FHFA Suspends “High Risk” Provision on Fannie, Freddie

The Federal Housing Finance Agency (FHFA) and the U.S. Department of the Treasury have suspended proposed rule changes for Preferred Stock Purchase Agreements (PSPAs), FHFA announced in a press release. The goal of these changes, put in place at the end of the Trump administration, was to limit Freddie Mac and Fannie Mae’s ability to back certain types of mortgages, including on second homes, multifamily homes and homes bought with higher risk loans. ‚ÄúThis suspension will provide FHFA time to review the extent to which these requirements are redundant or inconsistent with existing FHFA standards, policies, and directives that mandate sustainable lending standards,” Acting Director Sandra L. Thompson said. FHFA will consult with Treasury on the scope of the review…