Join us on LinkedIn Follow us on Twitter Like us on Facebook Follow us on Instagram
 
  OCTOBER RESEARCH STORE Already a subscriber? LOG IN
AddControlToContainer_DynamicNavigation5

This Week in Washington

FHFA finalizes capital rule

Email A Friend Printer Friendly Version
0 comments
This Week in Washington
Monday, November 23, 2020
The Federal Housing Finance Agency (FHFA) has finalized its rule governing the required capital structures for Fannie Mae and Freddie Mac.

The final rule makes certain changes to the proposed rule published June 30. That proposed rule was a re-proposal of the regulatory capital framework proposed in 2018. The final rule fulfills Congress's Housing and Economic Recovery Act of 2008 mandate that FHFA establish risk-based capital requirements for the government-sponsored enterprises. 

FHFA received 128 comments on the proposal, and hosted two webinars and listening sessions on the topic. 

The final rule is intended to ensure the safety and soundness of the enterprises by increasing the quantity and quality of their regulatory capital and reducing the pro-cyclicality of the aggregate capital requirements, FHFA said.

“Fannie Mae and Freddie Mac have a mission to serve the American housing market during good times and bad. After considering all the comments on the proposed rule, and the Financial Stability Oversight Council’s review of the secondary mortgage market, FHFA is confident that the final rule puts Fannie Mae and Freddie Mac on a path toward a sound capital footing. Increased capital means that they can serve all Americans, especially low- and moderate-income families, throughout the economic cycle,” FHFA Director Mark Calabria said in a news release. “The final rule is another milestone necessary for responsibly ending the conservatorships.” 

However, the National Association of Realtors (NAR) had some concerns.
 

“While more analysis of the final rule is needed, NAR remains concerned the proposal could significantly raise costs for consumers, hamper the GSEs’ ability to support underserved markets and undermine reforms made over the last decade,” NAR President Charlie Oppler said in a statement. “NAR believes excess capital is no replacement for transparency and effective oversight.

 

“Fannie Mae and Freddie Mac have provided critical housing security throughout the COVID-19 pandemic, preserving American jobs and safeguarding an industry that represents nearly 20 percent of the U.S. economy,” he said. “With the GSEs now supporting three-quarters of all U.S. home purchases, NAR urges the FHFA to ensure Fannie and Freddie are providing much-needed market stability during this prolonged period of uncertainty and disruption. NAR thanks the FHFA for its work to reduce procyclical risk and we look forward to analyzing the proposal in more detail over the coming days, but we caution the Treasury and FHFA against taking drastic action with two institutions that are so vital to housing and the economy.”

The final rule is similar to the proposed rule in terms of overall structure and approach. As required by the proposed rule, an enterprise must maintain more than 4 percent tier 1 capital to avoid restrictions on capital distributions and discretionary bonuses.

FHFA made three notable changes to the risk-based capital requirements:

  • Increased capital relief for credit risk transfers (CRT);
  • Reduced capital requirements for single-family mortgage exposures subject to COVID-19 related forbearance; and
  • Increased the exposure level risk-weight floor for single-family and multifamily mortgage exposures to 20 percent. 

FHFA said the enhancements in the final rule ensure each enterprise's safety and soundness and its ability to fulfill its statutory mission across the economic cycle, particularly during periods of financial stress.

 

Today's other top stories
Court grants debtors’ motion on escrow deficiency
HUD issues NPR to address affordable housing crisis
Wells Fargo to shift gears on home lending
Income discrimination has racial implications in Memphis
Sourcepoint named ‘leader’ in market segment


COMMENT BOX DISCLAIMER:
October Research is not responsible for the comments posted on its websites by readers. We will do our best to remove comments that include profanity or personal attacks or other inappropriate comments.
Comments:

Be the first to leave a comment.

