Fannie's ADC Program on Hold

The Office of Federal Housing Enterprise Oversight has placed the expansion of Fannie Mae's acquisition, development, and construction lending program on hold, the company's chief executive has told MortgageWire.Fannie president and CEO Daniel Mudd said OFHEO raised concerns about the adequacy of the ADC program's controls and processes, and he agreed to make improvements. Once OFHEO is satisfied that Fannie Mae has "the right routines and controls in place, we will expand the ADC program," Mr. Mudd said in an interview. At a homebuilders' conference in January, Mr. Mudd announced plans to expand the ADC pilot program and purchase $10 billion in ADC loans over 10 years. Mr. Mudd characterized his company's relationship with OFHEO as "positive" and "challenging" during the interview. "I would put them in the tough-but-fair category," he said.