Housing finance reform

In the continued absence of legislation, Fannie Mae and Freddie Mac’s regulator announced work on a new capital framework.

The future secondary mortgage market entities will receive high investment grade ratings, even as there is no clarity on their scope or form, Fitch Ratings said.

Lenders should not get so desperate chasing volume by originating lower credit non-qualified mortgage products that they are inviting the next regulatory crackdown, said David Stevens, the Mortgage Bankers Association's CEO.

Freddie Mac and Arch Capital are testing a new form of risk-sharing deal to boost investor appetite for low down payment mortgages. But the pilot is raising concerns about "charter creep" because it dictates private mortgage insurance decisions typically made by lenders.

The success of the government-sponsored enterprises' credit risk transfer programs shows that they can be the basis for housing finance reform.

The Supreme Court dealt hedge funds and other big investors a blow Tuesday by refusing to revive core parts of lawsuits that challenged the federal government’s capture of billions of dollars in profits generated by Fannie Mae and Freddie Mac.

Despite a legislative push by some senators and other stakeholders to jump-start housing finance reform, efforts to form consensus over a bill once again are stuck in neutral.

Lenders should be encouraged to hold more credit risk in the mortgage market, rather than having it foisted on Fannie and Freddie.

Housing finance reformers are pushing full steam ahead to get a bill introduced before the political calendar makes passage nearly impossible.

Senate negotiators are working on a bill that would place Fannie Mae and Freddie Mac into receivership and replace them with multiple mortgage guarantors, according to sources.

Fannie Mae and Freddie Mac will be allowed to build capital buffers to protect against losses under an agreement between the Treasury Department and the Federal Housing Finance Agency announced on Thursday.

Until recently, there was a consensus among policymakers that Fannie Mae and Freddie Mac needed to be eliminated. That just changed. Here's why.

House Financial Services Committee Jeb Hensarling shifted tactics on housing finance reform Wednesday, acknowledging that a bill he’s pushed for years to virtually eliminate the government’s role in the mortgage market lacks the support to become law.

Testing of the common securitization platform is taking longer than expected, but the Federal Housing Finance Agency said it won't delay the 2019 launch of Fannie Mae and Freddie Mac's new single "uniform mortgage-backed security."

The financial services industry has cheered a proposed reduction in the corporate tax rate, but a lower rate could force Fannie Mae and Freddie Mac to write down assets, increasing the odds that the companies will need Treasury support.

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.

Though FHFA Director Mel Watt stopped short of saying he would break with a Treasury agreement that forces all profits of the GSEs to go to the government, he emphasized that it couldn’t continue indefinitely.

The gulf between those at the upper ends of the wealth ladder and lower-income Americans has worsened markedly since the financial crisis, despite the trillions of subsidies that taxpayers provide for housing.

Dividend payments by Fannie Mae and Freddie Mac are due to come one day after the U.S. is estimated to hit the debt ceiling, raising the stakes in the debate over whether those payments should continue.

Credit risk transfers have emerged as more than just a method for mitigating taxpayer exposure. They could be a key component of comprehensive housing finance reform.