Upstaging that arrogant goof!
I love those Twitter clowns!
Gasbag is feeling some heat!
Go FnF!

I guess any attention that you can get makes you feel better!
Go FnF!

Oh you clowns on Twitter get under gas bag's skin!
Clown day traders
Kill FnF!
What a complete ass!
Go FnF!

It couldn't 't happen without severe damage to the economy and destroying the 30 year mortgage.

Treasury and maybe fhfa would have to agree to not appeal. I think.
Go FnF!

How long did it take Mel to get into the corner office at FHFA?
I think he worked there.
Go FnF!

Hell I think I read it someplace. Maybe on this forum but I can't remember.
Go FnF!

After hearing from Calabria today I am thinking differently. I should not have entertained the idea of him talking about any real plans for FnF. Now I am thinking that some smart and sneaky people have a plan and each part will be put into effect with little or no warning.
Certain elected officials (TBTF tools) won't have much time to complain or attempt to obstruct.
Otting can start the game and take the first steps after the confirmation vote when Calabria is safe. Then Otting can hand the ball off to Calabria when he takes over at FHFA.
Does this sound logical?

Reform of Fannie, Freddie should fall to Congress: FHFA nominee

By Hannah Lang
Published February 14 2019, 3:51pm EST



WASHINGTON — The nominee to run the Federal Housing Finance Agency appeared to lean toward having Congress reform the government-sponsored enterprises, despite recent speculation that the Trump administration was readying a plan that could be carried out without legislation.
Mark Calabria, now an aide to Vice President Mike Pence, told Senate Banking Committee members he would “carry out the clear intent of Congress” should lawmakers enact GSE reform, 

https://www.americanbanker.com/news/reform-of-fannie-freddie-should-fall-to-congress-fhfa-nominee

Fannie-Freddie Watchdog Pick Urges Overhaul to Avoid Losses

Elizabeth Dexheimer, Bloomberg News

(Bloomberg) -- President Donald Trump’s pick to lead Fannie Mae and Freddie Mac’s regulator pledged to work with Congress on overhauling the companies, while downplaying controversial positions he’s previously laid out on everything from the 30-year-mortgage to affordable housing initiatives.
Mark Calabria, the libertarian economist who Trump has nominated to lead the Federal Housing Finance Agency, told senators Thursday that they should play a leading role in pursuing changes for the mortgage giants, which have been under U.S. control since 2008. He outlined what he thinks should be the goals of any reform effort, emphasizing the need to dial back Fannie and Freddie’s dominance by fostering competition for the companies.
“We need an open, competitive market,” Calabria said at his confirmation hearing before the Senate Banking Committee. “There is certainly a part of me that has a suspicion of monopolies and duopolies.”

Fixing Fannie and Freddie, which underpin the mortgage market by buying loans from lenders, is the main unresolved issue from the 2008 financial crisis. The Trump administration has repeatedly said that coming up with a solution is a priority but it has made little headway two years into the president’s term. Securing Calabria’s Senate confirmation is considered crucial to any revamp.
Taxpayer Losses

