Apr 26 2023
WASHINGTON – U.S. Senator Lindsey Graham (R-South Carolina) today signed onto a letter to the Federal Housing Finance Agency (FHFA) Director Sandra Thompson opposing a Biden Administration proposal to penalize Americans who have managed their money responsibly in order to subsidize high-risk borrowers with low credit scores.
Graham said the proposal will disincentivize Americans from being responsible when managing their money and reliable in paying off their loans and credit cards. It also punishes hard-working Americans with high credit scores by raising their interest rates.
The Biden Administration plan has come under intense scrutiny and criticism.
“This shortsighted and counterproductive policy demonstrates a profound misunderstanding of the necessity of accurately tailoring housing finance products to credit risk and establishes a perverse incentive that punishes hardworking Americans for their fiscal prudence,” wrote Graham.
“Under your leadership, FHFA has pushed forward a number of policy proposals and changes that seek to social-engineer the U.S. housing market in ways that increase riskiness and promote discrimination,” continued Graham. “The fact that a proposal flaunting credit risk is being openly pushed by FHFA just a decade-and-a-half after the housing-led 2008 financial crisis is staggering. The housing market should not be exploited as a means to pander to targeted demographics that you have chosen, nor an instrument to secure political favoritism.”
The letter was also signed by U.S. Senators Thom Tillis (R-North Carolina), Roger Marshall (R-Kansas), Mike Braun (R-Indiana), Ted Budd (R-North Carolina), Shelley Moore Capito (R-West Virginia), Tom Cotton (R-Arkanas), Kevin Cramer (R-North Dakota), Chuck Grassley (R-Iowa), Ron Johnson (R-Wisconsin), James Lankford (R-Oklahoma), Jerry Moran (R-Kansas), Mike Rounds (R-South Dakota), Marco Rubio (R-Florida), Eric Schmitt (R-Missouri), Rick Scott (R-Florida), John Thune (R-South Dakota), and Todd Young (R-Indiana).
Full text of the Senators’ letter is here.