A 2008 mortgage policy that targets Florida real estate took center stage on Capitol Hill this week, with Rep. Byron Donalds (R-FL) pressing the new housing secretary to explain why Floridians are still paying more upfront to buy a home than the rest of the country.
During the House Financial Services Committee’s annual oversight hearing, Donalds directed his questioning toward Scott Turner, the newly sworn-in Secretary of the Department of Housing and Urban Development (HUD). It marked Turner’s first appearance before the committee since taking office on February 5.
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While the hearing covered broader topics of housing affordability, Donalds focused on a specific Fannie Mae guideline—B4-2.2-04—that has created a distinct financial hurdle for Florida condominium buyers for nearly two decades.
According to Donalds, the policy forces Florida residents to put 25% down upfront when purchasing a condo under the “limited review process.” In contrast, buyers in other states are typically required to put down only 10% (qualifying for a 90% loan-to-value ratio).
“For 17 years, this policy has only applied to Florida and has negatively impacted condominium owners throughout my state,” Donalds told the committee.
He argued that the rule, implemented in the wake of the 2008 housing crash, unfairly penalizes buyers based solely on geography.
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“Floridians should not be disadvantaged just because they chose to make Florida their home,” Donalds said. “What actions are required by the FHFA to fix this and make Florida subject to the same lending terms as the rest of America?”
Secretary Turner acknowledged the disparity during the exchange. While the specific policy falls under the purview of Fannie Mae and the Federal Housing Finance Agency (FHFA), Turner committed to coordinating with federal partners to review the issue.
“I will make sure that we work very closely with our partners at FHFA to make sure that Florida residents… are being treated appropriately and fairly,” Turner said.
The “limited review process” is a streamlined approval path for mortgages, often used when buyers have substantial down payments. However, the stricter requirements for Florida have long been a point of contention for local real estate agents and buyers who argue the market has stabilized significantly since the policy was written.
Donalds indicated he plans to work with Turner’s staff to track progress on revising the guideline.
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