MBA Statement on Amendments to the GSEs’ Preferred Stock Purchase Agreements

CONTACT
Rob Van Raaphorst
rvanraaphorst@mba.org
(202) 557-2799

WASHINGTON, D.C. (January 14, 2021) - MBA President and CEO Bob Broeksmit, CMB, released the following statement regarding amendments to the Preferred Stock Purchase Agreements (PSPAs) governing the conservatorships of Fannie Mae and Freddie Mac (the GSEs):

"Today's announcement preserves and extends a level playing field for lenders of all sizes and business models while avoiding near-term measures that could have threatened market stability. MBA has cautioned that a premature release of the GSEs from conservatorship could roil the mortgage market, hurting borrowers, savers and investors and harming a fragile economy still recovering from the ravages of the pandemic.    

"While MBA is still reviewing the specifics of the amendments, we are pleased with several provisions and will carefully analyze others, including the potential impact of limiting the GSEs' purchases of certain categories of loans. It is critically important that measures to guide the GSEs' market footprint carefully balance the need for them to meet their affordable housing mission for both single-family and multifamily homes. Some of the provisions may prove inflexible during market stress, and it will be vital for FHFA and the Treasury Department to monitor those impacts and remain open to changes as necessary, especially for untested standards.  

"Also, MBA continues to agree with Treasury that Congress must play a role in any substantive housing finance reform - particularly by providing an explicit federal guarantee on securities issued by the GSEs.  

"We look forward to working with the incoming Biden administration, Treasury Secretary designee Janet Yellen, Congress, and FHFA to continue strengthening both the single-family and multifamily mortgage segments, ensuring deep and liquid markets for affordable housing finance through all economic cycles."