navycmdr
25 minutes ago
What’s Ahead for the GSEs Under the New Administration?
By Gail Kalinoski- November 18, 2024
https://www.multihousingnews.com/whats-ahead-for-the-gses-under-the-new-administration/
Even before Donald Trump was elected to a second term, multifamily and finance industry insiders had spent months discussing whether another Trump administration would finally take Fannie Mae and Freddie Mac out of conservatorship.
Two things most agree when talking about privatizing the GSEs is that exiting conservatorship would be a complex undertaking and that it would likely take several years to complete. There is less agreement on the best route to that exit.
Different reform efforts, current and previous
The Wall Street Journal reported in mid-September that Trump allies, including Larry Kudlow, former director of the National Economic Council during Trump’s first term, and bankers were discussing plans to have the government sell most of its stakes in the GSEs, which are valued at hundreds of billions of dollars. The goal was reportedly to sell to investors, including sovereign wealth funds.
Under the plan floated by Trump’s allies, the Treasury Department would partially back some of the Fannie and Freddie loans, similar to how the Federal Deposit Insurance Corp. backs a certain amount of bank deposits. It would also be similar to the implicit pre-2008 guarantee that became explicit under conservatorship.
The WSJ reported that such discussions started in the spring and included conversations with investment managers on how the deal could work. The talks also considered various pathways to privatization, including going through Treasury and the Federal Housing Financing Agency, rather than Congress.
Previous reform efforts, including some initiated by Congress and another led by former Treasury Secretary Steven Mnuchin, and Mark Calabria, the FHFA director, late in Trump’s first term, failed to get across the finish line. The Biden administration had their own list of priorities and didn’t pick up the baton.
“They’re mindful of it,” Bill Killmer, chief lobbyist & senior vice president for legislative and political affairs at the Mortgage Bankers Association, told Multi-Housing News. “They field questions about it. But it’s not risen to a level of priority that it would need to if you’re going to try to attempt this conservatorship exit.”
By contrast, Killmer said that in a second Trump administration, “There really is a chance that an examination of this kind of project with the GSEs will be renewed at the Treasury Department and with whoever occupies the directorship at FHFA.”
The FHFA sets both the capital requirements and standards for Fannie and Freddie, so the FHFA leader will be a key player in any exit strategy, along with the Treasury secretary.
Calabria, currently a senior advisor to the Cato Institute, has made it known that he is interested in a Treasury position where he could be involved in such negotiations between Treasury and FHFA to end conservatorship, according to Dave Borsos, vice president for capital markets at the National Multifamily Housing Council.
Killmer said that an MBA blue-ribbon task force representing both the multifamily and single-family sectors has been meeting for about nine months to look at the practical implications of ending conservatorship.
“We really kickstarted that effort again to take stock of reforms that had been executed administratively over the last couple of administrations and see what progress had been made, and also lay out the parameters of what would need to be done on the multifamily and single-family side,” he said.
After hearing from members of Congress prior to the election that ending conservatorship would be one of their priorities in 2025, Borsos pulled out his GSE reform directory with a variety of proposals
“Going back and reading that again this week, there were 49 things that the Treasury planned to focus on, things that were separately identified for releasing the GSEs,” he said. Of those 49 issues, 31 were administrative and could be accomplished without congressional actions, whether by an executive order or negotiations between Treasury and FHFA.
Importance of the PSPAs
Housing Tax Credit investment caps have been raised from $850 million to $1 billion annually.
There is some concern that if the GSEs are privatized, it could impact on their affordable housing goals and mandates.
“In the plan that was issued in response to the call by President Trump [in his first term], they did acknowledge that, and they did say that Fannie and Freddie should serve that low- and moderate-income sectors,” Borsos said. “So they were still in favor of continuing the affordability mandate.”
Killmer stressed preserving the role of the GSEs to support multifamily liquidity as a priority for the MBA.
“We want to make sure that the commitments are maintained,” Killmer said. “It’s a question of how you shift the gears and pull certain levers with respect to Area Median Income and the obligations so the GSEs have the means by which they’re trying to meet them.”
Overall, Killmer said the MBA isn’t leaning in with a preference for or against exiting conservatorship. “We want to make sure that we play a critical role,” he said. “If conservatorship exit is attempted, that it be done with care and with the right kind of exit ramp—that takes an ample amount of time.”
RickNagra
29 minutes ago
I asked on X and this is the response I received.
Guest said not many approaches had been suggested, but the one he thinks most appropriate is, to release the GSEs and have them be private, but also pay some sort of premium for having an implicit government backstop. “I don’t know if that’s how it will be done, but that’s how I think it should be done,” was the gist.
navycmdr
59 minutes ago
ABA, associations: Fannie Mae, Freddie Mac should rescind property verification bulletins
November 18, 2024
https://x.com/usnavycmdr/status/1858636920605339768?t=Iq-c1y_RRfQ8iX2XFG-HIQ&s=19
Fannie Mae and Freddie Mac should rescind three bulletins issued earlier this year revising both enterprises’ property verification requirements as they have created numerous compliance difficulties, the American Bankers Association, Mortgage Bankers Association and Home Policy Council said today in a joint letter to the Federal Housing Finance Agency. The groups also urged FHFA to recall a related survey of lenders and servicers.