While the housing market has been stable in the decade since Fannie and Freddie were taken over, Calabria warned that maintaining the status quo could lead to “significant” taxpayer losses in another crisis. The U.S. took over the companies during the 2008 meltdown, eventually injecting them with $187.5 billion in bailout money.
In response to repeated questions from Democrats about his commitment to maintaining the government’s role in housing, Calabria gave assurances that he sees FHFA as an “absolutely necessary” agency and that he has no interest in disrupting the $10 trillion mortgage market. He said he expects that the 30-year fixed-rate mortgage, the bedrock of the U.S. market, will survive his tenure after lawmakers questioned whether he might try to undermine it.
Calabria added that he supports a “modest capital buffer” above the $3 billion that both Fannie and Freddie are now permitted to hold to protect against losses, but said he doesn’t think the FHFA director can unilaterally increase the cushions. He declined to specify what an appropriate level would be. To make changes, FHFA would have to reach an agreement with the Treasury Department.
Hedge funds and other investors have been calling for Fannie and Freddie to be permitted to hold more capital, which they see as a step toward the companies being released from U.S. control. At Thursday’s hearing, Calabria did not endorse recapitalizing the companies and then ending their conservatorships.
Democrats have been worried that Calabria might try to lower the size of mortgages that Fannie and Freddie are permitted to purchase from lenders. He seemed to temper some of those concerns Thursday by saying he wasn’t sure the FHFA has authority to determine loan limits, saying that’s Congress’ responsibility.
Failed Efforts
A series of lawmaker efforts to revamp Fannie and Freddie have failed. Amid the stalemate, officials including acting FHFA Director Joseph Otting, who also serves as comptroller of the currency, have indicated that the administration might act alone. Calabria sought to walk that back Thursday.
Calabria, who has been working for Vice President Mike Pence, told lawmakers that he hasn’t seen anything resembling a White House plan for housing-finance reform, noting that he withdrew from internal discussions on the topic once it became clear that he’d be the FHFA nominee. A White House spokeswoman said late last month that the administration would soon release a framework that outlines an approach for developing a proposal.
Calabria also discussed the Fannie and Freddie’s affordable-housing goals, which have been a sticking point in previous overhaul efforts. Democrats have insisted that the companies play a role in ensuring lower-income borrowers have access to mortgages. While Calabria has previously criticized such objectives, he committed to preserving them Thursday -- within the confines of the law.
Fannie and Freddie, both of which turn profits over to Treasury under terms of their bailout agreements, reported fourth-quarter and full-year financial results earlier Thursday. Fannie will pay $3.2 billion to Treasury, while Freddie will pay $1.5 billion. Shares of Fannie were down 3.77 percent at 12:59 pm, while shares of Freddie fell 3.16 percent.
Companies’ Profits
Calabria, who is expected to be confirmed due to Republicans’ Senate majority, didn’t make any specific comments Thursday about wanting to revise the companies’ payments to Treasury.
When he was a scholar at the Cato Institute before joining the Trump administration, Calabria called for putting Fannie and Freddie into a form of bankruptcy that would have allowed them to continue operating while being reorganized with the help of a court-appointed trustee. He didn’t touch on this topic at Thursday’s hearing.

https://www.bnnbloomberg.ca/fannie-freddie-watchdog-pick-urges-overhaul-to-avoid-losses-1.1214575

Trump admin considers sidestepping Congress to overhaul Fannie and Freddie

One option is to recapitalize the entities before privatizing them

KEVIN REBONG FEB 14, 2019 10:30 AM

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Steven Mnuchin and Nancy Pelosi (Credit: Getty Images)

The Trump administration may bypass Congress in its effort to privatize Fannie Mae and Freddie Mac, which have been in government “conservatorship” for a decade.

Treasury secretary Steven Mnuchin, who previously sought support from Democrats in Congress to privatize the mortgage giants, is now working on a set of proposals to do so unilaterally, sources told the Financial Times.
“They want bipartisan support, but they know that is going to be difficult, especially with so many Democrats running for president,” one source said. “But there are plenty of things they can do without Congress giving its support.”
Efforts to overhaul the country’s two largest mortgage guarantors have been in limbo for years, as lawmakers argue over how to remove them from government control while ensuring that they underwrite loans for low-income households, all while protecting American taxpayers.
One way of bypassing Congress, which would require the backing of the Federal Housing Finance Agency, would be to simply recapitalize the two institutions and allow them to enter the private market as-is. The administration’s choice to lead the FHFA, Mark Calabria, will testify in front of Congress on Thursday.
Since 2012, a policy known as the “net worth sweep” has required that Fannie and Freddie return all their profits to the Treasury. Investors argue that ending this policy would give the entities sufficient capital buffers to weather a major financial storm.
Another option would be not to privatize the entities at all, but to recapitalize them under government control and shrink their scope, a move that would likely anger shareholders banking on big returns from privatization.
Many observers believe this administration is no more likely to succeed in privatizing the mortgage giants than lawmakers have been over the past decade.
“Any administrative effort to remove Fannie Mae and Freddie Mac from conservatorship without legislation falls short on a fundamental goal of housing finance reform,” said Ed DeMarco, president of the Housing Policy Council and former head of the FHFA. [FT] — Kevin Sun

https://therealdeal.com/2019/02/14/trump-admin-considers-sidestepping-congress-to-overhaul-fannie-and-freddie/amp/

Realtors® Urge Confirmation of Mark Calabria to FHFA

NEWS PROVIDED BY
National Association of Realtors 
Feb 14, 2019, 13:41 ET

WASHINGTON, Feb. 14, 2019 /PRNewswire/ -- National Association of Realtors® President John Smaby issued the following statement after Mark Calabria's testimony in front of the Senate Committee on Banking, Housing, and Urban Affairs this morning. The Realtors® are urging the Senate to quickly confirm Dr. Calabria to head the Federal Housing Finance Agency, which has been led by Acting Director Joseph Otting since the beginning of this year.

