Incoming FHFA Director Announces New Rules for Fannie, Freddie
May 13 - In remarks delivered at the Brookings Institution Forum on the Future of Fannie Mae and Freddie Mac, FHFA Director Melvin Watts announced a series of new policy decisions. Watts said he hoped the new policies would improve liquidity in the housing finance market and address lenders' concerns over life of loan extensions.
Key points from Watt's speech:
- We must ensure that Fannie Mae and Freddie Mac operate in a safe and sound manner. It means that we’ll work to preserve and conserve Fannie Mae and Freddie Mac’s assets. And it means that we’ll work to ensure a liquid and efficient national housing finance market. Our job at FHFA is to balance these obligations.
- One topic that is not on FHFA’s agenda, because it’s not part of our statutory mandate, is housing finance reform legislation. My guess is that there were many people who expected that I would start talking about reform legislation the minute I got to FHFA. I am well aware, and regularly express my belief, that conservatorship should never be viewed as permanent or as a desirable end state and that housing finance reform is necessary. However, Congress and the Administration have the important job of deciding on housing finance reform legislation, not FHFA.
- We are releasing a new Strategic Plan for the Conservatorships of Fannie Mae and Freddie Mac along with their 2014 Conservatorship Scorecard. Both documents are built around three strategic goals: MAINTAIN, REDUCE and BUILD.
To read Watt's speech in its entirety, click on this link.