Section 4022, which covers forbearance under the CARES Act, does not include an explicit end date. According to the CSBS, this has led many to assume it ends on Dec. 31. The truth is less certain.
Going forward, mortgages will qualify for the QM safe harbor if the annual percentage rate on the loan doesn’t exceed the average prime offer rate by more than 150 bps.
Treasury Secretary Steven Mnuchin suggested in a Senate hearing that Fannie and Freddie may not have enough capital to exit conservatorship before Trump leaves office.
The FHFA has directed the GSEs to extend moratoriums on single-family foreclosures and real estate-owned evictions. The move is likely to cost the two mortgage giants between $1.1 billion and $1.7 billion.
After the 2019 increase, homebuyers with newly eligible loans had an average income twice that of buyers whose loans were still eligible under the 2018 limit.
Though both Fannie and Freddie exceed FHFA’s benchmarks for low-income refis, low-income borrowers actually accounted for a smaller share of the companies’ refis than they did for the market as a whole.
In September, the FSOC endorsed the FHFA’s capital rule, even urging the agency to use tougher, more bank-like standards. What the report didn’t say was how the council reached its conclusions.
If the FHFA wants to release the GSEs from conservatorship before President Trump leaves office, it will need a big assist from Treasury. And therein lies the problem.
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