the Federal Housing Finance Agency (FHFA). A government-sponsored enterprise (GSE) is a quasi-governmental entity that enhances the flow of credit to specific economic sectors by providing public financial services. Congress began hearings on the program in February.[6]. JSTOR is part of ITHAKA, a not-for-profit organization helping the academic community use digital technologies to preserve the scholarly record and to advance research and teaching in sustainable ways. The Housing and Economic Recovery Act of 2008 (Pub.L. HERA addressed the subprime mortgage crisis, reformed the regulator of Fannie Mae and Freddie Mac, authorized the Federal Housing Administration to guarantee up to $300 billion in new 30-year fixed-rate mortgages for subprime borrowers, created the Neighborhood Stabilization Program, and authorized the creation of the Housing Trust and Capital Magnet Funds. The Homeowner Affordability and Stability Plan is a 2009 program created to stabilize the U.S. economy. HERA included a number of sub-title acts under the main act, including: This subtitle act in HERA offered a refundable tax credit for qualified first-time homebuyers related to purchases on or after April 9, 2008, and before July 1, 2009, equal to 10 percent of the purchase price of a principal residence, up to $7,500. The Federal Housing Finance Agency (FHFA) is a U.S. government agency that regulates the secondary mortgage market. The Act also established the Federal Housing Finance Agency (FHFA) out of the Federal Housing Finance Board (FHFB) and Office of Federal Housing Enterprise Oversight (OFHEO). 1. Licensed Realtors and MLOs who work for federally regulated financial institutions, for example, are not required to be licensed as MLOs, although they are required to register. It authorized the Federal Housing Administration to guarantee up to $300 billion in new 30-year fixed rate mortgages for subprime borrowers if lenders wrote down principal loan balances to 90 percent of current appraisal value. ©2000-2020 ITHAKA. It was intended to restore confidence in Fannie and Freddie, but included provisions that came after years of work by the affordable housing industry. The Act provided emergency assistance for the redevelopment of abandoned and foreclosed homes. President Obama signed the Recovery Act eleven years ago today that helped to kick-start an economic recovery that has lasted for over a decade and create the longest period of … Some provisions of the law were modified by the American Recovery and Reinvestment Act of 2009, which was signed into law by President Obama on February 17, 2009.[1]. It authorized the Federal Housing Administration to guarantee up to $300 billion in new 30-year fixed rate mortgages for subprime borrowers if lenders wrote down principal loan balances to 90 percent of current appraisal value. This statute established the Federal Housing Finance Agency (FHFA) as an independent federal agency. 3221 - The Housing Stimulus Bill", "Statement of FHFA Director James B. Lockhart", "Fact Sheet: Questions and Answers on Conservatorship", "Treasury to Rescue Fannie and Freddie: Regulators Seek to Keep Firms' Troubles From Setting Off Wave of Bank Failures", "Homeowners Rescue Program Shows Slim Benefits", "As Housing Act Passes Congress, Questions Emerge", "Bush signs housing bill as Fannie Mae grows", "Bush Signs Measure for Homeowners, Fannie, Freddie", http://www.govtrack.us/congress/bill.xpd?bill=h110-3221, Emergency Economic Stabilization Act of 2008, Dodd–Frank Wall Street Reform and Consumer Protection Act, Acquired or bankrupt banks in the late 2000s financial crisis, Federal takeover of Fannie Mae and Freddie Mac, Homeowners Affordability and Stability Plan, Public–Private Investment Program for Legacy Assets, 2009 Supervisory Capital Assessment Program, Term Asset-Backed Securities Loan Facility, https://en.wikipedia.org/w/index.php?title=Housing_and_Economic_Recovery_Act_of_2008&oldid=972596113, United States federal housing legislation, Articles to be expanded from September 2008, Articles with unsourced statements from May 2011, United States federal legislation articles without infoboxes, Creative Commons Attribution-ShareAlike License.