WASHINGTON—NAFCU sent a letter to the Federal Housing Finance Agency (FHFA) in response to the proposed rule outlining the 2022-2024 housing goals for Fannie Mae and Freddie Mac, the government-sponsored enterprises (GSEs).
In the letter, Regulatory Affairs Counsel Aminah Moore said the trade group is generally supportive of the proposal but calls on the FHFA to work closely with the Treasury Department to fully remove limitations under the amendments to the Preferred Stock Purchase Agreements (PSPAs).
Moore further requested the FHFA allow credit unions to continue to provide temporary GSE-qualified mortgages to help GSEs achieve their overall housing goals.
Additionally, the FHFA should continue to evaluate opportunities for community financial institutions, including credit unions, to “sell more of their loans to the GSEs, consequently allowing them to better serve low-income communities,” wrote Moore.
Regarding the single-family low-income refinance goal, which is based on the percentage of all single-family, owner-occupied refinance mortgages purchased by the GSEs that are for families with incomes less than or equal to 80% of AMI, the FHFA is increasing the benchmark level in this proposed rule by 5%, setting the goal at 26%.
Support for Increased Benchmark
“NAFCU supports the increase in the benchmark level for the low-income refinance goal and hopes that the higher goal will encourage the GSEs to purchase refinance mortgages from the financial institutions whose mission is to serve the community, such as credit unions,” noted Moore.
In addition, Moore commended the FHFA’s decision to allow a one-year suspension of the most recent amendments to the PSPAs, specifically suspending the limits on the GSEs’ cash window, multifamily lending, loans with higher risk characteristics, and second home and investment properties. “These amendments have the potential to have a negative impact on communities and borrowers of color,” remarked Moore.