Lenders argue that Thompson should focus on reversing unpopular policies initiated when Mark Calabria was FHFA director. They point to unvetted credit requirements and the product caps included in the PSPAs.
Fannie and Freddie raked in billions of dollars from the loan-level price adjustment before FHFA pulled the plug last week. Are more Calabria-era rules on the chopping block?
Sandra Thompson’s elevation to acting director from her role as head of housing mission and goals presaged FHFA’s new focus on fair lending practices enforcement.
The Supreme Court’s decision in the long-delayed Collins case sets the stage for a swift change in leadership at FHFA but it may not end the shareholder lawsuits over the GSEs and the net worth sweep.
Critics argue that community banks and small credit unions are vulnerable to rules designed for large lenders. Also, if Fannie and Freddie exit conservatorship, many of the guardrails protecting small lenders could vanish.
Federal Reserve Chair Jerome Powell suggested expanding the Community Reinvestment Act to include nondepository financial institutions but said Congress will have to make that decision.
The new rule gives Fannie and Freddie two years to come up with a resolution plan that includes no government support in the event of a crisis. Housing finance experts say: “Good luck with that.”
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