U.S. Rep. Tom Emmer (R-MN) wants Americans with non-traditional forms of income, including those who are creditworthy independent contractors or self-employed, to have improved access to mortgage products.
“America was founded by innovators and no one embodies that spirit more than the self-employed,” Rep. Emmer said on Wednesday.
Rep. Emmer on May 1 sponsored the Self-Employed Mortgage Access Act of 2019, H.R. 2445, with cosponsor U.S. Rep. Bill Foster (D-IL), which would permit mortgage lenders to utilize documentation standards already approved by federal agencies to underwrite income earned through self-employment or other so-called gig economy work.
“These individuals should not suffer unnecessary obstacles because of their dedication to create a better life for themselves and their family,” said Rep. Emmer. “They deserve to own a home and build their American dream, and needless government regulation should not stand in their way.”
If enacted, the congressman said that H.R. 2445 would allow access to mortgages for people receiving steady forms of income by letting lenders verify an applicant’s income using additional forms of documentation, instead of relying on an employer’s W-2 form, for example.
According to the text of H.R. 2445, if enacted, the U.S. Bureau of Consumer Financial Protection would amend the Code of Federal Regulations to provide that a creditor may, in satisfying certain requirements, rely on specific existing standards to determine income and debt.
The standards used would be required to be maintained by federal agencies such as a federal home loan bank, the U.S. Department of Housing and Urban Development, the U.S. Department of Veterans Affairs, and the U.S. Department of Agriculture, among others.
H.R. 2445, which is supported by the Mortgage Bankers Association, the Consumer Federation of America, and The Milken Institute, is being reviewed by the U.S. House Financial Services Committee.