Federal Housing Finance Agency Tag Archives

CFPB Supreme Court Hearing with Implications for FHFA

The Supreme Court agreed to review a challenge to the constitutionality of the Consumer Financial Protection Bureau’s (CFPB) authority. Plaintiff, Sheila Law LLC, is arguing that a legal provision stipulating that the director can only be removed by the President for cause violates the constitutional separation of powers. The CFPB director, like the Federal Housing Finance Agency (FHFA) director, serves in a five-year role and cannot be fired at will. The Supreme Court’s decision will have implications for both the CFPB and FHFA.

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Federal Housing Finance Agency News

It’s been a busy week for the Federal Housing Finance Agency (FHFA). During the American Credit Union Mortgage Association’s Annual Conference, Director Mark Calabria shared his concerns about volume-based pricing discounts on Guarantee Fees (G-Fees). FHFA issued a confidential administrative directive to Fannie Mae and Freddie Mac restricting competition on G-Fees

FHFA sent a letter to the 11 Federal Home Loan Banks (FHLBanks) instructing them that, as of December 31, 2019, they should stop purchasing investments in assets tied to London Interbank Offered Rate (LIBOR) with a contractual maturity beyond December 31, 2021.

FHFA announced modified Preferred Stock Purchase agreements with Fannie Mae and Freddie Mac that allow the GSEs to retain capitals of up to $25 billion and $20 billion, respectively. The move ends the capital sweep on earnings above $3 billion that was put into place in 2008 when the GSEs entered conservatorship.

Finally, FHFA announced an agreement with Simone Grimes who accused former director Melvin Watt of sexual harassment.

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FHFA Revises Fannie Mae, Freddie Mac Multifamily Loan Purchase Caps

The Federal Housing Finance Agency (FHFA) announced new multifamily loan purchase caps of $100 million each for Fannie Mae and Freddie Mac from the fourth quarter of 2019 to the fourth quarter of 2020. The new caps apply to all multifamily business with no exclusions. The FHFA also directs at least 37.5 percent of Fannie Mae and Freddie Mac multifamily business to mission-driven affordable housing.

FHFA Hosts Duty To Serve Listening Sessions

Fannie Mae, Freddie Mac (the Enterprises) and the Federal Housing Finance Agency (FHFA), in collaboration with the Federal Reserve Bank of St. Louis and the Federal Reserve Bank of San Francisco are hosting four Duty to Serve (DTS) Listening Sessions in the Fall of 2019. These listening sessions are an opportunity for the public to provide input on the Enterprises’ proposed plans for the second DTS plan cycle, 2021-2023.

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Treasury, HUD Release Housing Finance Reform Plan

Last week the Department of the Treasury and HUD sent their Housing Finance Reform Plans to President Trump following his March Memorandum, which ordered the reports. The Senate Committee on Banking, Housing and Urban Affairs held a hearing on Housing Finance Reform: Next Steps with HUD Secretary Ben Carson, Treasury Secretary Steven Mnuchin and FHFA Director Mark Calabria as witnesses.

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Harvard JCHS Paper on GSE Reform

The Joint Center for Housing Studies (JCHS) of Harvard University released a new paper GSE Reform: None or Mostly Done? Author Don Layton argue that while Congress has yet to pass comprehensive reform of the government-sponsored enterprises (GSEs), almost all of the major flaws of the pre-conservatorship GSEs have been successfully addressed while the companies have been in conservatorship.

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Senate Banking Committee Chairman Crapo Releases Outline for Housing Finance Reform

Senate Banking, Housing and Urban Affairs Committee Chairman Mike Crapo (R-ID) released an outline for housing finance reform legislation. In a statement Chairman Crapo said, “we must expeditiously fix our flawed housing finance system. My priorities are to establish stronger levels of taxpayer protection, preserve the 30-year fixed rate mortgage, increase competition among mortgage guarantors, and promote access to affordable housing.” 

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Senate Committee To Hold Oversight Hearing on GSE Pilot Programs

The Senate Committee On Banking, Housing and Urban Affairs will meet in on October 18 to conduct a hearing entitled “Oversight of Pilot Programs at Fannie Mae and Freddie Mac.”  The witnesses will be:

  • Ms. Sandra Thompson, Deputy Director, Division of Housing Mission and Goals, Federal Housing Finance Agency; 
  • Mr. Timothy J. Mayopoulos, Chief Executive Officer, Fannie Mae; and
  • Mr. Donald H. Layton, Chief Executive Officer, Freddie Mac.

It is unclear at time of press which Pilot Programs will be addressed during the hearing, which will be webcast live.

House Financial Services Committee Schedules GSE Reform Hearing on Sept. 27

The Committee on Financial Services will hold a hearing entitled “Oversight of the Federal Housing Finance Agency’s role as conservator and regulator of the Government Sponsored Enterprises” on Thursday, September 27, 2018, at 10:30 a.m. in room 2128 of the Rayburn House Office Building. This will be a two-panel hearing with the following witnesses:

Panel One:

  • The Honorable Laura Wertheimer, Inspector General, Federal Housing Finance Agency

Panel Two:

  • The Honorable Melvin Watt, Director, Federal Housing Finance Agency
  • Mr. Timothy Mayopoulos, CEO, Federal National Mortgage Corporation (Fannie Mae)
  • Mr. Donald Layton, CEO, Federal Home Loan Mortgage Corporation (Freddie Mac)

The Housing and Economic Recovery Act (“HERA”) of 2008 created the Federal Finance Housing Agency (“FHFA”). FHFA is an independent agency charged with the supervision, regulation, and oversight of Fannie Mae, Freddie Mac and the Federal Home Loan Bank System, which includes the 11 Federal Home Loan Banks. On September 7, 2008, then-FHFA Director, James Lockhart, used the statutory authority provided by HERA to place both Fannie Mae and Freddie Mac into conservatorship.

This hearing will examine the FHFA’s performance as the regulator and conservator of the Government Sponsored Enterprises, which include Fannie Mae, Freddie Mac and the Federal Home Loan Banks. Specifically, the Committee will examine FHFA’s policies and procedures used to supervise Fannie Mae and Freddie Mac, the FHFA’s structure, and the need to reform the housing finance system in the United States.