[ad_1]
The Federal Housing Finance Agency published a rule on Tuesday that would require Fannie Mae and Freddie Mac to give advance notice of new activities and get approval before launching new products.
“The final rule clarifies how FHFA will evaluate new activities and products proposed by businesses,” agency director Sandra Thompson said in a news release. “Operations of firms can have a significant impact on the mortgage market, consumers and industry stakeholders, and today’s rule will further refine FHFA’s process to ensure that operations continue to serve the mission of firms while maintaining high standards of safety and soundness.”
The notice of proposed rulemaking was first published by FHFA on November 9, 2020, and received 17 comments, the agency said. The final rule is effective 60 days after publication and supersedes the interim rule effective July 2, 2009.
The Fannie Mae and Freddie Mac pilot programs and any changes in duration or scope to them will be considered new activities subject to this rule.
Recent pilots from government-sponsored enterprises It includes the introduction of special purpose credit programs, which will be launched in 2023.
In July, House Republicans called Thompson Take measures to ensure that SSEs do not overstep their legal boundaries when moving into new products and activities.
Among the items that the FHFA specifies as not covered by this new rule are any changes to their automated underwriting systems or terms and conditions or underwriting criteria that apply to residential mortgages that are purchased or guaranteed by the GSEs. The rule also does not cover changes to an approved new product.
In the case of excluded activities that are substantially similar to automatic underwriting modifications and similar modifications, Fannie Mae and Freddie Mac are required to notify FHFA 15 calendar days in advance of their initiation, explaining why they qualify for the exemption.
Among the items for which CSEs are required to obtain prior approval are new activities that serve underserved markets and are designed to further their enterprise housing, fair housing and fair lending goals.
They must report the new activity to the FHFA, which has 15 days to determine that it is a new product. If the regulator finds that it is not a new product, Fannie Mae and Freddie Mac can start the activity, but the FHFA has the power to impose restrictions on it.
“If FHFA determines that the new activity is a new product, the final rule requires FHFA to publish a public notice requesting comments on the new product within a 30-day period,” the fact sheet states. “After the comment period ends, FHFA has 30 calendar days to approve or disapprove the new product.” If it’s approved, the agency can set the limits again.
Nothing in the final rule prevents FHFA from reviewing activities for safety and health at any time.
[ad_2]
Source link
