September 15, 2020

Housing regulators detail efforts to provide clarity, stability amid coronavirus pandemic

HUD Deputy Secretary Brian Montgomery addressed attendees Monday during NAFCU's Virtual Congressional Caucus.

During NAFCU's Congressional Caucus yesterday, both Federal Housing Finance Agency (FHFA) Director Mark Calabria and Department of Housing and Urban Development (HUD) Deputy Secretary Brian Montgomery offered insights into lessons learned from the housing crisis of 2008, steps taken to provide relief amid the coronavirus pandemic, and how they plan to ensure clarity and stability in the housing market moving forward.

During their separate remarks, Montgomery and Calabria cited coronavirus relief as their main priority. Montgomery noted that HUD is “first and foremost focused on making sure individuals and families have what the need.”

Recently, HUD announced an extension of its foreclosure moratorium through Dec. 31, 2020. Likewise, the FHFA extended its moratorium on foreclosures and evictions through the end of the year.

Montgomery also focused heavily on the Federal Housing Administration’s (FHA) progress on its housing finance reform plans. Most notably, the FHA’s information and technology modernization efforts – which have been “critical to success” amid the pandemic – have created a multigenerational shift in how business is conducted at the administration. Of the innovations planned moving forward, Montgomery noted he is hopeful that a loan closing and endorsement capability will be available on the FHA’s platform by the end of the year.

“In short, HUD has made and continues to make changes which we believe will improve access to FHA loans, facilitate originations, and enhance overall market liquidity, whether it is for first time, low-to-moderate, or minority homebuyers,” stated Montgomery.

FHFA Director Mark Calabria offered remarks Monday.

In addition, Montgomery and Calabria both noted their focus on low- to moderate-income homebuyers and first-time homebuyers. Calabria expressed gratitude for the joint efforts of both the FHFA and HUD, along with other housing finance agencies, to ensure the options available to borrowers are consistent and not confusing.

On the mortgage market, Calabria reiterated the FHFA’s focus on supporting the function of the market amid the crisis.

The FHFA heeded NAFCU's call to provide mortgage servicers with some relief and provided a four-month limit on advances of principal and interest payments for loans in forbearance sold to the government sponsored enterprises (GSEs). It has also allowed the GSEs to purchase certain-single family mortgage loans in forbearance and earlier this week extended that policy for loans originated through Sept. 30.

NAFCU also has cautioned the FHFA against pursuing a 0.5 percent adverse market refinance fee, which the agency said is intended to mitigate risks brought on by the pandemic. As a result of NAFCU's advocacy, the FHFA delayed the implementation of the fee to Dec. 1. Related to this topic, Calabria noted the GSEs urgent need for more capital in order to offer additional support for coronavirus relief and “continue to keep families safe in their homes amid the pandemic.”

Calabria concluded by reiterating that in order to provide stability, the GSEs must be stable themselves.

As NAFCU’s Congressional Caucus continues today, stay tuned to NAFCU Today for recaps from the event and follow #NAFCUCaucus on Twitter for live highlights.