While the real estate and mortgage markets are no longer in free fall, the state of our nation's housing situation remains weak and unstable. Policymakers and institutions are grappling with a myriad of components that will stabilize real estate markets and support a broad economic recovery. Faced with an overhang of foreclosure inventory, a population with deteriorating credit ratings, and a fragmented mortgage finance system, the Asian American Pacific Islander (AAPI) community has suffered a greater loss in homeownership rates, home equity, and credit access than the overall population.

AREAA presents this Five-Point Plan in order to bring awareness and solutions to the unique homeownership challenges that the AAPI community faces. Our Five-Point Plan focuses on the following:

1. Guide Homeowners to the Path of Credit Recovery
2. Clear the Way to Real Estate Recovery
3. Restore Confidence in the Mortgage Market
4. Reinvest in America's Homes and Neighborhoods
5. Prepare for a Diverse Future

In a letter to Consumer Financial Protection Bureau director Richard Cordray, AREAA and various real estate, lending and consumer protection agencies urged that a broadly-defined Qualified Mortgage (QM) be central to the forthcoming Ability to Repay regulation.

The letter warns that an unnecessarily narrow definition of QM would undermine prospects for a housing recovery and threaten redevelopment of a sound mortgage market.

The QM definition will have a significant impact on credit accessibility for Asian Americans who often have the ability to repay, however, may not qualify for mortgage products due to high rates of business ownership and/or a lack of traditional credit.

Representing more than 70,000 real estate practitioners of color and the growing minority community of America, AREAA, NAHREP and NAREB have released a five-point policy plan to address the needs of the nation's multicultural and homebuyers and homeowners.

This plan focuses on sustainability, accountability and responsibility on the part of all parties in a real estate transaction. It calls for more diverse solutions to meet the future housing needs, and demands more preparation and responsibility on the part of consumers and the industry alike. It also calls on the industry to develop unique and innovative solutions to the housing challenges facing the multicultural communities today and in the future.

Listen to AREAA Founding Chair, John Wong, discuss the Five-Point Plan with NAHREP and NAREB leadership on NAHREP's radio program:

The higher limits have been an essential element of the U.S. housing market recovery and should be extended until liquidity from the private markets is restored.

AREAA, as a member of a coalition of real estate and community-based organizations, is encouraging the House Committee on Financial Services to oppose further increases in FHA's downpayment requirement.

Such a change to the program will only hamper economic recovery and hurt millions of families who rely on FHA insurance to obtain safe, affordable mortgage financing.

WASHINGTON, D.C. (MARCH 3, 2010) - The combined 70,500 members and affiliates of the National Association of Hispanic Real Estate Professionals, The Asian Real Estate Association of America (AREAA) and the National Association of Real Estate Brokers (NAREB) plan to share The Five-Point Plan: Creating A Sustainable Path to Minority Homeownership during their 2010 Multicultural Real Estate & Policy Conference this week in Washington, D.C. Leaders from the three national trade groups are appealing to lawmakers during Capitol Hill visits to take actions that stabilize the market, expand consumer protections, preserve liquidity and stop the spiral of losses in minority communities.

"Communities of color remain at great risk. We must take common sense actions that stop the spiral of losses, keep homeowners in place and prevent our neighborhoods from becoming renter communities," said incoming NAHREP Chairman Alex Chaparro. "Lawmakers are looking to the real estate industry to collaborate on solutions that balance the role of government and private enterprise. We believe this plan does that."

The three trade associations, which represent the most impacted communities, call for support of a five-point plan that:
1. Expands the scope of Community Reinvestment Act (CRA) functions to include loan servicing,
2. Mandates pre-purchase face-to-face homebuyer education and household budget management training,
3. Provides principal forgiveness for homeowners that are underwater on their mortgage and have more than 10 percent negative equity
4. Advocates the role of the GSE's and FHA to expand the flow of stable capital to the mortgage market
5. Promotes the role of a consumer protection agency that puts consumer interests first and is empowered to implement robust reforms that align industry practices with values that serve the common good.

