Housing

Federal Home Loan banks aren't doing enough to address the shortage of affordable housing in the U.S., FHFA Director Sandra Thompson says. Some of their members are instead using advances to manage liquidity and perhaps engaging in crypto-related and other activities that put the Deposit Insurance Fund at risk, she says.

The homeownership gap between Black and white populations has widened in the years since the Great Recession, putting obstacles in the way of achieving wealth for a large percentage of Americans. How did we get here, and what do the housing and home lending industries need to do to change the current course?

A heated panel discussion sponsored by the Federal Housing Finance Agency raised questions about the funding, structure and mission of the Home Loan banks.

The Federal Housing Finance Agency's tangible capital rule could prevent some banks from accessing advances from the Federal Home Loan Bank system in a rising interest rate environment.

Rising interest rates could force some community banks to fall below a critical capital threshold that the Federal Housing Finance Agency uses to determine eligibility for Home Loan bank advances.

Dozens of community bankers and housing experts offered their opinions on the Federal Home Loan Bank System, the first review in nearly 100 years. But the insurers, nonbanks and megabanks that use the system the most were largely absent from the debate.

The former head of the agency said a decision last year to suspend caps on investor loans has further induced demand in an already hot market. Other experts say a supply-demand imbalance is the true driving force.

A couple squatted in their foreclosed home since 2009 and are only now being evicted, highlighting stubborn problems in the foreclosure process.

The move comes amid dwindling advances and a growing concern that the Home Loan banks are participating in riskier investments.

Federal Housing Finance Agency Director Sandra L. Thompson told lawmakers on Wednesday that the agency would consider “foundational questions about mission, purpose, and organization” of the Home Loan Bank System.

Led by Rep. French Hill, the group of conservative lawmakers said the agency must do more to ensure appropriate transparency regarding any new products or activities that the enterprises undertake.

Plummeting returns add to indications that investors may become more selective in home purchases.

In addition to hinting at a March rate hike, the central bank this week announced an intention to have Treasury securities make up a greater share of its holdings, which has implications for securitized home loans.

The guarantor of mortgage-backed securities has been without a Senate-confirmed president for four and a half years. The vacancy makes it difficult for other government agencies to coordinate housing objectives, according to stakeholders.

The hot hot real estate market has pulled homeowners out of a debt trap that many had been stuck in since the great financial crisis more than a decade earlier.

President Biden removed Mark Calabria as Federal Housing Finance Agency director hours after a Supreme Court ruling made the move possible. The administration is expected to offer up a nominee who will prioritize affordable housing and racial equity in housing instead of reforming Fannie Mae and Freddie Mac.