Housing finance reform

The groups applauded a proposal to establish minimum GSE capital requirements, but called for more immediate steps to release the companies from conservatorship.

Risk management and technology systems at the Federal Housing Administration lag decades behind Fannie Mae and Freddie Mac and desperately need to be revamped, according to a top official at HUD.

No plan will be implemented as long as Fannie Mae and Freddie Mac remain in conservatorship, but a capital framework for the companies could still have a substantive impact.

The agency proposed new minimum capital requirements for Fannie Mae and Freddie Mac that would only go into effect if the government ends its conservatorships.

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

Reducing unnecessary compliance burdens will pave the way for economic growth, larger job creation and wage increases, and re-evaluating technology will play an important role in doing so, according to Craig Phillips, counselor to the secretary at the Department of the Treasury.

President Trump has nominated Michael Bright, the current acting president and chief operating officer of Ginnie Mae, to head the agency full time.

The Treasury secretary said reforming Fannie Mae and Freddie Mac will come into focus more in 2019, when Federal Housing Finance Agency Director Mel Watt’s term will end.

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.