Arkansas Gov. Bill Clinton's record on housing in his home state and a favorable plank in the Democratic Party platform are good news to mortgage bankers. But the impact of an administration on interest rates will be the dominant factor in determining whether the housing industry will be revived.

The Carter administration came in with great ideas for housing, but soaring interest rates meant there was no fuel to fire the engine," said Angelo R. Mozilo, president of the Mortgage Bankers Association. Mozilo, who also is president and chief executive officer of Countrywide Funding Corp. in Pasadena, Calif., has been strongly critical of Bush administration housing policies. He has led a MBA effort to get both political parties to make a commitment to revive the nation's housing industry.

He persuaded the Democrats to adopt platform language that specifically pledged a commitment to improve Federal Housing Administration programs and said he was "very disappointed" that the Republicans did not. He did acknowledge that many proposals by the Republicans, including support for a reduction in capital gains and a tax credit for first-time home buyers would be helpful. Mozilo also said aspects of the Democratic platform and Clinton's own economic proposals could be inflationary and ultimately, detrimental to housing.

Two Arkansas bankers--both Clinton supporters--said Clinton's commitment to housing for low-income families was unquestioned.

"The state government has been favorable for the mortgage banking industry," said Lyndell E. Lay, president of First Charter Bankshares, Little Rock, and chairman and chief executive officer of its mortgage subsidiary.

"The state housing agency (the Arkansas Development and Financing Authority) has worked with the mortgage bankers to help provide funding for low-income borrowers. I don't think lenders could have done it without state help."

William H. Brandon, president and chief executive officer of the $95 million asset First National Bank of Phillips County in Helena, said Clinton has worked hard to bring funds into the depressed eastern part of the state.

Brandon, the president-elect of the American Bankers Association. said Clinton has supported the banking industry in its opposition to the state usury law that limits interest rates to five points over the discount rate.

Clinton always has appointed someone from the industry to head the state banking commission rather than making a purely political appointment, Brandon said. "That way, we've always had someone who knows what they're doing," he said.

Lay, who serves on the MBA legislative committee, said mortgage bankers have been satisfied with their regulatory structure, too.

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