Leave your comment
CAPTCHA Validation
CAPTCHA
Code:
: 
: 
Your Email is for reporting purposes only. It will NOT be displayed.
Popularity:
This article has been viewed 1379 times.
Hits: 1000

Monthly Newsletter

RESPA News Monthly
January 2023

Cover Story:

Chopra answers committee questions at CFPB semi-annual report


Tweets from https://twitter.com/RESPANews/lists/around-the-industry
News by Topic   News by Edition   Special Reports   Events   Subscribe
All Rise
Case Law
Enforcement Update
Industry News
Legislation
Regulatory News
The Week in Washington
The TRID Journey
TILA News
 
 
RESPA News Monthly
November 2022
RESPA News Monthly
December 2022
RESPA News Monthly
January 2023
Archives
 
2023 State of the Industry
Mortgage Technology
Real Estate Compliance Outlook
Enforcement Lessons
Mergers & Acquisitions
Archives
 
 
National Settlement Services Summit (NS3)
Women's Leadership Summit (WLS)
Webinars
 
Subscriptions
Free Email Updates
Try a Free Edition
Library       RESPA Defined   About   Other Publications
Affiliated Compliance
Case Law
CFPB Guidance Documents
Enforcement Documents
Federal and State Legislation
Federal Register Notices
HUD's FAQ's - General
HUD's RESPA final rule FAQs
 
 
Model Disclosure Forms
Other Guidance Documents
Position Papers
Proposed Disclosure Forms
Proposed Rules and Regulations
Settlement Agreements
Statements of Policy
Studies and Proposals
 
Timeline of revisions
Disclosure requirements
Prohibited practices
RESPA enforcement
Dodd-Frank Amendments
Current Issues
The RESPA Statute
 
RESPA News
Contact / Editors
Advertise
Social Media
Are You An Expert?
Subscriber Agreement
 
The Title Report
The Legal Description
Valuation Review
Dodd Frank Upate
Copyright © 2005-2023 RESPA News
An October Research, LLC publication
3046 Brecksville Road, Suite D, Richfield, OH 44286
(330) 659-6101, All Rights Reserved
www.respanews.com | Privacy Policy
VISIT OUR OTHER WEBSITES
> Dodd Frank Update
> The Legal Description
> The Title Report
> Valuation Review
> The October Store


Loading... Loading...
12 USC Section 2605 or Section 6 is titled Servicing of mortgage loans and administration of escrow accounts. It pertains to qualified written requests, notices of transfer of servicing and the administration of escrow accounts.
An arrangement that involves a person who is in a position to refer business as part of a real estate settlement service and who has an interest in a settlement services provider.

In the arrangement, the person, who has either an affiliate relationship with or a direct or beneficial ownership interest of more than one percent in a settlement services provider, directly or indirectly refers business to that provider or influences a consumer to select that provider.
An arrangement that involves a person who is in a position to refer business as part of a real estate settlement service and who has an interest in a settlement services provider.

In the arrangement, the person, who has either an affiliate relationship with or a direct or beneficial ownership interest of more than one percent in a settlement services provider, directly or indirectly refers business to that provider or influences a consumer to select that provider.
A mortgage disclosure that lists all estimated charges and fees associated with your loan. In addition to fees and charges, it will list your loan amount, mortgage rate, loan term and estimated monthly payment. Your escrows due at closing for insurance and taxes will also be outlined. Mortgage lenders are legally required to provide a GFE within three days of receiving your application.
A mortgage disclosure that lists all estimated charges and fees associated with your loan. In addition to fees and charges, it will list your loan amount, mortgage rate, loan term and estimated monthly payment. Your escrows due at closing for insurance and taxes will also be outlined. Mortgage lenders are legally required to provide a GFE within three days of receiving your application.
Under RESPA Section 2605(e)(1)(B), a qualified written request is a written correspondence that includes: 1) the name and account of the borrower, or has enough information to allow the servicer identify that information; and 2) a statement of the reasons for the belief of the borrower that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.

A QWR cannot be written on a payment coupon or other payment medium supplied by the servicer.
Under RESPA Section 2605(e)(1)(B), a qualified written request is a written correspondence that includes: 1) the name and account of the borrower, or has enough information to allow the servicer identify that information; and 2) a statement of the reasons for the belief of the borrower that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.

