Mortgage lenders were up in arms regarding the Federal Housing Finance Agency‘s (FHFA) adverse market fee being implemented on September 1, 2020. There was a bit of a panic when something like that comes about without fair warning.
A quick backgrounder: FHFA said it has a statutory responsibility to ensure safety and soundness at GSEs through prudential regulation and this particular fee will cover a projected COVID-19 losses of at least $6 billion at Fannie Mae and Freddie Mac.
According to CU Members Mortgage SVP Steve Hewins, there’s usually a month or two heads up to give everybody a chance to prep — not two weeks. Thankfully, banking and lending associations, leagues, and companies (including CUNA and NAFCU) banded together to let the FHFA know that this was a bad idea. FHFA apparently listened and has postponed the fee until December 1, 2020.
Steve came on the show to share his expertise in this area, adding this was not good timing to implement an increase like this during a pandemic when people are still hurting. He also explains other reasons as to why this is happening, what credit unions need to do to prep, who this affects, and much, much more.
This session was originally shown on CU Broadcast.