What has Joseph Otting, acting director of the FHFA, included in the plan for removing the government sponsored enterprises from conservatorship and how will it affect underserved communities?

Concerned that he will take that step without their input, much less take the time to explain what’s planned, Rep. Maxine Waters, D-CA. and chairwoman of the House Financial Services Committee, and Sen. Sherrod Brown, D-OH, ranking member of the Senate Committee on Banking, Housing, and Urban Affairs, sent Otting a letter:

[caption id="attachment_9329" align="alignright" width="237"] Sherrod Brown[/caption]

“In an interview on Jan. 10, 2019, you stated that there was ‘a clear mission that’s outlined by the Treasury and the White House, what they want to accomplish’ at FHFA and indicated that you would pursue that mission in your new role. It has also been reported that you told FHFA employees that you would soon announce a plan to move Fannie Mae and Freddie Mac out of conservatorship. To date, we have not seen a comprehensive statement from the White House and Treasury Department under the Trump Administration providing their views on regulation of the housing finance system.”

Waters and Brown are worried about how the Trump Administration plan would affect communities that have been underserved in the past. That’s because recent legislation requires the GSEs to serve these communities and for the FHFA to monitor their compliance with them.

They articulated their concerns on this issue as follows:

“The enterprises’ activities are especially impactful in traditionally underserved parts of the market, including low- and moderate-income households, rural areas, affordable rental housing, and manufactured housing. In the two most recently enacted bills to strengthen oversight of the Enterprises, Congress expressed bipartisan support for the enterprises’ continued and expanded role in serving underserved markets. To ensure that the enterprises fulfilled this duty, Congress directed their regulator, FHFA, to monitor and enforce the Enterprises’ activity across each of these market segments.”

Otting also serves as Comptroller of the Currency.