CREF Policy Update: FHFA Releases Annual Scorecard for Fannie Mae and Freddie Mac
FHFA and Treasury Announce Amendments to the PSPAs
Recently, the Federal Housing Finance Agency (FHFA) and the U.S. Department of the Treasury (Treasury) announced amendments to the Preferred Stock Purchase Agreements (PSPAs) governing the conservatorships of Fannie Mae and Freddie Mac (the GSEs).
Why it matters: The amendments make various modifications, including deleting previously portions of the PSPAs that were suspended through the September 14, 2021, Letter Agreements, clarifying that the GSEs must meet the capital requirements established by FHFA as those rules are modified over time, and technical changes or clarifications applicable to the GSEs’ financial reporting. Notably, the amendments also reinstate the requirement for Treasury’s consent prior to terminating the conservatorships and incorporate a side agreement between Treasury and FHFA to establish a process for eventual public input on termination options and potential impacts.
What they’re saying: In a press statement, MBA President and CEO Bob Broeksmit, CMB, said, “MBA believes strongly that any efforts to remove Fannie Mae and Freddie Mac from their federal government conservatorships must fully consider the impact on single-family and multifamily housing markets and overall financial stability. This includes the critical move that Congress establishes an explicit federal backstop for mortgage-backed securities.”
He added, “Conservatorship was never intended to be perpetual, and we support efforts toward the GSEs’ release. We appreciate the rationale behind today’s changes to the PSPAs, which are designed to foster transparency across government agencies, share market impact analysis, and give appropriate time for market participants to provide feedback on proposed reforms.”
Go deeper: The suspended portions of the PSPAs that were deleted through this amendment were the artificial limits on GSE acquisitions of loans secured by second homes and investment properties, loans with multiple risk factors, lenders’ use of the cash windows, and multifamily lending volumes caps. These disruptive and unworkable backward-looking limits were initially suspended in response to intense MBA advocacy and their removal from the PSPAs is welcome.
What’s next: MBA will review the amendments to the PSPAs in the coming days and will participate fully in the newly established process for public input regarding ending the conservatorships. MBA strongly believes the GSEs’ conservatorship was never intended to be permanent and supports efforts toward a careful and deliberate release of them with appropriate reforms. MBA stands ready to work with the incoming Trump administration at the White House, Treasury Department, and FHFA — and also with the Congress — to ensure that happens.
For more information, please contact Sasha Hewlett at (202) 557-2805 or Megan Booth at (202) 557-2740.
FHFA Releases Annual Scorecard for Fannie Mae and Freddie Mac
On Dec. 20, FHFA released its 2025 Scorecard for Fannie Mae and Freddie Mac and Common Securitization Solutions. The 2025 Scorecard builds on progress made last year and focuses on two equally weighted areas: promoting equitable access to affordable and sustainable housing, and operating in a safe and sound manner.
Go deeper: The 2025 Scorecard highlights specific objectives that address housing affordability, housing supply and the resiliency of the nation’s housing stock, efficiency in the mortgage process, and sustainability in housing outcomes.
• Objectives include exploring opportunities to support first-time homebuyers and homebuyers limited by wealth and income, a continued focus on multifamily workforce housing, leveraging data, technology, and other innovations to promote efficiency and cost savings in housing finance, identifying opportunities to mitigate risk in the evolving property insurance market, continuing to monitor natural disaster/climate-related market developments and risks, and exploring the benefits and risks of increased use of artificial intelligence (AI) and machine learning in the mortgage industry.
• Notably, the Scorecard again includes an objective that the GSEs will work with industry stakeholders to improve loan quality and continue to harmonize processes and remedies that support the Single-Family Representations and Warranties Framework. This reflects a key advocacy issue MBA has pursued over the last year.
• It also includes a reference to continuing the tenant protections that were initiated by the GSEs last year.
Why it matters: The Scorecard outlines FHFA’s expectations for the GSEs’ priorities in the coming year. These priorities, in turn, influence the GSEs’ operations across a wide range of policy areas and business activities.
What’s next: MBA will continue to work with the GSEs as they implement the Scorecard initiatives and, over the long term, continue to pursue the necessary conditions to exit conservatorship.
For more information, please contact Sasha Hewlett at (202) 557-2805 or Megan Booth at (202) 557-2740.
HUD Publishes 2025 Multifamily Loan Limits
Last week, the Department of Housing and Urban Development (HUD) published its annual indexing of the statutory multifamily loan limits. This notice increases the loan limits by 3.4% beginning January 1, 2025. For example, a two-bedroom walkup for a 221(d)(4) will go from $88,733 to $91,749, and a two-bedroom elevator building from $97,379 to $100,689.
Why it matters: The cost of construction continues to rise, and the indexing of the limits is necessary to address those increases.
What’s next: The statutory limits remain far too low and have not increased in more than a decade. MBA will call on the 119th Congress to increase the statutory limits to ensure that HUD multifamily financing is a viable option.
For more information, please contact Megan Booth at (202) 557-2740.
Upcoming MBA Education Webinars on Critical Industry Issues
MBA Education continues to deliver timely commercial/multifamily and single-family programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – all complimentary to MBA members:
• Managing Rising Insurance Risks in Commercial Lending – Jan. 14
• Fundamentals of Commercial Insurance Issues and Problems – Jan. 28
• CREF Career Conversations: Insights from Industry Leaders – Jan. 28
• Navigating and Ensuring Accurate Reporting with the MBA Commercial and Multifamily Inspection Form – Jan. 30
MBA members can register for any of the above events and view recent webinar recordings by clicking here.
For more information, please contact David Upbin at (202) 557-2931.
