FHFA: GSEs Will Fall Far Short of AH Goals

Fannie Mae and Freddie Mac will fall short of their affordable housing goals by a large margin in 2008, according to the Federal Housing Finance Agency, which has asked the government-sponsored enterprises to draw up their own AH goals for 2009. FHFA Director James Lockhart indicated that the affordable housing goals developed by the Department of Housing and Urban Development in 2004 are too ambitious in view of today's market conditions. "With the enterprises now in conservatorships, even if some or all of the goals are found to be unattainable, I will expect each enterprise to develop and implement ambitious plans to support the borrowers and markets targeted by the goals," Mr. Lockhart told the Senate Banking Committee. The FHFA director also noted that his agency is preparing regulations so the Federal Home Loans Banks can use their affordable housing funds to restructure underwater mortgages for borrowers that qualify under a Federal Housing Administration refinancing program called Hope for Homeowners. "FHFA plans to have the regulation in place by Oct.1," he testified.