The National Association of Home Builders said banks and other lenders are continuing
to squeeze builders denying loan extensions and requiring more equity than what
has historically been needed.
With
many construction companies struggling, one of the country’s largest contractor
organizations is asking Congress for help.
The
National Association of Home Builders chairman testified before a U.S. House subcommittee
last week looking into credit problems. He asked Congress to improve access to
credit for builders and consumers.
"With the spigot for
housing production loans cut off, and the threat that the uncertainty from new
rule-making under the Dodd-Frank financial services law will further impact the
ability of small community lenders to service the credit needs of our industry,
it is clear that congressional action is needed to help open the flow of credit
to home builders," said NAHB Chairman Bob Nielsen, a builder from Reno,
Nev.
"Without such action, there can be no housing
recovery, which has major implications for our nation's ability to recover from
the current economic downturn."
Nielsen said banks and other
lenders are continuing to squeeze builders denying loan extensions and requiring
more equity than what has historically been needed.
"While federal bank
regulators maintain that they are not encouraging institutions to stop making
loans or to indiscriminately liquidate outstanding loans, reports from my
fellow members and their lenders across the nation suggest that bank examiners
in the field are adopting a much more aggressive posture," he added.
