Bill Pulte, director of the Federal Housing Finance Agency (FHFA) took to X on Tuesday to rescind a series of advisory bulletins and directives implemented by the Biden administration.
Pulte announced the changes with photographs of paper orders posted on X. There were no formal announcements or press releases.
Chief among the changes was an order terminating special purpose credit programs (SPCPs). Pulte also rescinded an advisory bulletin calling on the FHFA to work against unfair and deceptive acts or practices (UDAP). The decision to rescind UDAP enforcement was seen as possibly reshaping the regulatory landscape for mortgage lenders and servicers.
In another order, Pulte rescinded policies that would require borrowers working with Fannie Mae and Freddie Mac to meet certain minimum standards for rental payment grace periods and lease notices. Pulte stated in the order that requiring Fannie Mae and Freddie Mac to incorporate additional tenant protections into all multifamily loan agreements would increase compliance burdens for multifamily lenders and property owners.
Also eliminated in the flurry of orders was an advisory bulletin on climate-related risk management and a directive to develop a strategy to complete all needed property repairs.
Some of the policy changes have caused swift reactions from stakeholders.
Mortgage Bankers Association (MBA) President and CEO Bob Broeksmit said in a statement that the MBA supports the rescission of the UDAP advisory and said that the bulletin’s “specific expectations for government-sponsored enterprises Fannie and Freddie to conduct consumer protection oversight of their customers wrongly established the GSEs as compliance regulators.”
He also said that the eliminated advisory had duplicated existing federal and state regulatory oversight of UDAPs and would have negatively impacted consumers and lenders through higher costs.
At the same time, the National Association of Mortgage Brokers (NAMB) released a statement saying the FHFA’s move to terminate SPCPs was concerning.
In the statement, NAMB pointed out that the programs have served as critical tools in expanding access to affordable homeownership, particularly for first-time and low- to moderate-income homebuyers.
The association pointed out that in 2023 alone, Fannie Mae acquired 921 loans through its HomeReady First SPCP program, providing more than $5 million in down payment or closing cost assistance. The GSE also purchased an additional 4,747 loans through lender-sponsored SPCPs, totaling 5,668 households served.
NAMB also stated that Freddie Mac helped another 9,300 households through other SPCP programs, contending that the programs “have served as a critical pathway to affordable homeownership for many first-time and underserved homebuyers, who annually make up approximately one-quarter to one-third of homebuyers.”
“NAMB remains steadfast in its commitment to promoting responsible lending and ensuring all Americans have access to mortgage financing,” said NAMB President Jim Nabors. “We welcome the opportunity to engage with FHFA, policymakers and industry partners to discuss constructive paths forward that preserve affordability, foster innovation and support homeownership for those who need it most.”
