Servicers working for Fannie Mae and Freddie Mac are now prohibited from being reimbursed altogether for expenses associated with lender-placed insurance practices, the Federal Housing Finance Agency announced this week. The FHFA’s action follows a notice the agency published in March calling for seller/servicers to be prohibited from accepting sales commissions or fees related to lender-placed or force-placed insurance where a conflict exists between them and the insurance providers and their affiliates.
The creation of a U.S. sovereign wealth fund could grease the skids for an end to the conservatorships of Fannie Mae and Freddie Mac.
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