Freddie Mac’s proposal represents further unnecessary encroachment by the government into sectors of the housing market that operate well.
WASHINGTON, April 17, 2024 – The Structured Finance Association (SFA), a leading trade association representing the structured finance and securitization industry, today released the following statement after the Federal Housing Finance Agency (FHFA) invited comments about a proposal by the Federal Home Loan Mortgage Corporation (Freddie Mac) to purchase certain single-family closed-end second mortgages as a new product. SFA views this new product as an unnecessary government encroachment into a sector that has been operating successfully without government involvement.
“In the current market, closed-end second mortgages have been, and continue to be, successfully originated and funded by private capital,” said Michael Bright, CEO of SFA. “It is quite unclear what role the government-sponsored enterprises have in funding these mortgage products, or how that fits into Freddie Mac’s overall government-chartered mission objective. We look forward to engaging with policymakers on this important question, and the overall question of the appropriate government role in the housing market.”
SFA will convene a task force in the coming days to discuss Freddie Mac’s proposal and will share its findings with the FHFA.
About the Structured Finance Association
With more than 370 member institutions comprised of accounting firms, broker/dealers, diversified financial intermediaries, investors, issuers, IT vendors, law firms, mortgage insurers, other small financial institutions, rating agencies, servicers, and trustees, SFA is the leading voice for the securitization industry.
SFA is focused on helping grow the real economy and improving the lives of individuals, families, businesses, and communities across the nation; helping make credit more affordable and available to people who need it to finance some of life’s biggest goals — education, car purchases, starting a business, buying a home — or reduce their debt through consolidation loans; safeguarding essential protections for consumers and the financial system; facilitating valuable dialogue among the financial services market, its practitioners, policymakers and the broader public; and recognizing that all finance entails risk, but it should not involve recklessness.
For inquiries, please contact Walt Cronkite, Director of Communications at the Structured Finance Association. Walt.Cronkite@StructuredFinance.org