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House panel backs MFA-managed tenant creditworthiness program to ease rental access
Summary
The House Appropriations and Finance Committee voted to advance House Bill 453, which would create a Mortgage Finance Authority (MFA)-managed creditworthiness program to help property managers rent to applicants with low credit scores while protecting landlords through limited coverage for unpaid rent and property damage.
SANTA FE — The House Appropriations and Finance Committee on Tuesday advanced House Bill 453, which would create an MFA-managed creditworthiness program intended to make it easier for tenants with poor credit scores to secure rental housing while offering protections for property managers.
The bill, as amended, directs MFA to run a program under which property managers may rent to applicants who meet other rental requirements but have a lower-than-desired credit rating; the program includes a financial-literacy training component for participating renters.
Sponsor remarks and an amendment clarified what the bill does not do. The sponsor said the program "is not rental assistance or eviction prevention" and that "this bill does not require any changes on how a property manager selects their tenants." The committee adopted an amendment (2 3 1 5 9 3.1) that struck an appropriation on page 1 and removed a $250,000 line on page 16 after members confirmed the funding is included elsewhere in the budget.
Supporters at public comment said the program would fill a gap between households who earn too much to qualify for other rental assistance but still face difficulty renting because of credit scores. Dana Warwath of the Governor’s Office of Housing said credit counseling and creditworthiness supports can help "secure stable housing and move up the ladder to things like homeownership." Anne Lynn Hall, CEO of Prosperity Works, said the program would let landlords "say yes to potential tenants knowing that if they are unable to pay their rent, that the housing creditworthiness assistance program would be able to help." Judy Messell of Lutheran Advocacy Ministry in New Mexico and Catherine McGill of the New Mexico Black Leadership Council also testified in support.
Committee members asked for program details. The sponsor told Representative Garrett that the proposal would cover up to $5,000 in unpaid rent to a qualifying grantee per participant and up to $2,500 for property damage payable to the property manager if a tenant defaults within the first year of the lease. The training program component will be administered by MFA, the sponsor said.
After public comment and questions, the committee voted to advance the bill as amended. Ranking Member Chatfield moved a do-pass recommendation on HB 453 as amended, seconded by Representative Little; Representative Pettigrew was recorded in opposition.
The measure now moves to the next committee for consideration in the legislative process.