Continue Reading 

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National Association of Realtors logo (PRNewsFoto/National Association of Realtors)

"The National Association of Realtors® was pleased to see Mark Calabria today defend the FHFA's critical role in the U.S. housing market. Specifically, NAR applauds Dr. Calabria for pledging his commitment to the 30-year fixed rate mortgage, supporting additional access to capital, and highlighting taxpayer and consumer protection as critical tenants of housing finance reform," said Smaby, a second-generation Realtor® from Edina, Minnesota. "With decades of housing policy experience, including time spent as an economist at NAR, Dr. Calabria has demonstrated the industry expertise needed to lead this agency forward, particularly as GSE reform conversations begin to intensify in Washington."
Calabria also indicated support for reforming the G-fee structure, a position for which NAR has publicly advocated in the past.
"NAR urges Dr. Calabria's swift confirmation in the Senate, and we look forward to immediately engaging the FHFA to advance housing finance reforms that will protect taxpayers, minimize costs to consumers, promote housing affordability, preserve the 30-year fixed rate mortgage and maximize access for creditworthy borrowers," Smaby concluded.

https://www.prnewswire.com/news-releases/realtors-urge-confirmation-of-mark-calabria-to-fhfa-300796130.html

Trump Housing-Finance Nominee Pledges to Preserve 30-Year Mortgage

Mark Calabria tells senators at confirmation hearing that ‘a well capitalized, strong system’ is compatible with the 30-year mortgage, a product he opposed in the past

https://www.wsj.com/amp/articles/trump-nominee-to-face-questions-on-future-of-30-year-mortgages-11550142000

What will Otting be doing when Calabria begins after confirmation? Will he have a position somewhere?
Go FnF!

Yes but he was also saying that he removed himself. He was saying that when senator whoever interrupted him and started talking over him. If the video becomes available we can go over it later and maybe we can see that Cal was answering very carefully and was interrupted. Something like this. "I said that I didn't see anything that looked like a plan. I didn't say that we never talked about it."
I will have to replay that a few times.
Go FnF!

He wants all of the red and blue votes that he can get. He played the game well.

Maybe not. Cal doesn't have to answer questions if he can claim he doesn't know. He said that he removed himself.

Cal probably acknowledged that tres, pres, and ott are working on something . He said that he decided to remove himself from it since the hearing was coming up. Now he has plausible deniability. He does not have to answer questions about the plan.
Pretty smart.
Go FnF!

Shiiiit ! I haven't seen anything that looks like a plan.

Patel is literally a deer in the headlights

Pipe dream

Well capitalized well managed well regulated

Calabria just stated "The power of the conservator is to protect the assets of the company"

Trump eyes bypassing Congress to privatise Fannie and Freddie

Move considered to end 10-year government control of state-backed mortgage groups

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Freddie Mac and Fannie Mae guarantee most of the mortgages in the $10tn US housing market © AP

   

February 14, 2019 11:00 am by Kiran Stacey in Washington

The Trump administration is considering bypassing Congress as it looks to privatise the country’s two largest mortgage guarantors, according to people who have been briefed on the plans, following years of failed attempts to remove them from state control.
Steven Mnuchin, the Treasury secretary, is working on a set of proposals that he hopes will end the 10-year government control of Freddie Mac and Fannie Mae, which guarantee most of the mortgages in the $10tn US housing market.
Mr Mnuchin has previously said he wanted to achieve this with support from Democrats in Congress, but with Washington as divided as it has been in recent years, officials are considering what options they have to act unilaterally.

