Remarks by Ronald A. Rosenfeld at the Mortgage Bankers' Association of America 89th Annual Convention Chicago, IL October 22, 2002

Thank you for that introduction, Steve.

It's a pleasure to be in Chicago today. I'm a Midwesterner myself — born and raised in Cleveland, Ohio, just a couple of Great Lakes away from here.

Clark Gable, a fellow Ohioan, once told President Reagan that "the most important thing a man can know is that, as he approaches his own door, someone on the other side is listening for the sound of his footsteps."

What I think he meant is that a home is about more than four walls, a roof and a deed. It's about independence, faith in family and community, and of course, opportunity. It's about America.

I'm here today to talk about how we can all work together to ensure that this opportunity of homeownership is extended to every American. It's time to bring America home.

I think this is the best part of what we do.

You know, I've been in real estate and finance for a long time now — more than 25 years. And I've been a public servant for more than a decade — at both the federal and state levels. And I'm encouraged by the climate in this industry right now.

These are record years for mortgage finance.

Low interest rates have fueled a refinancing boom, but more importantly, a boom in new homeowners.

In fact, the average age of first-time homebuyers in America is pretty young — thirty-two years.

And the overall homeownership rate in America today is 67 percent — one of the best in the world.

This is one of the great American success stories — the public and private sector working together for the good of the American people.

Ginnie Mae is committed to continuing this tradition.

When I started at Ginnie Mae, I promised you action on a number of fronts.

Today I'd like to talk about what we've already accomplished, and what we're planning to accomplish in the coming weeks and months. Then I'll be happy to take any questions you might have.

In Toronto last year, we were only 30 days removed from the September 11 terrorist attacks on our nation. We work just across the river from the Pentagon, and of course our New York office is in the heart of the financial district.

I would just like to say once again how proud I am of Ginnie Mae employees for working through this difficult time and providing uninterrupted service to the mortgage industry.

One year later, we're healing. But America has more work to do — and our men and women in the armed forces need our help.

Tomorrow, Secretary Martinez, whom many of you heard speak this morning, will be announcing one way that Ginnie Mae will be helping our issuers support our military.

But what I'd like to focus on today is the way we are improving the way we do business — so that you can improve the way you do business.

When I first started at Ginnie Mae, one of the first things I learned was that the documentation we required was a problem with our business partners.

So last year we began to address this problem by working with the industry to streamline our requirements.

The first thing we streamlined was our recertification process.

In April 2001, we stopped requiring our issuers to prepare or maintain agency assignments — a move that saved the industry more than $7 ½ million — and a great deal of time.

This year, our emphasis has been on eliminating paperwork.

First, we eliminated the need for paper insurance certificates — for about eight months now, Ginnie Mae has had in place an electronic confirmation of insurance.

And in March, we announced that Ginnie Mae would no longer require agency assignments, a change I know all of you welcomed.

The changes we made this year alone will save the industry — will save you — more than $10 million per year.

But we're not done.

Today, if you are a federally-regulated institution, or affiliate of a federally-regulated institution, you will not need to provide key documents in order to have your custodian provide final certification for a pool — Ginnie Mae will accept representations and warranties in lieu of the collateral documents.

This change is effective immediately, and will apply to all outstanding pools.

This does not relieve you from having collateral documents, but it will take you "off the clock," so to speak, giving you the freedom you need to run your business more efficiently.

This one change, along with some other documentation changes we made over the past two years, will save issuers over $20 million annually.

It will also remove another layer of bureaucracy. It's the right thing to do for our issuers, and it's the right time to do it.

For those institutions that are not federally regulated or affiliated with a federally-regulated institution — we are working on ways to provide you with this same opportunity.

And this is just the beginning.

As many of you know, we are also working to restructure our MBS program.

Because we value your input, in November (subject to a budget passed by Congress) representatives from Ginnie Mae will be traveling to five cities across the country — New York, Los Angeles, Atlanta, Detroit and Dallas — to discuss proposed changes with our issuer and investor communities.

And of course, if you can't schedule a meeting with us in one of these five cities, come see us in Washington — or give us written comments. One way or another, we are very interested in what all of you have to say.

Let me say now we have not made any kind of decision — and that you will be the first to know when we do.

It's a new day for Ginnie Mae. The things I've talked about today are just part of our plan to increase accountability and responsibility at the nation's only agency providing credit-risk-free mortgage-backed securities.

When I and some others on my team met with a number of you in September, some great ideas — big and small — were put on the table.

We need to keep this dialogue going so that we can better focus on our central goal. That is: to simply improve the way we do business while staying true to our mission of expanding affordable housing in America.

President Bush, Secretary Martinez and I know that status quo isn't an option — because status quo improves only the status of the few.

America demands more from us.

And while we've made an impressive start, we have a lot of work ahead of us.

I mentioned earlier that American homeownership rates are today 67 percent. Well, here's the flip side of the coin: minority homeownership rates are well below that, at 47 percent for Latinos, 48 percent for African-Americans and 53 percent for Asian-Americans and others.

In response, President Bush has issued a challenge to all Americans: five-and-a-half million more minority homeowners by the end of the decade.

Last week, the President convened his conference on minority homeownership.

And one of the things discussed at the conference was the economic benefits of increasing minority homeownership — and it turns out that five-and-a-half million more minority homeowners can mean more than $250 billion in economic impact.

But the benefits don't stop there — homeownership is good for our children, our communities — and even our entrepreneurial spirit.

So for all these reasons — and many more in the days and months to come — let's talk about how we can work together to meet the President's challenge.

Let's take this opportunity to keep the dialogue going. And let's begin by asking some questions:

• Why is mortgage finance the only industry — outside of sheep-herding — that hasn't changed in decades?
• Why can't we develop a mortgage where a consumer can refinance without starting the loan process from square one? It seems so basic.
• What other actions can we take to offer more Americans — particularly minority Americans — access to affordable housing?
• And finally, how can we bring more Americans home?

We want to know what you think — and I guarantee you will have our attention in finding answers.

I mentioned earlier that Ginnie Mae is committed to becoming more responsive and more accountable. I want you to know that this is a personal goal of mine as well — so if you feel like you're not getting the kind of attention you deserve from us, call me directly.

I promise that we'll do our very best to get you what you need.

Thank you for your time.