In testimony prepared for a House subcommittee today, Mortgage Bankers Association (MBA) President David H. Stevens said that the home-lending industry needs to get back to having private equity, not the government, carry the risks.

"“The proposed Private Mortgage Market Investment Act is aimed at achieving our shared goal of opening a pathway to a sustainable real estate finance system. As MBA has consistently stated, the current environment, in which the federal government owns, securitizes, or guarantees nearly every mortgage, is both unsustainable and undesirable," Stevens' prepared remarks stated.

“MBA also appreciates that the bill provides for the establishment of different classes of standard mortgage products. Safe, well-defined product standards help consumers compare their financing options. For investors, the core market will establish performance standards for pricing purposes," Stevens' testimony said.

Stevens said the association believes "the financial crisis proved that some form of government support is required to keep the mortgage market open during times of severe distress." He added, however, "MBA believes the government’s role should be to promote liquidity for mortgage finance, not to provide the capital for it or absorb all the risks itself."