Regulator to Block New Loan Products from Fannie, Freddie
Mortgage-finance giants Fannie Mae and Freddie Mac will not be allowed to introduce new loan products in the mortgage market while they are under the control of the U.S. government, the companies' federal regulator announced Tuesday in a letter to Congress. Since last summer, Fannie and Freddie had been allowed to submit new loan products for review through a process established by the companies' federal regulator, the Federal Housing Finance Agency. While no new products have been submitted yet, the regulator cited the companies' massive losses and looming challenges in making his decision to block future product submissions. "It's a standard regulatory approach to limit or restrict new business activity," said Edward DeMarco, the FHFA's acting director, in an interview Tuesday.