Catching up on news from late last week, the Office of Federal Housing Enterprise Oversight reported last Friday that Fannie Mae and Freddie Mac have been making progress in an effort to adopt the Interagency Guidance on Nontraditional Mortgage Product Risks. Both GSEs said in letters to lenders last week that they will enforce compliance with the guidance on all conforming loans starting September 13. The OFHEO had originally instructed the GSEs to adopt the guidance way back in December, so Friday’s press release should have come as sort of an update. But you’d never know that if you read some of the major media coverage on this — here’s one from the Washington Post, with the ominous title Fannie, Freddie Told to Tighten Lending:
The regulator for Fannie Mae and Freddie Mac said yesterday it is requiring the two largest U.S. mortgage finance companies to adopt guidelines aimed at reducing imprudent lending through interest-only and other non-traditional mortgages.
There’s nothing like reporting news from December like it’s todays news, making the GSEs look slow to act — and their regulator even slower — when the truth is that the compliance directive was actually issued more than 8 months back. At least the Wall Street Journal got it right.