The Federal Housing Finance Agency must set fees equal to the cost of capital that private banks hold against similar risk, not just the amount of capital that Fannie and Freddie think are right for themselves.
Mark Calabria, the chief economic adviser to Vice President Mike Pence, said the administration is focused for now on more pressing issues than GSE reform, including addressing housing damage from recent hurricanes.
A securities settlement, portfolio asset sales and greater interest among smaller lenders helped Freddie Mac compensate for potential losses from the catastrophic hurricane season.
Federal Housing Finance Agency Director Mel Watt said the agency is poised to examine alternatives to how a Fannie Mae and Freddie Mac assess creditworthiness of home buyers, including seeking public comment on the issue later this fall.
In a moment of rare unity, the Independent Community Bankers of America and National Association of Federally-Insured Credit Unions sent a joint letter to FHFA arguing to stop the GSEs' profit sweep.
The week of Oct. 2 is shaping up to be a significant one for the financial services industry on Capitol Hill, as lawmakers grill the top executives of Equifax and Wells Fargo, as well as the top regulator of Fannie Mae and Freddie Mac.
Sen. Bob Corker has been a key voice in the housing finance reform debate. His departure at the end of next year puts a deadline of sorts on his efforts to unwind and replace Fannie Mae and Freddie Mac.
Efforts to persuade regulators to allow Fannie Mae and Freddie Mac to use alternative credit scores would stifle competition between the credit bureaus and FICO and do little to expand access to credit, according to industry analyst Chris Whalen.
