This was a vote on an amendment by Rep. Tom Price (R-GA) that would have capped the number of new mortgage loans provided to borrowers under the federal government’s mortgage insurance program at 10 percent of the total number of private-market home loans given each year.
Price urged support for his amendment: “…If we are honest with ourselves, when appropriately sized, the FHA does indeed do a wonderful job and is very helpful. But at this point, this is just another government program that is distorting the market. FHA's huge market share is a hindrance to regaining equity in the housing market.”
Rep. Brad Sherman (D-CA) urged members to oppose Price’s amendment: “Right now, FHA is 30 percent of the home purchase finance market, about over half of that market for African Americans, 45 percent for Hispanics. Are we going to tell one-third of American home buyers, almost half or over half Hispanics and African Americans seeking to buy homes, that they are not going to be able to buy those homes? Because, if they can't get FHA financing, the private sector may be there, but at much higher rates. And there is no way that these individuals will be able to afford to buy those homes.”
(The federal government’s mortgage insurance program is run by the Federal Housing Authority (FHA), which was established during the Great Depression to make home ownership accessible and affordable for more Americans. It insures mortgages provided to homeowners by FHA-approved private lenders. The program is intended to shield private lenders participating in the program from losses that occur when homeowners default on their loans. The program is largely “self-sustaining” – meaning the taxpayers do not finance it. To keep the program solvent, the legislation raised premiums paid by homeowners receiving loans from FHA-approved lenders.)
The House rejected the Price amendment by a vote of 106-316. 105 Republicans and 1 Democrat voted “yea.” 251 Democrats and 65 Republicans voted “nay.” As a result, the House rejected an amendment to housing legislation that would have capped the number of new mortgage loans provided to borrowers under the federal government’s mortgage insurance program at 10 percent of the total number of private-market home loans given each year.