Regulators who oversee Fannie Mae, Freddie Mac and the Federal Housing Administration are telling mortgage lenders that they’re ready to cut them some slack, and mortgage lenders say they’re ready to run with the ball.
Speaking at the Mortgage Bankers Association’s annual convention, Mel Watt — who runs Fannie and Freddie’s regulator, the Federal Housing Finance Agency — said a pact with the mortgage giants to be unveiled in coming weeks should ease many of the fears lenders have about extending credit to riskier borrowers.
“We know that this issue has contributed to lenders imposing credit overlays that drive up the cost of lending and also restrict lending to borrowers with less-than-perfect credit scores or with less conventional financial situations,” Watt said Sunday in a speech to bankers.
Watt confirmed media reports that FHFA has reached an agreement with Fannie and Freddie on revising the representation and warranty requirements, and said lenders can expect to get more clarity in coming weeks. (click here to read more)
(Source: Inman News)