In February, at the direction of FHFA but without prior notice to or engagement with banking or insurance stakeholders, Fannie and Freddie issued bulletins “clarifying” lenders’ and servicers’ responsibilities with respect to the valuation and verification of property insurance requirements. The bulletins state that lenders and servicers are required to verify that homes securing a mortgage purchased by the enterprises are insured at Replacement Cost Value (RCV) and that Actual Cash Value (ACV) coverage is unacceptable.
In their letter, the associations said the revised requirements instead created significant operational, legal and consumer protection questions and challenges. They requested that Fannie and Freddie rescind the bulletins “and affirmatively state that the current industry practice of verifying that an insurance policy pays claims on a replacement cost basis meets [government-sponsored enterprise] requirements.”
The associations also said that while they appreciate agency efforts to engage with the property and casualty insurance sector, the survey currently underway is being conducted “through a non-transparent and non-public process is premature and likely violates the Paperwork Reduction Act.”
“Instead of proceeding with the surveys, we urge FHFA and the GSEs to continue their policy dialogue with the property and casualty insurance sector,” the associations said. “If, after this engagement, FHFA and the GSEs determine that additional information is necessary, they should initiate a transparent and public request for information.”
jcromeenes
2 hours ago
I work in tech and have for decades. Most times when we go looking for highly skilled programmers, not just programmers, they end up being H1B folks. We start with JUST resumes. In short, either Americans in general cannot create a resume that shows these skills, or they don't have them. Further, these people are not hired solely on interviews. They are given tasks to complete to prove the claimed skills on the resume. This further points us to the folks that have the H1Bs. So, those folks in Kansas and Nebraska are not only not telling us of those wonderful skills, but they are also unwilling to demonstrate them in our testing. I know you WANT to believe they have the skills and I want them to have them too, but they don't have them.
Riddle me this, why did Melania Trump and Ivanka Trump need to be brought in to the USA on H1B visas as models? Don't we have any pretty women in the USA to have their photos taken? How is a model a "highly skilled" category? It's not. They also didn't have jobs lined up with sponsoring companies when they were brought in on their H1Bs. Bad, bad, bad.
jcromeenes
2 hours ago
I saw a recent article that referenced Ackman's ownership as well as a 10-k >>> However when I went looking for the 10-l I fear it may have been old. In the end, the reference was stating Ackman controlled about 11% of the stock, as I recall, I did find this recent Motley Fool article that is also stating a 10% number and how Ackman still holds it - https://www.fool.com/investing/2024/10/12/billionaire-investor-bill-ackman-holds-a-10-stake/
There are some missing dots to connect it seems but I would believe Ackman still owns it as we would have felt, badly, 115M share dump.
navycmdr
3 hours ago
FHFA Enables Fannie Mae and Freddie Mac to Expand Support for Rental Housing
The Federal Housing Finance Agency announced higher caps for 2025 that allow the
Enterprises to purchase up to $146 billion in multifamily loans and will continue to
exempt workforce housing from the limit
for immediate release - 11/18/2024
Washington, D.C. – The Federal Housing Finance Agency (FHFA) will allow greater rental housing support from Fannie Mae and Freddie Mac (the Enterprises) by raising the multifamily loan purchase cap for each Enterprise to $73 billion, representing $146 billion in total 2025 multifamily market support and a more than 4 percent increase from 2024, the Agency announced today.
FHFA establishes the caps every year, and they are later included in Appendix A of the Enterprises’ Conservatorship Scorecard, a set of annual priorities that they are expected to meet. Just like in 2024, when the cap for each Enterprise was $70 billion, multifamily loans that finance workforce housing will be excluded from the 2025 limits.
“The 2025 multifamily loan caps reflect the Enterprises’ strong commitment to provide liquidity to make renting a home more affordable,” said FHFA Director Sandra L. Thompson. “Additionally, the ongoing workforce housing exemption will continue to enhance the Enterprises’ ability to support properties that preserve affordable rents, including properties preserved or created through corporate-sponsored affordable housing initiatives.”
Over the past year, since workforce housing was first exempted from the caps, both Enterprises have seen encouraging growth in this critical market segment. In addition, FHFA is continuing to require that at least 50 percent of the Enterprises’ multifamily businesses be mission-driven.
The Agency will continue to monitor the multifamily mortgage market and maintains the ability to raise the caps further if necessary to support liquidity in the market. However, to prevent market disruption, if FHFA determines that the actual size of the 2025 market is smaller than was initially projected, FHFA will not lower the caps.
2025 Multifamily Caps Fact Sheet
2025 Appendix A
NeoSunTzu
4 hours ago
ENOUGH ENOUGH ENOUGH ALREADY with the "even if the government takes this percent or that percent or executes warrants ..." for christ's sakes why do you goofs incessantly repeat this nonsense ... we have been through this a thousand times ...
these companies have paid everything back, won the jury breach decision, earn enough capital on their own, the warrants were NEVER intended for execution, the NWS was improperly executed to undermine companies when they were shown to return to comfortably return to profitability previously, the capital rule is unrealistically high and is not commensurate with their business risk and on and on ad infinitum ...
there should be no need for ANY new capital raise, execution of warrants, or any dilution ... they are already on schedule for full capital levels at the proper risk rate commensurate with their business and business model .... stop giving the government your green light for dilution just because you are satisfied to get some return ... these are shareholder owned companies, we are the shareholders, and government corruptly executed these conservatorships ... it is time to return them without the any further thievery or fuckery!
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