A QWR cannot be written on a payment coupon or other payment medium supplied by the servicer.
12 USC Section 2609 or Section 10 is titled Limitation on requirement of advance deposits in escrow accounts. It governs escrow accounts including notifications and statements to borrowers. Section 10 also sets out penalties for those who violate the section.
RESPA Section 3 provides that a thing of value includes any payment, advance, funds, loan, service or other consideration

Regulation X says thing of value includes: monies, things, discounts, salaries, commissions, fees, duplicate payments of a charge, stock, dividends, distributions of partnership profits, franchise royalties, credits representing monies that may be paid at a future date, the opportunity to participate in a money-making program, retained or increased earnings, increased equity in a parent or subsidiary entity, special bank deposits or accounts, special or unusual banking terms, services of all types at special or free rates, sales or rentals at special prices or rates, lease or rental payments based in whole or in part on the amount of business referred, trips and payment of another person’s expenses or reduction in credit against an existing obligation.
A form used by a settlement or closing agent itemizing all charges imposed on a borrower and seller in a real estate transaction. This form represents the closing transaction and provides each party with a complete list of incoming and outgoing funds. RESPA requires the HUD-1 to be used as the standard real estate settlement form in all transactions in the U.S. involving federally related mortgage loans.
Featuring:
  • Delivery 3X a week plus breaking news as it happens
  • Comprehensive title insurance industry news
  • Recent acquisitions, mergers, real estate stats
  • Exclusive in-depth coverage of the industry's hottest stories
Featuring:
  • Delivery 2X a week plus breaking news as it happens
  • Comprehensive Dodd-Frank coverage
  • The latest information from the CFPB
  • Full coverage of Congressional hearings
  • Updates on all agency actions
  • Analysis of controversial provisions
  • Release of newest studies and reports
Sign up today and...
  • Be one of the first to know where NS3 is being held
  • Learn about NS3 speakers and sessions
  • Save on registration with Super-Early Bird rates
  • Discover the networking opportunities NS3 offers
  • Find out if CE credits will be offered for your area
  • And much more
Featuring:
  • Delivery 2X a week plus breaking news as it happens
  • Preview the latest RESPAnews.com Top Story
  • RESPA related headline news
  • Quote of the Week
Featuring:
  • Delivery 2X a week plus breaking news as it happens
  • Legal, regulatory and legislative information impacting the settlement services industry
  • News from HUD, Congress, state legislatures and other regulatory agencies
  • Follow the lobbying efforts of all the major national real estate services organizations.
Featuring:
  • Delivery 2X a week plus breaking news as it happens
  • The industry's only full-time newsroom
  • Relevant, up-to-date appraisal industry news
  • Covering the hottest stories and industry trends
NEWS BY TOPIC
NEWS BY EDITION
SPECIAL REPORTS
EVENTS
LIBRARY
FREE EMAIL UPDATES
ABOUT
SUBSCRIBE
All Rise
Case Law
Enforcement Update
Industry News
Legislation
Regulatory News
This Week in Washington
The TRID Journey
TILA News
Current Edition
December 2022
November 2022
October 2022
Archives
2023 State of the Industry
Mortgage Technology
Real Estate Compliance Outlook
Best Practices
Enforcement Lessons
Archives
National Settlement
Services Summit (NS3)
Women's Leadership
Summit (WLS)
Webinars
2023 Economic Forecast Series
CFPB Unconstitutionally funded?
Industry and Regulatory Outlook
Evolving Lender Relationships
Manufactured Housing
Evolving Realtor Relationships
CFPB Update
Understanding Cyber Insurance
Collaborating on eClosings
Webinar Archives
Executive Interview Series
eClosing Solutions Showcase
Affiliated Compliance
RESPA DEFINED
Case Law
Disclosure Forms
Enforcement
Federal and State Legislation
Guidance Documents
HUD's FAQ's - General
HUD's RESPA final rule FAQs
Position Papers and Studies
Rules and Regulations
Timeline of revisions
Disclosure requirements
Prohibited practices
RESPA enforcement
Dodd-Frank Amendments
RESPA Glossary
Current Issues
The RESPA Statute
Model Disclosure Forms
Proposed Disclosure Forms
Enforcement Documents
Settlement Agreements
CFPB Guidance Documents
Other Guidance Documents
Statements of Policy
Position Papers
Studies and Proposals
Federal Register Notices
Proposed Rules and Regulations
RESPA News
Contact Us
Advertise
Social Media
Are You An Expert?
Subscriber Agreement