Back in January 2015, the Dodd-Frank banking and lending laws were enacted by the Obama administration and implemented into the Real Estate industry nationwide as a way to reel in the lackadaisical practices that led to global financial meltdown of 2008.
To say that that it was a knee-jerk overreaction to a problem that did exist would be putting it mildly. Instead of applying thoughtful, just and practical solutions and laws, it swung the pendulum so far the opposite way that it restricted and strangled money lending and the procedures associated with them.
Of course, regulations are always the answer right! The law also created the Consumer Financial Protection Bureau (CFPB). The Trump administration has vowed to dismantle the Dodd-Frank Act and replace it with policies to encourage growth and job creation.
The Trump administration has a blueprint to replace Dodd-Frank called the Financial Choice Act and while it won’t replace the original act, what it will do is ease some of the restrictions it has had on people borrowing money to purchase new homes.
As a realtor here in Phoenix to Veterans and First Responders, many who are first time home buyers, have been unable to purchase a home because they can’t quality due to Debt To Income issues, or other disqualifying reasons that wouldn’t have been there prior to Dodd-Frank.
We view this as a positive step to revitalizing money lending which will create jobs and enable more first time home buyers to get a slice of the American dream.