MBA Newslink – Mike Sorohan
The Federal Housing Finance Agency yesterday announced a public comment period on a controversial proposal to gradually reduce the maximum size of loans that Fannie Mae and Freddie Mac can purchase. FHFA said it will send to the Federal Register a request for public input on implementation of the plan, which it and the Obama Administration said would reduce the government’s footprint in the mortgage market.
Setting reduced loan purchase limits furthers the goal of contracting the market presence of Fannie Mae and Freddie Mac gradually over time, one of the key objectives of FHFA’s Strategic Plan for Enterprise Conservatorships,” the agency said. “The loan purchase limits, which FHFA would set under its authority as conservator of Fannie Mae and Freddie Mac, would modestly reduce Fannie Mae’s and Freddie Mac’s business at the high end of the market, invite private capital to re-enter the market…
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