5 Mortgage Questions Facing President Trump and the New Congress
Unlike the past two presidential elections, housing was not a focal point in the 2016 race. But as the election cycle winds down and Washington gets back to the business of governing, many issues facing President-elect Trump and the 115th Congress will have far-reaching implications for the mortgage industry. Here's a look at five of the most pressing mortgage questions awaiting elected officials when they take office in January.
A new, Republican administration means job openings for a variety of housing-related positions in the federal government, including Department of Housing and Urban Development secretary, Federal Housing Administration commissioner, Ginnie Mae president and Federal Housing Finance Agency director (when Mel Watt's term ends in 2019). Likewise, Rep. Scott Garrett's defeat in New Jersey's 5th congressional district means there will be a new Republican chair of the House Capital Markets and Government-Sponsored Enterprises Subcommittee.
The government-sponsored enterprises are in their eighth year of conservatorship under the Federal Housing Finance Agency and talks of reform have stalled. Will the new administration and Congress move to release Fannie Mae and Freddie Mac from their obligations to the U.S. Treasury Department?
The Federal Reserve has held steady since it raised the federal funds rate 25 basis points for the first time in more than nine years last December. With the election over, is another rate hike looming? Could it happen as early as the Fed's December meeting?
The housing industry has staunchly defended the mortgage interest tax deduction as an essential tool for promoting homeownership. But the Mortgage Bankers Association recently signaled willingness to re-examine the deduction, so long as it's a part of comprehensive overhaul of tax laws. If Congress can find consensus on tax reform, will that include changes or an outright elimination of the MID?
Following a federal court's ruling that the structure of the Consumer Financial Protection Bureau is unconstitutional, a case with major mortgage industry implications could be headed to the Supreme Court. Senate Republicans have so far blocked Merrick Garland, President Obama's nominee to succeed Justice Antonin Scalia on the Supreme Court. That will likely continue, providing an opportunity for the Trump administration to offer its own nominee.