On August 31st NAR sent a letter to the Federal Housing Finance Agency commenting on its proposed rule regarding capital standards at Fannie Mae and Freddie Mac. In the letter, NAR argues that the capital rule should be modeled to reflect this special nature of the Enterprises’ construct and the relationship with the federal government. However, the FHFA failed to explain how a government guarantee, which REALTORS® believe should be explicit and defined by Congress, would affect the proposed capital rule. Homeownership is a central part of the fabric of the American Dream, and the Enterprises’ mission to provide liquidity in the market plays a fundamental role in helping people achieve that dream. A critical weakness of the Enterprises before conservatorship was their undercapitalization, but care must be taken in redesigning the GSEs’ capital framework to appropriately protect taxpayers, stabilize markets and support homeownership.
NAR Letter to FHFA Director Calabria In Response to NPRM on Capital Rule
Issue Date: August 31, 2020
On August 31st NAR sent a letter to the Federal Housing Finance Agency commenting on its proposed rule regarding capital standards at Fannie Mae and Freddie Mac. In the letter, NAR argues that the capital rule should be modeled to reflect this special nature of the Enterprises’ construct and the relationship with the federal government. However, the FHFA failed to explain how a government guarantee, which REALTORS® believe should be explicit and defined by Congress, would affect the proposed capital rule. Homeownership is a central part of the fabric of the American Dream, and the Enterprises’ mission to provide liquidity in the market plays a fundamental role in helping people achieve that dream. A critical weakness of the Enterprises before conservatorship was their undercapitalization, but care must be taken in redesigning the GSEs’ capital framework to appropriately protect taxpayers, stabilize markets and support homeownership.
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