A 91% drop in GSE earnings during 1Q has raised concerns about their second-quarter performance and exit from conservatorship.

In addition, Fannie and Freddie have helped reduce face-to-face interactions during the closing process by expanding the use of powers of attorney and remote online notarizations.

If servicers’ cash crunch becomes critical, the onus of creating a liquidity facility would fall on the Federal Reserve and Treasury, not on the FHFA, agency Director Mark Calabria said.

At the end of the forbearance period, mortgage servicers will provide homeowners several options for making up missed payments, Fannie Mae and Freddie Mac reassured borrowers.

Fannie Mae and Freddie Mac will purchase single-family mortgages that are in forbearance. But there’s a catch: steep LLPAs.

The only rule explicitly stated by the GSEs is “forbearance does not mean payments are forgiven.” Meanwhile, the FHFA and CFPB have joined hands to protect consumers from fraudulent forbearance activities.

The Federal Home Loan Banks will accept Paycheck Protection Program loans as collateral. The loans carry a 100% SBA guarantee.

Regulators have acknowledged that the lack of legal clarity and the speedy implementation of the new forbearance requirements may set the stage for exploitation by unscrupulous or ill-informed servicers.

Of course, early this spring, the FHFA, in trying to aid consumers economically impacted by the pandemic, requested that servicers provide forbearance.

The OIG identified four areas where the FHFA will have to improve if it hopes to supervise the GSEs absent the powers of a conservator.