For a sense of the uphill battle facing the mortgage industry and its leading trade group, there’s not a better primer than today’s welcome address from its incoming chief executive.Interesting piece in the Wall Street Journal today, written by By Nick Timiraos, regarding the turbulence going on in the Mortgage Industry
The Mortgage Bankers Association tapped David Stevens, the former commissioner of the Federal Housing Administration and Obama administration housing adviser, as its new chief executive officer in March.
In a speech at a conference in New York on Monday, Stevens called on the industry to own up to its past mistakes in order to get ahead of a wave of forthcoming regulation. “We own some of this,” Stevens said, issuing a call by the industry to hold itself accountable for its current black sheep status.
“Being defensive about intervention into our industry really is not productive,” he said. That step requires admitting that some within the industry gave loans to borrowers that they shouldn’t have. “No longer will we ignore or excuse bad behavior in the industry,” he said. “Integrity and commitment to safe and sound practices is fundamental to us regaining that trust.”
Stevens’s message is fairly straightforward: If the industry doesn’t mind itself, Washington will do the job, sometimes using a “blunt instrument” that may have unintended consequences that the industry will have to sort out.
He also stressed the need to draw ranks together for a trade group that risks having big banks and smaller ones split off into splinter groups. Community banks worry that the nation’s largest banks are set to exploit recent consolidation to make themselves gain still more market share. In recent years, different groups representing community lenders and the nation’s largest banks have threatened to erode the MBA’s lobbying clout.
“Now is not the time to fight turf wars,” said Stevens, warning that a “parade” of different trade groups before regulators and lawmakers would dilute or undermine the industry’s lobbying muscle… MORE