Thank you.
The basic principle here is that the first-time buyer currently competes in the housing market against seasoned buyers, move-up buyers, and investors who often have more down payment availability because they are selling a home themselves that has a lot of equity built up in it. In addition, they have access to a 30-year amortization. Arguably they have more buying power and our view is that the insured buyer should be allowed to compete at least on an even playing field in that regard, which would mean a 30-year amortization be extended to them.
I think there is obviously merit in the fact that a 30-year amortization is somewhat inflationary in that it extends more buying power. But when you think about some of the comments we've made already to this committee on how big a role the first-time homebuyer plays, which we estimate is somewhere in the range of 15% to 20% of all mortgages, they're not really the inflationary force in the market. They're also buying homes that are on average a lot cheaper than the market averages.
Just to level the playing field, we've often thought that a 30-year amortization max would be appropriate in the insured buyer space. Currently it's limited to 25 years.