These are worrisome times for mortgage bankers. Realtors are nipping at their heels to write home loans, a Republican Congress threatens to cut back the FHA mortgage insurance program, and even the once sacrosanct deduction for mortgage interest is under attack.
"Everybody is worried about their turf," said Paul S. Reid, the new president of the Mortgage Bankers Association, in a telephone interview from his office in Richmond, Va. "The mortgage banker has got concerns about his role in the process," as do real estate agents, mortgage insurance companies, lawyers, and others.
Much of Mr. Reid's focus at this time of industry angst will be political. He said he plans to lobby lawmakers in Washington on the trade group's No. 1 priority: preserving the FHA program. And he will join with other trade groups to declare war if Congress tampers with the mortgage interest deduction.
With national elections on the horizon, Mr. Reid wants housing issues to be featured on the political platforms of both parties.
"We want to make sure that housing becomes a word that rolls off the tongue like it used to in the 1960s and the 1970s. You couldn't run for public office in this country without addressing the housing issue," he said. "My intent is to make sure that the platforms of both parties hear us loud and clear, and that we can elevate housing back where it should be."
It's fitting in some ways that Mr. Reid's year at the helm of the MBA is likely to be dominated by legislative issues.
He has strong opinions about political involvement. As CEO of American Home Funding Inc., Mr. Reid has pushed his firm to be a top contributor to the MBA's political action committee.
"I've always tried to keep my people abreast of the issues," Mr. Reid said. "I tell them quite frankly, 'This is your career. Don't you think you should make sure of its direction in a proactive way?'"
Like many mortgage bankers, Mr. Reid is passionate about the FHA. Under the combined assault of large mortgage insurers and Republicans in Congress, the FHA mortgage insurance program is likely to be drastically curtailed this year. It chiefly insures low-down-payment mortgages to first-time homebuyers. Most of these loans are made by mortgage bankers.
Republicans in the House of Representatives have proposed that the government insure only a portion of each mortgage, rather than the full amount, as it does now. The effect will be that mortgage bankers, who make most FHA-insured loans, will bear more risk.
Mr. Reid said he dislikes the proposed changes, to say the least.
"This term of privatization has become so godlike - if the private sector can do it, get the government out of it," he said.
"Well that sounds great, (but) look at FHA. Are there going to be more homeowners in this country if we don't have the FHA as we know it today? I would say a loud, resounding no."
Mr. Reid also has instituted a grass-roots lobbying program in his own company. Every time a borrower takes out an FHA-insured loan at American Home Funding, he or she gets a letter to send to the local congressman in support of the program. And Mr. Reid noted that grateful borrowers follow through.
Another Republican idea, a flat tax that could curtail the mortgage interest tax deduction, also raises Mr. Reid's hackles.
Property values will tumble if Congress meddles with the deduction, he said. The entire mortgage industry - homebuilders, realtors, insurers, and bankers - will make that case to Congress if a flat tax comes to pass, he said.
"It's somewhat open season in Washington right now," he said. "You can't go to sleep on any issue."
You can't be president of the MBA these days without thinking long and hard about rapidly changing mortgage technology, and where mortgage bankers will fit in.
On that score, Mr. Reid said mortgage bankers need to redefine their role, and make contact with consumers earlier in the loan process.
One way to do that would be to qualify borrowers before they start shopping for a house, he said. Presumably, that will make the realtor's loan less influential than it now is.
His colleagues also need to touch up their image, Mr. Reid said. The MBA has done studies of how the public views mortgage bankers, he said.
"What comes back is almost a little bit humorous - the dark-suited, middle-aged man behind the desk," he said. "I think we've got to do a lot to dispel that image."
Mr. Reid is a Civil War buff. He built a home in the antebellum style two years ago, and said he did a lot of research to get it just right. Living in Richmond, he said he was surrounded by the Civil War - even his golf course has Civil War trenches.
He studied history as an undergraduate at the University of Virginia, and obtained a graduate degree in guidance and counseling from there as well.
He has four children: Brian, 23; Heather, 21; Shelby, 11; and Zachary, 9.