In 2020, the FHFA will require Fannie and Freddie to assist regulators in determining what overlaps exist between the two enterprises and the FHA

Fannie Mae and Freddie Mac may stop offering certain home loans as they prepare to privatize, but borrowers won’t be left behind, the companies’ chief regulator said. When the Trump administration released its plans for housing finance reform in September, one key element was to identify overlaps between the loan products offered by Fannie and Freddie and those insured by the Federal Housing Administration. The Federal Housing Finance Agency put that recommendation into action when it released its new strategic plan and “scorecard” for Fannie and Freddie. Through the scorecard, the FHFA outlined the priorities for Fannie and Freddie for the next year. For the first time, the agency is requiring the two enterprises to come up with plans for how they will exit conservatorship. In 2020, the FHFA will require Fannie and Freddie to assist regulators in determining what overlaps exist between the two enterprises and the FHA. “Thoughtfully addressing these overlaps makes sense for both the Enterprises and FHA because they were created to perform different roles in our housing finance system,” FHFA Director Mark Calabria said. “In order to prepare to responsibly exit conservatorship, Fannie and Freddie must not repeat the mistakes of the crisis by stretching to serve borrowers who are better served by FHA.

Source: MarketWatch