"Our five-point plan, when adopted, will set a new course for this Nation's housing recovery, particularly within the minority community. The magnitude of our crisis requires us to act boldly and a decisively to put us back on the right track and restore consumer confidence in the real estate market," said AREAA Chairman John Fukuda. "Communities and people we serve deserve this kind of comprehensive approach."

Current government programs, while well intended, have had limited impact especially in minority neighborhoods where the incidence of expensive mortgages and higher unemployment is greater. (At the peak of the housing expansion, African Americans and Latinos held high cost mortgages at two to nine times the frequency of whites in some foreclosure regions.) According to a report from the Federal Reserve, African American borrowers were 1.8 times as likely as white borrowers to be in foreclosure and Latino and Asian borrowers were 1.4 and 1.3 times, respectively, to be in foreclosure.

"The collaborative effort of African American, Hispanic and Asian American real estate professionals signals a broad call to action. Our respective communities have experienced previously unimaginable losses since the onset of the mortgage loan debacle and the subsequent far-reaching economic crisis," said Vincent Wimbish, President and CEO of NAREB. "We firmly believe that the five-point plan offers a solutions-based approach to making homeownership, not only sustainable, but once again desirable for communities of color as well as for all Americans."

Homeownership among African Americans and Latinos varies by region. For Latinos, the greatest proportion of homeowners is based in the West and Midwest. Among African Americans, homeownership is most concentrated in the Midwest and the South. One-third of the nation's Asian population is based in California. The foreclosure crisis has turned into a regional phenomenon. Minorities reside in many of the states suffering the highest rates of foreclosures and home devaluations including: Nevada, California, Arizona, Florida, Illinois, Ohio and Michigan.

Leaders from the Hispanic, Asian and African American trade groups plan to discuss the tenets of the plan at a White House briefing during their policy summit this week. The associations have collaborated on joint positions in the past. This is the second time they have recommended a plan together. A copy of The Five-Point Plan: Creating A Sustainable Path to Minority Homeownership is available at www.nahrep.org, www.areaa.org or www.nareb.com.

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Contact: Joni Byun (310) 914-5000 ext. 14

Mortgage insurers make it possible for consumers to buy homes with less than a 20 percent down payment. Their mission facilitates the entrance of first time homebuyers applying for conventional loans. A vibrant housing market will not be possible unless new homeowners enter the market. The mortgage insurance industry is also a critical counterparty to the GSEs who are increasingly being relied on to fulfill their important mission of creating liquidity and providing financing for qualified homebuyers.

SAN DIEGO (September 25, 2009) - The Asian homeownership rate suffered the steepest decline among minority groups in 2008, according to the recently released American Community Survey.

The survey, conducted by the U.S. Census Bureau, reveals that Asians have been disproportionately impacted by the current housing crisis, with homeownership rates dropping 1.24 percent to 59.4 percent. By comparison, African Americans faced a 0.88 percent decline to 45.6 percent, Hispanics fell 0.80 percent to 49.1 percent and the homeownership rate for Whites decreased 0.40 percent to 73.4 percent overall.

While some of the decline in Asian homeownership can be attributed to the regional impact of foreclosures--one third of Asian Americans live in the high foreclosure state of California--two lesser known factors are driving this issue.

"Asians made significant advancements in homeownership in the early part of the decade; however, much of this equity has been eliminated with the recent decline in home prices" states Jim Park, President of the Asian Real Estate Association of America. "This loss of equity creates an unstable homeownership environment in today's housing market, particularly for those homebuyers who recently became homeowners in the early to mid part of the decade."

To further exaggerate the problem, the industry has not fully overcome the language and cultural obstacles facing many Asian Americans, two-thirds of which are foreign born.

"Outreach efforts for loan modification and refinance assistance are not widely understood in the Asian American community," Allen Chiang, Chairman of AREAA added. "The industry must recognize and address the cultural and linguistic barriers that exist today, that create an enormous hurdle for these distressed homeowners. To prevent future foreclosures, they need to proactively reach out to Asian homeowners to educate them on their options in times of financial distress."

