The US Supreme Court decided that the leadership structure of the Federal Housing Finance Agency (FHFA) violates the Constitution and the separation of powers. That gave President Biden authority to remove the agency’s head at will.
Just hours after the court’s decision, the White House fired Mark Calabria and appointed Sandra Thompson as acting director. Thompson previously served as deputy director of the agency’s Division of Housing Mission and Goals, where she oversaw FHFA’s housing and regulatory policy, fair lending, and other regulatory matters.
The FHFA’s leadership will have an effect on how the Freddie and Fannie GSEs are managed and their direction. The GSEs have a direct impact on Conforming loan availability and interest rates.
Calabria was pushing for bringing the GSEs out from Government Conservatorship and under private ownership. Now it’s a good probability that the new leadership (i.e. White House) will prefer to maintain control of the GSEs, exert more control over the regulator and GSEs, and be more concerned about providing more liquidity and affordability to the housing market.
Already mortgage associations are pushing for the removal of the .5 point Adverse Market Fee (refinance tax), and the 7% cap on investor and second home loans that added fees or minimized the origination of those loans.
Over the past month, we have seen a tightening of the underwriting guidelines and loan approvals in the Freddie and Fannie artificial intelligence underwriting systems (DU and LPA). Some loans that were approved a couple of months ago would not longer be approved. With the change of leadership, hopefully, the guidelines will ease up.
With the recent expansion of the demographic information required to be disclosed on the 1003 loan application, and the new director previously in charge of FHFA’s housing and regulatory policies, we’ll see how strict the regulator gets on lenders for Disparate Impact… The unintentional discrimination based on statistics, and occurs when policies, practices, rules or other systems that appear to be neutral, result in a disproportionate impact on a protected group. For example, evaluating all applicants using the same underwriting guidelines but the results unintentionally eliminate certain minority applicants disproportionately is disparate impact. “Disparate treatment” is intentional discrimination.
If you are in the Los Angeles area, have any questions or real estate sales or financing needs, feel free in contacting me
Ron Henderson GRI, SRES, SFR, RECS, CIAS
President/Broker
Multi Real Estate Services, Inc.
Gov’t Affairs Chair – California Association of Mortgage Professionals (2017-2018)
Chairman – OutWest Marketing Meeting (Real Estate Education)
BRE #00905793 NMLS #310358
www.mres.com
ronh@mres.com
Specialist in the Art of Real Estate Sales and Finance
Real Estate market, mortgage rates, Los Angeles, San Fernando Valley, Conejo Valley, Simi Valley, Woodland Hills, West Hills, Calabasas, Chatsworth
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