The nine-year-old federal conservatorship of the government-sponsored enterprises (GSEs) needs to come to an end sooner than later, according to a policy position issued by NAMB.
NAMB President Fred Kreger, CMC has authored an eight-point policy agenda to address the future of the GSEs and the Federal Housing Finance Agency’s (FHFA) regulatory control of these entities. Key among these concerns was the financial health of the GSEs.
“The GSEs will run out of capital in the first quarter of 2018,” said Kreger. “NAMB believes the FHFA should permit them to accumulate capital in order to “buy time” so the legislative process can move forward at a reasonable and carefully deliberate pace in order to minimize unintended consequences.”
Kreger also called for Fannie Mae and Freddie Mac to remain politically neutral in the future and not to be involved in lobbying on Capitol Hill. He also envisioned the creation of “other entities” in the secondary market, but warned that any new guarantors should be standalone operations under FHFA regulation and that “vertical integration should be prohibited from the secondary market to the primary market.”
Kreger also called on clarification of the question of G-Fees in a post-conservatorship environment and the requirement that the current and potentially new GSEs “support an effective national affordable-housing strategy that helps meet the needs of low-income and underserved households and communities.”