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  • Comment Detail

  • Date: 05/22/24
    First Name: Christopher
    Last Name: Denson
    Organization: Georgia Public Policy Foundation
    City: N/A
    State: N/A
    Attachment: N/A
    Number: 2024-N-5

  • Comment

    This comment is regarding Freddie Mac’s proposed purchase of closed-end second mortgage loans and whether it is in the public interest. Ultimately, the overall downside to the U.S. economy and taxpayers is greater than whatever economic boom is provided for those households fortunate enough to have existing home equity and a low interest rate on their mortgage -- and are looking to increase their spending power or subsidize existing personal loans. 

    Citizens across the country are struggling to find adequate housing right now: lack of supply, more costly building materials, higher interest rates, and onerous zoning regulations are among the factors making homeownership unattainable for far too many.  This proposed rule does not address any of those barriers to buying a home. Not only that, it goes beyond the intended mission of Freddie Mac to increase opportunities outside of the private housing finance markets for low and middle-income homeownership. In fact, the primary outcome of this program appears to be allowing homeowners to use equity accrued to secure loans at rates that are below what the private market is already offering -- with the backing of the U.S. government. Freddie Mac buying second mortgages will not only supplant existing financial institutions but increase the debt risk for both the private and public sector throughout the U.S. economy and should not be implemented.