WASHINGTON—The Federal Housing Finance Agency (FHFA) and Ginnie Mae held a public listening session during which representatives from both NAFCU and CUNA spoke.
NAFCU Regulatory Affairs Counsel Aminah Moore offered support for increased capital and liquidity requirements for non-depository sellers/servicers, noting the important effect these changes would have on the safety and soundness of the housing finance system as a whole.
Moore offered support for the FHFA's discretionary authority to designate a non-depository institution with $50 billion or more in total single-family servicing unpaid principal balance at the end of any quarter, where the servicer is the master of record, as a large seller/servicer and for the additional standards for large non-depository seller/servicers because the annual capital and liquidity plan requirements will provide a more complete picture of the internal oversight and governance of these non-depository institutions.
Moore emphasized that this would "better allow the FHFA and government sponsored enterprises (GSEs) to manage the risks associated with these institutions."
Moore also called on the FHFA to more clearly define who constitutes a "qualified, independent, third-party" that provides to the GSEs an annual assessment of the seller/servicer's performance and creditworthiness. Currently, the re-proposal does not define the term in the description of the requirement nor in the Frequently Asked Questions portion of the proposal.
CUNA’s Position
In addition, CUNA Senior Director of Advocacy and Council Elizabeth Sullivan said there are opportunities for the agencies to reduce operational burden on credit unions participating in federal housing-related programs in support of the missions of both agencies to support access to affordable housing.
“Credit unions are fulfilling their mission to meet the needs of those in their communities,” she said during the session. “More than 50% of credit unions focus on serving low-income individuals. 70% of credit union branches are in middle, moderate, and low-income communities—35% of credit unions are in CDFI investment areas.”
“Credit unions originated more than two million mortgages last year. More than half of credit union-originated home loans go to borrowers earning middle income or less,” she added. “The average size of a credit union first mortgage in 2021 was $180,534, significantly smaller than the national average mortgage of $453,000.”
Sullivan noted that requirements affecting credit unions, particularly around capital requirements should be informed by the requirements of the National Credit Union Administration because of their capability to understand the unique needs and abilities of credit unions.
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