One person who has been consulted on the administration’s thinking said: “They want bipartisan support, but they know that is going to be difficult, especially with so many Democrats running for president. But there are plenty of things they can do without Congress giving its support.”
Freddie Mac and Fannie Mae have been in “conservatorship” — which gives the government control of the two entities, but does not put their liabilities on the public balance sheet — since they were bailed out at the height of the financial crisis in 2008. Collectively their balance sheets are worth about $5tn.
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In recent years, politicians on both sides have made moves to end this state of limbo. But so far these have foundered as lawmakers argue over how to restore them to the private sector while also making sure they underwrite loans for low-income households but no longer pose a risk to the taxpayer.
The Trump administration has put privatisation back on the table, however, making housing reform one of its top goals for this year.
Mr Mnuchin said this month: “Protecting American taxpayers by ensuring the safety and stability of the United States housing finance system is a priority for the Treasury department.”
If Mr Mnuchin wants to succeed where others have failed, he needs either to persuade Democrats in Congress to back his plans or to find a way to avoid Congressional approval altogether.
Some believe that the Trump administration can secure Democratic support if it guarantees a set amount of money for affordable housing.
Mark Zandi, chief economist at Moody’s Analytics, said: “If you had the same affordability regime [as now] and on top of that provided extra money to subsidise an expansion of credit, there is a comfort level at which you get progressives on board.”
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Most however believe that agreeing a package that is palatable to Democrats and Republicans is all but impossible, leaving Mr Mnuchin looking for solutions that do not require Congressional backing.
One option would be simply to recapitalise the two institutions and allow them to enter the private market as they are.
Since 2012, Fannie and Freddie have been required to return all their profits to the Treasury — a policy known as the “net worth sweep”. Investors argue that ending this requirement would allow the two institutions to build up their capital buffers so they no longer present a risk to the taxpayer.
Tim Pagliara, executive director of a group of investors in Fannie and Freddie known as Investors Unite, said: “If they had capital requirements of 2.5-3 per cent, they would have enough money to survive the equivalent of a 500-year flood.”
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Mr Pagliara points out that since 2008, the pair have returned $292bn to the Treasury in dividends — about 50 per cent more than they have drawn from the government since the crash.
Such an option would require the backing of the Federal Housing Finance Agency, which oversees the two mortgage backers.
Mark Calabria, the administration’s choice to lead the agency, will testify in front of Congress on Thursday. But in the past he has argued that Fannie and Freddie should no longer have to return their profits to the government, saying the policy has “undermined public trust in the government role in insolvencies”.
Others, however, say new laws are required to make sure Fannie and Freddie continue to fulfil a public service by underwriting loans for poorer people and to make sure there is never a repeat of 2008.
Ed DeMarco, the president of the Housing Policy Council and former head of the FHFA, said: “Any administrative effort to remove Fannie Mae and Freddie Mac from conservatorship without legislation falls short on a fundamental goal of housing finance reform.”
One alternative option for the administration is not to remove them from conservatorship at all, but to recapitalise them while under government control and shrink their scope.

Recommended

US housing: how Fannie Mae and Freddie Mac became rental powerhouses

Such an option however, is likely to attract anger from private shareholders hoping for a return and from large parts of the banking industry, which does not want to compete with two fully-capitalised government-backed entities.
Given the complexities involved, many believe this administration is no more likely to succeed in privatising Fannie Mae and Freddie Mac than the host of members of Congress who have failed in the past.
Nevertheless, there remains an ideological impulse on both sides of politics to end the status quo.
Ron Haynie, who spent 20 years working for Freddie Mac and is now senior vice-president at the Independent Community Bankers of America group, said: “These two enterprises have been all but nationalised. That is something we simply don’t do in this country.”

https://amp.ft.com/content/617d11e0-2fb0-11e9-8744-e7016697f225

The next two years of federal housing policy could be positive under Mark Calabria

The Trump administration has been a nightmare for housing advocates. Housing and Urban Development Secretary Carson has stopped enforcing fair housing laws, with assists from Treasury Secretary Steven Mnuchin and Comptroller of the Currency Joseph Otting. Those two have been working to scale back fair lending enforcement and the Community Reinvestment Act.
Consumer Financial Protection Bureau Acting Director Mulvaney has gutted consumer protection in the mortgage market. I am more hopeful though when it comes to housing finance reform. The administration has nominated Mark Calabria to be the next director of the Federal Housing Finance Agency; the FHFA is Fannie Mae and Freddie Mac's regulator.
There have been three types of leaders on Trump's team that have been working on housing issues. First are those who seek to explicitly undermine the work of the agency they lead, like Mulvaney. Leaders like Mulvaney are generally proponents of a radical conservative ideology that has been way out of step with American political norms until the Tea Party movement swept through Congress. Second are those who pay some lip service to the agency's mission, but work to undermine it, like Carson. And third are those who are clearly industry favorites, like Mnuchin and Otting. They primarily seek to address concerns of the industry they regulate at the expense of their agency's broader public mission.
Calabria represents a fourth type of leader, one who is more likely to implement a more traditional Republican agenda for the housing sector. For the last couple of years, he has been serving as Vice President Pence's chief economist.

