Industries

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.

The agency is currently using upper ceilings set in the Housing and Economic Recovery Act of 2008.

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 number of sellers discounting their original listing grew by over 83% year over year, according to HouseCanary.

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.

The San Francisco-based company recently raised $14 million in Series A funding and closed more than $400 million in sales in the first quarter.