Good afternoon —
This week has brought flashbacks of the old The Price is Right, which I used to watch after school as a kid. We're essentially in the final round of a game called Pick the Next FHFA Director and you have to choose Door #1, Door #2 or Door #3. But pick carefully, because the whole mortgage industry lies in the balance.
Now more than ever, the leaders of FHFA serve at the will of the president, carrying out his vision for regulating Fannie and Freddie.
Mark Calabria, appointed by Trump, was keen to release the GSEs from conservatorship, but couldn't find a viable pathway, especially once COVID-19 hijacked the economy. The current acting director, Sandra Thompson, has wasted no time rolling back many of the policies put in place during Calabria's last hurrah, though she was only installed in June.
Thompson's actions in such a short time prompted David Stevens, former executive at Freddie Mac, Wells Fargo, and the MBA, as well as FHA Commissioner under the Obama administration, to jump into the fray today, writing an op-ed urging that Thompson be given the permanent director position.
"In just a few short months as acting director, she has reversed a series of policies deployed by the previous director and more. She cancelled the 50 basis point refinance fee, paused the policies in the January 2021 PSPA which included the limits on 2-4 unit, second homes, the 2 of 3 factors rule, and cash window sales. All of these policies that were detrimental to housing and to the mortgage and real estate industry have now been halted due to Thompson's effective leadership.
"But she hasn't stopped there. Yesterday the FHFA announced a suspension to the proposed capital rule for the GSEs. This was the right thing to do. The proposed capital rule was excessive and eliminated any value for credit risk transfer (CRT), something that many stakeholders believe is critical to having an effective risk-based capital structure."
Other names have made the rounds, including what looked like a lock for Mike Calhoun, the president of the Center for Responsible Lending, late last week. But politics being politics, nothing is certain until it's announced, and we've yet to see that happen.
Speaking of politics, we're going to discuss what to expect from the whole alphabet soup of regulators at our HW Annual event Sept. 27-28. The FHFA, CFPB, FDIC, OCC and more are working in coordinated ways under the Biden administration and we've got experts to unpack what that means for you and your business. Find out all the details here. We've got a special rate for readers of this newsletter, so email me at swheeler@housingwire.com to get that. Hope to see you there!!
Until tomorrow —
Sarah Wheeler
HousingWire Editor in Chief
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