President Joe Biden (D) and his administration recently announced a new plan that looks to reward homeowners with lower credit scores by penalizing those with higher ones. Representative Brian Mast (R-FL) and other Republicans have scratched their heads at this plan, as it comes across as a way for the government to unfairly redistribute wealth.
The Federal Housing Finance Agency (FHFA), which oversees a the majority of mortgages in the United States announced that those with a FICO credit score below 620 will receive a discount on their fees, while simultaneously granting a monthly fee on those with a credit scores higher than 740.
One of the main causes of the house market crash in the late 2000s was banks accepting those applying for mortgages with risky, low credit scores, and granting them gargantuan loans.
Mortgages were viewed as a safe risk, because “who wouldn’t pay their mortgage?” Those same banks that granted those risky loans went bankrupt and were bailed out by the federal government.
Rep. Brian Mast responded to this announcement in a blog post, stating that the Biden Administration seems determined to undo the American principle of rewarding those who are successful by “punishing hard work and responsible decision making.”
“The founding idea of America is simple: if you work hard, you can provide a better life for yourself and your family. For almost two centuries, that’s been a guiding principle that has made our country the envy of billions around the globe. And yet, the Biden Administration seems determined to undo that principle by punishing hard work and responsible decision making,” said Mast.
He would go on to mention that Biden’s aims are with good intent, but his approach isn’t the right one.
“Closing the homeownership gap is a good goal, but doing so on the backs of hardworking individuals who have managed their money responsibly isn’t the way to do it. It’s big government at its worst - punishing success by taking more out of people’s wallets,” stated Rep. Mast.
He would conclude with the notion that the Biden administration is looking to fix a problem with the intent of doing something “so blatantly un-American.”
The FHFA’s plan is set to begin on May 1st.