SFA Responds to FHFA’s 5-Year Strategic Plan
SFA’s Response to the Federal Housing Finance Agency’s 5-Year Strategic Plan Focuses on the Importance of Private Capital in our Nation’s Housing Finance System
article by Structured Finance Association
On February 24, 2022, the Federal Housing Finance Agency Published their 5-year Strategic Plan, which outlines goals and priorities for the Agency over that time period, and solicited comments from the industry on the Strategic Plan.
SFA response focuses on the need for private capital in our nation’s housing finance system. The use of private sources of financing help enforce market discipline, provides a feedback loop from which policymakers can derive pertinent information, and removes risks to taxpayers, which currently back Fannie Mae and Freddie Mac while they are in Conservatorship.
SFA’s response focuses on two recent policies from the FHFA: the Enterprise Regulatory Capital Framework, which affords capital relief for credit risk transfer transactions, as well as their Targeted Fee increase which incentivizes second homes and investment properties to be funded by PLS. SFA encourages FHFA to continue to take steps to allow private capital so that the GSEs can focus on their core mandate of providing liquidity and access to credit for low- and moderate-income borrowers.