True Stories: Hybrid, eNote and RON Implementation

Join expert panelists that will discuss the status of federal legislation, trends in digital adoption and how best to prepare your organization for the next generation of lending processes.

Spruce’s Patrick Burns on innovation in title technology

In the season finale of Housing News season 5, Spruce CEO discusses heightened investor interest in title tech, innovation and fintech adoption.

Top CFPB official “hates” QM rules, jeopardizing safe harbor

A top CFPB official in charge of the rule-making process has heavily criticized the agency's own qualifying mortgage rule, jeopardizing safe harbor.

Don’t sleep on non-QM products

Now is the perfect time for originators to consider expanding to non-QM products – to grow business, diversify their offerings and to ensure an opportunity to better serve their customers.

Politics & Money

Presidential candidate Mike Bloomberg wants to merge Fannie and Freddie

Calls for tougher regulations on banks

Mike Bloomberg, former mayor of New York City and latecomer in the Democratic race for the presidency, released his financial reform policy plan, and it has sweeping implications for the housing industry.

The plan lays out his proposed changes, including:

  • Toughen stress tests of the country’s largest financial institutions, including by reviving the Fed’s power to judge participants on “qualitative” grounds and making the tests better reflect real crisis conditions.
  • Reinstate annual living wills, in which large financial institutions must explain how they could go bankrupt without harming the broader economy – and make the documents public.
  • Restore the Volcker Rule and make enforcement more effective, by focusing on the outcome of speculative trading – big gains and losses – rather than trying to discern traders’ intent.
  • Reinvigorate efforts to monitor and address risks arising outside the banking system, including by subjecting systemically important non-bank institutions – such as insurers – to added scrutiny and requirements.

Bloomberg also announced he has big plans for mortgage giants Fannie Mae and Freddie Mac.

“Fannie Mae and Freddie Mac, the mortgage guarantors that make the traditional 30-year home loan possible, have been under state control since the government bailed them out in 2008,” Bloomberg said in his plan. “The Trump administration wants to return them to approximately the same form that set them up for failure: a quasigovernmental hybrid in which private shareholders benefit in good times, and taxpayers stand by to cover losses when crises arise.”

But Bloomberg is proposing the government merge Fannie and Freddie into a single, fully government-owned mortgage guarantor. The new single guarantor would transfer downside risk to private investors.

This could throw off the current administration’s plan to remove the GSEs from conservatorship before Federal Housing Finance Agency Director Mark Calabria’s term as director is up.

“Mike Bloomberg rolled out his financial reform policy today, and it’s something everybody should read,” said David Stevens, former Mortgage Bankers Association CEO. “You have to stay on top of news sources and analysts who are writing about these topics because you have to be thinking about how this may impact your business in the future.”

“Things can shift pretty dramatically when you get a regime change at the White House no matter which way it goes – Democrat to Republican or Republican to Democrat,” Stevens said.

Bloomberg also lays out his plan to restore regulations cut back during President Donald Trump’s administration. This includes reinvigorating the Consumer Financial Protection Bureau, and restoring the CFPB’s payday lending rule and the CFPB’s mandatory arbitration rule.

Click here to read Bloomberg’s full plan.

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