Policy experts' GSE reform plan would benefit big banks, community lenders say

SOURCE: Mortgage News Feed

A trade group that represents small lenders says a proposal to turn Fannie Mae and Freddie Mac into a single government corporation would cede control of the mortgage markets to the big banks. The Community Lenders of America (CMLA) slammed a government-sponsored enterprise (GSE) reform plan released last month by a group of policy experts and released a competing plan. In March, five analysts led by former White House advisor Jim Parrott and Moody’s Analytics Chief Economist Mark Zandi rolled out their plan called “A More Promising Road to GSE Reform.” Under that vision, a new corporation would take over the GSE functions of purchasing and securitizing loans. The government would provide an explicit government guarantee on mortgage-backed securities, but the new entity would be required to transfer all of the noncatastrophic credit risk to private entities. Read Full Article Here >>


About The Author

Each week we post articles on FHA/VA Government news topics, ranging from FHA Direct Endorsement Underwriters, to current FHA underwriting guidelines, to new FHA rules/regulations, FHA compliance, FHA lending requirements and much more! PLEASE NOTE: We are NOT owned, operated or affiliated with HUD, FHA or the Federal Government in any way.


Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.