New FHFA head says not to let the opportunity for mortgage system reform pass
Trump administration officials continue to discuss plans to push Fannie Mae and Freddie Mac out of government conservatorship, according to a report by The Wall Street Journal.
The news came after Treasury Secretary Steven Mnuchin said that he wants to create a plan to overhaul both government-sponsored enterprises over the next six months.
Mnuchin said the administration would do it through legislation, but it would look for “things we could do on an administrative basis” absent action from Congress.
Trump’s administration has limited power over Fannie and Freddie absent legislation, which would be crucial to privatize the GSEs. But the Federal Housing Finance Agency has the authority to increase fees on lenders and regulate the size of loans the firms could buy. These kinds of changes might put mortgages out of reach for most homebuyers, according to WSJ.
Newly confirmed FHFA head Mark Calabria said that the mortgage system is vulnerable, and “we must not let this opportunity for reform pass.”
The GSEs have been under government conservatorship since the 2008 financial crisis.
