FHFA Issues Rules for Fannie Mae, Freddie Mac and FHLBs – NMP Skip to main content

FHFA Issues Rules for Fannie Mae, Freddie Mac and FHLBs

Dec 23, 2010

The Federal Housing Finance Agency (FHFA) has sent to the Federal Register three final rules and one Advance Notice of Proposed Rulemaking for Fannie Mae, Freddie Mac and the Federal Home Loan Banks (Banks). The final rules pertain to Fannie Mae and Freddie Mac portfolio holdings; Minority and Women Inclusion; and Federal Home Loan Bank Housing Goals, and the Advance Notice of Proposed Rulemaking pertains to membership in Federal Home Loan Banks. Final Rule-Portfolio Holdings of Fannie Mae and Freddie Mac The final rule implements section 1109 of the Housing and Economic Recovery Act of 2008 (HERA) and adopts without change FHFA’s interim final rule on portfolio holdings, which was effective Jan. 30, 2009. The final rule establishes, as the standard for the Enterprises’ portfolio holdings, the criteria set forth in the Senior Preferred Stock Purchase Agreements, that each Enterprise may hold mortgage assets up to $900 billion as of Dec. 31, 2009. For each subsequent year starting Dec. 31, 2010, each Enterprise is required to reduce its maximum holdings of mortgage assets by 10 percent of the maximum limit in the preceding year until the limit reaches $250 billion. At that point, no further reduction in the maximum limit is currently required. The rule is effective upon publication in the Federal Register. Final Rule-Minority and Women Inclusion The final rule implements section 1116 of HERA and requires Fannie Mae, Freddie Mac and the Banks to promote diversity and the inclusion of women, minorities and individuals with disabilities in all activities. The rule requires each entity to establish an Office of Minority and Women Inclusion, or designate an office responsible for carrying out the requirements at every level of the organization including management, employment and contracting. FHFA continues to refine its plans to implement the diversity provisions of The Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 and section 1116 with respect to the agency’s operations and intends to amend this rule when those plans are finalized. The rule is effective 30 days from publication in the Federal Register. Final Rule-Federal Home Loan Bank Housing Goals The final rule, substantially the same as the proposed rule, implements section 1205 of HERA, which requires the Director of FHFA to establish housing goals with respect to the Banks’ purchases of mortgages, if any. The rule also provides that the Banks’ housing goals are to be consistent with the housing goals established by FHFA for Fannie Mae and Freddie Mac, taking into consideration the unique mission and ownership structure of the Banks. The rule is effective Jan. 26, 2011. Advance Notice of Proposed Rulemaking-Members of Federal Home Loan Banks FHFA is undertaking a review of its regulations governing Bank membership to identify provisions that may need to be updated to ensure that they remain consistent with the statutory provisions that require a nexus between Bank membership and the housing and community development mission of the Banks. The Advance Notice reviews the statutory provisions governing membership and the regulatory provisions that implement those statutory requirements, suggests ways that the regulations might be amended within this statutory framework, and invites comment on each of the possible alternatives. Comments are due March 28, 2011. For more information, visit www.fhfa.gov.
About the author
Published
Dec 23, 2010
California Approves $25B Homebuyer Loan Program, Targeting New Construction

Proposition 37 could open new purchase lending opportunities, but financing costs and borrower qualification will determine its reach

When AI Takes Action: New Federal Framework Raises Questions

New federal banking guidance examines the risks of autonomous AI, from borrower communications to servicing transactions, with a focus on human oversight and accountability

States Tighten Mortgage Rules For Home Equity Investments

Massachusetts, Maine, and Illinois are expanding oversight of home equity financing

West Capital LO Challenges Contractor Status, Required Fees

A former originator alleges unpaid overtime, recurring tech charges, and company restrictions that he says undermine his independent-contractor status

CFPB Closes 40% Of Investigations, Keeps Mortgage Enforcement In Focus

The federal watchdog closed thousands of supervisory and investigative matters as it narrowed oversight

Midterms Loom With Mortgage Policy Changes Already In Motion

As voters head to the polls Tuesday, Washington is weighing changes to refinancing costs, loan pricing, and lending regulations