Without increased focus and attention to this issue, the API homeownership rate could continue to deteriorate at a significant pace. AREAA has recently partnered with Bank of America, Chase, Wells Fargo and Freddie Mac to pursue various foreclosure prevention efforts in the Asian community.

SAN DIEGO (JULY 27, 2009) - The Asian Real Estate Association of America is in favor of the Home Buyer Tax Credit Act of 2009 (S.1230), as introduced by Senator John Isakson (R-Ga.), increasing the homebuyer tax credit from $8,000 to $15,000 and expanding the tax credit to include all purchasers of primary residences, rather than first time homebuyers exclusively.

"As Census data shows, Asian American homeownership has been in decline since 2006, after a decade of steady increases," states Allen Chiang, AREAA Chair. "Legislation aimed at increasing accessibility to homeownership will help to reverse this trend and benefit the Asian community.

"It should also be noted that homeowners with the capacity and desire to move up in a favorable market represent great potential, given an incentive to purchase. Allowing all homeowners access to the tax credit will encourage more sales and, ultimately, boost the economy."

Founded in 2003, the Asian Real Estate Association of America (AREAA) is a national professional trade organization dedicated to promoting sustainable homeownership opportunities in Asian American communities by creating a powerful national voice for housing and real estate professionals that serve this dynamic market.

AREAA advocates for policy positions at the national level that will reduce homeownership barriers facing the Asian American community.

First time and immigrant home buyers often lack the credit depth necessary to qualify for low interest rate mortgages. They have to obtain alternate financing at higher rates or go without purchasing a home altogether.

The market should test and implement alternative credit tools, such as First American's Anthem, and the VantageScore Solutions. These programs measure creditworthiness of borrowers based on non-traditional credit lines, such as: rent, utilities and other financial obligations.

Implementation of these programs will streamline the underwriting process and better position more immigrant and first time homebuyers to qualify for affordable mortgage products.

Congress is considering various proposals to retool the GSE regulatory regime related to safety enhancements and capital requirements.
AREAA supports:

A portion of the GSE after-tax profit should be earmarked for post-purchase counseling, consumer awareness and foreclosure prevention efforts. Mortgage rescue funds should be made available to low or moderate income borrowers; or borrowers in neighborhoods comprised primarily of minorities to assist in refinancing into manageable fixed-rate products

AREAA believes that a strong FHA can help our communities by:

Increased loan amounts, financing alternatives and acceptable property options under FHA guidelines will increase the affordable housing options for many Asian Americans. Historically, this segment has not used FHA loans in great numbers due to the fact that most Asian Americans live in high-cost metro areas, where median home prices lie well above FHA loan limits. Also, many Asian Americans are self-employed and require stated income products, disqualifying them from strictly full doc FHA loans.

Legislation has been proposed to deter predatory lenders from taking advantage of unknowing borrowers. Asian Americans have been victimized by these unethical real estate lenders because many of them lack familiarity with the mortgage process in this country, which can become magnified by language barriers.

AREAA supports uniform standards throughout the country, increased penalties, severe license restrictions, tougher enforcement on unscrupulous lenders and increased disclosure from lending institutions regarding their minority lending practices.

AREAA opposes overly restrictive limitations around products, and mortgage terms as long as there is sufficient disclosure and choice for the borrower and AREAA supports increased overall consumer disclosure and education on riskier mortgage products.

Foreign interest in U.S. real estate investment opportunities is at an all time high. However, given the recent restrictions placed on visa issuance, it has become increasingly more difficult for foreign nationals to visit and spend time in the U.S.

AREAA believes visas for foreign retirees to live and reside in the U.S. should be easier to retain. This would not be a green card that would permit employment, but a separate designation that would permit someone to reside in the US and invest in our real estate market without burdening our social services or health care.