Skip to main content

FHFA Proposes Post-Conservatorship Capital Buffers for GSEs

Phil Hall
Jun 13, 2018
A coalition of industry trade organizations is calling on the U.S. Senate to speed the confirmation of Seth Appleton's as the next Assistant Secretary for Policy Development and Research at the Department of Housing and Urban Development (HUD)

Since no one in Washington is talking up the concept of ending the conservatorship of the government-sponsored enterprises (GSEs), the Federal Housing Finance Agency (FHFA) has stepped into that void with proposals on capital buffer arrangements for Fannie Mae and Freddie Mac their conservatorship is over.
The conservatorship arrangement enables Fannie Mae and Freddie Mac to each keep up to $3 billion in capital as protection against operating losses; both GSEs send the bulk of their profits directly to the U.S. Treasury. The FHFA proposed two future options for the post-conservatorship GSEs: one involving the GSEs holding 2.5 percent of their total assets and off-balance sheets guarantees, which totaled $139.5 billion as of 2017, and one that involved their holding 1.5 percent of their trust assets and 4 percent of their non-trust assets, which totaled $103.5 billion.
“In proposing this rule, FHFA is not attempting to take a position on housing finance reform,” the agency stated. “Similarly, this proposed rule is not a step towards recapitalizing the enterprises and administratively releasing them from conservatorship. FHFA’s position continues to be that it is the role of Congress and the administration to determine the future of housing finance reform and what role, if any, the enterprises should play in that system.”

Jun 13, 2018
5 Federal Agencies Propose Guidance For ROVs

Addresses reconsiderations of value (ROV) for residential real estate transactions. 

Freddie Mac Adds Affordable Housing Program For Native Americans

HeritageOne will increase access to affordable mortgages for tribal members living in tribal areas.

6 Federal Agencies Seek Comment On Proposed Rule For AVMs

The rule is intended to ensure the credibility and integrity of Automated Valuation Models.

FHA Proposes New Program To Help Struggling Homeowners

Legal expert questions whether agency has authority to implement the program.

Fitch Places Fannie, Freddie On Negative Ratings Watch

Ties credit rating to outcome of U.S. debt limit negotiations.

FHFA Director Strongly Defends New GSE Pricing Framework 

Tells House committee it’s “simply not true” that financially stronger borrowers are subsidizing others.