CREF Policy Update: Federal Reserve Cuts Rates by 25 Basis Points
Federal Reserve Cuts Rates by 25 Basis Points
In response to current economic conditions, the Federal Reserve’s Federal Open Market Committee (FOMC) decided to cut the federal funds rate to a target range of 3.75-4.00% on Wednesday.
Why it matters: The Committee emphasized that, “[we] will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals. The Committee’s assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.”
MBA Chief Economist Mike Fratantoni in a written statement said, “The FOMC also announced that it would be ending quantitative tightening on December 1st, indicating that the overall balance sheet will no longer be shrinking. MBS prepayments and amortization will be rolled into Treasuries going forward. As these moves were anticipated by the market, MBA does not expect any significant changes to mortgage rates as a result. Mortgage rates are currently around their low for the year and this has spurred both refinance and purchase activity.”
For more information, please contact Mike Fratantoni at (202) 557-2935.
Federal Government Shutdown in Fifth Week as Stalemate Continues
As the impasse is in its fifth week, bipartisan talks continue amongst a group of senators attempting to negotiate an end to the funding stalemate.
• Read MBA’s member guide that outlines the potential impacts to multifamily and single-family government lending programs.
Why it matters: Hundreds of thousands of federal employees have missed paychecks this month. Moreover, the shutdown has necessitated furloughs and has been used to justify Reductions in Force (RIFs) of many federal employees, as well as significant curtailment of certain operations at key agencies such as HUD, Treasury, the VA, and USDA.
• National Flood Insurance Program (NFIP) authorities remain expired, with the White House and GOP congressional leaders still declining to make a deal to reauthorize the program prior to passage of a “clean” Continuing Resolution (CR). To avoid long-term disruptions to the housing and flood insurance markets, MBA continues to advocate for an immediate restoration of the program’s authority.
Go deeper: The federal government has been shut down since Congress failed to come to an agreement on FY 2026 funding before a Sept. 30 11:59 p.m. ET deadline.
• On Sept. 19, House Republicans passed a short-term CR to extend FY 2024-2025 funding through Nov. 21, 2025. In the Senate, ongoing attempts to advance either the House bill or a Democratic alternative have failed, with Democrats seeking to include additional health care priorities.
What’s next: MBA remains in contact with lawmakers and regulators and encourages members to share any real-time operational impacts. The longer this shutdown lasts – particularly with extended federal agency furloughs and missed paychecks – the more likely it will lead to significant disruption for the industry and its customers and end users. MBA continues to monitor all funding votes as the posturing continues.
For more information, please contact Bill Killmer at (202) 557-2736 or Jamie Woodwell at (202) 557-2936.
Senate Banking Committee Holds Nomination Hearings for FDIC, FHA, and Ginnie Mae Leaders
On Thursday, the Senate Banking Committee convened a hearing to review the nominations of Travis Hill for Federal Deposit Insurance Corporation (FDIC) Chairman, Frank Cassidy for Assistant Secretary (Federal Housing Administration (FHA) Commissioner), Department of Housing and Urban Development (HUD), and Joseph Gormley for Ginnie Mae President.
• The hearing was often contentious with partisan clashes over blame for the past culture at the FDIC, housing affordability, agency staffing issues, and banking oversight and regulation in the Trump administration. A memo summarizing the hearing can be found here.
What they are saying: Chief Lobbyist Bill Killmer sent letters of support on MBA’s behalf for the Hill, Cassidy, and Gormley nominations, which can be found here and here.
Go deeper: There was a stark divide between some Democrats and Republicans on the panel regarding housing affordability and the best policy approaches needed to address the problem.
• Sens. Tina Smith (D-MN) and Raphael Warnock (D-GA) pressed Frank Cassidy on rising costs, HUD employee terminations, and policies they believe disadvantage first-time homebuyers.
• Sen. Bernie Moreno (R-OH) blamed higher cost areas in the Northeastern and Western states on partisan governance by elected Democrats.
• Cassidy emphasized his focus on streamlining FHA programs, speeding up processing times for construction financing under the Sect. 221(d)(4) multifamily housing program to generate more housing supply, and engaging in deregulatory efforts to attempt to reduce costs.
What’s next: After questions for the record submitted by senators are completed by the nominees, the Banking Committee will schedule a vote to report them out for confirmations votes on the Senate floor.
For more information, please contact George Rogers at (202) 557-2797 or Bill Killmer at (202) 557-2736.
Delinquency Rates for Commercial Properties Decreased in the Third Quarter of 2025
Delinquency rates for mortgages backed by commercial properties decreased during the third quarter of 2025 compared to the prior quarter. This is according to MBA’s latest commercial real estate finance (CREF) Loan Performance Survey, released last Tuesday.
