Aug032013

We don’t need another homeowners advocacy group

What we probably really need a group promoting saving your money and not getting to races with the Joneses, but is a topic outside this blog. I’ll the article do most of the description of the new group.

New group being formed to advocate for homeowners’ interests

WASHINGTON — Do 75 million homeowners need their own advocate before Congress and federal agencies on issues such as the mortgage interest tax deduction, retention of low-down-payment loans and the start of tougher financing rules next January?

A group of mortgage and real estate industry veterans, joined by leaders of national community development, fair housing and consumer groups, thinks so. They’re set to launch an unusual effort — a national nonprofit organization modeled after AARP, the seniors lobby, solely to speak for the home-owning public.

It’s called America’s Homeowner Alliance and is scheduled to be formally announced within two weeks. The mission, according to its sponsors, is to “protect and promote sustainable homeownership for all segments” of the population, from moderate-income renters saving money for a down payment to long-established owners.

Members will be asked to pay annual dues of $20 — AARP’s dues are $16 — and will receive access to an extensive program of rewards and discounts from more than 1,000 participating companies that offer home-related products and services. They include Home Depot, Lowe’s, Best Buy, Sears, Verizon, major appliance manufacturers, furniture and housewares stores, and encompass what sponsors say will be more than 1 million products. Members will earn points on every product purchase and be able to redeem them for merchandise, travel or other benefits.

Let’s review what organizations, groups, and business interests  currently advocate directly or indirectly for homeowner’s interests:

  • National Association of Realtors (NAr)
  • California Association of Realtors (CAr)
  • Home builders
  • Retailers – Home Depot, Lowe’s
  • Suppliers to Home builders
  • Big Banks
  • Mortgage Bankers Association (MBA)
  • Mortgage Servicers
  • Fannie Mae and Freddie Mac – I believe they still have lobbyists.

Now these are the policies and programs the federal government has to support housing

  • Mortgage Interest Deduction
  • Property tax Deduction
  • Guarantees Fannie Mae and Freddie Mac
  • FHA loan program
  • VA loan program

I think you can even make the argument that HAMP, HARP, and FHA streamline are all programs that also support or promote homeownership above a reasonable level. In addition, California has the California Homeowners Bill of Rights that allow borrowers to squat longer in their house if they don’t pay their mortgage, so that can be argued as another example of laws that promote homeowners.  If fact, they have kicked the delinquency can down the street.

Renters have very few groups to promote their right.  Although in California it is the hardest place to evict tenants that don’t pay their rents.  However, the same can be said with Homeowners that squat in their by not paying their mortgages.

You don’t have to pay a membership fee to this organization to get the same benefits.  Every time you pay your mortgage the bank and servicer uses those fees to support lobbying efforts.  If you used a Realtor in last Real Estate transaction they pay dues to CAr and NAr to support lobbying efforts.  Most homeowners have already paid fees to support these types of efforts this organization is designed to do, we don’t need another one.

What help contribute to the housing bubble was all these entities pushing housing beyond the normal supply and demand levels.  Having  healthy mix of renters and homeowners is actually better for the economy and the number one reason why is the mobility of labor.  We don’t another organization trying to inflate the housing bubble again.

Mike