While I do not agree with Calabria about many things, he is very thoughtful and knowledgeable about the federal housing finance system. His thoughtfulness and knowledge are obviously good qualities to have in any government official, but they particularly stand out in the context of the Trump administration's housing team and more broadly in an administration that has more than its fair share of scoundrels and incompetents.
He has a principled libertarian bent; and Calabria's nomination is not sure to go through, but there is good reason to believe that it will. He is a former Republican Senate staffer and the Senate Republicans have a healthy majority in 2019.
It is particularly timely to think about a new phase in GSE reform because the term of FHFA Director Watt, President Obama's appointee, expired earlier this year. This means that the Trump administration will be in charge of the FHFA for the first time in 2019.

The FHFA has broad authority to implement GSE reform unilaterally and can do even more in coordination with Treasury. So, it is worth thinking through what can happen with housing finance reform now that change is in the wind. Commentators are trying to parse out whether Calabria is a free market ideologue along the lines of former Rep. Jeb Hensarling (R-Texas) or a more traditional Republican.
Calabria's writings could reasonably lead you to believe that he will be of the former sort, seeking to release Fannie and Freddie from conservatorship in some manner and return them to private ownership. I do not see him doing this, because that plan would have to keep a government backstop in place for their obligations in one way or another. I certainly don't see Calabria returning to the "good ole days" of privatizing profits and socializing losses that characterized Fannie and Freddie's existence before they entered conservatorship.
I believe that he will be more of pragmatist, notwithstanding the content of some of his think tank writings. Calabria has written quite a bit, so we have a good sense of his views on a broad range of housing finance issues.


https://thehill.com/opinion/civil-rights/429963-the-next-two-years-of-federal-housing-policy-could-be-positive-under?amp

Fidelity fnma bid$2.65 ask$2.66

Calabria nomination hearing link below
Thanks Navy!

https://www.banking.senate.gov/hearings/02/07/2019/nomination-hearing

Confirmation hearings
How long will the congressional grilling take?
I seem to recall some of them taking days.
If my memory serves me correctly there could be lots of time for lots of Q&A. Therefore there could be lots of potential bomb shells that move the share price up or down over the course of days. (ROLLER COASTER)
Yes or no?
Go FnF!

Maybe in here somewhere. I will look for it if you can tell me the first time that Donald Duck and Popeye appeared together in a cartoon in technicolor.
Go FnF!

https://pershingsquareholdings.com/company-reports/letters-to-shareholders/

They are not required to report but Ackman disclosed at his annual.

Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC) are other long positions in the partnership - the holdings were disclosed in 13D filings on November 15, 2013 - as they are not 13F securities, they are not listed in the 13F report. Ackman held just under 10% of the outstanding shares of both these businesses - 115.57M shares of FNMA at a cost-basis of $2.29 and 63.5M shares of FMCC at a cost-basis of $2.14. The combined investment outlay was ~$400M. FNMA and FMCC currently trade at $1.36 and $1.40 per share respectively. In March, Pershing Square said their Fannie/Freddie pfds now amount to 21% of its total investment in the two GSEs. They said it is a hedge in case the resolution favors pfds more than the common.

https://seekingalpha.com/article/4174598-tracking-bill-ackmans-pershing-square-portfolio-q1-2018-update

6 years ago nobody could have convinced me that watching a confirmation hearing for the next director of the FHFA would have me on the edge my seat like the last 5 minutes of a close Super Bowl game! I am a fannie fan.
Go FnF!

Didn't Corker say that?
J.K! Don't beat me up.
Go FnF!

5 things to watch at FHFA nominee's Senate hearing

By Hannah Lang

Published February 13 2019, 12:53pm EST

WASHINGTON — All eyes will soon be on Mark Calabria. 

The Trump administration’s nominee to serve as director of the Federal Housing Finance Agency, Calabria is set to testify Thursday before the Senate Banking Committee. The nomination hearing could provide an important window into the White House's plans for a future housing finance system, including how reforms might be carried out. 

Senators almost certainly will grill Calabria on what he knows about an administrative framework that acting FHFA Director Joseph Otting has promised is forthcoming, but he will likely have to convince lawmakers that Congress still has a role in reforming the government-sponsored enterprises if he hopes to secure his confirmation. 

Calabria will also have a tall order in tempering past criticisms of Fannie Mae and Freddie Mac, especially if the administration ultimately seeks to recapitalize the GSEs under his watch. Before joining the Trump administration as Vice President Mike Pence’s chief economist, Calabria was the director of financial regulation studies at the Cato Institute, where he regularly advocated for constraining the footprint of Fannie and Freddie.

Following are five key questions to consider ahead of the hearing.

What does Calabria know about the administration’s plans for housing finance reform?

