Proposed legislation revives congressional debate about ending the conservatorships. But mortgage industry stakeholders are skeptical about the bills chance of passage.
In a scenario that Fannie and Freddie exit conservatorship, Urban Institute analysts believe that the courts will allow the uniform MBS to persist, even though it requires coordination between the GSEs that could invite antitrust litigation.
A GSE shareholder advocate says selling rights to existing shareholders could resolve conflicting objectives that have vexed GSE reform during the Trump administration.
Despite saying he will nominate former SEC Chair Jay Clayton as director of national intelligence, President Trump appears to be sticking with FHFA Director Bill Pulte as acting DNI.
Some economists suggest Fannie and Freddie should accept mortgages that include a modest prepayment penalty as a way to keep residential mortgage rates lower. But that would be a political challenge.
If FHFA reduces the GSEs’ capital requirements, that would be a key signal that efforts are moving forward to end the conservatorship of Fannie Mae and Freddie Mac.
Industry watchers believe GSE reform is probably off the table until after the mid-term elections at least, as the administration’s focus has shifted to other priorities.
Trump budget ignores GSE reform; Morningstar DBRS affirms AAA ratings on GSEs; Vice Capital an early adopter of new low loan balance payment categories; Fannie to simplify income eligibility calculations for some LLPA waivers.
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