What they are saying: “After significant increases in the second quarter, delinquency rates declined in the third quarter,” said Judie Ricks, MBA’s Associate Vice President of Commercial Real Estate Research. “Compared to the first quarter, third-quarter delinquency rates were up, driven by increases in later stage delinquencies and Foreclosure/REO properties. It is worth watching this portion of the market the rest of the year amidst broader economic uncertainty.”
To purchase the full report, click here.
For more information, please contact Judie Ricks at (202) 557-2745.
MBA Offers Recommendations on White House RFI on AI
Last Monday, MBA responded to the White House’s Office of Science and Technology Policy (OSTP) Request for Information (RFI) on Artificial Intelligence (AI). MBA explained that new laws and regulations on AI will create uncertainty or make it harder to use systems that the industry has relied on for decades. Additionally, the growing patchwork of state regulations is the most significant inhibitor to adopting advanced AI and the continued use of existing AI.
Why it matters: MBA has been engaged with lawmakers on both the state and federal levels to ensure that new prohibitions and rules on the use of AI do not disrupt the core mortgage origination process.
• MBA supports greater regulatory clarity on how existing laws apply to AI, which would facilitate AI adoption by the mortgage industry, and opposes new laws restricting AI use that are largely redundant given those existing laws.
Go deeper: Last year, MBA released its white paper, “AI in the Mortgage Industry,” which explains the industry’s use cases for AI, existing laws impacting AI use, and principles for lawmakers to consider as they discuss how to regulate the use of AI.
• Please see www.mba.org/stateai for more updates on AI policy.
What’s next: MBA will keep members informed about any proposed rules following the RFI.
For more information, please contact Gabriel Acosta at (202) 557-2811 or Rick Hill at (202) 557-2718.
MBA Updates Commercial Licensing Law Database
Last Thursday, MBA released its updated Commercial/Multifamily Licensing by State Resource, a comprehensive, state-by-state guide outlining licensing requirements for commercial mortgage banking and servicing across all 50 states. The resource, updated every two years, includes links to relevant statutes, regulator websites, and key contacts.
Why it matters: State-level regulation creates a complex and often fragmented compliance landscape. MBA’s updated database helps members efficiently navigate this patchwork of requirements and stay informed about the laws governing their business activities.
For more information, please contact William Kooper at (202) 557-2737 or Liz Facemire at (202) 557-2870.
MBA Adds Commercial Leadership to State Legislative Regulatory Committee
Last month at MBA’s Annual Convention and Expo in Las Vegas, Kimberly Tayton of BWE was installed as Commercial Vice Chair of MBA’s State Legislative Regulatory Committee (SRLC). MBA created this new role to boost visibility and advocacy in the states around Commercial/Multi-Family policy issues. The SLRC helps direct MBA’s advocacy on state and local issues and works with the network of independent partner associations around the country to address issues relevant to the real estate finance industry.
• Kimberly Tayton brings passion, a wealth of experience, and vast connections to assist MBA and its state partners as they continue to educate policy makers on the needs of MBA’s CREF members.
Why it matters: Increasingly, state and local initiatives around rent control, real estate taxation, licensing and artificial intelligence threaten commercial and multifamily business models. This committee works to identify those issues and help states partners advocate for an against proposals.
What’s next: Expanding the committee to include more commercial members will increase MBA’s reach into state and local policies impacting members. To join the committee, simply add it to your MBA profile at mba.org.
For more information, please contact William Kooper at (202) 557-2737 or Liz Facemire at (202) 557-2870.
Upcoming MBA CREF Councils and Committee Meetings
MBA’s CREF Councils and Committees are a key way to connect to everything MBA has to offer around policy, advocacy, market intelligence and research, education, and networking. Councils and Committees are built around specific capital sources and serve as an opportunity for you to join other commercial real estate finance professionals to hear from experts, discuss opportunities and challenges, and connect with peers.
Upcoming virtual meetings include:
• FHA Council: Nov. 12
• Private Credit Finance Council: Nov. 17 – Meet in-person @ the Summit
• Life Company Council: Nov. 18
• Servicer Council: Nov. 20
For more information, click on the links above and/or contact Kelli Burke at (202) 557-2742.
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, opportunities, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – all complimentary to MBA members:
• Overview of Commercial/Multifamily Insurance Compliance – Nov. 5
• Mastering Commercial/Multifamily Lender-Placed Insurance – Nov. 12
• Rethink Everything You Know About Networking: Part II – Nov. 13
• Exploring Data Centers – Nov. 18
• AI Speed Learning for the Mortgage Professional – Nov. 20
• Introduction to LIHTC for Mortgage Professionals – Dec. 10
• Commercial/Multifamily Capital Markets and Securitization – Dec. 16
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.