?Bloomberg News

Crucially, the nomination hearing could be the first chance senators have to drill down into the mechanics of the administration’s framework for housing reform.

Otting reportedly told agency employees at a staff meeting last month that “Mark has signed off on” the administration’s proposal to overhaul the housing finance system.

Sen. Sherrod Brown, D-Ohio, the ranking member of the Senate Banking Committee, along with House Financial Services Committee Chair Maxine Waters, D-Calif., sent Otting a letter after his comments were reported, requesting that Otting provide the committees with “a copy or detailed description of the mission that Treasury and the White House have outlined to which you referred.”

But Otting sidestepped the inquiry in his response, instead saying he welcomes congressional Democrats' “insight and perspective” on how to end the conservatorships of Fannie Mae and Freddie Mac. 

Now lawmakers, including Brown, will have the opportunity to ask another administration official about the White House's plans, especially if Calabria did approve the plan, as Otting previously indicated. 

“Even if the new blueprint isn’t yet formally out there, Mark will be called to discuss where he understands the administration to be on Fannie and Freddie,” Charles Gabriel, the president of Capital Alpha, said in a Jan. 25 research note. “And why would Otting have spilled the beans if he and others hadn’t pre-thought how Congress might react?”

Any questions about the White House’s plans for GSE reform will be scrutinized, as administration officials have put out conflicting information, with Otting suggesting that an end to conservatorship was in sight, while a White House spokeswoman has said that the administration plans on working with Congress and will ask federal agencies to propose reform plans. 

“It is possible Dr. Calabria provides some details about how the Trump administration plans to end the GSEs' conservatorships, but… any comments he makes are likely to be general in nature and highlight the administration's preference to work with Congress on the matter while preserving its option to act unilaterally if Congress fails to pass legislation,” analysts from Keefe, Bruyette & Woods said in a research note.

Content Continues Below

Will Senators express concern that the Trump administration might bypass Congress?

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Calabria can only afford to lose three Republican votes, and so he may spend his hearing reassuring Republican lawmakers that a legislative solution is not off the table. 

This will also be the first Senate Banking Committee hearing in the new congress, and will include for the first time freshmen Republican Sens. Kevin Cramer from North Dakota and Martha McSally from Arizona, who have not previously made their views on housing finance reform clear. 

After the White House announced that it was planning to release a framework for housing finance reform, Sen. Mike Crapo, R-Idaho, released a blueprint of his own that signaled a potential desire from Congress to reassert its role in the debate. 

Even Sen. Richard Shelby, R-Ala., whom Calabria worked for as a staffer on the committee, appeared concerned that the Trump administration could sidestep Congress.

“We should all want to" end conservatorship, he told Roll Call earlier this month. “There are a lot of things he can do over there without an act of Congress, but to reform the whole of Fannie and Freddie? He can’t do that alone.”

Will Calabria reaffirm the views he championed at Cato?

?Blooomberg News

While at the Cato Institute, Calabria wasn’t shy about criticizing the government’s approachtoward Fannie and Freddie, calling securitization, a core business for the GSEs, a “false god.” 

Senators are particularly likely to ask him about his views on a dividend agreement — referred to as the net worth sweep — that requires the GSEs to deliver nearly all of their profits to the Treasury Department.

Calabria has been opposed to the sweep, and even co-wrote a paper in 2015 with Michael Krimminger, former general counsel for the Federal Deposit Insurance Corp., claiming that the 2012 dividend agreement violates the Housing and Economic Recovery Act of 2008 and that the FHFA and Treasury have used Fannie and Freddie as “cash cows.” 

“It manipulates the conservatorship process to redirect billions of dollars to the government’s general operating budget, with no accountability over how funds are spent,” the paper says. 

Calabria has also proposed eliminating the 30-year fixed-rate mortgage, a view that is likely to come under fire on Thursday, as lawmakers on both sides of the aisle have expressed support for maintaining that feature of the market. 

“Some would argue that the 30-year fixed is worth subsidizing because it provides certainty to the borrower. But if borrowers do value that certainty, they should be willing to pay its true cost,” Calabria wrote in 2011. 

And no matter what Calabria does to convince lawmakers that the administration would be willing to work with Congress on GSE reform, that doesn’t change the fact that he has bemoaned lawmakers’ inaction and has advocated for the FHFA and Treasury placing Fannie and Freddie in receivership.

“We are where we are today due to the failures of both FHFA and the Treasury Department to pursue this strategy,” Calabria wrote in a 2016 op-ed for American Banker. “The most pressing problem resulting from the government's poor decisions is the lack of significant capital.”

