Peters Introduces Bipartisan Bill to Improve Housing Financial Literacy

WASHINGTON, DC – U.S. Senator Gary Peters (MI) today announced he introduced a bipartisan bill that would aim to bolster financial literacy among prospective first-time homeowners. The Housing Financial Literacy Act, which Peters introduced with Senator John Cornyn (R-TX), would provide those who complete a Department of Housing and Urban Development (HUD)-certified housing counseling course the opportunity to claim a .25% deduction on their Federal Housing Administration (FHA) mortgage insurance premium. A bipartisan companion bill introduced in the U.S. House of Representatives by Representatives Joyce Beatty (OH-03) and Steve Stivers (OH-15) passed the chamber unanimously.

“As the Coronavirus pandemic continues to impact all sectors of our economy, ensuring that Michigan families have a firm grip over their personal finances has never been more critical,” said Senator Peters, member of the Congressional Financial Literacy Caucus. “This bipartisan bill would not only give more first-time homeowners a leg-up on their mortgage payments, but also the tools necessary to maintain long-term financial stability for them and their loved ones.”

“Owning a home is part of the American dream, but it can seem daunting for first-time homebuyers,” said Sen. Cornyn. “This legislation would help Texans manage their finances responsibly and make them less likely to face foreclosure down the road.”

The bipartisan legislation would grant qualifying first-time homebuyers a .25% reduction on their FHA mortgage insurance premium. For example, if a homebuyer were about to accept a 30-Year FHA mortgage at a 3.25% interest rate, they could take a HUD-approved housing counseling course and reduce it to 3%. After four years, the HUD Secretary would then have the authority to alter the .25% discount to a figure that is properly aligned with the reduced risk of loss, if any, as a result of the housing counseling.

Peters’ effort has been supported by the National Association of Realtors, NAFCU, CUNA, National Housing Resource Center, National Association of Real Estate Brokers, Leadership Conference for Civil and Human Rights and the National Urban League.

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