FSOC’s statement on the FHFA’s proposed capital rule raises questions for market participants trying to anticipate a post-conservatorship secondary mortgage market, should the incoming administration go through with the GSEs’ exit from governmental control.
The former FDIC chief oversaw the resolution of hundreds of failed banks during the financial crisis and knows how to build relationships with regulators. Those skills could be crucial in helping Fannie exit federal control.
The agency confirmed that loans backed by Fannie Mae and Freddie Mac can continue avoiding debt-to-income limits as the bureau completes a revamp of the Qualified Mortgage standard.
The Financial Stability Oversight Council said the mortgage giants may need a bigger capital cushion than their regulator has proposed, but stopped short of designating them as “systemically important financial institutions.”
The future of Fannie Mae and Freddie Mac, the Fed’s supervisory regime for the biggest financial institutions, reform of the Community Reinvestment Act and a host of other industry-related issues are on the ballot this November.
Fannie Mae and Freddie Mac have been slammed for planning an additional refinancing charge to cover COVID-related losses, but the head of the Federal Housing Finance Agency defended the policy in House testimony.
The Federal Housing Finance Agency's proposal could undermine the companies’ mission to support the housing market and penalize consumers in underserved communities, industry and consumer groups say.
Refinancing has been one of the bright spots in a difficult year for lending, and the industry has concerns that a fee to be imposed by Fannie Mae and Freddie Mac could slow down the business.