Content Continues Below

What will Calabria say about Otting’s decision not to defend FHFA’s constitutionality?

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Shortly after Otting took the helm of the FHFA in January, the agency announced it would no longer defend the constitutionality of the agency’s single-director leadership structure in the en banc review of a federal appeals court ruling from July. 

“To the extent the Court concludes it is necessary to reach the constitutional issue, FHFA will not defend the constitutionality of [the Housing and Economic Recovery Act’s] for-cause removal provision and agrees with the analysis in Section II.A of Treasury’s Supplemental Brief that the provision infringes on the President’s control of executive authority,” the brief said.

Waters and Brown derided this decision in their joint letter to Otting requesting details on the administration’s GSE reform plan. 

“Your comments call into question the independence of the FHFA under your leadership,” the lawmakers said. “So, too, does your decision to direct the FHFA to change its position in a case currently pending before the Fifth Circuit Court of Appeals.” 

Other Democrats on the Senate Banking Committee could grill Calabria on this call to see if he would follow suit or decide that the agency should defend its single directorship. 

Otting’s decision is similar to how the Trump administration has viewed claims that the single-director structure of the Consumer Financial Protection Bureau — an agency created under the Obama administration — is unconstitutional.

How will Calabria respond to Democrats’ concerns about affordable housing?

?Bloomberg News

Democrats have long criticized many housing finance reform plans as not going far enough to defend and facilitate affordable housing, and some have already expressed worry that Calabria’s appointment could diminish current protections. 

“I have serious concerns about the expected nomination of VP Pence's economist, Mark Calabria, to be FHFA Director,” Sen. Mark Warner, D-Va., said on Twitter in December. “I'll have plenty of questions on his past statements calling in to question his commitment to affordable mortgages and even the 30 year fixed-rate mortgage.”

Some of Calabria’s past comments on affordable housing may not help his case with Democrats. In a 2012 article for “Investing in What Works for America’s Communities,” Calabria wrote that the problem with community development is not a lack of resources, but instead “poor governance.”

“The existing resources available to community development would be more than enough to revitalize struggling communities across the country if local governments were run better, allowing the market to work more efficiently to provide the goods and services communities need,” he said. 

And with the Senate Banking Committee playing host to several potential 2020 contenders, including Brown and Sen. Elizabeth Warren, D-Mass., the issue is all the more likely be thrust into the spotlight. 

“One also needs to be on the lookout for a solution on the affordable housing front,”Jaret Seiberg, an analyst with Cowen Washington Research Group, said in a note. “This is a big political problem for those seeking to change the system, especially because key Democrats involved in this issue are running for President.”

https://www.americanbanker.com/list/5-things-to-watch-at-fhfa-nominees-senate-hearing

Our new mantra! "What does the statute say?"
Go FnF!

That's right! Me and Bill are together in this thing. We got each others backs!
Go FnF!

The Hot Trade in the Housing Market: Servicing Your Mortgage

The cooling housing market and higher interest rates are slowing mortgage originations, fueling sales of servicing rights

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The servicing rights for the mortgage of Andrew Smith’s home in Richmond Hill, Queens, N.Y., have been sold twice in the loan’s first year.PHOTO: ELISE AMENDOLA/ASSOCIATED By Ben Eisen

Feb. 13, 2019 10:00 a.m. ET

The mortgage-market slowdown is stirring up interest in a humdrum segment of American home lending: the rights to the arcane task of handling monthly payments.
Sales of so-called mortgage-servicing rights jumped 14% in 2018 from a year earlier, according to industry research group Inside Mortgage Finance, to more than $600 billion of loans backed by Fannie Mae , Freddie Mac and Ginnie Mae. In the final three months of 2018, the servicing changed hands on loans worth $183 billion, up 27% from the previous year.

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Mortgage servicers, in addition to collecting a borrower’s installment and passing it on to the loan owner, take care of duties like ensuring taxes and insurance are paid. If the borrower defaults, the servicer is the first to jump into action. The company that services a mortgage used to be the same as the one that made the original loan, but in recent decades those two crucial housing market functions have separated.

The increase in servicing transfers is the latest ripple effect from a slowdown in the housing market, which has forced lenders to slim down, consolidate or close up shop.
Many of the sellers are independent mortgage lenders that don’t have deposits to fund themselves or other lines of business that can help them withstand a downturn. Stronger players—both banks and nonbanks—have been picking up servicing rights from weaker lenders that need to raise cash.

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The industry shakeout stems from a sharp decline in refinancing activity as rates have risen and a drop-off in new purchases.
“The name of the game when you’re in lean periods of origination and you’re not a bank is that you need sources of cash,” said Eric Schuppenhauer, president of home mortgages at Citizens Financial Group Inc. “You’re just trying to make it to the next good origination period.”
Some buyers see servicing rights as a new source of revenue in the more challenging market and a chance to pitch additional services. Citizens bought Franklin American Mortgage Co. last year, more than doubling the number of households whose loans the Providence, R.I.-based bank services.

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The lender’s mortgage-banking fees, trending lower before the acquisition, jumped in the final half of last year. Servicing revenue made up 41% of all mortgage-banking fees last quarter, up from 21% in the year-earlier period.

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New Residential Investment Corp. , a real-estate investment trust managed by private-equity firm Fortress Investment Group LLC, said in its Tuesday earnings report that it snapped up servicing rights on $114 billion in loans from 15 different business partners last year. New Residential’s stock is up 21% so far this year, more than double the S&P 500’s rise.
“We do expect more consolidation in the mortgage-origination and servicing business throughout the course of 2019, and we believe that we’re perfectly situated to take advantage of that,” Chief Executive Michael Nierenberg said on an earnings call Tuesday. “Mortgage bankers are going to need to raise some capital, therefore, there’ll be more assets for sale.”
Mortgage servicers came under fire during the financial crisis for the way they treated homeowners who were facing foreclosure. One firm, Ocwen Financial Corp. , later settled with multiple regulators to resolve allegations of mistreating borrowers.
These days, homeowner delinquency rates are low. A number of regulators, including the Consumer Financial Protection Bureau, now oversee mortgage servicers.


Lenders don’t need a borrower’s consent to sell a loan or servicing right, and the terms of the loan don’t change when they’re transferred. The risk for homeowners is that they end up with a servicer they don’t like or trust—and didn’t sign up to work with when they took out the loan.
When Andrew Smith took out a mortgage last winter to buy a house in Queens, N.Y., he went to FM Home Loans LLC. At the closing, he found out that his servicer would be Citigroup Inc.Last fall, he found out that the servicer would now be Cenlar FSB.
Mr. Smith, who works as a camera assistant in the entertainment industry, said that he was surprised by the multiple switches.
“It was a little unnerving,” he said. “It happened twice in the first year of the loan.” He said he doesn’t particularly like the website of his newest servicer but was reassured by a knowledgeable customer-service representative he spoke with on the phone.

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Mr. Smith at home with his wife, Danielle, and son, Jackson.PHOTO: KHOLOOD EID FOR THE WALL STREET JOURNAL

Servicing rights generally become more valuable as interest rates rise because borrowers are less likely to refinance their loans and the stream of income from servicing continues for longer. Prices on servicing rights for mortgages backed by Fannie, Freddie, and Ginnie rose by 7% to 9% on average last year, though it varied widely based on the initial mortgage rate, according to data from MountainView Financial Solutions, which advises on servicing transactions and provides analytics.
What’s more, banks may have less incentive to hold on to servicing rights because pending rules could force them to hold more capital as a result. The Mortgage Bankers Association, which lobbies on behalf of the industry, pushed back on these rules late last year and has said it is forcing banks out of the market

https://www.wsj.com/amp/articles/the-hot-trade-in-the-housing-market-servicing-your-mortgage-11550070000

So this just popped into my little monkey brain.
Can a rider concerning FnF be attached to this border wall bill that everyone is scurrying about and trying to put some pork into?
Go FnF!

Fannie-Freddie Fates in Focus as Watchdog Nominee Gets Hearing

Posted Feb. 13, 2019, 6:15 AM

By Elizabeth Dexheimer

Calabria’s past comments could draw criticism from Democrats

Senators’ scrutiny follows furor over administration’s plans

President Donald Trump’s pick to oversee Fannie Mae and Freddie Mac is likely to face questions on the fate of the two companies as well as controversial comments he’s made about the future of U.S. housing finance when he appears at a confirmation hearing on Feb. 13.
Federal Housing Finance Agency nominee Mark Calabria is expected is deliver remarks to the Senate Banking Committee that take a measured approach in reiterating the Trump administration’s goal of ending the U.S. conservatorships...

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https://news.bloomberglaw.com/banking-law/fannie-freddie-fates-in-focus-as-watchdog-nominee-gets-hearing

Guess big or go home!
What will we win if we are right?
Oh hell we will already have won it all!
Go Big FnF!